Is Human Rights Your Business?

"For the past 33 years, I have looked in the mirror every morning and asked myself: 'If today were the last day of my life, would I want to do what I am about to do today?' And whenever the answer has been 'No' for too many days in a row, I know I need to change something." 

- Steve Jobs

I remember back in law school when a commercial law professor told us that a corporation had no obligation other than to make a profit for its shareholders. I was not persuaded then and I strongly oppose the view now.

Profitability might be measured by dollars and cents but getting to the bottom line is more complicated than that. A company may make millions in a few short years while depleting the resources necessary for its business operations, grabbing a quick buck while leaving communities damaged forever. Industries like mining, gas and lumber have learned this the hard way and few corrections have been made thus far. But if you were to look deeper into the future, you may understand how protecting and preserving communities and their environment will yield long-term, sustainable and meaningful wealth for the company and all its stakeholders (not just its stockholders).

So why do businesses need to protect human rights? Professor John Ruggie of Harvard’s Kennedy School of Government laid down a deceptively simple answer known as the ‘Protect, Respect and Remedy Framework’. This was adopted by the UN Human Rights Council as its ‘Guiding Principles on Business and Human Rights’. The framework highlights three things:

1. States’ existing obligations to respect, protect and fulfill human rights and fundamental freedoms; 
2. The role of business enterprises as specialized organs of society performing specialized functions, required to comply with all applicable laws and to respect human rights;
3. The need for rights and obligations to be matched to appropriate and effective remedies when breached.   

The elegance of this framework is that it creates no new laws, rights or obligations. It simply combines existing international law and shared general principles to guide us on how to conduct business responsibly.

Forget about Corporate Social Responsibility (CSR) programs, foundations and charities. These are all good and noble but they are always voluntary. Even worse, they have sometimes been used merely as vehicles for tax cuts and good publicity. CSR programs have been abused as a way for the left corporate hand to give publicly while the right hand takes away much more in private. Money spent giving scholarships to a few poor children might have been taken from funds withheld from the company’s laborers, denying them a fair living wage.

The Ruggie Principles hold businesses accountable for all its activities. It does not care about how you spend corporate money for philanthropy but how the business makes money in the first place. With what I like to call ‘Due Diligence Plus’, one is able to monitor basic human rights concerns like labor practices of a company or the environmental impact caused by its business operations. These factors are not limited by local laws but should conform to international standards of human rights protection. 

Now, this is not voluntary.

These principles have also been echoed under the ‘Guidelines for Multinational Enterprises’ of the Organization for Economic Cooperation and Development (OECD), in the human rights chapter of the ‘Guidance on Social Responsibility’ from the International Organization for Standardization (ISO 26000), and in the revised ‘Sustainability Framework and Performance Standards’ of the International Finance Corporation (IFC) and are quickly becoming the international gold standard for responsible business.

Businesses are powerful movers of society. They can influence policies, win elections and destroy regimes. Businesses create wealth that can either build great opportunities or attract great evil. This time, we must hold them truly accountable under the toughest human rights standards. 

The quicker we learn these principles and adopt them, the quicker we eliminate child labor, human trafficking, war profiteering, environmental damage, displacement of local communities, corruption and unbridled greed. These things are stoppable. I believe this generation has an opportunity to do so.

Read Professor Ruggie's Report here.