In April this year, 25 civil society organisations launched a campaign for a new law to make UK companies more accountable for human rights and environmental abuses in their global operations and supply chains. Under this law, companies would need to conduct environmental and human rights due diligence.
Under the UN Guiding Principles on Business and Human Rights, companies have a responsibility to undertake human rights due diligence (HRDD) – “an ongoing risk management process…in order to identify, prevent, mitigate and account for how [a company] addresses its adverse human rights impacts”. But according to the 2018 Corporate Human Rights Benchmark, 40% of the biggest companies in the world failed to show any evidence of identifying or mitigating human rights issues in their supply chains.
Mandatory human rights due diligence and corporate liability developments in Europe. Credit: European Coalition for Corporate Justice (ECCJ).
Good news in Europe and beyond
The good news is that there is growing momentum worldwide to require companies to undertake human rights and environmental due diligence and hold companies accountable for their negative impacts. It’s exciting to see this issue taking root in so many European countries.
Key developments in the past few months include the passing of the Dutch Child Labour Due Diligence law in May, due to come into force after 1 January 2020. This aims to put more responsibility on companies to prevent goods and services involving child labour coming into the Dutch market. Meanwhile, in Switzerland the Responsible Business Initiative Bill continues to make steady progress. John Ruggie, author of the UNGPs, recently reaffirmed his strong support for the Bill.
In France the French Duty of Vigilance Law (introduced in 2017) is going through its first big test. On 23 October, French and Ugandan campaign groups announced they were taking Total to court for its failure to address the human and environmental impact of its Ugandan operations (as required by the law). In the words of Juliette Renaud of Les Amis de la Terre: “We fought for years to see this law passed. This first case is a real test to see if it does indeed allow us to prevent future human and environmental catastrophes”.
Campaigns for human rights and environmental due diligence laws are also underway in Finland (who currently hold the EU Presidency) and Germany (who will have the EU Presidency in the latter half of 2020), as well as other countries. The new Government in Finland has already committed to mandatory HRDD legislation at national and EU level.
This should help to pave the way for EU-wide mandatory due diligence. Discussions on this topic continue and earlier this year a group of MEPs in the European Parliament launched ambitious plans for an EU law requiring companies to carry out HRDD in their supply chains. This has been welcomed by the European Commission and a due diligence report is expected in Spring 2020.
Human rights due diligence is also part a new draft UN Binding Treaty on human rights and business, which is currently being negotiated.
What next for the UK?
Here in the UK we’re facing challenging and uncertain political times – but times where people, be it regulators, shareholders, or consumers increasingly expect companies to be aware of, and accountable for, what goes on throughout their supply chains.
Some businesses see this as an opportunity to get ahead and secure a potential long-term competitive advantage. As one company recently put it: “In short, it is not a question of if, but when such laws will be in place and how they will impact current business operations and practices”.
We’re calling on the Government to introduce a new law to make UK companies act to prevent human rights abuses and environmental damage in their global operations and supply chains. The time is now!