The Institute for Human Rights and Business (IHRB) published Responsible Business in Uncertain Times: Strengthening Corporate Leadership Amidst Widening Global Conflicts (November 2024), which builds on discussions from a series of IHRB events on the role of business in conflict, including: Responsible Business in Uncertain Times (Geneva, 2024); Corporate Responsibility in a New Age of Conflict and Uncertainty (Washington D.C., 2024); and a multi-stakeholder meeting in Copenhagen in 2023.
Human Level’s Take:
Some key highlights with text extracted from the report itself:
1. Business neutrality in conflict does not prevent it from having an impact.
Even where businesses do not directly contribute to hostilities, their presence and operations might have some impact on conflict dynamics. 'Neutrality' is about not taking side with one party against another. It is different from the impact of business operations on conflict dynamics which can be unintended. The difference is in the positioning and therefore about intentionality of companies involved. Businesses operating in such contexts need to comprehensively and continuously review their impacts, and all their interactions with conflict actors, as well as the impacts of the conflict on their ability to meet their responsibility to respect human rights. This is what defines conflict-sensitive, or heightened, human rights due diligence.
2. ‘Following the money’ is useful, but will not solve the problem alone.
Conflicts require financing. Governments need to raise more revenue, by formal and informal means. For non-state combatants, the control of key commodities, particularly minerals, is often a major objective, resulting in conflict and associated human rights abuses. All of this can pose risks for businesses and affected stakeholders. There is a need for more local coordination in countries where commodities associated with conflict are extracted and grown, including with host governments, and input from local stakeholders. When it comes to payment of taxes, the payment of taxes does not on its own make a business involved with the violations of a government regime, even an illegitimate one (apart from exceptional circumstances where a business is a very significant tax contributor to a government that is involved in gross violations of human rights).
3. Conflict thrives on, and creates, economic inequalities.
Organisations working with political actors on conflict prevention, resolution and peacebuilding should recognise that private sector activities contribute to the realisation of economic and social rights. They should stress the duty of state actors to protect against business actions that may undermine the realisation of specific rights and call for the adoption and implementation of legal frameworks that support companies in undertaking responsible business activities wherever they operate.
4. Legality and responsibility are connected, but different.
The responsibility to respect human rights is not simply achieved by staying within the bounds of what is legally permissible and possible. It also requires effective human rights due diligence to minimise adverse impacts, which should be ‘heightened’ in high risk and conflict situations. That does not mean undertaking ‘more’ human rights due diligence, but instead highlights the importance of applying a conflict lens.
5. The red lines for avoiding complicity in international crimes are evolving, particularly due to technology.
Under international criminal law, businesses risk being complicit in international crimes such as genocide, war crimes, crimes against humanity, and ethnic cleansing. Companies should review whether business relationships may draw them into situations that expose them to complicity risk, and whether these complicity risks are changing, for example, in the case of Vanuatu’s proposed amendment to add ‘ecocide’ to the Rome Statute of the International Criminal Court. The use of technology, including artificial intelligence (AI), in conflict and the theatre of war is a quickly evolving area in which the private sector is intrinsically involved, either through military contracts or indirectly through the potential dual-use or misuse of products by armed actors, raising major issues of human rights and humanitarian law.
6. Boards need to consider conflict as more than just ‘geopolitical risk.’
Increasing conflict and uncertainty represent a material risk all directors should be focussed on as part of their fiduciary duties. But too often this issue sits on a dashboard under the broad heading of ‘Geopolitical Risk’. There, it is considered primarily from a Financial Materiality perspective, with the focus on commercial and operational risk: what are the impacts on supply routes and input scarcity, and market demand? Do we have insurance? Can we declare force majeure? The impacts on people may be forgotten. Boards are in real need of good guidance in navigating the multifaceted material risks presented by conflict and uncertainty, as well as some cautionary tales – and good practice examples.
7. ‘De-risking’ and exit may not always be the best way for companies to respect human rights.
Sometimes withdrawal or divestment may be the only or the best option for responsible action. It is a perfectly legitimate response to the risk of links to abuse, but only where exit is carefully managed and considered in light of the impacts of exit.
8. Use leverage and pursue collective action at the local level.
In a sensitive situation, for companies there is safety in numbers, both within and across sectors. While global multi-stakeholder initiatives or industry initiatives can provide the principles and case studies, the most effective collective action and leverage is achieved when it is coordinated in-country, by those who are actually dealing with the current challenge and involving local civil society and national and sub-national governments.
9. Governments, and particularly embassies in conflict-affected countries, need to step up.
After initial enthusiasm in 2011 with the adoption of the UNGPs, followed by National Action Plans on Business and Human Rights published by some countries, many governments currently seem less engaged on the business and human rights agenda, both from a funding perspective, and in-country level through diplomatic missions. Coming at a time when there are increasing societal and regulatory expectations on business to undertake conflict-sensitive human rights due diligence, this reveals a major gap and a mismatch. Where there is a human rights case to stay, guidance and support to companies undertaking due diligence is even more essential, including in ongoing efforts to support just transitions for workers and local communities.
