The 11th session of the UN Annual Forum on Business and Human Rights 2022: What just happened?
Anna Triponel
December 2, 2022
The 11th session of the UN Annual Forum on Business and Human Rights took place this week in Geneva, after two years of online sessions during the pandemic. This year, in the context of ongoing conflict, the climate crisis, economic distress, we saw representatives from companies, governments, investors, community groups and civil society, trade unions, law firms, national human rights institutions and academia come together face to face again to discuss the implementation of the UN Guiding Principles on Business and Human Rights (UNGPs). In light of the urgency of taking action to prevent impacts to people and planet, the UN Annual Forum underscored the need to act collaboratively and creatively, with rights holders perspectives at the centre.
The theme of this year’s UN Annual Forum was “Strengthening accountability to advance business respect for people and the planet in the next decade.” Despite being smaller than past versions - in the number of participants and events - we greatly enjoyed the opportunity of attending most sessions and having the space to engage in deeper discussions with many peers about the complexities of our current challenges, and opportunities to act together.
While in Geneva, our founder Anna Triponel posted key takeaways from the first panel of the UN Annual Forum that she moderated with a range of experts and rights holders from around the world who are all playing a role in placing rights holders at the centre of remedy. You can find that post here. (In short, the UNGPs are serving as goal posts within which companies are looking to design operational-level grievance mechanisms in dialogue, consultation and engagement with rights-holders. Where they are not being used in this way, innovative measures to enable remedy are being found, ranging from public lobbying to letters to the UN Working Group on Business and Human Rights and the creation of locally-led associations.)
Here are a few of the things we took away from the Forum this year.
Accountability through mandatory human rights due diligence for Europe is imminent - but key political discussions remain.
Lara Wolters, Member of the European Parliament and rapporteur for the Corporate Sustainability Due Diligence Directive (CSDDD) shared the state of the legal and political discussion around the CSDDD within the European Parliament in the Opening Plenary. Lara described that the upcoming EU directive on corporate sustainability due diligence is necessary for a number of reasons: voluntary measures have been too limited; we need to re-balance powers and “give rights-holders what they deserve”; and the EU is starting to think more broadly about sustainability. “We’re trying to put money where our mouth is. It’s an exciting time to be a Member of the European Parliament.” She emphasized that “the UNGPs are a constant reference point” in the law, to ensure that the directive serves the purpose of serving people and planet. She observed that “the UNGPs have been extremely useful for our work; we are standing on the shoulders of giants, like John Ruggie.”
She noted that there are legal questions that will require a political answer: (i) the level of engagement with rights holders; (ii) to what extent and how far companies can be asked to know their value cain and take responsibility for it; (iii) clarity on liability for companies causing, contributing, or being linked to human rights and environmental impacts; (iv) the extent to which SMEs will be subject to the duty (her view is that SMEs in high risk sectors have to be included but there is resistance politically); (v) remedy; and (vi) what can be defined as a ‘high-risk sector’. However, she hopes that these questions will be resolved and that the EU Parliament arrives at text by the end of 2023. In that case, most companies could need to start complying with the law by 2025 and, possibly, SMEs by 2027.
When asked about industry initiatives, Lara observed that there is a space for them, but that a number of voluntary initiatives have not had enough impact, and therefore clarity is needed on those that don’t work and those that do. Speaking about civil liability, Lara observed that “this is about justice, re-balancing, and ensuring that people can get access to justice.” She underscored the importance of both civil liability, and administrative enforcement - with civil liability only kicking in in situations of cause and contribute, but not direct linkage - consistent with the UNGPs as well as stakeholder views on what’s expected.
The CSDDD is one of the regulations on this topic, alongside regulations for the financial sector and responsible investment, the circular economy, the European Green Deal, minimum wages across Europe, and the composition of corporate boardrooms. As the European Union seeks to build an economy to serve people and planet, the panel on “Western Europe and Other States Group (WEOG): Recent regulation in business and human rights” discussed whether stakeholders from the global south might need to be consulted in the development of laws that aim to have extraterritorial impacts.
Worker-driven initiatives backed by market incentives can transform the way companies conduct due diligence and act to respect rights.
Greg Asbed and Lucas Benítez, co-founders of the Coalition of Immokalee Workers, presented the Fair Food Program as a case study for the session on “The importance of rights-holder perspectives in the design of remedial mechanisms”. The Fair Food Program arose as result of the engagement and collaboration of agricultural workers in Florida, food growers, and buyers – based on the model of ‘worker-driven social responsibility.’ Lucas emphasized that pickers were ready for challenging work - but they were not ready to put up with physical abuse, sexual harassment and other labour rights violations, all while picking food to feed the world. He observed that buyers always say they have CSR standards, but that the workers were not seeing these observed in practice, so they decided to organise. He described the ‘Workers Social Responsibility (WSR)’ born in Immokalee as the result of worker organisation as a “vaccination to prevent abuse and loss of life”, to ensure that workers are the ones responsible for monitoring their own rights, rather than this being set by people in buyer companies who had never been in the fields themselves.
Greg observed that because 90% of the tomato industry was in Florida, the model could be created there overnight. They tried at first to work with existing auditing schemes, for efficiency, but none of them put workers first. This is why a new model had to be created. In the program, workers act as frontline monitors of their own rights in the fields, while a binding legal agreement between suppliers and buyers puts buyers on the hook to only purchase from certified suppliers and fund the Fair Food Standards Council. The program involves (i) human rights education for workers led by workers themselves to enable them to recognise where their rights are being impacted, (ii) a third-party grievance channel that is available 24/7 enabling workers to report issues immediately and in confidence as they arise, with immediate resolution which caters to migrant workers who may only be in the farm for a short period of time, and (iii) deep dive audits – with a minimum of 50% of workers on that farm being interviewed – to enable a deep dive into systemic issues that may not be the subject of individual grievance. Greg emphasized that audits - even when conducted in-depth with other 50% of workers being interviewed - only ever serve as a snapshot, hence the necessary contribution of the 24/7 hotline.
The model put workers themselves at the heart of human rights due diligence. As explained by Graham Givens, representing a company who has been in the Fair Food Program since 2009, buyers can get a better picture of the working conditions and support workers by leveraging their purchasing power. The model has now been replicated in other initiatives around the world that have subscribed to the Worker-Driven Social Responsibility Network, and include Milk with Dignity in the US and the Gender Justice in Lesotho Apparel initiative.
Investors are taking stakeholder-driven approaches to using their leverage.
In a panel on “Strengthening Accountability: BHR and Investors”, asset managers and investors shared how they are exercising their leverage by engaging directly with stakeholders about investee companies’ impacts and taking a rights holder-centred approach to investment. Paloma Muñoz Quick, Associate Director of Financial Service at BSR, highlighted the growth in ESG investing – 41 trillion dollars this year, and 50 trillion dollars in 2025. In short, 1/3 of global assets under management in 2025 will go to companies that perform well on ESG factors. However, this is to be contrasted with the poor performance of investors on human rights: less than 3% disclose evaluating human rights risks in financial services. Paloma emphasized that “ESG is not working for people.” Further, investors are missing inter-connections between areas (such as just transition) – although some examples of good practice are developing.
Doug McMurdo, Ward Councillor, Bedford Borough Council and chair of the Local Authority Pension Fund (LAPFF), agreed, noting that “companies we invest in just don’t get it.” After receiving questions and reports from investors in the fund, he personally visited the Mariana and Brumadinho in Brazil after the Vale dam collapses. Getting his boots on the ground and speaking directly with the impacted people, enabled Doug to connect directly with the people and the impacts - which also prompted a visit from the Chairman to the site. Doug issued a call to action to all investors: get your boots dirty and engage with impacted people, and push your investee companies to do the same. He also urged companies to stop talking about accidents - these are incidents that are avoidable and called on non-executive directors to step up in their role.
Stakeholder-driven approaches are also being implemented by increasingly more investors that are taking a risk to people lens to identify high-risk investments in their portfolios. Mary Beth Gallagher, Director of Engagement at Domini Impact Investments LLC based in New York, commented that they are taking deeper dives into a select number of companies a year by using stakeholder engagement models. Additionally, they are looking at how to better use their leverage to incorporate FPIC in the financing of projects and push for good practice in the management of human rights related impacts and risks.
As Paloma noted, the focus on whether or not an issue is financially materially is mis-guided: civil society organisations have the tools to make an issue that may not be material, material. By spotlighting a human rights issue, organisations can create reputational, legal and other business risks for companies - not including the actual financial costs of applicable fines once impacts have occurred, as highlighted by Doug in the example of Vale (25 billion dollars).
There is growing attention to the intersections between climate and human rights, and the carbon credits market is a new frontier for addressing these links.
In the panel on “Business and human rights in the Anthropocene: A climate for change?”, a range of experts highlighted how indigenous peoples, local communities, women, the elderly, people with disabilities, and small-scale farmers are especially vulnerable to the environmental impacts of climate change, and how those in certain regions in Asia-Pacific, Africa and Latin America will be especially impacted. Additionally, they reminded us they are also vulnerable to impacts related to climate actions, like offsetting emissions.
Investigative journalist and Pulitzer Center Rainforest Investigations Network fellow Andres Bermúdez Liévano presented his research on carbon credit projects in Colombia and described how “few issues are at the intersection of human rights, indigenous people’s rights and climate change like carbon credit schemes.” Andrés has documented that, in Colombia, carbon credit project developers have been found to be using divide and rule practices to win over communities, disregarding FPIC, and keeping land-owning communities out of the loop of key financial and management decisions. Andrés noted that ultimately, buyers of carbon credit are performing very poor or no quality human rights due diligence on the quality of the credits that they are selling and buying. He recommended that the standards of transparency in the entire carbon credits value chain be elevated, and that companies interested in buying good quality credits only select projects that are co-designed by local communities, and have a clear and transparent plan on how to transfer knowledge to local communities.
Indigenous populations and Human Rights and Environmental Defenders are key stakeholders to engage with and prioritise in the just transition.
In the Opening Plenary and the panels on “Ending the Criminalization of Indigenous Human Rights Defenders: The Way Forward” and “Leveraging a human rights approach in the extractive and energy industries”, panelists that included rights holders, activists, human rights defenders, state and company representatives, and the UN Special Rapporteur on the rights of Indigenous Peoples shared different perspectives on how these groups are being especially impacted by harassment, Strategic Lawsuits Against Public Participation (SLAPPs), business-related social and environmental impacts, and climate change. Impacts related to the tenancy of land, environmental and biodiversity degradation, food security and livelihoods rose to the top across the board of reported impacts to indigenous and local communities, who are at the centre of both business-related impacts and the environmental and climate crisis.
Different mechanisms were presented as means for companies to address these risks and respect human rights defenders and indigenous communities’ rights. Adrian Lasimbang, Director of Community Development & Regenerative Farming VERDE Resources (Malaysia), a company developing community-based renewable energy systems, especially highlighted the value of building inclusive partnerships with indigenous communities and implementing participatory design processes.
Growing attention to the role of commercial lawyers in the UNGPs.
Rae Lindsay, partner at Clifford Chance, and now also co-chair of the Business & Human Rights Lawyers Association (BHRLA), announced the launch of the BHRLA during the session ‘Roadmap for the next decade: Taking stock.’ Rae observed that most commercial lawyers have never heard of the UNGPs, and have no exposure to human rights - although they are at the heart of a number of transactions that directly impact human rights. “This has to change.” Until lawyers understand the UNGPs and how they operate, they cannot effectively advise their corporate clients.
We supported the development of the BHRLA this year, as we brought 22 founding member firms together to create an ambitious vision and work plan for the BHRLA’s first year. We have now handed the BHRLA over to the founding member firms themselves, although obviously will do what we can to see it succeed in its mission as the association advances. (To receive further updates on the BHRLA, including with regard to membership, feel free to follow the BHRLA Linkedin page.)
