KEYNOTE ADDRESSUNITED NATIONS FORUM ON BUSINESS & HUMAN RIGHTSPALAIS DES NATIONSGENEVA, SWITZERLAND
JOHN G. RUGGIEHARVARD UNIVERSITY
14 NOVEMBER 2016
I suspect that many of you here today were surprised, as I was, by
the results of the U.S. presidential election. I also suspect that many of you
were surprised, as I was, by the results of the Brexit referendum. Perhaps
we should not have been. As far back as January 1999 Kofi Annan warned,
in a World Economic Forum speech, that unless globalization has strongsocial pillars it will be fragile and vulnerable—“vulnerable to backlashfrom all the ‘isms’ of our post-cold war world: protectionism; populism;nationalism; ethnic chauvinism; fanaticism; and terrorism.” He specificallyappealed to the business community to step up and play its role inachieving a socially sustainable globalization.
Clearly, we must redouble our efforts. Equally important, we have tomaximize the effectiveness of our efforts to make globalization work for all
because, as Annan has also said, if it doesn’t, “in the end it will work fornone.” We neither need, nor do we want, additional evidence of Annan’sprophetic insight.
In keeping with the urgency of this challenge, my focus today is on
the relationship between the Sustainable Development Goals and the UN
Guiding Principles on Business and Human Rights. And my message isthat for business to maximize its contribution to sustainable development,
it must put efforts to advance respect for human rights at the heart of thepeople part of sustainable development.
The GPs set out the global standard of what businesses must do toembed respect for human rights throughout their operations and business
relationships. The SDGs, in turn, are a vision statement and action plan forachieving social and environmental sustainability on our planet. Logicallyand in practice the two should be inextricably linked, with the Guiding

Principles setting the tone for the social components of the SDGs to whichbusiness is expected to contribute.
Given the sheer ambition of the SDGs and the pressing need for all
sectors of society to contribute to their realization, I urge businesses
everywhere to help meet our common existential challenge.
At the same time, I want to flag an emerging risk I see in some of theSDG narratives within the business community that may weaken the link
between the Guiding Principles and the SDGs, or possibly sever it
altogether. This can occur when businesses are encouraged to believe that
advancing respect for human rights involves merely doing no harm, andthat to do positive good they need to go beyond respecting rights. Thisview misses one of the most important features of respecting human rights.
When companies drive respect for human rights across their own
operations and their global value chains, they generate an unprecedented
large-scale positive impact on the lives of people who may be most in needof the benefits of sustainable development.
Is there a risk of weakening the link between the GPs and SDGs?
And if there is, how should it be dealt with? Let me begin by summarizing
some of the emerging narratives that are the source of my concern.
First, the General Assembly resolution adopting the SDGs in its
operative part makes only a passing reference to relevant standards andagreements that address corporate accountability for human rights harm,
including the Guiding Principles. This may be misread by some to imply
that these standards matter less than getting business to engage in theSDGs on any terms. Of course that was not the intent, as the Resolution’s
section on implementation makes abundantly clear. But it is an impressionthat we are starting to see gaining ground.
Second, quite a number of business strategies for contributing to theSDGs draw on the Creating Shared Value paradigm, made famous by myHarvard colleague Professor Michael Porter. In a Harvard Business Reviewarticle Porter defines creating shared value as “the policies and operational
practices that enhance the competitiveness of a company while
simultaneously advancing the economic and social conditions in thecommunities in which it operates.” It stands to reason that any such win2

win situation should be prized and seized upon, and the more of them thatcan be created, the better.
However, Porter clearly stipulates that “creating shared value
presumes compliance with the law and ethical standards, as well as
mitigating any harm caused by the business.” But isn’t the business andhuman rights challenge precisely about the fact that this presumption fails
to hold in far too many circumstances? Why else would we have needed
the Guiding Principles? Why else is there a move in several countries,
including France and Switzerland, to make human rights due diligencemandatory? Why else are some governments and many advocacy groups
pushing for the adoption of an international business and human rights
treaty? In short, business strategies drawing on this paradigm need to take
into account that its underlying presumption is problematic in practice.
My third concern stems from findings in early consultancy reports.
Most companies surveyed indicate that they are not planning to assess
their possible contributions against all 17 SDGs but, in the words of one
report, that they will “cherry-pick.” On what basis will they pick? The
answer is: materiality, or put simply, business risks and opportunities. But
business and human rights in the first instance is not about what is material
to the firm: it is about the salient risks, or most severe potential harms, thatbusiness activities and relationships pose to people. Salient risks may turnout to be material to the business if they are left unattended. But a
traditional materiality test will often miss them. Nor can businessinitiatives to promote social goods substitute for failing to address salient
risks. This is a fundamental difference between human rights and climatechange: in human rights there is no equivalent to buying carbon offsets.
A fourth and related reason for my concern stems from the way inwhich strategies for contributing to the SDGs are being framed by some
who are advising business. The claim is made that these strategies are sonovel that they will generate “transformative” and even “disruptive”
business models. Indeed, one report suggests that the SDGs invite a shift“from responsibility to opportunity.” It posits what it calls a “maturitycontinuum,” with responsibility at one end, and transformative
opportunity at the other. Now, who would not prefer to be considered“mature” and leave behind the irksome task of being responsible for one’s
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own negative externalities in the quest for new business opportunities? Of
course, no such maturity continuum exists. In fact, getting respect forhuman rights right is itself radically transformative and disruptive.
My fifth and perhaps most critical concern is the assumption
embedded in this whole discourse that respecting human rights is merely
about stopping a negative practice, lacking the more inspirational virtue ofmaking a positive contribution. This rests on a false dichotomy, between
compliance-based views of ‘respect’ on the one hand, and voluntary efforts
to ‘promote’ human rights on the other. Ironically, this is the same false
dichotomy on which the old CSR model was based—a dichotomy theGuiding Principles left behind long ago.
Consider this example. Companies have learned that nondiscrimination in their personnel practices involves much more thanadopting a few rules to regulate unacceptable behavior. It involves
instituting a positive culture of inclusion and diversity, of empowering
people whose potential previously might have been discounted, ofproviding equal pay for equal work and equal opportunity foradvancement. It requires extensive training and other support systems that
did not exist before. These are not negative acts. They are powerfully
affirmative, transformative and even disruptive of traditional practices.
One of the Guiding Principles’ most transformative contributions is
the requirement that companies’ responsibility to respect human rights is
not limited to their own operations, but extends to human rights impacts
connected to their products and services throughout their network ofsuppliers and other business relationships. The GPs recognize thatcompanies do not control every dimension of these relationships, so they
introduce the concept of leverage. Where people’s human rights areadversely affected by activities in a company’s value chain, the company’s
responsibility is to use its leverage to try to improve those people’ssituation. Where the leverage is insufficient the company is expected to try
and increase it, perhaps in collaboration with other companies or different
stakeholders. I venture to predict that this is where business can make its
single biggest contribution to the people part of the sustainable
development agenda.
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Why? Because the labor of roughly one in six workers in the world
today is part of multinational value chains. This doesn’t count those in“informal” work, which may include in-home subcontractors. It does notcount non-standard work, such as temporary work or forced labor. Also
reflect on the fact that many of the workers in multinational value chains
have families and live in communities, which suffer the ill effects or reap
the benefits from how those workers are treated. The numbers add up very
quickly to reach perhaps two billion people or more—out of the total world
population of 7.4 billion. Now that is scale.
A concerted effort by business to respect the human rights of workers
in their global value chains would have two transformative effects. First, byhelping to ensure that people are paid a living wage, that men and women
workers are treated with equal dignity and provided equal opportunity,that their rights to organize and bargain collectively are respected, theirhealth and safety on the job and in their communities protected, and so on,
business would uplift those people’s situation significantly. It would
enable them to lead decent lives and contribute to their own wellbeing aswell as their country’s development—while also increasing the global
consumer base of business.
I hasten to add that this focus involves not only SDG 8 (decent workand economic growth). It would also have positive effects on SDG 1(poverty), 2 (hunger), 3 (health), 4 (education), 5 (gender equality), 6 (waterand sanitation), 10 (reduced inequalities), 11 (sustainable communities),and in some respects even SDGs 14 and 15 (life below water and on land). I
strongly suspect that the scope and scale of the positive impacts this would
unleash significantly outstrip many of the initiatives that currently
dominate business attention and resources.
A second benefit of focusing laser-like on respect for human rights
in global value chains would be to help manage the growing threat that
globalization itself faces from populist forces in industrialized countries.
Whether on the political left or right, these populist forces involve people
who have been left behind by the liberalization and technologicalinnovations that have made it possible to slice and dice production
processes into the most minute of parts, each located where labor costs arecheapest or the regulatory context is the most malleable. Surely a more5level playing field is a better answer to this challenge than more Brexits
and other such electoral surprises.
So to conclude, of course businesses should look for every
opportunity to create shared value and find other ways to contribute to theSDGs. So much hangs in the balance. My concern is that the greatest
potential contribution business can make risks getting discounted in theminds of too many, as they slide along an imaginary continuum fromresponsibility to opportunity.
In contrast, my proposition to business—and to you all—is that far
from being at the “immature” end of a transformative trajectory of businessmodels, respect for human rights, respect for the dignity of every person, isat the very core of the people part of sustainable development. And as ifthat alone were not enough, it is also the key to ensuring a sociallysustainable globalization, from which business stands to be a major
beneficiary.

John G. Ruggie is the Berthold Beitz Professor in Human Rights and International Affairs at theHarvard Kennedy School of Government, Affiliated Professor in International Legal Studies at
Harvard Law School, and a Fellow of the American Academy of Arts & Sciences. From 19972001 he served as UN Assistant Secretary-General for Strategic Planning, and from 2005-2011
as Special Representative of the Secretary-General for Business and Human Rights, in which
capacity he produced the UN Guiding Principles on Business and Human Rights. His bookreflecting on that experience, Just Business: Multinational Corporations and Human Rights(W.W. Norton), has been translated into Chinese, Japanese, Korean, Portuguese and Spanish.

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