RESPONSIBLE
BUSINESS
Key messages
f r o m i n t e r n at i o n a linstruments

have a positive impact on business operations bymanaging risks more efficiently and enhanced
corporate reputation, among other benefits.

Responsible
Business isEveryone’s
Business
Businesses are the engine of the economy. They
contribute to economic and social development
through job creation, development of skills andtechnology, and the provision of goods andservices. At the same time, business activities
can have adverse impacts on people, theenvironment and society. All business, regardlessof their location, size, sector, operational context,
ownership and structure, should act responsibly,and identify and manage risks of impacts linked totheir operations, products or services, including intheir supply chains and other business relationships.
Governments should encourage responsible businessbehaviour through a smart mix of mandatory andvoluntary measures, and support the creation ofan enabling environment conducive to responsible
business practices.
In order to promote the positive contribution thatbusinesses can make to sustainable development
and help prevent and address negative impacts, theInternational Labour Organization (ILO), theOrganisation for Economic Co-operation andDevelopment (OECD) and the United Nations(UN), have developed instruments that provide
guidance on responsible business. These
instruments establish that all companies have theresponsibility to avoid and address adverse impacts
with which they are involved, including in their
supply chains, while making a positive contribution
to the economic, environmental and social progressof the countries in which they operate. As such,these expectations of good conduct go beyond legal
requirements. At the same time, responsible businesspractices enhance company performance and can

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ILO – Responsible Business

The implementation of international corporate
responsibility standards have also become essential
for business aiming to contribute to the Sustainable
Development Goals (SDGs). By making a positive
contribution to economic growth and development
while effectively avoiding and addressing adverse
impact on people, the environment and society,businesses can become a powerful driver for achieving
the SDGs. For example, ensuring respect for humanrights and decent working conditions in supply chainscan drive large-scale positive change across SDGs.
From an operational perspective, it is also a practicaland dynamic way to integrate the SDGs in corebusiness and existing management processes.

International Instruments
The three main instruments that have become thekey reference points for responsible business, andwhich outline how companies can act responsibly are
the ILO Tripartite Declaration of Principles concerning
Multinational Enterprises and Social Policy (ILO MNE
Declaration), the OECD Guidelines for Multinational
Enterprises (OECD MNE Guidelines) and the UN
Guiding Principles on Business and Human Rights(UN Guiding Principles). They are aligned with, andcomplement, each other.
The ILO Tripartite Declaration of Principles
concerning Multinational Enterprises and Social
Policy provides guidance to encourage the positive
contributions companies can make to economic andsocial progress and to minimise and resolve difficulties
in their operations. The principles addressed tobusiness reflect good practice for all enterprises. The
ILO MNE Declaration also provides policy guidance
to governments as well as employers’ and workers’organizations, which play central and distinctive roles
in creating an enabling environment for responsible
business. Its recommendations on employment,
training, conditions of work and life, and industrial
relations are based on international labour standards,
including the fundamental Conventions underpinning
the ILO Declaration on Fundamental Principles andRights at Work (1998) which addresses forced labour,child labour, non-discrimination and freedom of
association and collective bargaining. The ILO MNE
Declaration was most recently updated in 2017 toinclude new labour standards and policy outcomes andto make explicit references to global developments
such as the adoption of the UN Guiding Principles andthe 2030 Agenda for Sustainable Development.

The OECD Guidelines for Multinational Enterprises
are recommendations from governments to businesses
on how to act responsibly. They cover all areas ofbusiness responsibility, including labour and human rights
issues, environment, disclosure, bribery, consumer
interests, science and technology, competition, andtaxation. The Guidelines were adopted in 1976 and last
updated in 2011 to include a chapter on human rightsaligned with the UN Guiding Principles. The chapter on
Employment and Industrial Relations is aligned with
ILO labour standards. The Guidelines also include a
unique non-judicial grievance mechanism: National
Contact Points (NCPs). The OECD Working Party on
Responsible Business Conduct brings together thegovernments that have adhered to the Guidelines– currently 48 – whose mandate is to promote theimplementation of the OECD MNE Guidelines and RBC
policies.
The UN Guiding Principles on Business and Human
Rights focus on avoiding and addressing adverse
business-related human rights impact. They arefounded on three pillars: 1) the State duty to protect
against human rights abuses by third parties, including
business enterprises, 2) the independent responsibilityof business enterprises to respect human rights, whichmeans that they should avoid infringing on the humanrights of others and should address adverse humanrights impacts with which they are involved and 3) theneed for those harmed by business-related activities
to have access to effective remedy. These principles
were unanimously endorsed in 2011 by the UN
Human Rights Council. Both the Office of the UN HighCommissioner for Human Rights (OHCHR) and the UN
Working Group on Business and Human Rights (UNWorking Group) are charged with promoting the UN
Guiding Principles and their implementation, including
by unpacking what the principles mean in practicewith respect to different human rights issues, sectors
and types of actors.

CSR, RBC and BHR: Lost in translation?

Many businesses, governments and stakeholders are familiar with the term Corporate Social Responsibility(CSR), which has historically been used to describe business interactions with society.
Over the last years, CSR has increasingly been used alongside RBC and BHR, with some using the terms
interchangeably (e.g. the European Union). How do these concepts relate to each other?
They all reflect the expectation that businesses should consider the impact of their operations and supply
chains on people, the planet and society as part of their core business considerations and not as an add-on.
This includes the need to avoid and address negative environmental and social impacts. A key characteristicof CSR, RBC and BHR is that they refer to corporate conduct beyond simply complying with domestic law andcall on business to contribute positively to sustainable development while managing risks and impacts that
may result from their activities. These concepts should not be understood to be equivalent to philanthropy.
ILO – ILO
Responsible- Policy Alignment
Business3

labour rights, - the environment and society, both
positive and negative. The instruments establish acommon understanding that enterprises can cause,
contribute to, or be directly linked to adverse impacts(through operations, products or services by business
relationships), and they provide a framework for how
enterprises should avoid and address them.

CONDUCTING DUE DILIGENCE

A Coherent Approach
The instruments developed by the ILO,OECD and UN set the global expectations
for responsible business conduct and arealigned and complement each other. Eachorganisation brings its own value-added totheir implementation, based on its mandate
and expertise: the ILO with its tripartite
structure and authority on international labour
standards; the OECD with its broad approach to
RBC and the links to economic policies; and the
OHCHR and the UN Working Group with theirexpertise on business and human rights andUN human rights mandates. The main common
elements are set out below.

FRAMEWORK FOR ALL COMPANIESInternational corporate responsibility standards set
the expectation that all companies – regardless of
their size, sector, operational context, ownership andstructure– avoid and address the adverse impacts
with which they are involved, and contribute to thesustainable development of the countries in which
they operate.

COMMON UNDERSTANDING OF IMPACT
The instruments set out that impact of businessactivities is understood beyond the impact on thecompany itself and refers to the impact businessactivities may have on human rights – including

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ILO – Responsible BusinessBusinesses should undertake due diligence to identify,
prevent and mitigate their actual and potential
negative impacts and account for how those impacts
are addressed. This process should involve meaningful
consultation with potentially affected groups and otherrelevant stakeholders. With respect to labour rights,
consultation with workers’ organisations is particularly
important. By helping companies understand theimpacts of their activities and by clarifying the
expectations around due diligence, these international
instruments guide companies on what they should doin order to know and show that they are behaving
responsibly.

RESPONSIBILITY THROUGHOUT
THE SUPPLY CHAIN
Responsible business covers not only impacts thata company may cause or contribute to through its
own activities but also those impacts directly linked
to an enterprise’s operations, products or services
through its business relationships. This includes:
business partners, entities in the value chain such as
subsidiaries, suppliers, franchisees, licensees, joint
ventures, investors, clients, contractors, customers,
consultants, financial, legal and other advisers, andany other non-State or State entities.

ACCESS TO REMEDY
As part of their duty to protect against businessrelated adverse impacts, States are expected totake appropriate steps to ensure, through judicial,administrative, legislative or other appropriate means,that when such abuses occur within their territory and/or jurisdiction those affected have access to effective
remedy. In addition, where companies identify thatthey have caused or contributed to adverse impacts,
they are expected to address them through providing
remedy, and they should provide for or cooperate inthis remediation through legitimate processes.

effective implementation
Governments, enterprises, social partners and other stakeholders all have important roles to play to implement
these international instruments and advance responsible business operations. Governments have a duty to protect
people, the environment and society. To achieve this, they are expected to adopt and enforce relevant laws,
regulations, and policies that promote, enable and support responsible business conduct. Enterprises should meettheir responsibility to avoid and address harms. They should use their leverage and set clear expectations to theirbusiness partners to also meet international expectations for responsible business conduct.
Importantly, both governments and companies are expected to communicate externally how they
address their impacts and engage with employers’ and workers’ organisations, as well asother stakeholders, such as civil society, human rights defenders and community members, toachieve decent work and respect for human rights in practice.
To support effective i mplementation o f t hese international i nstruments by business, governments a nd otherstakeholders, international organisations provide support and guidance through various means.

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The ILO MNE Declaration contains a set ofoperational tools. At the enterprise level, the ILO
Helpdesk for Business is a free and confidential
service that provides information for businesses on
the principles set out in the MNE Declaration. The ILO
company-union dialogue service provides a space for
a company and union to come together voluntarily to
discuss issues of mutual concern. At the national level,
the ILO provides technical support to national partners,
including through the facilitation of dialogue platforms
that bring together governments and employers’
and workers’ organizations to identify decent work
opportunities and challenges and to agree on joint
action to address them. Home-host country dialogues
also involving MNEs foster partnerships for advancing
decent work in global supply chains. Tripartite
appointed national focal points are established topromote the application of the ILO MNE Declaration.
At the regional level, the ILO produces reports onregional foreign direct investment trends and issues
identified by governments and the social partners
on how the principles of the ILO MNE Declaration
are being applied. Through its International Training
Centre (ITC-ILO), the ILO also offers a range of training
opportunities on the labour dimension of responsible
business conduct.

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All governments that adhere to the OECD MNEGuidelines have to set up a National Contact
Point (NCP) to promote RBC and handle cases(referred to as “specific instances”) as a non-judicial
grievance mechanism. NCPs have received more than
450 cases relating to company operations in over 100
countries and territories. They have resolved a wide
range of complaints relating to companies’ impacts
on the environment, human rights and labour rights,

including in global supply chains. The OECD has also
adopted a range of instruments providing guidanceon due diligence to help companies operating indifferent sectors to understand and address RBC risks.
The OECD due diligence guidance instruments havebeen developed through a multi-stakeholder process(including ILO and OHCHR), and have been embedded
in domestic legislation in a range of countries. The OECD
also provides support to governments and companies
to facilitate their use through training, peer learningand policy advice. The Global Forum on Responsible
Business Conduct brings together stakeholders fromgovernments, business, trade unions, civil society andacademia to debate key global social and economic
challenges related to responsible business conduct.

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OHCHR and the UN Working Group provide
guidance and engage in dialogue with States,
companies and other stakeholders on how to
implement the UN Guiding Principles. For example,
OHCHR convenes practice-oriented workshops toengage and support the business community indifferent countries to improve alignment of policies
and processes with the UNGPs. The UN Working
Group regularly assesses how companies are making
human rights due diligence part of business practiceand how governments are implementing their duty
to protect against business-related human rights
abuse and fostering responsible business in line with
the UN Guiding Principles. The annual UN Forum on
Business and Human Rights, organised by OHCHR
and the UN Working Group, yearly takes stock ofprogress, challenges, good practice and efforts inthis area. OHCHR is also leading a project on how to
improve accountability and access to remedy in casesof business involvement in human rights abuses.
ILO – Responsible Business

5National action plans on business and humanrights have become an important means forgovernments to promote the effective andcomprehensive implementation of the UN Guiding
Principles, and alignment with implementationof other instruments. As governments often
have many different laws, policies and practices
that are relevant to RBC, national action plans
can help ensure that all government actors areworking in a coherent manner to include RBC
in their activities. National action plans have also
served as an important way for governments toengage in dialogue with stakeholders, including
companies, social partners and civil society. They
also help identify ways in which the State has
a particular role to play to ensure standards
are implemented, e.g. in its role as an economic
actor. In some countries, this exercise has led
to the adoption of new regulations and policies.
Some national action plans go beyond the theme ofbusiness and human rights by also encompassing
the environment, human rights or responsible
business more generally.

Joining Forces for Responsible Business
The ILO, OECD and OHCHR have strengthened their collaboration and coordination in a rangeof areas to help governments, companies, civil society and other stakeholders step up action
on responsible business in a coherent way. Coherence is particularly important to avoid a proliferationof expectations at the international level and across countries, which can create challenges for business
operating globally.
The three organisations are therefore actively working to ensure alignment among their instruments andimplementation programmes. Each instrument refers to the others and builds on each other’s important
added-value. For example, the due diligence approach set out in the UN Guiding Principles was subsequently
incorporated in the OECD MNE Guidelines and the ILO MNE Declaration. More recently, the 2018 OECD Due
Diligence Guidance for Responsible Business Conduct promotes a common understanding on due diligence forresponsible business conduct. Both the ILO and the UN Working Group on Business and Human Rights promote
this Guidance. This was recognised by the UN Working Group in its report to the UN General Assembly in 2018
which highlighted key features of human rights due diligence.
The organisations have also joined forces to provide technical advice and promote
implementation at the country level. With the support of the European Union through its
Partnership Instrument, they promote responsible business within the context of projects in
Asia and Latin America and the Caribbean. The project in Asia seeks to promote responsible
supply chains aimed at enhanced respect for human rights, labour and environmental standards
by businesses, in line with international instruments. It also promotes policy environments
conducive to responsible business conduct and increased opportunities for dialogue. The
project in Latin America seeks to promote responsible business conduct by supporting thedevelopment and implementation of NAPs, strengthening due diligence and sharing goodpractices on responsible business conduct. These projects provide an important opportunity topromote synergies and for each organization to contribute to the creation of a strengthened enabling
environment for responsible business conduct

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ILO – Responsible BusinessFor More Informationwww.ilo.org/mnedeclarationwww.mneguidelines.oecd.org
www.ohchr.org/EN/Issues/Business/Pages/BusinessIndex.aspx
www.ohchr.org/EN/Issues/Business/Pages/WGHRandtransnationalcorporationsandotherbusiness.aspx

The International Labour Organization (ILO) is the specialised agency of the United Nations on employment
and labour issues whose work involves adopting international labour standards and providing policy
guidance, capacity building and technical assistance to governments, employers and workers in its
187 member States. The aim of the ILO is to promote rights at work, encourage decent employment
opportunities, enhance social protection and strengthen dialogue on work-related issues. www.ilo.org
The Organisation for Economic Co-operation and Development (OECD) is an intergovernmental organisation
with a mission to promote better policies for better lives of people around the world. Its member countries(37) span the globe and include many of the world’s advanced and emerging economies. The goal of theOECD is to build a stronger, cleaner and fairer world. www.oecd.org
The Office of the High Commissioner for Human Rights (OHCHR) leads the Business and Human Rights
agenda within the UN system, supporting the work of the UN Human Rights Council and the UN
Working Group on Business and Human Rights in promoting the dissemination and implementationof the UN Guiding Principles on Business and Human Rights. The UN Working Group is composed offive independent experts of balanced geographical representation appointed by the UN Human Rights
Council. www.ohchr.org

ILO – Responsible Business7This brochure was produced as part of the Responsible Supply Chains in Asia
programme, a partnership between the European Union, the ILO and the OECD.

With funding by the European Union

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ILO – Responsible Business

OECD

EU

ILO