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UNITED STATES INSTITUTE OF PEACE

© USIP 2012 • All rights reserved.

“Implementing the 

“respect and remedy” 

framework proactively will 

enable businesses to understand and manage risks and 

communicate to stakeholders 

that they are doing so. Failure 

to do so could result in the 

disruption of management 

time, reputational damage, 

constrained access to project 

finance, or exposure to 

negative campaigning.”

June 29, 2012

Business and Human Rights

An Issue Whose Time Has Come

Summary

•	 Business activitiesin fragile and conflict-affected regions could adversely impact the human

rights of host populationsin diverse ways, and could trigger orsustain violent conflict.

•	 The international“Protect, Respect and Remedy Framework on Business and Human Rights”

could help businesses avoid infringing on the human rights of others and should address

adverse human rightsimpacts when they occur.

•	 Thisframework would complement (and not replace) exiting initiativeslike the U.N. Global

Compact, IFC Performance Standards and OECD Guidelines. It provides a human rightslens

that does not treat communities as‘vulnerable’or‘needy,’but as viable partners with rights.

•	 Implementation of the framework (and other voluntary standards) will always be fraught with

difficulty. However, companies could become more amenable if they discover that compliance could enhance risk management and improve productivity.

•	 Coordination, communication and accountability are vital for credible and effective implementation of the framework. Key steps have been identified to help corporations comply.

Introduction

For decades, nongovernmental organizations(NGOs) have been calling for businessesto be aware

of the human rightsimpacts of their activities, and to accept that companies have broad responsibilitiesfor respecting and protecting human rightsin the countriesin which they operate. Until

recently, this call has had little traction. Thisis despite the patchwork of issue-specific corporate

responsibility initiatives, which include the anti-apartheid Sullivan principlesin the 1980s, ongoing

effortsto remove child labor from supply chains, and litigation under the United States Alien Torts

Claims Act1.

Now things are changing. Under the leadership of Harvard’sJohn Ruggie, clear guidelinesfor

businessresponsibilities with respect to human rights have been developed through a U.N.-facilitated processthat involved governments, businesses and NGOs. The“Protect, Respect and Remedy

Framework on Business and Human Rights”and the associated Guiding Principles2 provide

authoritative statements on businessresponsibilities with respect to human rights. The framework

and guiding principles are rapidly being incorporated into existing‘soft law’standards, notably

the OECD Guidelinesfor Multinational Enterprises3 the IFC Social and Environmental Performance

Standards4 and the U.N. Global Compact5.

Jill Shankleman

E-mail: js@shankleman.com

Hannah Clayton

E-mail: hanclayton@yahoo.com

PEACEBRIEF129
© USIP 2012 • All rights reserved.

Business and Human Rights: An Issue Whose Time Has Come

page 2 • PB 129 • June 29, 2012

Importantly, the“Ruggie Framework”articulatesthe following responsibilities of business

regarding human rights:

•	 Governments are responsible for respecting, protecting and fulfilling the human rights of

individuals within their territory and/or jurisdiction.

•	 The business role is to respect human rights. This furthermore means that they should

address adverse human rights situations with which they are involved.

•	 Government responsibilities extend to ensuring that businesses respect human rights.

Demonstrating sensitivity to human rightsis particularly important for businesses operating in

post-conflict and transitional regimes, as highlighted by Secretary of State Hillary Clinton when

encouraging U.S. corporationsto invest responsibly in Burma.6Thisreport highlightsthe main

options and challengesfor businessesimplementing the corporate responsibility to“respect and

remedy.” It concludes with recommendations on priority actionsto make“Protect, Respect and

Remedy”an effective approach.

How Does Business Impact Human Rights?

Attention paid to business and human rights has grown because of a number of cases where

NGOs, the United Nations, or courts have found or alleged violations. Some of the waysin which

business activities can be at risk of infringing on human rights are:

•	 if security guards, police or military abuse civilians while protecting business assets;

•	 if employees, contractors’or suppliers’workers do not have contracts, safe working conditions, the right to organize collectively, or access to a grievance mechanism;

•	 if employment agencies discriminate;

•	 if labor brokers hold onto the passports of migrant workers or charge fees for work placements that create long-term indebtedness;

•	 if rights acquired by a business from the government (e.g. a mining concession, a right

of way, land for agriculture etc.) displaces people from their homes or livelihoods without

consultation or compensation;

•	 if children are at work, in the business or in the supply chain, or if women or disabled

people do not have equal opportunities to be considered for employment;

•	 if land traditionally used by indigenous people is affected without their consent;

•	 if chemicals, oil spills or other pollution damage the health of workers or communities—

directly or through damage to the environment;

•	 if the products businesses supply are used by customers (e.g. military, large infrastructure

projects) in a way that is abusive of human rights; and

•	 where personal information is lost, misused or released to governments or third parties

without prior agreement.

How will the Protect, Respect and Remedy Framework 

be Enforced?

Although the framework is notlegally enforceable at present,stakeholders are in the process of

establishing mechanismsthat will encourage itsimplementation. Governments are supporting a

high-level working group mandated to encourage implementation by issuing additional guidance to

governments and businesses, disseminating best practices and reporting progress on an annual basis.

The working group will also establish a multi-stakeholderforum on business and human rights.7
© USIP 2012 • All rights reserved.

Business and Human Rights: An Issue Whose Time Has Come

page 3 • PB 129 • June 29, 2012

Further, NGOs are pushing for the working group to consider more robust international enforcement mechanisms with an eye to the development of an international treaty based on the framework.8

If a treaty were negotiated (and this could face very significant resistance from business

and many governments), then it would likely include provision for overseeing implementations,

through a mix of government reporting requirements, and potentially, provisionsto investigate

specific sectors or cases,similar to the other international human rightsinstruments.

Businesses should expect questions from governments, institutional investors and NGOs to

demonstrate what they are doing to implement the framework and to face public criticism and

possible reputational risk for failing to remedy non-compliance. Leading companies have already

publically endorsed the framework and committed to taking significant steps to make it work in

practice.9

The OECD Guidelines on Multinational Enterprises, asrevised in May 2011, include a new chapter on human rights, explicitly drafted to implement the framework. Businesses domiciled in any

of the OECD’s 34 countries are open to investigation by the agencies(known as National Contact

Points, or NCPs). The OECD guidelines are specific about what is expected of corporationsin terms

of protection of human rights. NCPs are starting to reference the guiding principlesin their reports

and recommending that companiestake specific stepsto implement them.10

The Global Compact11, a U.N.-backed corporate responsibility charter that nearly 9,000 businesses worldwide have signed, from the start hasincluded human rights principles. As with the

OECD Guidelines, the framework sets out what this meansin practice, providing“operational

clarity for the two human rights principles championed by the Global Compact. Principle 1 calls

upon companiesto respect and support the protection of internationally proclaimed human

rights; Principle 2 calls upon them to ensure that they are not complicit in human rights abuses.”12

Key Steps for Incorporating Human Rights into Corporate 

Management 

For businessesthat have sustainability managementsystems, or have already adopted corporate

social responsibility standardssuch asthe Global Compact, IFC Performance Standards, etc.

discussed above, implementing the framework necessitatessome adaptation of the existing

managementsystems.

At the same time, using a human rightslens provides a different focus. In particular, in relation

to communities, it leadsto a shift from treating communities as‘vulnerable’or‘needy’to treating

them as people with rights and potentialsthat a company can help realize, providing an improved

operating environment for the company.

The key stepsfor corporationsto implement the framework are:

•	 developing internal capacity to understand human rights issues and the content of the

framework;

•	 developing and securing high-level commitment to a human rights policy—stand alone or

within existing policies;

•	 identifying the business activities and actions (including those of suppliers and customers)

that could potentially impact on human rights or the company’s human rights reputation;

•	 conducting a gap assessment—reviewing if these risks are fully addressed by existing

policies and procedures or if new tools are required;
© USIP 2012 • All rights reserved.

Business and Human Rights: An Issue Whose Time Has Come

page 4 • PB 129 • June 29, 2012

•	 reviewing underlying assumptions and language—a human rights approach is about

peoples’rights and capabilities, subtly different to a traditional impact assessment

approach that focuses on people as impacted, vulnerable, and needy; 

•	 developing the necessary internal standards, procedures, awareness, training and performance review processes to fill the gaps;

•	 tracking and monitoring performance; regular review of risks and systems;

•	 ensuring there are grievance mechanisms through which complaints related to human

rights impacts can be raised;

•	 developing communications strategy—internally and externally—‘know and show’

company commitment to respecting human rights.

Implementing the Framework: the Business Case 

As businesses become familiar with human rights concepts by implementing the framework, they

will become able to identify any activities, operations and locationsthat presentsignificant risks of

becoming associated with human rights problems and find waysto mitigate these risks.

The initial benefit that the framework offers businessesis protection from allegations of human

rights abuses. Implementing the framework proactively will enable businessesto understand

and manage risks and communicate to stakeholdersthat they are doing so. Failure to do so could

result in the disruption of management time, reputational damage, constrained accessto project

finance, or exposure to negative campaigning. Putting in place effective systems and processesto

manage these low likelihood but high impact risks will help businesses meet this challenge.

While generally supportive of the framework, business organizations continue to raise a

number of important concerns. In particular, they hold a strong view that the initiative should be

understood as providing guidance to businessrather than establishing new legal obligations; are

concerned about what, in practice, isrequired ofsmall businesses; argue thatstatestoo should be

pressed to implement their human rightsresponsibilities, and; hold that businessshould not be

held responsible for what are essentially state failures.

Conclusion

The“Protect, Respect and Remedy Framework for Business and Human Rights”changesthe debate

on business and human rightsfrom an adversarial issue to a practical matter of corporate and

project management. The framework and associated guidelines have been welcomed by corporations, and are expected to be reflected in national businesslaws and regulations over time.

Businessesinvesting in major projectsin developing, post-conflict or transitional countries, or

with large workforces,supply chains or customersin such countries,should include human rights

acrosstheir due diligence, risk and impact managementsystems.

Expert and systematic action by corporationsto mitigate risksto human rightsfrom business activities has potentialto reduce tensions and contribute to the avoidance of conflict as well as enhanced

reputations and improved bottom lines.Howeverthese global benefits will only be realized ifthe

momentum behind development ofthe“Protect, Respect and Remedy Framework”is maintained.

Notes

1.	 The Alien Tort Claims Act of 1789 (ATCA) is a U.S. law under which non-U.S. citizens who have

been victimised by foreign states, government officials, private persons and corporations outside
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USIP provides the analysis, training and 

tools that prevent and end conflicts, 

promotes stability and professionalizes 

the field of peacebuilding.

For media inquiries, contact the office 

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Business and Human Rights: An Issue Whose Time Has Come

page 5 • PB 129 • June 29, 2012

About This Brief

USIP’s Center for Sustainable 

Economies hosts a taskforce 

on business and peace, which 

explores creative and effective 

ways in which the corporate sector 

could avoid fomenting conflict 

while being aware of actions that 

could promote peace. There is 

growing interest in the connection 

between business and human 

rights, particularly in resource-rich 

countries where contracting and 

oversight failures often put local 

communities at a disadvantage 

and could contribute to the onset 

of violent conflict. Violent conflict 

in turn generally negatively affects 

the bottom line of most businesses. This report contributes to 

the work of the task force by using 

a conflict-sensitive framework to 

address this issue. Co-authors Dr. 

Jill Shankleman, a former Jennings 

Randolph Senior Fellow at USIP, 

advises corporations and banks on 

political and social risks of large 

scale foreign direct investments; 

Hannah Clayton supports private 

and public sector bodies to 

integrate human rights principles 

and standards into organizational 

practice and culture. 

of the U.S. may seek to obtain monetary damagesin U.S. federal courts. See http://www.uscib.org/

index.asp?DocumentID=4264

2.	 The full text of the Framework, Guiding Principles and related information can be found here:

http://www.business-humanrights.org/SpecialRepPortal/Home

3.	 http://www.oecd.org/document/28/0,3746,en_2649_34889_2397532_1_1_1_1,00.html

4.	 http://www.ifc.org/ifcext/sustainability.nsf/Content/PerformanceStandards

5.	 http://www.unglobalcompact.org

6.	 http://www.state.gov/secretary/rm/2012/05/190260.htm

7.	 See http://www.state.gov/r/pa/prs/ps/2011/06/166475.htm

8.	 See for example Human Rights Watch’sstatement http://www.hrw.org/news/2011/12/08/

moving-guidance-compliance and Amnesty International http://www.amnesty.org/en/library/

asset/IOR40/009/2011/en/55fab4a5-fb8a-4572-93f3-67581b2dca45/ior400092011en.html

9.	 See for example Adidas Group statement http://www.adidas-group.com/en/sustainability/

assets/governance/Human_Rights_Responsible_Business_Practices_QA_July_2011.pdf. See also

the May 2011 statement from major investorsrepresenting over $2.7 trillion under management,

http://www.unpri.org/collaborations/2011-05-20_Investor_statement_Guiding_Principles.pdf

10.	 “Mining Company does not act in accordance with the OECD Guidelines,” http://www.

regjeringen.no/en/sub/styrer-rad-utvalg/ncp_norway/report_intex.html?id=664912

11.	 http://www.unglobalcompact.org

12.	 http://www.unglobalcompact.org/Issues/human_rights/The_UN_SRSG_and_the_UN_Global_

Compact.html