Another Step on the Road? What does the “Zero Draft” Treaty mean for the Business and Human Rights movement?

Phil Bloomer and Maysa Zorob, Business & Human Rights Resource Centre

 

This blog is part of the Reflections on the Zero Draft blog series on the proposed binding treaty on business and human rights. We present this series as part of our work to highlight key developments and opportunities for change, with the aim of empowering advocates in civil society, governments and businesses with the evidence and guidance to help define their position and engagement in the treaty process. We believe this initiative is complementary to the implementation of the UN Guiding Principles, and that an inclusive and open debate is crucial to ensure these initiatives deliver for everyone, and that the business & human rights movement continues its 'unity in diversity'.

While the UN Guiding Principles on Business and Human Rights (UNGP) continue to be the primary international reference point on business and human rights, over the past four years the Treaty process has consolidated action, spurred cooperation, and stimulated healthy debate among international and local human rights and corporate accountability groups. In the few weeks since its release on 16 July 2018, the first official draft of the legally binding Treaty on Business and Human Rights has rekindled this debate. The so-called “Zero Draft” marks a key milestone in a complex and lengthy process, against the backdrop of a political context which has become increasingly challenging since the UN Human Rights Council voted by majority to begin negotiations in June 2014.

Where We Stand

In the last year, the Business & Human Rights Resource Centre has sought responses from companies in relation to over 400 allegations of corporate abuse. What have we learned? Affected communities rarely receive adequate remedies, and only a small cluster of responsible companies makes efforts to learn from their failure to comply with human rights standards and incorporate this into their due diligence processes. It is this reality that is driving the efforts to develop a Treaty on business and human rights.

As an organization, we believe in the complementarity of the proposed Treaty and the continued implementation of the UNGP. Notwithstanding this position, this blog offers reflections on the first draft instrument, which we hope will be read in the spirit in which they are intended – one that encourages further debate on diverse strategies for driving human rights at the heart of business.

A Global Treaty in the Current Political Context?

By definition, successful international treaty making demands collective and effective action by states. After the heady days of the post-Cold War era, the global economic crisis has ushered in a wave of chauvinist nationalisms which governments are either responding to, or catalysing (Make America Great Again in the U.S., Au nom du peuple in France, to name two). In this sense, 2018 is not a propitious year to issue a draft text for an international Treaty on business and human rights. However, to get past narrow nationalisms, we need stronger visions of shared international prosperity and security, and the means to get there – of which a Treaty could certainly be a part.

A positive shift in our context is the slow but inexorable rise of socially responsible investors, some of whom have come out in support of national legislations on modern slavery or on duty of vigilance. For example, investors with over US$ 2 trillion assets under management have called for the establishment of a Modern Slavery Act in Australia, following a similar act in the UK. In a similar vein, the French Sustainable Investment Forum (Forum pour l'Investissement Durable) expressed their support for the French Devoir de Vigilance (due diligence) law. Their support for a Treaty could provide a boost for the negotiations. Will their increasing concern about non-financial risks provoke any leaders to speak out?

Scope and Scale of Proposition

The draft Treaty is rightly ambitious in scope and scale. Given the magnitude of corporate abuse and impunity that we record each day, it is clear that human rights protections currently available under many regional and national instruments are not sufficient. Equally, the text needs ambition in its inception, as it will face ruthless intransigence from vested interests that gain financially and politically from the status quo. That wall of ‘realpolitik’ has to be countered if the Treaty is genuinely to consolidate and advance steps taken under the UNGP.

The draft Treaty’s focus on corporate human rights due diligence is a key point of complementarity with the Guiding Principles and builds on international trends to consolidate mandatory transparency and due diligence in a binding instrument. Modern slavery legislation in the US, UK, and Australia (in preparation) has focused on mandatory transparency, but also exposed the need for mandatory due diligence. And the French due diligence law is recognised by French businesses and internationally as a useful step towards building back the lost public trust in global markets.

For those who will see this draft text as a glass half empty, we can reflect that the provisions in this draft would be a substantial advance for affected individuals and groups in all jurisdictions. This breach between the Treaty’s ambition and the reality of current business regulation highlights the scale of inequality and impunity that victims face in global markets.

Nevertheless, the proposed scope of the Zero Draft falls short in several key areas. A contentious area of the Treaty’s scope is its exclusive focus on “business activities of a transnational character.” While this conception is a welcome widening of scope from the previous exclusive focus on transnational corporations, it falls short of the coverage suggested by the UNGP, which apply to “all businesses.” As noted by Carlos Lopez from the International Commission of Jurists in his recent blog, such a restrictive definition risks denying access to remedy for victims of human rights abuses committed by national companies. From the experience of Business & Human Rights Resource Centre, allegations of corporate abuse are made against both national and international companies and national laws currently too often provide no adequate protection or remedy from either source of abuse. Including national companies in the Treaty’s scope is key in driving concrete improvements for the vulnerable and victims of abuse.  

Another area of contention is the lack of primacy of the proposed Treaty over existing and future trade and investment treaties, as noted by Doug Cassel, Emeritus Professor of Law at Notre Dame Law School, in his recent blog. Similarly, the weak language on gender has attracted criticism. While the draft acknowledges that women face “heightened risks of violations of human rights within the context of business activities”, women’s groups are demanding stronger language to prevent gender-based discrimination and special measures to address gender-specific risks. As rightly noted by Felogene Anumo and Inna Michaeli at AWID, a transformative framework to end corporate abuse requires a transformative shift in “in the way that gender equality, women’s human rights and gender justice concerns are articulated.”

Finally, and much to our regret, the draft instrument fails to acknowledge the particular risk of human rights abuses faced by human rights defenders and other activists including land rights and environmental defenders. Advocates who inform on and speak out against corporate abuse are not only vulnerable to, but often the very target of corporate human rights abuses. Any treaty that purports to “strengthen the respect, promotion, protection and fulfilment of human rights” within the context of business activities, must at the very least acknowledge the positive contribution of human rights defenders who monitor and help companies respect human rights and the critical need to protect and support these defenders.

Strategies for Progress

No Treaty will emerge quickly, if it ever does, and we are still a very long way from a final instrument, ratified by nations, that affected communities and victims could use to protect themselves and find remedy for corporate abuse. In the meantime, advocates for business and human rights need to be strategic to identify where advances can be made. Inevitably, some will choose not to engage in the debate and to invest their efforts elsewhere; those active in ensuring the implementation of the UNGP have used the ‘threat’ of a Treaty to spur action, whilst Treaty-supporters have worked on national legislative advances and continue to learn from discussions generated around the implementation of the UNGP. This ‘unity in diversity’ has highlighted the complementarity of the two approaches to optimise our movement’s impact. The continued implementation of the UNGP and the development of a binding Treaty can and should advance simultaneously, and both stand to benefit from doing so.

This draft text, warts and all, represents an important step forward. No party will find their dream Treaty here, but many will find elements of both substance and scope that could potentially be powerful in addressing irresponsible corporate practice and legal impunity, representing a substantial step forward for victims of abuse. The draft instrument builds on the emergent positive trends in business and human rights and deserves to gain substantial, if qualified, attention from states, responsible companies and their associations, investors, and civil society. All these actors will also use this draft to press now for advances in national regulation and company policy that further embed due diligence and remedy. In this sense, the draft text is useful to all our movement’s actors, no matter their leaning in the debate.

This is the first in a series of Reflections on the Zero Draft, our new blog series, which will feature commentaries by various stakeholders every week. Blog pieces on the Treaty process and elements are available on ourDebate the Treaty” blog. Please feel free to contact us if you wish to contribute to these reflections, and visit our Binding Treaty portal for more information.