On March 24, 2011 the United Nations released the "Guiding Principles for the Implementation of the UN Protect, Respect and Remedy Framework", by UN Special Representative on business & human rights John Ruggie. The UN Human Rights Council will consider formal endorsement of the text at its June 2011 session.
(From Stefan Marculewicz, U.N. Special Representative's Final Guiding Principles on Business and Human Rights: Policy Implications for Employers
Global Employment Law, March 29, 2011)
The consideration of the Guiding Principles marks a great milestone in the development of frameworks of governance of economic actors outside of the framework of national law. This milestone can be understood as consisting of four great aspects. The Guiding Principles represents the first successful efforts to provide a governance framework that can be adopted into the national legal orders of adhering states. In this aspect it represents a critical effort in the harmonization of national law on the basis of global consensus. At the same time, the Guiding Principles also represents the first successful effort to provide a framework for the development of customary and conventional international law. In this aspect, the Guiding principles represent a critical effort in the harmonization of governance for an important transnational actor at the international level. Additionally, the Guiding Principles for the first time acknowledges the existence and importance of non-governmental sources of governance rules. The embrace of the importance of social norm systems of autonomous behavior rules for economic enterprises represents a critical acknowledgment of non-state actors as a source of norm making the authority of which is not dependent on states. Lastly, the Guidelines for the first time link remedial obligations to the state duty to remedy and the corporate responsibility to respect human rights in a way that both preserves the autonomy of human rights and their connection to both law and social norms systems.
Institute for Human Rights and Business, March 31, 2011).
It will be inevitable that as the Guidelines move toward approval, all major stakeholders in the process will seek to mold the Guidelines to suit their interests. See, e.g., Stefan Marculewicz, U.N. Special Representative's Final Guiding Principles on Business and Human Rights: Policy Implications for Employers, Global Employment Law, March 29, 2011 ("We also believe these Guiding Principles, if not addressed proactively by companies, may create an opportunity for advocacy organizations (such as issue-specific non-governmental organizations and labor unions) to seek to define the parameters of the Guiding Principles on their own terms. "). In order to better understand the Guidelines, it may be useful to examine the context in which the Guiding Principles were developed and the development of the Guiding Principles from draft (in November 2010) to final form (March 2011) from a mpore neutral perspective. For this purpose I have provided my own thoughts about that context and development. That analysis is divided into four parts:
Part I: From Conception to Principle—The development of the Protect-Respect-Remedy Framework and the Drafting of the Guiding Principles
III. Between Draft and Final Guiding Principles: Stakeholder Comments and Conceptual Issues.
IV. The Final Guiding Principles: Section By Section Analysis
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Part I: From Conception to Principle—The development of the Protect-Respect-Remedy Framework and the Drafting of the Guiding Principles
A. The Foundational Reports: 2006-2010: The Development of Principled Pragmatism and Its Application to the Construction of the Protect-Respect-Remedy Framework for Business and Human Rights.
What was to become the General Principles was developed in the course of the work of the SRSG,1 as he sought to apply a principle of “principled pragmatism” as a basis for thinking through the issue of governance across multiple state systems, an emerging international governance framework,2 and systems of behavior developed by business in its activities across the world.3 The SRSG’s mandate began with a series of studies that were designed to elicit information from stakeholders including the corporate sector,4 along with a set of fact-finding missions.5 This section provides a brief review of the development of the Guiding Principles from initial conceptualization to its realization in late 2010 by considering the evolution and refinement of the SRSG’s mandate through the reports produced between 2006 and 2010.
The initial report produced by the SRSG in 2006 was based on his preliminary research and conceptualization of the mandate.6 The initial object was to reaffirm the classical organization of public power within which the law-state system held a primary position and with respect to which law, including international law, served as the most authoritative source of obligation.7 But the Report also recognized the possibility of spaces for regulation under regimes other than law, where the state, and its domestic-international law system was not directly involved. The possibility of bifurcating governance, would permit the development of a further possibility, that of creating a governance regime in which the several components of governance could be harnessed for the same purpose in a coordinated way. The Report also set out the information gathering tasks that were to serve as the foundation for the SRSG’s proposals.8
The 2007 Report addressed the principal elements of the initial mandate.9 It elaborated a series of five clusters of standards, which were to serve as the basis of the Protect, Respect and Remedy framework.10 The SRSG also began to consider issues of implementation, focusing initially on accountability and interpretive mechanisms.11
The 2008 Report presented the fruits of the information gathering of the prior years. Its theme was the construction of “a common framework of understanding, a foundation on which thinking and action can build in a cumulative fashion.”12 It was the first real attempt to conceive of a multi-governance framework in which the4 major stakeholders, states, businesses and non- governmental stakeholders, could each contribute to the objective of the mandate, the protection of human rights in economic intercourse, through their respective governance systems.13 The object of this approach was practical, derived from the recognition, emphasized in the fact finding of the prior reports. As a result, multiple governance organs contributed to the maintenance of human rights. The failure to coordinate between them, and to systematize their approach to human rights within each system, contributed significantly to the governance gaps that were at the heart of human rights governance failures.14 The three-pillar Protect-Respect-Remedy framework was first introduced as a response to this need.15
With the renewal of the SRSG’s mandate by the Human Rights Council (HRC) in 2008,16 the focus changed from conception to operationalization.17 It stressed that “the obligation and the primary responsibility to promote and protect human rights and fundamental freedoms lie with the State.”18 The 2009 Report provided a first attempt at conceptualizing operationalization.19 The emphasis was on the principle measures through which states and businesses operated as the starting point for framing issues of implementation. States operated through law and policy, and so operationalization required an emphasis on policy coordination and the aggressive implementation of law and legal obligation that bound states. Businesses operated through contract and the expectations of its principal stakeholders, regularized through markets. Operationalization required an emphasis on the mechanics through which these stakeholders could hold companies accountable. The form chosen was the disclosure regimes already proven relatively effective in the regulation of securities markets ion many states.
The 2010 Report20 refined and developed the ideas of the 2009 Report. It considered the results of extensive consultations with governments, business and civil society actors and refined the framework in response. The legal basis of the state’s duty was made a more central element of the Framework. The emphasis on the corporate responsibility was pushed to its disclosure obligations. The remedial framework The 2011 Report served as an introduction to the Guiding Principles themselves, along with an Official Commentary.
The three-pillar framework, then, is not just a reaction to the failed Norms project. Careful review of the SRSG’s foundational reports suggests its character and nature is that of an institutionalized multi-level governance framework that the Protect-Respect-Remedy framework represents.
The Draft Guidelines (“DG”) represents a new approach to the framing of governance for multinational corporations. True to the SRSG’s intention to construct a framework grounded in principled pragmatism,21 the DG have been developed to seek to strike balances among the multiple competing ideologies, governance approaches and stakeholders that have made this process so complex. That balance, symbolized by the Three Pillar approach, posits a framework of inter-systemic harmonization22 of a governance regime to which three autonomous but deeply related systems contribute—the law-state system, the international system and the social-norm system. That framework of inter-systemic harmonization is then itself implemented through an integrated but functionally divided system of dispute resolution that both reflects the autonomy of the governance systems that make up the regime, and the need for harmonization and connection of method. As such, it ground breaking for reasons much greater than its utility in clarifying the private sector’s responsibility for human rights.23 A close analysis of the DG, as both theory and praxis, reveals both the nature and complexity of that breakthrough.
B. The 2011 Report: The Maturation of Principled Pragmatism.
The Guiding Principles are introduced by a short Report (the “2011 Report”)24 that is meant to set the stage for the principles and commentary that follow. It represents the distillation of the SRSG’s project, the evolution of which was chronicled in detail in the Reports from 2006 through 2010.25 It also suggests the theoretical-policy foundations of the principles that follow, and its implementation. This section examines that Report and suggests the way in which it provides an important window on the DG, their character and limitations.
The focus of the Report is business—not a particular form that business can take, corporation, partnership, conglomerate, joint venture, value or supply chain, or the like—but business understood as a complex nexus of economics, law and politics.26 That nexus is posited as having been at some sort of reasonable equilibrium state in which the roles of the state and of non-state actors were aligned. But the last several decades have “witnessed growing institutional misalignments, from local levels to the global, between the scope and impact of economic forces and actors, and the capacity of societies to manage their adverse consequences.”27 At the heart of this misalignment is the corporation, which has itself evolved to embody “complex forms that challenge conventional understanding and policy designs.”28 These changes have affected all regions and states; they have effectively shattered the old status quo.29 Change is not merely expedient; change is necessary to restore the alignment between the economic, policy, political and social forces represented by business and those represented by the state.
This opening paragraph nicely sets the stage for the elaboration of both the theory and praxis that is to follow. Its purpose is specific—to focus on the problem of the governance of private aggregations of economic power. The logic of this construct is straightforward. Economic, political and communal spheres operate best when they exist in a stable system in which each contributes to the social fabric and each is bound by a set of obligations that ensure the stability of the system and the likelihood that it will work towards maximizing the ability of this construct to contribute to the welfare of people and the stability of the state. But the logic of globalization30 has changed the traditional alignment of these three communities. Though the SRSG focuses on the misalignment caused by the evolution of corporate power, misalignment also has roots in the evolution of state and communal power. For example, regimes of free movements of capital, goods and services has substantially altered the relationship between states and corporations, but has also changed the relationship of states with their populations and with other states as well. The burgeoning network of agreements among states has substantially altered the relationship between states and greatly augmented the institutional character and regulatory power of the community of states through increasingly effective international organizations both public and private in character. The decentralization of power has substantially increased the number and character of stakeholders in global society.31
But the SRSG does not mean to set the world right. His object is more modest in scope, though not in aim. The sort of “epochal changes”32 suggested by the description of changes in the global order is well represented in microcosm in the transformation of the framework governance regimes for business sand human rights.33 The microcosm of business and human rights, as exemplary of the misalignments in governance regimes, proved irresistible—a contained space within which new approaches could be developed and implemented, “to map the challenges and recommend effective means to address them.”34
But something as simple in theory as human rights,35 proved more difficult in practice where the aim was to “shift from institutional misalignments onto a socially sustainable path.”36 The SRSG thus moves from the description of the problem—misalignment—to the consequences of its resolution, requiring “operational and cultural changes in and among governments as well as business enterprises—to create more effective combinations of existing competencies as well as devising new ones.”37 And thus the SRSG moves from the singular focus on business, where he started the report, to the implication of that focus—the need for governments as well as business to change their behavior.
In recognizing the need to implement socially sustainable governance, the SRSG also acknowledges that the international community must play a key role.38 But business and human rights is acknowledged as new a policy domain as the international community is at the early stages of the journey to sustainable governance.39 Business and human involves all rights that enterprises can affect,40 includes all rights holders,41 and can invoke a broader range of regulatory tools than traditional state or international institutional actors.42
International institutional involvement is necessary because the traditional balance between business and state actors cannot be broad back into balance without its intervention. Moreover, because multiple regulatory systems are involved, the scope of the problem of business and human rights is considerable broader than the problems usually subject to the regulatory frameworks of the law-state. Globalization has produced something of a parity of power between companies and some states.43 The result is that the issue of business and human rights is bound up with the issue of states and human rights—companies may be complicit in the law system based human rights violations of states, and states may be involved in the human rights violations of companies.44 Two distinct governance areas are thus intimately connected, yet each is also subject to governance regimes that, though they may overlap, are not the same.45 And both law- state and corporate social-norm systems are intertwined with networks of regulation at the international level. Moreover, the human rights obligations of states, corporations and international organizations are bound up in larger webs of legal and social norm constraints.46
For the SRSG, then, the problem of misalignment is the expression of a macro issue that is supported, in some measure by the underling structural incapacities of states. “State practices exhibit substantial legal and policy incoherence and gaps.”47 Policy incoherence is the outward expression of institutional incapacity in the face of changing circumstances.48 At the international level, incoherence is evidenced by the disordered state of territorial limits of state action.49 Extraterritoriality is at once valued both for its ordering effect on behavior across borders, and encouraged as a means of controlling the activity of business.50 But it is also reviled as a means of projecting power from dominating to subordinated states.51 The SRSG suggests a very narrow form of extraterritoriality—the power of the home state to assert regulatory authority over its citizens or the entities it has chartered.52 The SRSG avoids the more aggressive versions of extraterritoriality and suggests as an alternative, and better model, the substitution of inter-state consensus standards for projections of state power abroad. And indeed, one can understand both the need for extraterritoriality as a tool and its solution, as powerful evidence of the consequences of misalignment and the way it produces incentives to extend the subordination of smaller states by larger ones in the form of extraterritoriality. Misalignment is also the expression of a macro issue that is supported, in some measure by the underling structural incapacities of companies.53 Misalignment and incoherence thus involves not merely adjustments between public and private governance, but also among states and within the legal ordering of the community of states.
Having identified the scope and character of the problem, the SRSG theorizes a solution and posits a suggested approach to implementation.
One major reason that past public and private approaches have fallen short of the mark has been the lack of an authoritative focal point around which the expectations and actions of relevant stakeholders could converge. Therefore, when the Special Representative was asked to submit recommendations to the Human Rights Council in 2008 he made only one: that the Council endorse the ‘Protect, Respect and Remedy’ Framework he had proposed, following three years of extensive research and inclusive consultations on every continent.54
The Protect-Respect and Remedy Framework is then described.55 The relationship of the Protect- Respect and Remedy Framework with the problem of misalignment and the context of multiple autonomous governance regimes is examined.56 Its utility is also suggested by the breadth of its influence,57 even before it has been operationalized.58
If the Protect, Respect and Remedy Framework provides the theoretical “authoritative focal point around which the expectations and actions of relevant stakeholders could converge”59 then the GP provides the operational focal point for the project. “The Guiding Principles that follow constitute the next step, providing the “concrete and practical recommendations” for the Framework’s implementation requested by the Council.”60 The nature of the CP’s contribution to the resolution of the problem that gave rise to the SRSG’s project is complex and subtle. The GP contributes to the “operational and cultural changes in and among governments as well as business enterprises—to create more effective combinations of existing competencies as well as devising new ones”61 not by changing contemporary legal and social norm structures but by providing a new organization for them. That organization is grounded in elaboration of existing practices and standards, their integration within a single framework, and the identification of areas that require further development.62 But at the same time, the operationalization proposed (in the form of the GP) is not meant to be what the SRSG describes as a mere “toolkit, simply to be taken off the shelf and plugged in.”63
And so the 2011 Report ends where it started—mindful of the difficulties of theorizing and implementing a single coherent and comprehensive framework that “will reflect the fact that we live in a world of 192 United Nations Member States, 80,000 transnational enterprises, ten times as many subsidiaries and countless millions of national firms, most of which are small and medium-sized enterprises.”64 The GP reflects these points of convergence, autonomy, polycentricity, and flexibility both within the governance frameworks of each of the components of the system articulated, and within the proposed framework itself. In the next section we turn to an examination of the extent to which the GP help “to secure the development of universally applicable and yet practical Guiding Principles in order to achieve the more effective prevention of and remedy for corporate-related human rights harm.”65
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Endnotes:
2. The object was to identify “the directions in which achievable objectives may lie,” the legal focus of which was to be on the identification and harmonization of legal standards; “achieving greater clarity of, and possibly greater convergence among, emerging standards is a pressing need.” John Ruggie, Remarks at the Business & Human Rights Seminar in Old Billingsgate, London (Dec. 8 2005), available at http://www.bhrseminar.org/John%20Ruggie%20Remarks.doc
3. The starting point is “corporate liability for abuses that amount to violations of international criminal or humanitarian law.” John Ruggie, Remarks at the Business & Human Rights Seminar in Old Billingsgate, London (Dec. 8 2005), available at http://www.bhrseminar.org/John%20Ruggie%20Remarks.doc. The reasons for starting at this point is that it is a critically important issue on its own, where greater clarity is needed, while it may also shed light on the general strategy of legalizing corporate human rights obligations. Id.
4. The SRSG planned to conduct surveys of business policies and practices with regard to human rights to learn how businesses conceive of human rights, what standards they reference, and their use of impact assessments. John Ruggie, Speech 4 (Oct. 2005). John G. Ruggie, Opening Remarks Wilton Park Conference on Business & Human Rights (Oct.10-12, 2005), p.4. Available at http://www.business- humanrights.org/SpecialRepPortal/Home/Speechesinterviews/2005, click link for Opening Remarks. Legal teams were also contacted to determine how European and American courts understand the concepts of complicity and sphere of influence in this context. Id.
5. Id. at 5.
6. SRSG 2006 Report, supra note 38, para. 3. Work on the mandate began by “conducting extensive consultations on the substance of the mandate as well as alternative ways to pursue it—with states, non-governmental organizations, international business associations and individual companies, international labor federations, U.N. and other international agencies, and legal experts.” Id.
7. The “premise that the objective of the mandate is to strengthen the promotion and protection of human rights in relation to transnational corporations and other business enterprises, but that governments bear principal responsibility for the vindication of those rights.” Id. para. 7.
8. Regional multi-stakeholder consultation took place in Johannesburg, Bangkok, and Bogotá. The workshops including legal experts took place in London, Oslo, Brussels, and New York. And the two Geneva-based consultations included work on the extractives and financial services industries. John Ruggie, London Speech (Feb. 2007). John G. Ruggie, Prepared Remarks at Clifford Chance, London (Feb.19 2007). Available at http://www.reports-and- materials.org/Ruggie-remarks-Clifford-Chance-19-Feb-2007.pdf
9. The Special Representative of the Secretary-General, Report of the Special Representative of the Secretary-General of the United Nations on Human Rights and Transnational Corporations and Other Business Enterprises: Business and Human Rights: Mapping International Standards of Responsibility and Accountability for Corporate Act, para. 1, delivered to the Human Rights Council, U.N. Doc. A/HRC/4/35 (Feb. 9, 2007) [hereinafter SRSG 2007 Report].
10. These clusters include: the state duty to protect against human rights abuses by third parties, potential corporate responsibility and accountability for international crimes, corporate responsibility for other human rights violations under international law, soft law mechanisms, and self-regulation. John G. Ruggie, Remarks at International Chamber of Commerce Commission on Business in Society, Paris (April 27 2007), p.2. Available at http://www.reports-and-materials.org/Ruggie-speech-to-ICC-27-Apr-2007.pdf. John Ruggie, Paris Speech, 2-4 (April 2007).
11. Mr. Ruggie emphasized there is commonly an underdeveloped accountability mechanism within voluntary initiatives that affects the performance of the initiative in that companies cannot correct what they don’t know is wrong. John Ruggie, Washington Speech, 5 (May 2007). John G. Ruggie, Remarks at Annual Plenary, Voluntary Principles on Security & Human Rights, Washington D.C. (May 7, 2007), p.5. Available at http://www.reports-and- materials.org/Ruggie-remarks-V oluntary-Principles-plenary-7-May-2007.pdf.
12. John G. Ruggie, Remarks, Next Steps in Business and Human Rights, Royal Institute of International Affairs, Chatham House, London (May 22, 2008), p.4. Available at http://www.reports-and-materials.org/Ruggie-speech- Chatham-House-22-May-2008.pdf John Ruggie, Speech, 4 (May 2008).
13. SRSG 2008 Report, supra.
14. This gap is vast between “the scope and impact of economic forces and actors” on one side and “the capacity of societies to manage their adverse consequences” on the other. SRSG 2008 Report, supra , para. 3.
15. SRSG 2008 Report, supra .
16. U.N. Human Rights Council, supra .
17. HRC directed the SRSG to operationalize the framework, by providing “‘practical recommendations’ and ‘concrete guidance’ to states, businesses and other social actors on its implementation.” John G. Ruggie, Remarks for ICJ Access to Justice Workshops, Johannesburg, South Africa (Oct. 29-30 2009), p.1. Available at http://www.reports-and- materials.org/Ruggie-remarks-ICJ-Access-to-Justice-workshop-Johannesburg-29-30-Oct-2009.pdfJohn Ruggie, S.A. Speech, 1 (Oct. 2009).
18. Report of the Human Rights Council on its Eighth Session, supra .
19. It is pointed out quite clearly from the fourteen consultations that “[e]very stakeholder group, despite their other differences, has expressed the urgent need for a common framework of understanding, a foundation on which thinking and action can build in a cumulative fashion.” Report of the Human Rights Council on its Eighth Session, supra note 24. The Protect-Respect-Remedy framework resulted. SRSG 2008 Report, supra. John Ruggie, Special Representative of the Secretary-General, Remarks at Chatham House (June 3, 2008).
20. Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, John Ruggie, Business and Human Rights: Further steps toward the operationalization of the “protect, respect and remedy” framework, A/HRC/14/27, Human Rights Council, 14th session, Agenda item 3, Promotion and protection of all human rights, civil, political, economic, social and cultural rights, including the right to development, available http://www.reports-and-materials.org/Ruggie-report-2010.pdf (hereafter the 2010 Report).
21. On the SRSG’s principled pragmatism, see 2006 Report, supra. “Like the Framework, the Guiding Principles draw on extensive research and pilot projects carried out in several industry sectors and countries, as well as several rounds of consultations with States, businesses, investors, affected groups and other civil society stakeholders. All told, the mandate will have conducted 47 international consultations from beginning to end.” Report of the Special Representative of the Secretary General on the Issue of Human Rights and Transnational Corporations and other Business Enterprises, John Ruggie, Guiding Principles for the Implementation of the United Naiton’s ‘Protect, Respect and Remedy’ Framework, DRAFT, Nov., 2010, ¶ 12.
22. On inter-systemic harmonization, see, Larry Catá Backer Inter-Systemic Harmonization and Its Challenges for the Legal-State, in FICHL Publication Series No. 11 (2011): The Law of the Future and the Future of the Law 427-437 (Editors: Sam Muller, Stavros Zouridis, Morly Frishman and Laura Kistemaker; Torkel Opsahl Academic EPublisher, Oslo, forthcoming 2011).
23. Norway, Ministry of Foreign Affairs, Report No. 10 (2008-2009) to the Storting: Corporate Social Responsibility in a Global Economy, Para. 7.1.1.
24. Report of the Special Representative of the Secretary General on the Issue of Human Rights and Transnational Corporations and other Business Enterprises, John Ruggie, Guiding Principles for the Implementation of the United Naiton’s ‘Protect, Respect and Remedy’ Framework, DRAFT, Nov., 2010.
25. For a more detailed examination, see, Larry Catá Backer, On the Evolution of the United Nations’ 'Protect-Respect- Remedy' Project: The State, the Corporation and Human Rights in a Global Governance Context (June 3, 2010). Santa Clara Journal of International Law, Vol. 9, No.1, 2010.
26. “Business is the major source of investment and job creation, and markets can be highly efficient means for allocating scarce resources, capable of generating economic growth, reducing poverty, and increasing demand for the rule of law, thereby contributing to the realization of a broad spectrum of human rights. ” 2011 Report at ¶ 1.
27. Id.
28. Id. The state, of course, also had evolved in as extraordinary a way, becoming less stridenly autonomous and more enmeshed in a growing web of supra national relationships and international consensus norms (both embodied in international hard and soft law) that have challenged the conventional notion fo the state, sovereugnty, democratic accountability and law.
29. 2011 Report at ¶ 1.
30. On globalization, see, e.g., J. Stiglitz, Globalization and Its Discontents (London: Penguin, 2002); J. Micklethait and A. Wooldridge, A Future Perfect: The Challenges and Hidden Promise of Globalisation (New York: Crowm:2000).
31. “We are beginning to abandon the hierarchies that worked well in the centralized, industrial era. In their place, we are sibstituting the network model of organization and communication, which has its roots in the natural, egalitarian, and spontaneous formation of groups among like minded people.” John Naisbitt, Megatrends, 281 (New York: Warner Books, 1984).
32. 2011 Report at ¶ 1.
33. 2011 Report at ¶ 2. The SRSG explains: "Institutional misalignments create the permissive environment within which blameworthy acts by business enterprises may occur, inadvertently or intentionally, without adequate sanctioning or reparation. The worst corporate-related human rights abuses, including acts that amount to international crimes, take place in areas affected by conflict, or where governments otherwise lack the capacity or will to govern in the public interest. But companies can impact adversely just about all internationally recognized human rights, and in virtually all types of operational contexts." Id.
34. 2011 Report at ¶ 2.
35. “The idea of human rights is as simple as it is powerful: treating people with dignity.” 2011 Report at ¶ 3.
36. Id.
37. Id.
38. 2011 Report at ¶ 4.
39. Id.
40. Id. It is thus distinguished from traditional human rights agendas at the international organization level, where organizes its regulatory agendas around a fixed set of particular rights.
41. Id. It is thus distinguished from states that can recognize the rights of particular groups.
42. Id. It is thus distinguished from regulatory regimes that focus solely on state-based human rights violations that are restricted to the methodologies of the law-state; it can invoke the regulatory methgods of private actors as well.
43. 2011 Report at ¶ 5.
44. The interrelationship has been made explicit in the ethics based determinations of the Ethics Council of the Norwegian Sovereign Wealth Fund. See, e.g., Larry Catá Backer, Developing a Coherent Transnational Jurisprudence of Ethical Investing: The Norwegian Sovereign Wealth Fund Ethics Council Model Part I Law at the End of the Day, Feb. 1-28, 2011.
45. The 2011 Report explains: States are under competing pressures when it comes to business, not only because of corporate influence but also because so many other legitimate policy demands come into play, including the need for investment, jobs, as well as access to markets, technology and skills. In addition, in the area of business and human rights States are simultaneously subject to several other bodies of international law, such as investment law and trade law. . . . At the same time, business conduct is shaped directly by laws, policies and sources of influence other than human rights law: for example, corporate law, securities regulation, forms of public support such as export credit and investment insurance, pressure from investors, and broader social action. Id., ¶ 5.
46. 2011 Report at ¶ 5.
47. 2011 Report at ¶ 6.
48. “The most prevalent cause of legal and policy incoherence is that the units of Governments that directly shape business practices—in such areas as corporate law and securities regulation, investment promotion and protection, and commercial policy—typically operate in isolation from, are uninformed by, and at times undermine the effectiveness of their Government’s own human rights obligations and agencies.” 2011 Report at ¶ 6.
49. 2011 Report, ¶ 7. “This is in contrast to the approaches adopted in other areas related to business, such as anti- corruption, money-laundering, some environmental regimes, and child sex tourism, many of which are today the subject of multilateral agreements.” Id.
50. “This enables a “home” State to avoid being associated with possible overseas corporate abuse. It can also provide much-needed support to “host” States that may lack the capacity to implement fully effective regulatory regimes on their own.” 2011 Report at ¶ 8.
51. For a discussion on extraterritoriality and neo-colonialism, see, e.g., Fidel Castro Ruz, Fidel Castro Speaks: Globalization 2000 (Speech at the opening session of the South Summit on April 12, 2000, in Havana, Cuba).
52. Thus, for example, John Knox suggests that “The first sentence in Paragraph 7 takes a stronger stand against the application of such obligations to corporate conduct than I think is clearly warranted. Moreover, it’s a position that is likely to draw fire from critics pointing to the absence of jurisdictional limits in the International Covenant on Economic, Social and Cultural Rights, for example, and the ESC Committee’s strong statements about extraterritoriality.” Special Representative of the United Nations Secretary-General for business & human rights, Draft Guiding Principles (GPs) for implementation of the U.N. "Protect, Respect and Remedy" Framework Online Consultation(Comments of John Know, Jan. 17, 2011), available http://www.srsgconsultation.org/index.php/main/discussion?discussion_id=19).
53. “Business consultancies and corporate law firms are establishing practices to advise clients on the requirements not only of their legal, but also their social, license to operate, which may be as significant to an enterprise’s success. However, these developments have not acquired sufficient scale to reach a tipping point of truly shifting markets.” 2011 Report at ¶ 9.
54. 2011 Report, ¶10.
55. Id., ¶11. See also discussion, supra.
56. The SRSG explained: Each pillar is an essential component in supporting what is intended to be a dynamic system of preventative and remedial measures: the State duty to protect because it lies at the very core of the international human rights regime; an independent corporate responsibility to respect because it is the basic expectation society has of business in relation to human rights; and access to remedy because even the most concerted efforts cannot prevent all abuse. Id.
57. The Framework has “become a common foundation on which thinking and action by stakeholders can build over time. Thus, the Framework has already influenced policy development by Governments and international institutions, business policies and practices, as well as the analytical and advocacy work of trade unions and civil society organizations.” 2011 Report, ¶ 12.
58. “In resolution 8/7 (June 2008), the Council was unanimous in welcoming this policy Framework, and in extending the Special Representative’s mandate to 2011 in order for him to “operationalize” and “promote” it.” Id.
59. 2011 Report, ¶ 10.
60. 2011 Report, ¶ 12.
61. Id.
62. In the words of the SRSG: The Guiding Principles’ normative contribution lies not in the creation of new international law obligations but in elaborating the implications of existing standards and practices for States and businesses; integrating them within a single, coherent and comprehensive template; and identifying where the current regime falls short and how it should be improved. Id., ¶ 13.
63. 2011 Report, ¶ 14.
64. Id.
65. 2011 Report, ¶ 15.
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