Looking Ahead: Five Developments We’ll be Watching in 2013

by Foley Hoag LLP - Corporate Social Responsibility
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As memories of New Year’s Eve fade, and another Inauguration Day winds down in Washington, D.C., it’s time to look ahead and identify key events and emerging trends that we think will help shape the business and human rights agenda in 2013.

Here are five developments that we’ll be watching closely:

Further integration of human rights considerations into business management systems. Eighteen months after the release of the U.N. Guiding Principles, companies are working to determine how best to incorporate human rights considerations into the management of their operations. In a recent report, State of Play: The Corporate Responsibility to Respect Human Rights in Business Relationshipsthe Institute for Business and Human Rights observed that “[c]ompanies are actively learning from their efforts to integrate environment, health and safety, and anti-bribery and corruption concerns in their management systems and business relationships,” and quoted one company as stating “human rights feels like where corruption was ten years ago.”  We’ll be watching closely as companies seek to leverage existing personnel capacity and compliance systems to meet these new challenges.

Human Rights Due Diligence as an underlying framework for legislative and regulatory expectations. Consistent with the state responsibility to protect human rights, legislators and regulators are adopting measures to encourage, or mandate, human rights due diligence efforts by companies. In the United States, we have already see both state and federal legislation incorporate human rights due diligence as an operative framework. At the end of 2012, the International Corporate Accountability Roundtable released a comprehensive report, Human Rights Due Diligence: The Role of States, urging governments around the globe to do more to incorporate human rights into due diligence expectations for business. We expect more governments to answer this call in the coming year.

The Supreme Court’s ruling in Kiobel v. Royal Dutch Shell. Sometime in coming months, the U.S. Supreme Court will issue its long-awaited decision in Kiobel. After two rounds of oral arguments, many expect the Supreme Court to place significant limitations on the ability of plaintiffs to file suits under the Alien Tort Statute against corporate defendants on the basis of allegations of extraterritorial conduct.  That said, we do not expect the Court to declare that that corporations are fully immune from liability.

Increased engagement by the business community in efforts to combat human trafficking. For years, many companies were quick to deny any link to human trafficking but, more recently, trafficking has emerged as a major focus area for the greater business community. Going forward, we expect more companies to more fully engage in efforts to combat the problem, spurred in part by new private sector initiatives like the Global Business Coalition Against Trafficking and the American Bar Association’s work to develop business conduct standards applicable to human trafficking.

New multi-stakeholder initiatives to address human rights concerns in corporate supply chains. The tragic fires in Bangladesh and Pakistan in late 2012 highlighted the limitations of voluntary monitoring systems and raised difficult questions about brand and supplier responsibility for basic worker safety in global apparel factories. Corporate due diligence efforts on conflict minerals has highlighted significant capacity gaps in terms of the capacity of companies to assess tens of thousands of suppliers and the sources of specific minerals. With these and other challenges in mind, we expect to see more multi-stakeholder efforts to address these challenges in the coming year, recognizing that no single group of stakeholders can address these concerns alone.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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