Companies now have a powerful international framework that will help them to address their social impacts, argues Sir Geoffrey Chandler
The recent unanimous adoption of the United Nations Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights by the 26-member Sub-Commission offers the corporate world a foundation for successful survival, if it has the wit and wisdom to build on it. That such a survival is under threat is obvious from the intense public mistrust of business, the prevalent belief that profit is put before principle, and the evidence of collateral damage to the social and physical environment inflicted by company operations, particularly in the developing world.
This distrust has not been diminished by the plethora of voluntary codes and guidelines that now exist. These have neither led to consistent action by companies, nor reassured the public. Only a minority of transnational companies has adhered to the UN Global Compact, valuable though this has been in creating awareness, and the OECD Guidelines for Multinational Enterprises have proved an inadequate mechanism for improving corporate behaviour.
The value of the Norms to companies is that they distil, in a single comprehensive and authoritative document, the international human rights principles applicable to the whole range of business responsibilities. They are not legally binding, but representing as they do the behaviour expected of companies by the international community, they are more than voluntary. They provide a template against which companies can measure their own codes and act as a mirror for their practice. Their acceptance by companies would cut through the confused and, for companies, often self-serving debate on corporate social responsibility and go far to diminish public distrust.
Opposition to the Norms seems misconceived. From the International Chamber of Commerce it is in keeping with a conservative stance which has traditionally resisted change. From those companies which already endeavour to act on principles in conformity with the Norms it would be more surprising. What is asked for lies fully within the legitimate role of business. The clause on monitoring – admittedly too ambitiously worded – in principle calls for no more than the independent audit to which all companies should be subject for the totality of their impact.
Companies have a choice: either of working constructively with the aspirations of society towards a level playing field, a regaining of public trust and an eventual regulatory framework which will retain the dynamism of the market economy within acceptable social boundaries – something that even the World Business Council for Sustainable Development now advocates; or, as in the past, fighting a rearguard action with growing damage to their reputation. The Norms represent an opportunity, not a threat – an opportunity for companies through their operations to be part of the solution to the world’s injustice and inequities, rather than, as now, part of the problem.
Sir Geoffrey Chandler was founder-chair of Amnesty International UK Business Group from 1991-2001 and is a former director of Shell International email [email protected]