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Article Excerpt
In response to increasing public concern over the accountability of transnational corporations (TNCs) for violations of human rights in the states in which they operate, governments, corporations and NGOs have promoted the development and implementation of voluntary self-regulatory regimes. However, TNC practices under these regimes call into question their adequacy and effectiveness in preventing complicity in egregious violations of human rights by corporations operating in conflict zones and repressive regimes. This article reviews and assesses the language, human rights content and compliance mechanisms of the voluntary policies and/or codes developed by a number of corporations, industry groups, intergovernmental organizations and multistakeholder initiatives, as well as associated corporate practices. The analysis shows that these voluntary regimes are flawed and inadequate, and therefore unable to ensure that TNCs are not complicit in human rights violations in their extraterritorial activities.
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There is a growing international concern about the accountability transnational corporations and other business entities (TNCs) for egregious violations of human rights committed by security forces, or host state military forces, in the protection or facilitation of business activity. Allegations of complicity (1) in forced displacement, extrajudicial killings, disappearances, rape and abduction, the use of forced labour and violent repression of peaceful protests have been made against companies, particularly in the extractive sector, operating in a commercial relationship with host governments with a poor human rights record and/or in the context of a civil war.
In Burma (Myanmar), for example, oil companies, including the U.K.-based Premier Oil have been accused of complicity in human rights abuses including forced displacement and forced labour committed by members of the Burmese military. (2) In the case of Premier Oil, Burmese military forces were hired by the company and its joint venture partners to protect the Yetagun pipeline and company employees (Macalister 2000; Osborn 2001). (3) In Sudan, in the course of an ongoing and brutal civil war, government military forces and government-sponsored militia have been protecting the oil exploration and development areas from rebel attacks. They have done this by forcibly displacing local civilian populations using helicopter gunships, crude bombs dropped from Antonov bombers and by further terrorizing these populations through murder, rape, the abduction of women and children and the burning of villages (Harker 2000; Gagnon and Ryle 2001; Human Rights Watch 2003b). Talisman Energy Inc., a Canadian company, which was operating in the Upper Western Nile region of South Sudan from 1998 to 2003 as partner in the Greater Nile Petroleum Operating Company (GNPOC), has been accused of complicity in these human rights abuses. (4)
Similar allegations have been leveled against companies such as British Petroleum plc. (BP), Royal Dutch/Shell Group (Shell), and other TNCs. (5) In relation to its operations in Colombia, BP was implicated in the grave violations of human rights, including extrajudicial murder, torture and "disappearances" committed by its hired security forces, which included members of the Colombian military (Human Rights Watch 1998). Shell was accused of complicity in the brutal repression of local protesters by the Nigerian military that culminated in the trial and execution of writer/activist Ken Saro Wiwa and nine others by the Nigerian Government (Human Rights Watch 1999). (6)
There is a growing consensus among individuals and organizations concerned with the promotion and protection of human rights that TNCs should be accountable for violations of international human rights law related to their business activities (Muchlinski 2001: 31-32; Ratner 2001: 446-448). This consensus is reflected in a growing academic, nongovernmental and intergovernmental literature that assesses the human rights impacts of corporate activity (UN 1995), and the legal and non-legal mechanisms by which these entities may be held responsible for violations of human rights (see, for example, Frey 1997; Clapham 2000; Forcese 2002; International Council on Human Rights Policy 2002).
Under international human rights law states have an obligation to respect and ensure respect for human rights within their territorial jurisdiction. Problems arise however, where TNCs operate in conflict zones or repressive regimes and are implicated in violations of human rights that are committed by a host state government or that the latter is unable or unwilling to prevent. Neither general international law nor international human rights law clearly impose direct legal obligations on TNCs to respect human rights (Frey 1997: 163; Joseph 1999: 175; McCorquodale 2002: 92-97). Nor does there appear to be an international legal obligation on the 'home' states of these business entities to ensure that the latter observe international human rights standards in their extratemtorial activities (Brownlie 1983: 165; Joseph 1999: 180-181). (7)
The domestic legal mechanisms that are currently available to home state governments and private actors to challenge extraterritorial corporate conduct have not proven sufficient to ensure that TNCs respect human rights when operating outside of their home state jurisdictions. Some states, such as the U.K., are currently considering draft legislation that would address some aspects of extraterritorial corporate conduct (U.K. Parliament 2003). However, to date, no state has enacted specific legislation to regulate the extraterritorial activities of corporate nationals that may have a detrimental effect on the human rights of individuals in host states. In Canada, for example, there are no effective legal mechanisms in place to require the assessment of the human rights impact of proposed investment in host states, to prevent such activity where it is clear there will be a negative human rights impact of to monitor corporate conduct to ensure that Canadian investment abroad does not contribute to, of profit from, violations of human rights. Legal mechanisms including the foreign tax credit provisions of the Income Tax Act, Export Development policies and practices, the Area Control List under the Export and Import Permits Act, the Special Economic Measures Act and the Crimes Against Humanity and War Crimes Act which could be used by the government to compel of induce Canadian companies to improve their human rights conduct abroad are not sufficient on their own to require TNC compliance with international human rights and humanitarian law in their overseas business activities (CLAIHR 2000; Gagnon, Macklin and Simons 2003: 58-66). Nor does Canadian law provide sufficiently effective tools for private actors to exert market pressure on these entities, such as mandatory social and environmental corporate reporting, amended pension fund laws to allow for socially responsible investment criteria of whistleblower protection for individuals who report information of human rights violations related to overseas operations (Canadian Democracy and Corporate Accountability Commission 2002).
TNCs have been sued under tort laws in various jurisdictions for such violations. However, the effectiveness of these claims to deter corporations from complicity in human rights violations is questionable due to the cost, jurisdictional hurdles for the plaintiffs (Meeran 2003: 8) and evidentiary difficulties. Suits against Talisman, Shell, Unocal and other companies have been brought under the U.S. Alien Tort Claims Act for complicity in human rights abuses committed by security forces. Although some claims have moved beyond the jurisdictional phase, no contemporary case against a TNC brought under the ACTA has yet resulted in compensation to the victims of such abuses (Macklin 2003: 279). (8)
Public pressure to address this 'governance gap' has prompted action from governments, corporations and NGOs. In an era dominated by free market ideology, increasing liberalization, and thus hostility towards legally binding regulatory measures, the response has been to promote the development and implementation of voluntary self-regulatory regimes (Mayne 1999: 239). The number of voluntary codes has steadily increased along with the emergence of other voluntary self-regulatory practices such as social reporting and verification.
Critics of these voluntary measures argue that their effect in regulating extraterritorial corporate activity and in solving the related human rights issues has been inadequate (Toftoy 1998; International Council on Human Rights Policy 2002: 7). A recent study, that examined Talisman Energy's joint venture investment in Sudan, its complicity in human rights abuses committed by Sudanese government-supported security forces in the course of protecting the oil fields, and the company's voluntary self-regulation efforts, found that the self-regulatory measures taken by Talisman had failed to prevent the corporation's complicity in egregious violations of human rights, including forced displacement (Gagnon, Macklin and Simons 2003). Despite the growing evidence of the inadequacy of corporate voluntarism, governments and TNCs continue to promote voluntary self-regulation as the most suitable means to regulate the human rights conduct of these corporate entities.
This paper will review and assess the voluntary self-regulatory instruments and practices of Talisman Energy, Premier Oil, BP and Shell. It will also undertake an analysis of codes or policies developed by industry, inter-governmental organizations (IGOs) and multistakeholder initiatives that have been adopted or endorsed by one or more of these companies or which may be applicable to their conduct. Each of these companies has been active in a conflict zone and/or repressive regime. Each has been the target of vigourous criticism by human rights groups and other activists for the company's complicity in egregious violations of human rights, committed by security forces in the course of protecting oil installations. In response to these allegations, each has developed a voluntary code and/or policy and performance assessment and verification practices to address the human rights impact of their activities.
Voluntary self-regulation regimes should be distinguished from mandatory self-regulation regimes that are based on legally binding and enforceable obligations set within a legislative framework. The human rights provisions, as well as most provisions relating to social and environmental conduct of the codes and policies discussed in this paper, are not based on binding and enforceable legal obligations. The voluntary aspect of these regimes pertains both to the adoption of the code, policy of set of principles, as well as to compliance with the standards the instrument in question may contain. Thus, corporations are not legally required to adopt such instruments. Nor are these entities legally accountable for actions that may contravene the provisions of an adopted instrument.
Many of the instruments discussed deal with a variety of concerns related to extraterritorial business activity, including labour rights (which are often distinguished from human rights) environmental issues, bribery and corruption and consumer protection. While some of the analysis in this paper may be applicable to corporate voluntarism in relation to these wider concerns, the discussion will focus on the effectiveness of these instruments in addressing corporate complicity in some of the more egregious human rights violations that have been associated with business activity in conflict zones and repressive regimes. It will examine the content of the human rights provisions, the language in which they are drafted, the mechanisms for oversight, as well as current TNC practice under these voluntary regimes.
CONTENT OF HUMAN RIGHTS PROVISIONS
The human rights provisions of most voluntary codes of policies are often vaguely worded and may also be expressed in permissive language, thus watering down any sense of obligation. In addition, the content of human rights provisions varies substantially between instruments.
Corporation-Developed Codes and Policies
The majority of corporation-developed codes deal very minimally with the issue of human rights abuses (Avery 2000: 48). A recent study of North American corporation-developed codes of conduct found that while the largest Canadian corporations "like many of their U.S. counterparts, [were] beginning to consider human rights issues in their international practices", a majority of large Canadian companies active internationally did not "have codes containing reference to even the most basic human rights standards". The report came to similar conclusions regarding U.S. corporate codes relating to international activity and noted that the findings "replicate those identified with respect to domestic codes of conduct" of U.S. and Canadian companies (Forcese 1997: 43, 30).
A comparison of the voluntary codes and/or policies of BP, Shell, Talisman and Premier Oil is illustrative of the lack of consistency between, and the insufficient definition of, human rights commitments set out in corporate policy documents. Each corporate policy displays a slightly different level of commitment to respect human rights and none of the codes or policies makes a clear statement of obligation on the part of the company to be bound by international human rights standards.
>From a review of public documents, BP's human rights policy appears to be the most comprehensive of the four companies. BP's policy on ethical conduct asserts the company's belief that the "promotion and protection of all human fights is a legitimate concern of business". The company asserts its respect for domestic law and notes that BP "supports" the principles set forth in the Universal Declaration of Human Rights (UDHR), the ILO Tripartite Declaration and the OECD Guidelines for Multinational Enterprises. It further states that it will not employ child of forced labour, and that it will evaluate the likely impact of its presence and activities before making major investments (BP 2002a). In another document prepared for employees, BP states: "It is the responsibility of States to defend the human rights of their population. As a company, we have a responsibility to contribute to the promotion of human rights and to consider the impact of our operations. We will ensure that we adhere to the principles of human rights within our operations and in those areas under our control" (BP 2000: 9) [emphasis added]. This document also sets out specific questions employees must consider in order to ensure that the company does not contribute to, or is not complicit in human rights violations.
Shell's Statement of General Business Principles declares that its responsibilities include the requirement "to observe the laws of the countries in which they operate, to express support for fundamental human rights in line with the legitimate role of business ..." (Shell 2002a: 5). This is not a clear statement of obligation to observe or be bound by international human rights standards and a "Management Primer" which discusses the role of business with respect to human rights also does not make a specific statement in this regard (Shell 2002b). Other statements on the company's website do appear to suggest that corporations are responsible for certain international human rights standards: "The Universal Declaration of Human Rights is aimed primarily at governments. Our challenge is to determine the specific responsibilities of Shell companies and provide managers with the necessary tools to meet their obligations" (Shell, "Our Approach to Human Rights"). In another report, Shell states that its "responsibilities to human rights" include employee rights, security, community rights, national rights and advocacy (Shell 2002c: 10-11).
Talisman's "Policy on Business Conduct" and its "Sudan Operating Principles", which together outline the company's commitment to human rights, are broadly worded and do not address specific human rights concerns that have been associated with Talisman's joint venture operations in Sudan. Among other things, the company states that it endorses the International Code of Ethics for Canadian Business (ICECB) and "has undertaken to use its best efforts to ensure that Talisman's operations reflect the principles embodied therein" (Talisman, "Policy on Business Conduct"). Under its Sudan Operating Principles the company commits "to addressing human rights concerns arising from Talisman and GNPOC operations" and undertakes to support "the principles of the Universal Declaration of Human Rights within Sudan" (Talisman, "Sudan Operating Principles"). Talisman is slightly more explicit in its most recent Corporate Social Responsibility (CSR) report. It states that under the ICECB, the company supports and promotes "the protection of human rights within [its] sphere of influence" and that it "will not be complicit in human rights abuses" (Talisman 2003: 8).
Premier Oil's human rights policy is similarly vague. It merely refers to the...
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