Business and Human Rights

What are human rights? Human rights are about promoting and protecting the values of respect, dignity and equality for every person, irrespective of race, sex, religion, political opinion, disability, sexuality, social status, age or any other characteristic.  Human rights standards are part of international law. The Universal Declaration of Human Rights is the best known of these standards. But there are many other human rights treaties dealing with a wide range of civil, political, economic, social and cultural rights.

A company’s operations can have an impact on so many people, including employees, customers, suppliers and their employees, business partners, and communities in which a company operates. Some sectors that have had examples of human right impacts include mining, resources, manufacturing, construction, retail, finance and primary production.  There are hardly any human rights that are not relevant to business.  However, the following are some of the human rights on which businesses commonly have the most significant impact upon: 

  • Labour rights such as ensuring business doesn’t participate in, or benefit from (eg through its supply chain): discrimination or harassment; underpayment of wages or unreasonable working hours; an unsafe workplace; restrictions on collective bargaining; forced labour; or child labour.
  • Right to life and security of the person, such as workplace policies to protect against bullying, injury or death.
  • Right to health such as policies to provide assistance and redress to people affected by industrial accidents, spillages or contamination.
  • Right to housing and an adequate standard of living.
  • Rights of Indigenous peoples.

So how does Australian business fare? A 2011 Net Balance Foundation report found that 47 ASX 100 companies identified as ‘exposed’ to human rights risks through their areas of operations, 90% appear to have management systems that are insufficient to mitigate exposure to human rights risks. Only 15% disclose evidence of human rights policy commitment and only 6% are judged to have adequate reporting on human rights management and outcomes. Corresponding research on the remaining 53 companies that are not captured in this definition, although they may still have other human rights exposures (eg supply chain, labour, discrimination), showed that these companies also fail to demonstrate adequate policies or disclosures on human rights.

One of the most pressing of human rights concerns globally at present is the notion of modern slavery.  Alarmingly, the International Labour Organization estimates that there are some 20.9 million people living in conditions of modern slavery (forced labour, human trafficking and slavery). Of this, around 18.7 million people are in forced labour in the private economy, being exploited by individuals and businesses.  Price of slavery, which is a contributor to the problem, has decreased from an estimated $40,000 adjusted figure in 1809 to $90 in 2009 per person – a number that many would be surprised by.  Australian businessman Andrew Forrest with his wife Nicola Forrest recently set up Walk Free Foundation to shed light and advocate on this issue.

International guidelines, including the 2011 Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework (UNHRC 2011) and the OECD Guidelines for Multinational Enterprises: 2011 Update (OECD 2011) are key guidance available to business to manage this fundamental tenet.

Source: Ruggie, J. (2008), ‘Protect, Respect and Remedy: A Framework for Business and Human Rights’, Innovations, Spring 2008, The Australian Human Rights Commission (www.humanrights.gov.au, August, 2014) & Net Balance Foundation, ACCA & CAER (October, 2001) Disclosures on Managing Human Rights.

Image ©2012 Eric Bridiers - CC BY-ND 4.0

Terence Jeyaretnam is a Director at Net Balance. Terence is based in Melbourne and can be contacted at terence@netbalance.com.