On April 22, the European Union lifted all sanctions on Burma except an arms embargo. The sanctions had already been eased in April 2012, which left open the option of easily putting them back into place. The European Union’s move to lift them altogether sends a strong signal of support for the reform-oriented government in Burma.

The European Union made this decision at a controversial time, just days after the BBC received footage of soldiers standing by as Buddhists attacked Muslims in Burma. The decision also came close on the heels of a Human Rights Watch report accusing the Burmese public forces of permitting and even joining in ethnic cleansing against the Rohingya, a Muslim ethnic minority. Human rights groups decried the European Union’s decision to give up sanctions as a point of leverage when such human rights abuses are ongoing.

Yet Nobel Peace Prize Laureate Daw Aung San Suu Kyi supported the European Union’s decision, telling the BBC, “It is time we let these sanctions go…I don’t want to rely on external factors forever to bring about national reconciliation which is the key to progress in our country.”

Meanwhile, the European Union’s decision puts pressure on the United States, which eased its sanctions in May 2012 but left in place the underlying legislation that would allow them to be reinstated easily. The United States has maintained its Specially Designated Nationals (“SDN”) list for Burma, although it recently issued a General License to allow U.S. persons to conduct business with four Burmese banks on the SDN list. Two are owned by the best-known “cronies” of the former military regime – both men are on the SDN list — and the other two are owned by the government. The General License will make it easier for U.S. companies to conduct business in Burma, but belies the U.S. government’s earlier indications that it could engage with Burma without supporting those who made fortunes through their alliances with the former junta.

The United States continues to strengthen economic ties with Burma in other ways. For example, the U.S. Acting Trade Representative just visited Burma to begin discussions on a framework agreement covering trade and investment between the two countries. It is unclear whether the U.S. will lift its sanctions in the near-term, especially since this would require that Congress act to unwind the underlying legislation.  But it is clear that the United States will continue to build closer economic ties with Burma, following the footsteps of Europe.

This post was originally published by the Institute for Human Rights and Business.  It is reposted here with permission.  

This week, members of the United Nations (“U.N.”) Working Group on Human Rights and Transnational Corporations are making an official visit to the United States as part of the Group’s mandate to promote the effective implementation of the U.N. Guiding Principles on Business and Human Rights. The visit, only the second by the Working Group since its establishment in 2011, provides an important opportunity to engage all stakeholders on efforts to make respect for human rights part of mainstream corporate practice in the United States.

The home of some of the world’s largest corporations, the United States is an important test case for Guiding Principles implementation. The visit by the Working Group will undoubtedly highlight the extent to which major U.S. companies are addressing challenges and opportunities in implementing the human rights due diligence process called for in the Guiding Principles. Equally important, it will also point to the critical role of the U.S. government in making this framework part of corporate America’s DNA.

The U.S. approach to integrating human rights concerns throughout business practices has been piecemeal and limited to date, due largely to the structure and culture of our political system:

• First, there are few U.S. federal government institutions and agencies that focus specifically on human rights, which can lead to policy incoherence. The State Department’s Bureau of Democracy, Human Rights, and Labor has a specific human rights mandate, as does the relatively new Human Rights and Special Prosecutions Section at the Department of Justice, although it has thus far not focused on the nexus of business and human rights in its prosecutions. The Department of Labor covers a subset of human rights. At the same time, other government agencies don’t see human rights as part of their mandate, even though they interact far more with and have more influence on business.
• Second, the U.S. Congress has created two permanent bodies that focus on human rights: the Senate Judiciary Subcommittee on Human Rights and the Law and the Tom Lantos Human Rights Commission in the House of Representatives, neither of which has focused attention on corporate related challenges to date.
• Third, the United States does not have overarching human rights legislation or a national human rights institution, unlike most countries in the world.  Far more energy is poured into our impressive domestic civil rights machinery, which protect Constitutional rights that apply domestically – which can leave externally-focused human rights efforts sitting in few and underfunded homes.
• Fourth, the Congress is less responsive to U.N. backed initiatives. Historically, it has shown limited deference to and interest in the U.N. compared to its European brethren.  For example, the U.S. Congress has refused to ratify a number of international conventions, even though the President and most other countries had signed them.  It is fair to say that most Members of Congress are unlikely to have ever heard of the Guiding Principles or the six-year global multistakeholder consultation process led by Harvard Professor John Ruggie that led to their unanimous endorsement by the U.N. Human Rights Council in 2011. Under the U.S. Constitution, only Congress can legislate, and it has passed no legislation supporting the U.N. Guiding Principles, nor has it held any hearings on them.  Notably, although some Members of Congress care passionately about human rights, they simply have no awareness of the helpful framework provided by the Guiding Principles to promote good conduct among all companies wherever they operate.

But it isn’t an altogether bleak scenario: the Obama Administration has taken a handful of steps to support the Guiding Principles. For example, the State Department’s Bureau of Democracy, Human Rights, and Labor (“DRL”) worked with the Treasury Department to develop the landmark Burma Reporting Requirements on Responsible Business, which require U.S. companies investing in Burma to report on their social and environmental due diligence. The Reporting Requirements are not final, but are likely to recommend the due diligence system in the U.N. Guiding Principles as a good practice. Likewise, DRL has held a series of roundtables with companies and civil society to increase awareness of the Guiding Principles. Separately, the Department of Labor has developed a Toolkit for Responsible Business aiming to reduce child and forced labor that refers to the Guiding Principles.

In an effort to cut off funding to armed groups in the Democratic Republic of Congo (“DRC”), Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act requires companies reporting to the Securities and Exchange Commission to identify whether their products are “DRC conflict free,” and describe the due diligence they conducted to arrive at their conclusions.  The Dodd-Frank Act, as it is popularly known, was passed before the Guiding Principles were finalized, and its provisions were not developed with them specifically in mind.  They do, however, use the language of due diligence to address indirect business impacts on human rights, and to that extent, are consistent with the Guiding Principles.

In sum, U.S. progress to date has been limited and issue-specific.  There is no indication of sufficient momentum to prompt most U.S. companies to develop human rights policies and procedures – except for the largest, brand-facing companies, many of which have these in place anyway.

But the United States cannot afford to ignore the issue. It needs to adopt a more coherent approach so that the goal of ensuring corporate respect for human rights in a more targeted and efficient manner can be  achieved. For example, the conflict minerals provision, while well-intended, is extremely expensive to implement, and it is unclear whether it will attain its fairly narrow goals. Attacking each human rights issue in such a ponderous way isn’t feasible. We need measures that lead companies to adopt systems that take human rights, writ more broadly, into account throughout their decision-making, from procurement to product design to investment choices.

The good news?  The United States can learn from the experiences of other nations. For example, human rights could be put on the radar for thousands of U.S.-based companies simply by requiring them to report on whether they have in place human rights policies and procedures, and what they include, as a number of other countries have done. Such a step would help quickly start to shift U.S. business culture, which for the most part remains convinced that human rights are of no direct relevance to companies or their bottom lines.

Moreover, the United States can learn from its own experience. The United States has helped companies incorporate social and environmental issues into their business fundamentals before. A report from the International Corporate Accountability Roundtable notes that the U.S. government has improved corporate environmental and labor practices through administrative law requirements, incentive schemes, and disclosure requirements.  For example, federal procurement regulations incentivize companies to improve their labor practices by requiring companies seeking government contracts to certify that their products were not made with forced or child labor. These regulations could be expanded to include human rights more broadly.

Moreover, the United States government has played an important role in developing industry-specific guidelines on human rights through its role in founding the Fair Labor Association and the Voluntary Principles on Security and Human Rights.  Such efforts should continue.

The human rights bodies in the Congress should hold hearings that regularly touch on the U.N. Guiding Principles and the nexus of business and human rights. The State Department should continue to leverage opportunities to heighten awareness of the agenda in other government agencies.

Of course, the U.S. government will not be the only entity seeking to support the Guiding Principles. Perhaps the most likely vehicle to “encourage” companies to conduct human rights due diligence will arise from the Supreme Court’s recent decision in Kiobel v. Shell.  This narrowing of the Alien Tort Statute’s applicability is almost sure to prompt U.S. NGOs to advocate for a law providing a cause of action against companies complicit in human rights abuses abroad.

The U.N. Working Group’s visit provides an opportunity to reflect on our progress. And our path has just begun.

The U.S. Supreme Court granted cert on April 22 in two important cases for the future application of the Alien Tort Statute (“ATS”) following its decision last week in Kiobel v. Royal Dutch Petroleum. 

As discussed in last week’s post, in Kiobel, the Supreme Court offered  little guidance to litigants regarding what facts and circumstances would be sufficient to overcome the presumption against extraterritoriality in ATS cases. Yesterday’s orders indicate that the Supreme Court is looking to move forward in providing greater clarity on this issue.  Specifically:

• In DaimlerChrysler v. Bauman, the Supreme Court is expected to explore the level of contacts needed to justify the exercise of personal jurisdiction in ATS cases over a foreign corporation (albeit one with significant financial, business, and administrative ties to the United States), and specifically whether a wholly-owned U.S. subsidiary can be used to create a territorial nexus between a foreign corporation and the United States sufficient to justify the exercise of jurisdiction.
• In Rio Tinto PLC v. Sarei, the Supreme Court vacated the Ninth Circuit’s judgment regarding the presumption against extraterritoriality and remanded the case back to the Ninth Circuit “for further consideration in light of Kiobel.”

As noted by SCOTUSblog,

[t]he Court had been holding the DaimlerChrysler case until it decided the core question of whether ATS claims could be made when all of those involved were foreign nationals or entities, and the incidents occurred abroad – that is, virtually no U.S. connection.

In Kiobel, the Supreme Court did address this question and concluded the presumption against extraterritoriality closed the door on ATS suits that have no nexus to the United States, but it left a window open as to exactly what could rebut or displace the presumption in the event that a plaintiff could demonstrate a relevant connection to the United States “with sufficient force.” In so doing, although not directly answering the question of corporate liability, Chief Justice Roberts underscored that

Corporations are often present in many countries, and it would reach too far to say that mere corporate presence suffices.

Bauman offers a better opportunity than Kiobel to explore the issue of corporate presence. Unlike Kiobel, in which the Second Circuit focused primarily on the subject matter jurisdiction question of whether corporations could be found liable under the ATS, in Bauman the Ninth Circuit focused on personal jurisdiction questions and thus has provided the Supreme Court with a lengthy and detailed record of analysis of the minimum contacts between the defendant corporation and the forum (California).

The Bauman plaintiffs are twenty-two Argentinian residents “alleging that one of [DaimlerChrysler AG’s foreign] subsidiaries … collaborated with state security forces to kidnap, detain, torture, and kill the plaintiff’s and/or their relatives during Argentina’s ‘Dirty War.’” The district court dismissed the case for lack of jurisdiction, reasoning that there was no agency between DaimlerChrysler AG (DCAG) and its wholly owned U.S. subsidiary, Mercedes-Benz USA, and that the exercise of jurisdiction in California was not fair and reasonable over the arguably foreign parent corporation based on the activities of a U.S. subsidiary.

The Ninth Circuit revived the case in 2011, reversing the district court’s decision that there was no agency and concluding that there was “no doubt that DCAG is subject to personal jurisdiction in California” on the ATS and Torture Victim Protection Act (“TVPA”) through, inter alia, its wholly-owned U.S. subsidiary, “and that the exercise of such jurisdiction is not only reasonable, but fair and just.”

As framed by Daimler Chrysler AG in its petition for cert, the question presented to the Court now is:

[W]hether it violates due process for a court to exercise general personal jurisdiction over a foreign corporation based solely on the fact that an indirect corporate subsidiary performs services on behalf of the defendant in the forum State.

The second ATS-related case of the day, Rio Tinto, also provides a proving ground for many of the questions raised but left unanswered by Kiobel, including whether an ATS claim can be based on aiding-and-abetting rather than the actions of a principal, the necessity — if any — of the exhaustion of local remedies, and how the presumption against extraterritoriality as articulated in Kiobel may be “displaced.”

As many noted before the Court’s call for rehearing in Kiobel, the lower court record in Rio Tinto is superior to that of Kiobel for many of these issues given that in Rio Tinto the Ninth Circuit had expressly questioned the extraterritorial application of the ATS where the claim is grounded in exclusively foreign conduct by foreign actors and where there was no exhaustion of local remedies. The Rio Tinto majority’s holding that permitting lawsuits under the ATS for transitory torts does not violate the presumption against extraterritoriality has certainly been undermined by Kiobel, and corporations will be watching closely the Ninth Circuit’s application of Kiobel’s less-than-clear discussions of the presumption.

As Justice Kennedy’s prescient concurrence underscored, Kiobel was “careful to leave open a number of significant questions regarding the reach and interpretation of the [ATS].” Bauman and Rio Tinto should be seen as the beginning of the follow-on litigation to Kiobel that will — hopefully — tease-out the answers to these questions over the coming years.

Earlier today the U.S. Supreme Court issued its long-awaited ruling in Kiobel v. Royal Dutch Petroleum, the case that was to decide whether the Alien Tort Statute (“ATS”) could be applied to corporations as legal persons and whether such lawsuits could be based on actions that occurred outside of the territory of the United States. The Court did not directly address the question of corporate liability and stated that, based on the facts of the case, petitioners’ claims had failed to overcome a presumption against extraterritoriality and thus affirmed the Second Circuit’s dismissal.

By stating that the presumption against extraterritoriality applies in ATS cases, the Court has established a high bar for potential plaintiffs to overcome, and many in the business community are celebrating today’s opinion as a victory.  That said, the Court clearly signals that that presumption could be overcome based on a different set of facts. Rather than bring clarity to an area of the law long-mired in confusion, therefore, the Court has left current and potential plaintiffs and defendants in ATS cases with a muddled playing field of substantive and jurisdictional questions.

Notably, nine justices agreed on the judgment and concluded that, under the facts presented by the case, extraterritorial application of the ATS cannot be sustained.  This unanimity, however, belies a deep and consequential divide regarding the reasoning needed to reach the judgment.

Chief Justice Roberts delivered the opinion of the Court, joined by Justices Scalia, Kennedy, Thomas, and Alito, concluding that the “presumption against extraterritoriality” requires that court interpret statutes as not having extraterritorial application unless Congress makes clear an explicit intent to the contrary. Roberts held that no such Congressional intent can be identified in the ATS.  Based on the facts presented in Kiobel, he found that the ATS cannot therefore be applied to a case where “all of the relevant conduct took place outside the United States” and “‘where the claims’ do not ‘touch and concern the territory of the United States … with sufficient force to displace that presumption [against extraterritoriality].’”

Justice Kennedy and Justice Alito (joined by Justice Thomas) each filed brief concurring opinions.  Justice Kennedy’s concurrence is only one paragraph long, but it is significant  for he underscores that “[t]he opinion for the Court is careful to leave open a number of significant questions regarding the reach and interpretation of the Alien Tort Statute[.]” Kennedy notes that

Other cases may arise with allegations of serious violations of international law principles protecting persons, cases covered neither by the [Torture Victims Protection Act] nor by the reasoning and holding of today’s case; and in those disputes the proper implementation of the presumption against extraterritorial application may require some further elaboration and explanation.

Justice Alito uses his concurrence to restate the Court’s explanation in Morrison v. National Australia Bank that more than a kernel of domestic activity is needed to overcome the presumption against extraterritorial application of a statute. Applying Morrison, he underscores that in order for a case’s territorial ties to the United States to be sufficient to sustain jurisdiction via the ATS, when the “claims touch and concern the territory of the United States, they must do so with sufficient force to displace the presumption against extraterritorial application.” Recalling Sosa v. Alvarez-Machain, he then elaborates that in order for an cause of action to displace the formidable presumption, it must be grounded in domestic conduct that “is sufficient to violate an international law norm that satisfies [the] requirements of definiteness and acceptance among civilized nations” — a very high, although not impossible, bar to meet.

Joined by Justices Ginsburg, Sotomayor, and Kagan, Justice Breyer filed a separate opinion, concurring in the judgment but challenging the Court’s reliance on the presumption against extraterritoriality. Rather than invoking the presumption, Breyer reaches to the “principles and practices of foreign relations law”, and concludes that where a case has sufficient ties to the United States, the ATS may indeed provide jurisdiction.

Specifically, relying heavily on Sosa and the Restatement of Foreign Relations Law of the United States, Breyer argues that jurisdiction is warranted where

(1) the alleged tort occurs on American soil, (2) the defendant is an American national, or (3) the defendant’s conduct substantially and adversely affects an important American national interest, and that includes a distinct interest in preventing the United States from becoming a safe harbor (free of civil as well as criminal liability) for a torturer or other common enemy of mankind.

Breyer makes clear that this test has not been met in Kiobel, but he asserts that there are fact patterns under which the test will be met, especially where suit would “vindicate[] our Nation’s interest in not providing a safe harbor, free of damages claims, for those defendants who commit such conduct.”  To illustrate, he discusses lower court ATS decisions cited in Sosa including Filartiga v. Pena-Irala and In re Estate of Marcos, Human Rights Litigation. In citing to Filartiga and In re Estate of Marcos, Breyer notes that “in Sosa, we referred to both cases with approval, suggesting that the ATS allowed a claim in such circumstances.”

Although no justice directly addresses the corporate liability question as originally presented, the Court and the concurrences do not challenge the notion that corporations may indeed be found liable under the ATS, albeit only if the corporations have more than cursory ties to the territory of the United States. For example, Roberts opines that “[c]orporations are often present in many countries, and it would reach too far to say that mere corporate presence suffices.” Similarly, Breyer notes that where “the defendants are two foreign corporations,” “plaintiffs are not United States nationals but nationals of other nations,” “the conduct at issue took place abroad,” and the defendants are alleged to have aided-and-abetted non-Americans rather than directly perpetrated “acts of torture, genocide, or the equivalent[.]”

In finding that jurisdiction in the case was not proper, Breyer also observed that defendants’ “only presence in the United States consists of an office in New York City(actually owned by a separate but affiliated company) that helps to explain their business to potential investors”, noting that defendants’ shares “like those of many foreign corporations” are traded on the New York Stock Exchange.

Looking ahead, the windows to jurisdiction hinted at by Roberts and Alito, and framed by Breyer, leave foreign and domestic defendants, including corporations, exposed to potential liability for conduct outside of the United States that violates the laws of nations. In the coming months, and years, considerable time by litigants and courts will be spent defining what sets of facts, if any, are sufficient to overcome the established presumption against extraterritoriality.

The International Code of Conduct for Private Security Service Providers’ Association recently published its Charter. This marks a critical step in the establishment of oversight and governance processes to operationalize the commitments outlined in the International Code of Conduct for Private Security Providers (“ICoC”).

The ICoC is a multistakeholder initiative the aim of which is to establish principles and standards for the private security industry based on international human rights and humanitarian law. Under the Charter the Association is mandated with undertaking the steps necessary for certification, auditing, monitoring and reporting activities.

Commitments Under the ICOC

As of March 2013 more than 590 companies, from 70 different companies, had signed up to the ICoC. In becoming ICoC signatories, companies commit to the following:

• to operate in accordance with the Code;
• to operate in accordance with applicable laws and regulations, and in accordance with relevant corporate standards of business conduct;
• to operate in a manner that recognizes and supports the rule of law; respects human rights, and protects the interests of their clients;
• to take steps to establish and maintain an effective internal governance framework in order to deter, monitor, report, and effectively address adverse impacts on human rights;
• to provide a means for responding to and resolving allegations of activity that violates any applicable national or international law or the Code; and
• to cooperate in good faith with national and international authorities exercising proper jurisdiction, in particular with regard to national and international investigations of violations of national and international criminal law, of violations of international humanitarian law, or of human rights abuses.

By adopting the ICoC, signatory companies not only commit to the principles outlined in the Code, they also endorse the principles of the Montreux Document on Pertinent International Legal Obligations and Good Practices for States Related to Operations of Private Military and Security Companies During Armed Conflict (“The Montreux Document”), as well as the “Respect, Protect, Remedy” framework developed by Professor John Ruggie, the former U.N. Special Representative on Business and Human Rights.

Purpose of the Charter and the ICoC Association

The purpose of the ICoC Association is “to promote, govern and oversee implementation of the [ICoC] and to promote the responsible provision of security services and respect for human rights and national and international law in accordance with the Code.” The Charter lays out concrete procedures by which meaningful regulation may be realized. The ICoC Association will have a General Assembly (which will meet at least once a year), a Board of Directors (the members of which have not yet been announced), and a Secretariat (operating under an Executive Director). An Advisory Forum of Montreux Document Participants will also be convened, to provide a resource to the Association.

Membership in the organization is open to the three “stakeholder pillars:” private security service providers, civil society organizations and governments. The specific requirements of membership for each group will be proposed by the Board, and approved by the General Assembly.

Certification of Compliance

The Association will be responsible for certifying that a signatory company’s systems and policies meet the principles and standards of the ICoC, and that the company is undertaking monitoring, auditing and verification processes (both at headquarters and in the field). Signatory companies will be expected to provide evidence of up-to-date certification under a standard recognized by the Board of Directors (this may be a national or international standard).

Reporting and Auditing

The Association will be responsible for overseeing signatory companies’ performance under the ICoC, including through external monitoring, reporting and a grievance process. The Secretariat will be responsible for gathering and receiving information (from both public and non-public sources) regarding signatory companies’ compliance with the ICoC, including written assessments from signatory companies themselves.

Both the Secretariat and the Board may offer observations and advice to, as well as engage with, signatory companies with the aim of improving performance or addressing specific compliance concerns. If the Board determines that in the context of non-compliance corrective action is necessary, the Board will request the signatory company to undertake such action.

The Association will report publicly, at least once a year, on its activities. It will also serve as a repository and promoter of industry best practices.

Complaints Procedure

The Association will oversee a fair and accessible grievance procedure, which offers effective remedies, to ensure that alleged violations of the ICoC are addressed. The Secretariat, together with the Board, will consider such claims, and after consultation with the signatory company may (1) suggest the complaint be referred to another grievance procedure for further consideration; or (2) recommend corrective action to be taken by the signatory company. In terms of follow-up, the Board may consider whether the signatory company (if deemed to have committed a violation of the ICoC) has taken sufficient corrective action. If a signatory company fails to do so, the Board may consider whether to suspend or terminate membership.

Relationship to U.S. Regulations

Federal statutes and regulations establish a framework for selection, training and accountability of private security contractors with whom the government contracts. The U.S. Department of Defense has also facilitated the development of quality management standards, recognized by the American National Standards Institute (see here and here). These standards govern the management and conduct of audit programs, address human rights considerations and provide a basis for entities to become certified to conduct audits of PSCs. It is likely that such a standard will be recognized by the Board for purposes of certification.

Though the U.S. government does not expressly require a PSC with whom it contracts to be a signatory to the ICoC, it “encourages companies to commit to the principles of the ICoC.” It will be interesting to see if U.S. rules and regulations are modified to include reference, explicit or otherwise, to the ICoC now that the Charter has been adopted and concrete steps are underway.

As mentioned in last week’s post, participants in the Voluntary Principles Initiative recently held their Annual Plenary Meeting. The discussions began with opening addresses from Professor John Ruggie, the former U.N. Special Representative on Business and Human Rights and author of the U.N. Guiding Principles, and Dr. Margaret Jungk, from the U.N. Working Group on Business and Human Rights.

In their remarks, both Professor Ruggie and Dr. Jungk noted the tremendous evolution that has taken place in the business and human rights agenda since the Voluntary Principles Initiative was originally launched in 2000. Professor Ruggie, now a Senior Advisor to Foley Hoag’s Corporate Social Responsibility practice, observed that

the international community has achieved considerable convergence around common normative principles and policy guidance for their enactment. This provides greater clarity and predictability all around, as well as authoritative benchmarks for assessing how effectively governments and companies are putting those principles into practice.

In talking about recent changes in the business and human fights field, noting especially the U.N. Guiding Principles, Dr. Jungk noted that “the VPs [Voluntary Principles] were ahead of their time. In 2000 the VPs were already using the clear, concrete language of human rights.” Looking ahead ten years, Dr. Jungk suggested that

By 2023, the vast majority of multinational companies will be conversant with human rights. They will understand the responsibility to respect, and will acknowledge that this responsibility is core to their business. Like the communities impacted by their operations, companies will use the language of human rights and the approach of stakeholder engagement and concrete performance indicators. This change will be driven from within companies by individuals who understand that community engagement and human rights due diligence are not a cost, but an investment.

The speeches given by Professor Ruggie and Dr. Jungk highlight both the achievements of the last thirteen years and the tremendous work that remains to be done.  In the early part of the last decade, it was remarkable for a group of companies to come together and make explicit human right commitments. Today, such commitments are not that unusual, but the work of actually integrating those commitments into the day-to-day management of business operations remains a great challenge. Even more challenging is translating those commitments into a platform for true dialogue with rights-holders, namely the communities impacted by corporate operations.