Compliance Challenge: The Links Between Corruption and Human Trafficking

TraffickingCompanies are increasingly being required to disclose how they assess and respond to the risks of human trafficking in their product supply chains. Statutes like the California Transparency in Supply Chains Act and the U.K. Modern Slavery Act require such disclosures. In addition, certain U.S. federal contractors are now required to develop detailed compliance plans to address the risks of trafficking associated with the good and services they provide to the U.S. Government.

As companies seek to address human trafficking-related risks, it is important to ensure that… More

Five on Friday – Five Recent Developments that We’ve Been Watching Closely

iStock_000011057325XSmallIt’s Friday and time for another overview of developments in the field of business and human rights that we’ve been monitoring.

This week’s post includes: recent developments with regard to a major Alien Tort Statute case, the announcement of a pilot effort to benchmark corporate human rights performance, and a major new report demonstrating the potential links between anti-corruption compliance programs and effort to eradicate labor trafficking in corporate supply chains.

The U.S. Supreme Court denied defendants’ petition for a writ of certiorari in an Alien Tort Statute case filed… More

SEC Provides Guidance on Exclusion of Shareholder Proposals Under the “Ordinary Business” and “Direct Conflict” Exceptions of Rule 14a-8

BusinessAs we head into the 2016 proxy season, we thought it was appropriate to share this client alert, written by Dean Hanley, Paul Bork, and Jennifer Audeh, originally published late last year by the firm’s Corporate Finance & Securities practice. 

In October 2015, the staff of the SEC’s Division of Corporation Finance issued Staff Legal Bulletin No. 14H (SLB 14H), which addresses issues related to shareholder proposals that conflict with a company’s own proposal or that relate to a company’s ordinary business operations. This recent guidance suggests that the staff is less… More

Human Rights Expectations for the Banking Sector: A New Report from Foley Hoag and UNEP FI

TransparencyAttorneys in Foley Hoag’s Corporate Social Responsibility (“CSR”) practice and the U.N. Environment Programme Finance Initiative (“UNEP FI”) recently collaborated on a report analyzing the implications of the U.N. Guiding Principles on Business and Human Rights for the banking sector. A copy of the report is available here.

In addition to assessing the implications of the U.N. Guiding Principles, the report evaluates existing national and international human rights laws and the extent to which these existing laws may create potential liabilities for banks and/or their officers. Finally, the report… More

SEC Extractive Industry Transparency Requirements Move Forward

UntitledOn December 11, 2015, the Securities and Exchange Commission (“SEC”) issued a new proposed rule to implement a key provision of the Dodd-Frank Act that targets corruption and increases transparency requirements for payments made to foreign governments by the oil, gas, and mining industries.

The SEC voted to re-propose rule 13q-1 and proposed an amended form SD to implement Section 1504 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The SEC previously adopted a rule in August 2012 that was vacated and remanded on September 2,… More

ERISA Fiduciaries May Factor ESG Issues Into Economic Analysis of Investments

HiRes (2)This post, written by Teresa Martland, Mark Barnett, and Jeff Collins, was originally published as a client alert

New guidance from the U.S. Department of Labor (“DOL”) clarifies the role of environmental, social and governance issues (referred to as “ESG factors”) in investment decisions by ERISA fiduciaries. ERISA Interpretive Bulletin 2015-01 recognizes that ESG factors, which include climate change, may directly affect the economic value of an investment, and makes clear that ERISA fiduciaries should appropriately consider such factors in investment decisions.

This Bulletin, effective October 26, 2015,… More

Corporate Defendants Find a Safe Harbor in California Transparency Litigation

thumbnailA District Court judge in California has dismissed a complaint against Nestlé USA Inc. and Nestlé Purina Petcare Co. (together “Nestlé”) which argued that the company was obligated to inform consumers that seafood in its catfood products may have been sourced from forced labor. Plaintiffs alleged violations of the California Unfair Competition Law, the Legal Remedies Act, and the California False Advertising Law.

Specifically, plaintiffs stated that they would not have purchased the company’s products if they had been informed that the seafood in those products was linked to forced labor, citing specific evidence that certain seafood… More

Alien Tort Case Development: Still No Corporate Liability in the Second Circuit (At Least for Now)

Alien Tort GavelOn December 8, the Second Circuit Court of Appeals upheld the dismissal of plaintiffs’ claims in five consolidated cases against Arab Bank, PLC. Plaintiffs in each of the cases alleged that they, or their family members, had been harmed in attacks by terrorist organizations that had received financing, in part, as a result of accounts and transfers arranged by the bank.

Claims in the consolidated cases, In Re: Arab Bank, PLC Alien Tort Statute Litigation, had been brought pursuant to the Alien Tort Statute (“ATS”), the Anti-Terrorism Act, and federal common… More

World Exchanges Encouraged to Report Indicators of Long-Term Sustainability

iStock_000008840900XSmallOn November 4th, the World Federation of Exchanges (WFE) released a set of 34 sustainability measures that include environmental, social and governance indicators. WFE recommends that its member exchanges implement these indicators into the disclosure requirements for listed companies.

The WFE is an industry trade organization made up of 99 organizational members, including 64 regulated exchanges (such as NASDAQ and NYSE) across the globe. More than 44,000 companies list on WFE exchanges. It acts to establish standards for publicly regulated securities markets and to ensure good international corporate governance.

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U.K. Modern Slavery Act: Five Things You Need to Know

thumbnailThe transparency provisions of the U.K. Modern Slavery Act went into effect on October 29. At the same time, the U.K. Government has released guidance for companies seeking to comply with the Act.

As previously discussed, the transparency provisions of the Act are applicable to companies that do any part of their business in the United Kingdom if they have annual gross worldwide revenues of £36 million (approximately $56 million) or more each year.

Companies subject to the Act will be required to publish an annual “slavery and human trafficking statement.” The… More