It’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: expected efforts by the U.S. Congress to repeal the Securities and Exchange Commission’s revenue transparency rule; the dismissal of a case against Royal Dutch Shell in the United Kingdom stemming from the company’s activities in Nigeria; and the revival of claims against Tahoe Resources in British Columbia on the basis of the alleged shooting of protestors at a mine site in Guatemala.
- In the coming weeks, Congressional Republicans are expected to use the Congressional Review Act to try to repeal the revenue transparency rule issued by the Securities and Exchange Commission last June. The rule requiring extractive sector companies to disclose the payments that they make to governments for the commercial development of oil, gas, or minerals and was issued pursuant to Section 1504 of the Dodd-Frank Act. The rule falls within the Congressional Review Act’s 60 day-review period during which time Congress may issue a resolution disapproving of a rule. Significantly, if President Trump were to sign such a Congressional resolution, the SEC would be prohibited from issuing a new rule that was “substantially the same” as the rule that was repealed.
- On January 26, the British High Court dismissed claims brought against Royal Dutch Shell for the actions of its Nigerian subsidiary, the Shell Petroleum Development Company of Nigeria, Ltd. More than 40,000 Nigerian plaintiffs brought claims on the basis of harms stemming from environmental pollution in the Niger Delta. The Court held that “there is simply no connection whatsoever between this jurisdiction and the claims brought by the claimants, who are Nigerian citizens, for breaches of statutory duty and/or in common law for acts and omissions in Nigeria, by a Nigeria company.” Shell had argued that plaintiffs’ claims should be heard in Nigerian courts.
- On January 26, the British Columbia Court of Appeal ruled that seven Guatemalan plaintiffs could proceed with their claims against Tahoe Resources, Inc., a Canadian mining company. The plaintiffs have filed claims allegedly that they were shot in 2013 by private security forces during a protest at the company’s Escobal mine. In 2015, the British Columbia Supreme Court had dismissed plaintiffs’ claims, finding that Guatemala was the more appropriate forum for the case to heard. In granting plaintiffs’ appeal of that earlier ruling, the Court of Appeal observed that there was “real risk” that the Guatemalan forum would not provide justice in the case, in part due to widespread corruption.
- On January 25, Susan Avery, an atmospheric scientist and a climate change expert, was elected to the Board of Directors of Exxon Mobil Corporation, effective February 1, 2017. In recent years, the company had been under investor pressure to bring on board member with expertise on climate change. At the time Ms. Avery’s election was announced, Tim Smith of Walden Asset Management observed, “[w]e are hopeful that Dr. Avery’s appointment will assist the company as it works to systematically embed climate risk into decision-making and address its implications throughout its operations and supply chain. Increasingly investors are calling for ‘climate competency’ and a disciplined system of review and accountability in company boards.”
- On January 13, in advance of the World Economic Forum, U.N. High Commissioner on Human Rights Zeid Ra’ad Al Hussein called on business leaders to stand up for human rights and to seek to prevent human rights violations in the countries in which they operate. He stated that “[c]ompanies need to take a clear, unequivocal stance that they will not tolerate links to human rights abuses anywhere in their operations and supply chains – and to have systems in place to ensure such abuses are actively prevented and promptly addressed.” Earlier in January, the High Commissioner had published a statement observing that, although, according to the Economist Intelligence Unit, “83% of senior executives considered business to be an important actor in respecting human rights…in practice, fewer than half their companies had drawn up a human rights policy statement.”
Click here to join the mailing list for quarterly digests of our “Five on Friday” posts.