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: a new guide for business lawyers from the International Bar Association that seeks to promote implementation of the U.N. Guiding Principles on Business and Human Rights; the public release of Know the Chain’s first report benchmarking technology companies on efforts to address forced labor in their supply chains; and a major expression of investor support for the Corporate Human Rights Benchmark.
- On May 28, the International Bar Association (“IBA”) Council, the Association’s governing body, voted to adopt the IBA Practical Guide on Business and Human Rights for Business Lawyers. The guide, which is intended to facilitate implementation of the U.N. Guiding Principles on Business and Human Rights, was developed over the course of approximately 18 months of research and consultations with bar associations, individual attorneys, non-governmental organizations, academics, and companies. The guide notes that “[t]here is growing recognition that a strong business case exists for respecting human rights and that the management of risks, including legal risks, increasingly means that lawyers, and particularly business lawyers, need to take human rights into account in their advice and services.”
- On June 10, a coalition of 80 investors representing $4.8 trillion assets under management announced support for the Corporate Human Rights Benchmark (“CHRB”). The CHRB is intended to incentivize companies to improve their management of the human rights impacts of their business operations and is currently working to rank 100 companies on their human rights performance as part of an initial pilot. The investor coalition previously announced support for the U.N. Guiding Principles Reporting Framework, which is intended to enable companies of all sizes, and in all sectors, to report on their efforts to operate consistently with the corporate responsibility to respect human rights.
- On June 20, the European Council adopted a set of “Conclusions on Business and Human Rights,” in part as a recognition of the fifth anniversary of the adoption of the U.N. Guiding Principles. The non-binding text underlined the growing trend toward legislative and regulatory transparency requirements with regard to corporate efforts to address human rights-related risks. Specifically, the Council’s conclusions cite “the critical role of business transparency in enabling markets to recognise, incentivise and reward respect for human rights by companies, recognising the close linkage with other areas within the responsible business agenda e.g. private sector development and anti-corruption and anti-trafficking policies.”
- On June 21, Know the Chain published its first benchmarking report of 20 information and communications technology (“ICT”) companies. The companies were benchmarked on their corporate policies and practice to address forced labor in their supply chains. Indicators used in the benchmarking included whether companies have processes in place to assess the risks of forced labor associated with specific commodities and regions, and whether companies integrate forced labor standards into supply contracts. The benchmarking was done on the basis of publicly available information. Companies that scored the highest in the initial report include HP, Apple, and Intel. Future benchmarking efforts will focus on the food and beverage and apparel sectors.
- On June 20, in RJR Nabisco v. European Community, the U.S. Supreme Court reaffirmed a two-step test for determining whether a statute should have extraterritorial application. First, a court should determine whether the presumption against extraterritoriality has been rebutted through affirmative expression by Congress that the statute should apply outside the United States. If the presumption has not been rebutted, a court should review whether a specific case involves domestic application of the statute. Microsoft has submitted a letter to the Second Circuit Court of Appeals citing the Supreme Court’s reaffirmation of this two-step process in the context of its long-running litigation against the U.S. Government in which it is seeking to prevent the U.S. Department of Justice from using a warrant to compel the company to turn over customer emails stored on a server in Ireland, arguing that the government does not have the authority for such an extraterritorial search and seizure. The company has stated that Congress did not intend for the Electronic Communications Privacy Act to apply outside the United States. This case is being closely watched by many companies who have already felt the business impacts of international mistrust of U.S.-based cloud service providers.