Sections

Section 1.0

Principles on corporates’ responsibility to respect human rights

Section 1.1

The principle of corporate’s responsibility to respect human rights

The second pillar of the “Protect, Respect and Remedy” framework is the responsibility of the company to respect human rights. Although human rights treaties are ratified by the government and not by the companies, the Universal Declaration of Human Rights in its preamble states that “every individual and every organ of society, keeping this Declaration constantly in mind, shall strive by teaching and education to promote respect for these rights”. “Respect” means that the company must not violate the rights of others.

The responsibility of companies to respect human rights has been recognized in non-binding standard initiatives such as the “Tripartite Declaration on the Principles Concerning Multinational Enterprises and Social Policy” of the ILO and “OECD Guidelines for Multinational Enterprises.” Companies are increasingly increasing their commitment to respect human rights through Global Compact, or through similar multi-stakeholder initiatives, and in their company policies.

 

Human rights as “Social license to operate”

The full range of legal documents and permits do not always guarantee a smooth operation of the company. In addition to permits or concessions from the government, company is also expected to respect human rights. Failure to do so can provide a variety of additional burdens for the company as illustrated in the case below.

Example case: Human right as “social license to operate”

The public consultation process (as part of the licensing process) shows the deep dissatisfaction of the local community with the project proposed by the company and causes the government to hold or delay the issuance of the final permit.
Not satisfied with the company’s treatment at the initial talks, landowners refused to sell their land to the company. This causes delays or even cancellations of a planned infrastructure project.

As a result of the frustration of the company’s attitude which is seen as arrogant and less involving local stakeholders in making decisions that affect people’s lives, a relatively small incident can lead to negative imbalance responses from local communities (eg demonstrations).

Local workers feel that companies do not care about them or local stakeholders and provide information to criminals.

Section 1.2

What is the responsibility of the company?

The Protect, Respect and Remedy framework explains that the company has different responsibilities from the country. But what is the responsibility of the company, and when are they considered to have fulfilled their responsibilities?

Companies are responsible when their activities potentially cause impacts on human rights of the others, such as the surrounding community, employees, consumers, suppliers, etc. Potential and actual impacts can occur through the activities of the company and through business relationships with various parties (suppliers, contractors, government, etc.). Every company will have different potential impacts depending on the context of which company operates.

In addition to the United Nations Guiding Principles on Business and Human Rights, the scope of corporate responsibility dealing with human rights can also be found in ISO 26000 Guidance Standard on Social Responsibility. There are 93% of member countries of the International Organization for Standardization (ISO), including Indonesia, that have agreed on the definition and scope of social responsibility.

 

 

ISO 26000 Guidance Standard on Social Responsibility.

Limitation of corporate responsibility for human rights

The company’s responsibility is to mitigate the adverse human rights impacts of the company’s business operations.

Based on the Business and Human Rights Framework, the fulfillment and protection of human rights is the responsibility of the government and not the responsibility of the company. However, it is recommended, and valued, if the company do more than the scope of respecting human rights.

Section 1.3

What are the corporates’ impacts on human rights?

Corporate’s activities can have an impact on the human rights of various parties. The impact can be positive and also negative. The question companies must ask themselves is whether their presence can affect the rights of the individuals and the community concerned.

Mapping of company’s human rights impacts

Corporate interactions with each group of individuals, society and the environment can be divided into 3 (three) areas of impact as seen through the diagram on the following page:

Wider, Indirect and Unexpected Impacts

The examples above relate to the direct impacts caused by the company. However, company activities often have broader, indirect and unexpected human rights implications.

An extractive company finds oil in certain areas, causing local people to move to other places and attract many outsiders who come looking for work;

An international clothing company that starts to get materials from local suppliers brings a number of consequences around supplier factories (e.g. suppliers spend existing water supplies around the site; other factories may cut wages or hire children to remain competitive and local government hopes benefiting from this new “rich” company began asking for bribes);

Ultrasound technology that helps determine maternal health risks, but can also be used to determine the sex of the fetus – which results in an unbalanced number of abortions for the female fetus;

Credit cards allow people to take advantage of purchases via the internet, but can also be used to buy child pornography;

Cellphone and internet technology provides facilities for more free expression, but also allows the government to spy on its citizens.

References

  • ELSAM dan Komnas HAM (2017), Rencana Aksi Nasional Bisnis dan Hak Asasi Manusia. Jakarta: Komnas HAM.
  • Global Compact, “Global Compact 2018 Progress Report: Asia Pacific Analysis”, 2018.
  • Inisiatif Bisnis dan Hak Asasi Manusia (2010), “Bagaimana Menjalankan Bisnis dengan Menghormati Hak Asasi Manusia: Sebuah Alat Panduan bagi Perusahaan,” Den Haag: Global Compact Network Netherlands
  •  INFID, “Kertas Kebijakan: Menuju Implementasi Prinsip-Prinsip Panduan PBB tentang Bisnis dan HAM di Indonesia, 2018.
  • Kementerian Luar Negeri, “Draf Panduan Bisnis dan HAM versi 13 Desember 2018”, Jakarta, 13 Desember 2018.
  • Shift, Oxfam and Global Compact Network Netherlands, “Doing Business with Respect for Human Rights: A Guidance Tool for Companies”, 2016.
  • Ilustrasi: www.freepik.com

Chapter 2 : Implementing corporates’ responsibility to respect human rights