Business can no longer disregard the human rights impact

 

From Eric Paulsen

The concepts of business and human rights may have traditionally been seen as distinct from, and possibly even at odds with, one another.

However, businesses can contribute positively to the realisation of human rights, including the right to work for fair remuneration and achieve an adequate standard of living.

On the other hand, when businesses make use of forced labour, provide unsafe working conditions, grab land from indigenous populations, or cause environmental destruction, the adverse impact can be immense.

Such labour or human rights abuses may occur in the context of a company’s own activities, but businesses may also be linked to abuses via relationships with their suppliers and service-providers.

This is a worldwide problem, whether it is clothing produced in sweatshops, seafood caught by victims of human trafficking on fishing trawlers, or minerals and metals found in mobile phones and computers that are mined in dangerous conditions or even funding conflicts.

Consumers all over the world and communities living alongside companies that share cities and towns, are increasingly demanding to know that these businesses are not tainted by human rights abuses anywhere in their supply chains or in their business relationships.

As many other states and companies respond positively to this, Malaysia must not fall behind.

It is the responsibility of both the government and companies themselves to ensure that business activities taking place in Malaysia do not have adverse impacts on human rights.

It is time for Malaysian businesses to recognise that if they are not willing to embrace and comply with these human rights standards, then other governments, trade partners, companies, investors, shareholders and consumers may no longer be willing to support them and will take their business elsewhere.

It cannot be business as usual, where profit is all that matters, and human rights are disregarded.

Although the government has supported the business and human rights agenda, there must be meaningful collaboration and engagement from the business community. While the responsibility to respect human rights applies to all businesses, regardless of size and sector, those of most concern in Malaysia include the glove manufacturing industry, palm oil and logging sectors.

Malaysian industries have been instrumental in the response to Covid-19 by providing much-needed disposable gloves. But at what cost? How many workers have been exposed to unfair treatment, enforced overtime, unsafe working and living conditions or harassment in the process of bringing these goods to market?

Covid-19 outbreak at glove factories

With such a huge global demand for Malaysian products, this is a great opportunity for our biggest industries and exporters to show that they can be relied upon to meet this demand safely and with respect for the human rights of all workers and communities impacted by their work.

After reports of human rights abuses and an extensive outbreak of Covid-19 among workers in glove factories late last year, the government acted.

Brightway, which produces over 340 million gloves each year, and Top Glove, the world’s largest manufacturer of gloves, were raided. Both companies face charges for failing to provide workers’ accommodation that met the minimum housing and amenities standards set out by the labour department.

While allegations of human rights abuses are often dismissed by the businesses concerned, they are taken seriously by international organisations, civil society and crucially, governments who can restrict imports if indicators of forced labour, modern slavery or other human rights violations are found.

In July 2020, the US Customs and Border Protection banned Top Glove from exporting its products to the US after it found forced labour practices in the production of gloves. The ban was only lifted in September this year after the company had addressed all the indicators of forced labour. More recently, Supermax and Smart Glove became the latest Malaysian glove makers hit by US import bans.

The US state department also downgraded Malaysia’s ranking in its 2021 Trafficking in Persons Report from Tier 2 to Tier 3, the lowest ranking, citing forced labour among other concerns in the country.

Concerns about the adverse human rights impacts of businesses are not unique to Malaysia, nor are the remedies sought or the potential consequences.

In January, a Dutch court ordered Shell and its subsidiaries to compensate Nigerian farmers who suffered as a result of major oil spills and widespread pollution. This shows that national legal systems are increasing their accountability measures and that justice can be achieved on behalf of victims of business-related human rights abuses or environmental harms, wherever they are in the world.

While governments are increasingly putting in place mandatory due diligence and trade enforcement measures over tainted products, responsible corporations too, have begun to show a willingness to stop doing business in countries where workers are exploited, or other human rights abuses are perpetrated.

Soon after the military coup in Myanmar, Kirin, a Japanese beer company, ended its partnerships in the country, while French energy giant EDF announced the suspension of its activities in Myanmar where it was involved in a US$1.5-billion project to build a hydroelectric dam.

The European Union, the US and the UK governments have also imposed sanctions on two giant conglomerates controlled by the military with interests in telecommunications, banking, mining, real estate and other businesses.

Aside from it being the right thing to do, it also makes good business sense to respect human rights. It is in the legal, financial, reputational and stakeholder relations interests of the companies involved to show meaningful commitment to human rights.

Companies that adhere to human rights standards can better sustain and build-up their brands and are less likely to miss out on business opportunities and profits.

Respecting human rights is a requirement under international law, but it should not be viewed as a burden on the business community. In fact, it is a way for companies to flourish and increase their value, as international markets increasingly prioritise responsible business practices.

All companies should conduct human rights due diligence to both identify and act upon actual and potential human rights risks for their workers, supply chains and the services they use. Mistakes have been made and the repercussions have already been felt, but these will only become more severe and more common if exploitative or outdated business practices don’t change.

The United Nations Guiding Principles on Business and Human Rights provide a roadmap for action, outlining the state’s duty to protect human rights, the corporate responsibility to respect human rights, and provide a remedy when business-related human rights abuses occur.

All countries are encouraged to develop their own National Action Plan based on the UN Guiding Principles to address their own context-specific business and human rights issues.

In Malaysia, much work has already been done on this front. Its adoption will advance not only our human rights reputation, but our business and economic success at home and abroad as more stakeholders are considering social responsibility and human rights issues in business decisions. - FMT

Eric Paulsen is the representative of Malaysia to the Asean Intergovernmental Commission on Human Rights.

The views expressed are those of the author and do not necessarily reflect those of MMKtT.