Introduction
This website provides analysis and examples relevant to applying the UNGPs to the specific context of commodity trading. It is intended to help representatives of commodity trading firms to implement the UN Guiding Principles on Business and Human Rights (UNGPs) in their own systems and company cultures. It should also be useful to those who are interested in promoting respect for human rights in the commodity trading sector, including industry associations, civil society organisations and governments. The content provided here is taken from The Commodity Trading Sector: Guidance on Implementing the UNGPs ("the Guidance").
Background
The 2013 Background Report on Commodities of the Swiss Federal Council highlighted the economic importance of commodity trading for Switzerland. Based on a recommendation in the Background Report, the Federal Department of Foreign Affairs (FDFA) and the State Secretariat for Economic Affairs (SECO) in 2015 mandated the Institute for Human Rights and Business (IHRB) to work with stakeholders to develop guidance for the commodity trading sector on implementing the United Nations Guiding Principles on Business and Human Rights (UNGPs) (see UNGPs section).
The FDFA and the SECO in consultation with industry and civil society representatives agreed steps for a process that would produce:
- a Mapping Study providing an overview of human rights issues associated with commodity trading based on perspectives from company representatives and other stakeholders as well as a review of existing reports and relevant information from civil society, academic experts and other actors (published in March 2017),
- followed by the development of this Guidance for the industry on implementing the UNGPs.
This is the first guidance document developed in a national context with a specific focus on commodity trading and human rights. It draws on a range of existing resources and implementation tools.
Global Developments
In addition to developments in Switzerland, a number of initiatives and related research relevant to commodity trading have been launched or continued in recent years. The most significant of these comprise the various OECD publications outlined in the Additional Resources section of this website.
More recently the requirement to conduct human rights due diligence is now being mandated by bodies such as the European Union and the London Metal Exchange, as well as national governments. See Additional Resources section for more information.
Methodology
The Federal Department of Foreign Affairs (FDFA) and the State Secretariat for Economic Affairs (SECO) mandated the Institute for Human Rights and Business (IHRB) to work with all representatives from different stakeholder groups to develop guidance for the commodity trading sector on implementing the UNGPs.
The development of the Guidance has been informed by a Mapping Study published by IHRB in March 2017. This Guidance has been prepared by IHRB in consultation with the project multi-stakeholder Advisory Group*. The Swiss Government thanks members of the Advisory Group for their valuable insights and comments.
Foreword from the Swiss Government
Foreword FDFA/SECO
“Business, labor and civil society organizations have skills and resources that are vital in helping to build a more robust global community” as Kofi Annan once stated.
In this spirit the key 2013 Background Report on Commodities of the Swiss Federal Council recommended that the Federal Department of Foreign Affairs (FDFA) and the State Secretariat for Economic Affairs (SECO) develop practical guidance for the commodity trading sector together with stakeholders from the industry and the civil society.
The Federal Council expects companies based and/or operating in Switzerland to act responsibly in accordance with international Corporate Social Responsibility (CSR) standards and to fulfil their responsibility to respect human rights in all of their business activities, wherever they operate. This expectation has been set out in the Federal Council’s Position Paper on Corporate Social Responsibility (2015) and National Action Plan for the implementation of the United Nations Guiding Principles on Business and Human Rights (UNGPs; 2016).
Since 2015, the FDFA and SECO have engaged with companies involved in commodity trading, NGOs and the canton of Geneva on behalf of other relevant cantons in this matter such as Zug and Tessin, as well as through public consultation to elaborate a guidance document on human rights due diligence. This collaborative approach is exemplary. It has greatly helped to promote a common understanding of responsible business conduct among all key actors in Switzerland and we strongly believe it will contribute to further promoting responsible practices of the commodity trading sector in Switzerland and beyond.
The objective of this Guidance is to support companies in implementing human rights due diligence for their own activities and along their supply chain, based on the UNGPs. The Guidance is consistent with and draws on the relevant OECD Guidances. It recalls the fundamental responsibility of all business enterprises to respect human rights, enshrined in the UNGPs and the OECD Guidelines for Multinational Enterprises that companies “should avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved”. This Guidance is not legally binding, neither is it intended to replace existing industry standards. However, it seeks to be as globally applicable as possible and serves as a tool for the commodity trading sector as a whole in developing a shared practice of responsible trading which is consistent with international standards.
The challenge now is to make all companies active in commodity trading aware of the Guidance and foster effective implementation. This will involve a range of efforts by the industry, alongside civil society and government. We are committed to working with all actors to support broad dissemination and implementation.
OECD Due Diligence Guidance
The OECD Due Diligence Guidance Responsible Supply Chains of Minerals from Conflict-Affected and High-risk Areas applies to companies involved in mineral resources trading, and has been incorporated in several regulations as well as by mandatory industry schemes such as the London Bullion Market Association (LBMA) Responsible Gold Guidance.
*Advisory Group Members
Advisory Group Members are representatives of the following organisations: Cargill, Glencore, Swiss Trading and Shipping Association, Bread for All, Public Eye, SWISSAID, Canton of Geneva, Swiss Federal Department of Foreign Affairs and Swiss State Secretariat for Economic Affairs.