What Are Human Rights?
Human rights are internationally agreed standards aimed at securing dignity and equality for all people. These rights apply to every human being without discrimination. At the international level, they include the rights contained in the “International Bill of Human Rights” which is comprised of the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights. These instruments, beginning with the Universal Declaration adopted by the United Nations in 1948 in the aftermath of the second World War, set out a range of rights and freedoms including the rights to life, to freedom of expression, to privacy, to education and to favourable conditions of work.
Under international human rights law, States have a legal obligation to respect, protect and fulfil the rights contained in specific treaties they ratify. This includes the obligation to protect individuals and groups from abuses caused by or involving third parties, including business enterprises.
Human rights also include labour rights set out in the International Labour Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work, which addresses freedom of association and collective bargaining, forced labour, child labour and non-discrimination. In addition, potentially vulnerable or marginalised individuals and groups (such as children, indigenous peoples and women) are the subject of specific international instruments that help provide clarity on how human rights apply to them (see Additional Resources for a list of relevant instruments).
Background to UNGPs
The United Nations Guiding Principles on Business and Human Rights (UNGPs) were developed by the Special Representative of the UN Secretary-General on the issue of human rights and transnational corporations and other business enterprises.
The UNGPs were unanimously endorsed by the UN Human Rights Council in 2011. They are based on the three pillars of the UN “Protect, Respect and Remedy” Framework:
UNGPs Pillars
PILLAR I. The State duty to protect against human rights abuses by third parties, including businesses, through effective policies, legislation, regulations and adjudication;
PILLAR II. The corporate responsibility to respect human rights, meaning that companies should avoid infringing on the rights of others and address negative impacts with which they are involved; and
PILLAR III. The need for greater access to effective remedy for victims of business related human rights abuses, through both judicial and non-judicial means.
Since this Guidance is intended for the commodity trading sector, it focuses primarily on those aspects set out in Pillar II of the UNGPs relating to the corporate responsibility to respect human rights; and Pillar III references to business involvement in operational-level non-State grievance mechanisms for individuals or communities who may be adversely impacted by business activities.
The second pillar of the UNGPs “protect, respect, remedy” framework is the corporate responsibility to respect human rights. As UNGP 11 states, “business enterprises should respect human rights. This means that they should avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved.”
The corporate responsibility to respect human rights as set out in the UNGPs contains a number of key concepts:
UNGPs Key Concepts
Human Rights Due Diligence
Human rights due diligence is an on-going risk management process that a reasonable and prudent company needs to follow in order to identify, prevent, mitigate and account for how it addresses its negative human rights impacts. It includes four key steps: assessing actual and potential human rights impacts, integrating and acting on the findings, tracking responses, and communicating how impacts are addressed.
Business Relationships
Business relationships refer to those relationships a company has with business partners, entities in its value chain and any other non-State or State entity directly linked to its business operations, products or services. They include business relationships in its value chain, beyond the first tier, and minority as well as majority shareholding positions in joint ventures.
Leverage
Leverage is an advantage that gives power to influence. In the context of the UNGPs, it refers to the ability of a company to effect change in the wrongful practices of another party that is causing or contributing to a negative human rights impact.
Communication
Communication is a regular sharing of information through – for example – public corporate sustainability reports including dedicated human rights reporting sections.
Remedy
Where a company identifies that it has caused or contributed to adverse impacts, it should engage in remediation, by itself or in cooperation with other actors. Remediation is the process of providing remedy. Remedies can take various forms including apologies, provisions to ensure the harm cannot recur, restitution or rehabilitation etc.
The Guidance section provides further details on these concepts and examples for each step of the due diligence process in the context of the commodity trading sector.
Human Rights Due Diligence
Implementing the corporate responsibility to respect human rights requires a process of ongoing due diligence. Human rights due diligence processes help companies understand human rights risks, how these risks may change over time and how to address them.
Human rights due diligence is not a one-off event but should instead be an ongoing process:
UNGPS 17 & 18 Human Rights Due Diligence
UNGP 17 defines the parameters of the concept of human rights due diligence:
In order to identify, prevent, mitigate and account for how they address their adverse human rights impacts, business enterprises should carry out human rights due diligence. The process should include assessing actual and potential human rights impacts, integrating and acting upon the findings, tracking responses, and communicating how impacts are addressed. Human rights due diligence:
- should cover adverse human rights impacts that the business enterprise may cause or contribute to through its own activities, or which may be directly linked to its operations, products or services by its business relationships;
- will vary in complexity with the size of the business enterprise, the risk of severe human rights impacts, and the nature and context of its operations;
- should be ongoing, recognizing that the human rights risks may change over time as the business enterprise’s operations and operating context evolve.
Note: The Commentary to UNGP 17 provides additional explanation and guidance including that human rights due diligence can be included within broader enterprise risk management systems, provided they go beyond managing material risks to the company to include risks to rights-holders.
UNGP 18 clarifies that this process should “draw on internal and/or independent external human rights expertise and involve meaningful consultation with potentially affected groups and other stakeholders as appropriate to the size of the business enterprise and the nature and context of the operation.”
As John Ruggie, the former Special Representative of the UN Secretary-General on business and human rights and author of the UNGPs has noted with respect to due diligence:
"This concept describes the steps a company must take to become aware of, prevent and address adverse human rights impacts… The due diligence process should consider three sets of factors: the country contexts in which the organization operates, the potential and actual human rights impacts resulting from the organization’s activities, and the relationships connected to those activities (such as with business partners, suppliers, State agencies and other non-State actors). How far or how deep this process must go will depend on circumstances."
Report of the UN Special Representative, A/HRC/8/5, 7 April 2008
As noted in the UNGPs Reporting Framework, an initiative which provides guidance for companies to report on human rights issues, human rights due diligence is “an ongoing risk management process…in order to identify, prevent, mitigate and account for how [a company] addresses its adverse human rights impacts. It includes four key steps: assessing actual and potential human rights impacts; integrating and acting on the findings; tracking responses; and communicating about how impacts are addressed.”
To be effective and consistent with the UNGPs, human rights due diligence should address adverse human rights impacts that firms ‘cause’ or ‘contribute to’ or which are ‘directly linked’ to operations through business relationships (see UNGPs 17 (a), 19 (b)(i), 22 and related commentaries). The way a company is related to adverse impacts will determine the type of action it is required to take in response (UNGP 13 (b)).
Definition Internationally recognised
human rights
The UN Guiding Principles on Business and Human Rights define these – at the minimum – as the rights in the International Bill of Human Rights (meaning the Universal Declaration on Human Rights, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights) and the principles concerning fundamental rights set out in the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work.
Definition Rights holders
In general terms, all human beings are considered to be “rights-holders” under the Universal Declaration of Human Rights and other international human rights standards. The term “duty-bearers” refers to those actors who have particular obligations or responsibilities to respect, protect and fulfill human rights. The term “duty-bearers” is most commonly used to refer to State actors. Specific groups of rights-holders, such as indigenous peoples, may have particular entitlements in relation to specific duty-bearers. A rights-based approach also considers rights-holders as active agents in the realisation of human rights.
UNGP 11 Principle
Business enterprises should respect human rights. This means that they should avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved.
UNGP 13 Principle
The responsibility to respect human rights requires that business enterprises:
(a) Avoid causing or contributing to adverse human rights impacts through their own activities, and address such impacts when they occur;
(b) Seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, even if they have not contributed to those impacts.
Definition Human rights risks
A company’s human rights risks are any risks that its operations may lead to one or more negative human rights impacts. They therefore relate to its potential human rights impacts. In traditional risk assessment, risk takes account of both the consequences of an event (its “severity”) and its probability. In the context of human rights risk, severity is the predominant factor. Probability may be relevant in helping prioritize the order in which potential impacts are addressed in some circumstances. Importantly, a company’s human rights risks are the risks that its operations pose to human rights. This is separate from any risks that involvement in human rights impacts may pose to the enterprise, although the two are increasingly related.
