The threat of stricter legislation and a recent legal challenge give companies an indication of future expectations regarding business and human rights.
The European Union is failing to stifle a deadly trade in conflict minerals, a coalition of rights groups including Global Witness and Amnesty International warned recently, ahead of weak new legislation being discussed in the UK parliament.
New research by Global Witness shows that companies are bringing billions of euros worth of minerals into Europe without having to disclose if their purchases finance armed groups or human rights violations in countries ravaged by conflict.
“At the moment we have no way of knowing what European companies are doing to avoid funding conflict or human rights abuses,” says Michael Gibb of Global Witness.
“The European commission has proposed legislation it claims will tackle the problem, but the draft law only goes so far as to suggest companies voluntarily check and declare the source of their minerals. Studies show companies simply don’t check their supply chains, unless they are required to. Putting it starkly, this legislation will not meaningfully reduce the trade in conflict minerals.”
So campaigners want companies to be legally obliged to check their supply chains.
Its easy to see why. The devil in that idea, is of course in the detail. Hammers can be used to crack nuts, but that doesn’t mean they are the best tool, however effective they might appear to be.
Companies, of course, do check their supply chains without being forced to. At least, say, the top few thousand in Europe, depending on how you define “check”.
We all know checking alone won’t solve many or even any problems. It’s what happens with the results that counts, until we bump up against the complex barriers of national law and expectations, culture and institutions and their effectiveness.
What is clear is that campaigners won’t be stopping these requests any time soon, and that in some sectors, mining for example, we’re seeing more and more reporting requirements.
It is hard to predict if and when EU companies will be forced to check their supply chains – however that is defined – but a betting man might consider backing a situation where reporting requirements on the state of supply chains will increase.
Campaigners v companies
Reporting, after all, is the great government compromise between campaigner demands and big company progress, without being seen as going too far in restricting trade.
“A class action suit brought by a group of trafficked children from Mali to the US 9th Circuit Court may have an impact on how corporations develop their business models in the future.
“In John Doe et al v Nestlé et al, child plaintiffs argued that Nestlé, ADM, and Cargill aided and abetted enslavement (and numerous violations of international and US law) in the companies’ cocoa supply chains. The former child slave labourers were allegedly trafficked by cocoa growers into Ivory Coast and forced to work in fields that supplied cocoa beans to the defendants in the case. The court held that they could bring the action under the US Alien Tort Statute. Since 1980, courts have interpreted this statute to allow foreign citizens to seek remedies in US courts for human rights violations for conduct committed outside US borders.”
Now, this is just the latest salvo in a long running series of cases against companies for alleged connections to human rights abuses.
In the long run, the companies involved, in this case Nestlé, matter less than the fact that lawyers are trying to find ways to use old US laws to attack companies on human rights issues.
In this particular case, the idea that Nestlé, ADM and Cargill knowingly aided and abetted enslavement is rather far fetched.
However, the lawyers may be able to make the companies uncomfortable in the public eye, and that’s been enough to claim victory in the past. And if the case goes to trial, (none have yet, they are usually thrown out, or settled) there’s always the chance that the companies can be criticised for unknowingly aiding and abetting enslavement, at least in the court of public media opinion.
In her blog post, Irit Tamir notes:
“The John Doe can is significant because it exploits the narrow opening that the Supreme Court left open for Alien Tort Statute plaintiffs following their ruling in the Kiobel v Royal Dutch Petroleum Co. case in 2013. In this case, the Supreme Court effectively closed the door to most foreign nationals suing foreign corporations in US federal courts. The plaintiffs in Kiobel were Nigerian citizens who claimed that Dutch, British, and Nigerian oil-exploration corporations aided and abetted the Nigerian government during the 1990s in committing violations of customary international law when they brutally crushed peaceful resistance to aggressive oil development in the Ogoni Niger River Delta.”
So the case, and its outcome, is worth keeping an eye on.