Human Rights and CSR Flashcards
CASE STUDY: Lundbeck
Who is Lundbeck ?
What was the problem ?
How was it solved ?
What are the Human Rights issues at skate ?
What would you advise Lundbeck to do ?
The company: Lundbeck is a global pharmaceutical company based in Denmark which specializes in drugs for treatment of brain related diseases.
The problem: In 2011, media reports, especially in US has drawn attention to the fact that a particular medical product owned by Lundbeck was one of the three substances included in a lethal cocktail used by US prison authorities to execute prisoners sentenced to the death penalty. The drug was produced in the US by a subsidiary of Lundbeck and sold under the brand name Nembutal. The drug was approved as a treatment for epileptics. As such it was a lifesaving treatment. However, the unintended use had the exact opposite effect.
What happened? Civil society and media were concerned with the human right implications of the use of Nembutal to carry out the death penalty. Lundbeck referred to its UN Global compact participation and its CSR policy in response to the initial media reports. However, the firm’s response led to more critique of the corporation and for not paying sufficient attention to the potential CSR issues and the firm responsibilities to its products.
Human rights? It’s not to kill people, it should save them. There is a conflict problem to use it to kill people when it’s avoided in the most part of the country. The issue of the death penalty.
What should’ve they done? Consider the options. Where the product goes, manage the sales process, and only sell the product with medical prescription. It’s not a significant product, it’s not a huge financial product so they decided to sell to another company.
Who has the duty to ensure human Rights?
Business needs human rights and human rights needs business.
► Traditionally, it has been sustained that the duties derived from human rights belong to states, but companies do have human rights responsibilities.
Who is John G. Ruggie?
- He was the Chief Advisor for strategic planning to UN Secretary-General Kofi Annan.
- Ruggie’s major responsibilities included designing and overseeing the Global Compact, Annan’s initiative to engage the corporate sector in promoting UN principles in the ares of human rights, labour standards, environmental sustainability and anti-corruption.
- In 2005, Kofi Annan appointed him as Special Representative on Business and Human Rights. This was extended under Ban Ki Moon.
- From 2005 to 2008, 14 multi-stakeholder consultation on 5 continents indicated one recurring theme: the urgent need for a common framework of understanding in the business and human right area.
- In 2008, he proposed a framework based on three pillars:
- State duty to protect,
- Corporate responsibility to respect,
- Need for greater access for victims to remedy.
What is the UN Global Compact 2018?
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What is the communication on Progress (COP) ?
As a voluntary initiative, the UN Global Compact seeks wide participation from a diverse group of businesses.
As a participant in the Global Compact, a company:
- sets in motion changes to business operations so that the UN Global Compact and its principles become part of strategy, culture and day-to-day operations
- is expected to publicly advocate the UN Global Compact and its principles via communications vehicles such as press releases, speeches, etc
- is required to communicate with their stakeholders on an annual basis about progress implementing the 10 principles, and efforts to support societal priorities.
The Communication on Progress (COP) is a visible expression of your commitment to sustainability and your stakeholders can view it on your company’s profile page. Companies that fail to report or to meet the criteria over time may be removed from the initiative. There are a number of ways that companies can take action.
What are the UN Global Compact 10 principles?
[Human Rights]: P1 – Support and respect the protection of internationally proclaimed human rights & P2 – Make sure that they are not complicit in human rights abuses.
[Labour Standards]: P3 – The freedom of association and the effective recognition of the right to collective bargaining, P4 – The elimination of all forms of forced and compulsory labour, P5 – The effective abolition of child labour & P6 – The elimination of discrimination in employment and occupation.
[Environment]: P7 Support a precautionary approach to environmental challenges, P8 – Undertake initiatives to promote environmental responsibility & P9 – Encourage the development and diffusion of environmentally friendly technologies.
[Anti-Corruption]: P10 – Businesses should work against corruption in all its forms, including extortion and bribery.
Is the UN Global Compact legally binding ?
The UN Global Compact is a purely voluntary initiative. It does not police or enforce the behaviour or actions of companies. Rather, it is designed to stimulate change and to promote corporate sustainability and encourage innovative solutions and partnerships. But once policies or codes of conducts have been put in place by a business, the business has to comply with it.
The state duty to protect ?
It is the state duty to protect against human rights abuses committed by third parties, including business, through appropriate policies, regulation and abjudication. States have the primary role in preventing and addressing corporate related human rights abuses.
- States should set out clearly the expectation that all business respect human rights in their jurisdiction (recommend for home states to take steps to prevent abuse abroad by business enterprises within their jurisdiction).
- Enforce laws and assess adequacy of such laws.
- Provide effective guidance to business.
- Encourage business to communicate how they address human rights impacts.
The corporate responsibility to respect ?
Avoid infringing on the right of others and address harms that do occur. Responsibility is used instead of duty because respecting human rights is not currently an obligation imposed by international laws on companies. It applies across its activities and through its relationships with third parties (business partners, supply chain, …).
There is a major role for the Business, companies can affect the whole spectrum of human rights, so for an authori-tative list of Human Rights, reference is made to the Universal Declaration of Human Rights and core conventions of the International Labour Organization.
Companies should go beyond « say » to « know and show » that they are meeting their responsibility, meaning they need a due diligence process on human rights.
Access to effective remedy ?
Effective grievance mechanisms for victims. Judicial and non-judicial mechanisms (whether state based or independent). Non-judicial systems need to be accessible, predictable, equitable and transparent.
CASE STUDY: Fatal fire in Bangladesh
What was the situation ?
Who is accountable for that chain of events?
The situation: More than 100 people died Saturday and Sunday in a fire at a garment factory outside Dhaka, Bangladesh, in one of the worst industrial tragedies in that country. The yarn was not stored in a fireproof warehouse as required by law. The building was 9 stories high, with the top three floors under construction. Most of the workers who died were on the first and second floors, fire officials said, and were killed because there were not enough exits.
Who is accountable? The garment factory who let the employees working in a building which is not safe or finished, the owner of the building and the company who handle the construction. But also the state of Bangladesh. It could be linked to corruption or no more resource. Legally it’s the owner which is responsible. Wallmart etc has a responsibility but not accountability.
Assuming a retailer firm believes it has the responsibility, to ensure the safety of the workers through its value chain, what actions should a firm take to insure safety ? They must check the building, their working condition, if the building follow the law (like the fireproof warehouse.
Are we as consumers responsible ? The consumer decides to buy the product or not, so the producer decides to contiue, and as lons as we continue to buy, they will continue to produce. We’re therefore a stakeholder for theses firms.
FACTS about the garment industry
- 60 million workers across the developing world rely on the garment industry for their livelihoods.
- Over 80% are women and many have migrated from rural areas – or even internationally – and garment work is their first entry into the job market.
While factories are a valuable source of jobs and can help improve livelihoods of workers and their families, poor working conditions remain a pressing issue. Mechanisms to enforce labour laws are often poor and workers may not have a good understanding of their rights nor the skills to effectively realize them. _Done differently, the global garment industry can potentially lift millions of people out of poverty by providing decent work, empowering women, driving inclusive economic growth and business competitiveness._
