Business and Human rights—what is in-house counsels role?

 

46414989_xxlThe role of lawyers and general counsel in  relation to the Guiding Principles has been highlighted in a number of  recent guidance notes and studies.  The changes to the commercial, legal and societal landscape has led to changes in the role of General counsel. These facts were documented in the UN Global compact (in association with Linklaters) study[1]

Over the past two months I have been interviewing in-house lawyers and General Counsel across a number of sectors, with one aim – to find out what their understanding of the UN Guiding Principles on Business and Human Rights were and whether the organisations they represented had an understanding of these issues.

The challenges facing the companies that the GC’s represented were very diverse. It might be surprising to some that companies approaches to the implementation of the Guiding Principles vary enormously . However, given the general lack of buy in at top management level to the issues, perhaps this is not a surprise. The challenges varied form cost consciousness to maintaining moment for change.  Only one of the organisations had a stand alone human rights policy.

Whilst ensuring compliance was still a key feature of the role of the GC there is a growing trend that they become involved in broader issues and not only commercial ones. The majority of participants played active roles in either helping their organisations understand the full range of issues (including moral issues) facing the business or participating in the development of the organisations approach to human rights.

GC’s should be aware of the role that they can play in relation to human rights and business in the following areas:

  1. Demystifying the subject of human rights and understanding how it applies to their legal advice as GCs[2].
  2. Advising their board and team members on the UNGPs: all too often the boards and senior management are aware of the threat that human rights abuses can impact on the organisations reputation and performance of the company.[3] GCs are well placed to provide advice on these issues.
  3. Implementing the UNGPs within the organization:the UNGPs apply to all companies in all sectors. GCs can provide advice to their organizations on how they can meet their duty to respect human rights.
  4. Managing legal risk:. typically GCs and in-house counsel will be advising their organization on the legal risks
  5. Integrating human rights into the public disclosure requirements for non-financial information under the UK Companies Act 2006 provisions: there is growing regulation that requires listed or large companies to report on their human rights impacts in their annual reporting framework. In the UK the Modern Day Slavery Act of 2015 requires companies with a turnover of >£36million to provide a ‘Trafficking and Slavery Statement’[4]
  6. Establishing human rights due diligence procedures: lawyers are usually heavily involved in the M&A due diligence process . GCs are well placed to play a role in the development of the human rights due diligence
  7. Supply chain contracts: GCs can negotiate language in supply chain contracts to negotiate adherence to human rights standards, often with reference to the company’s supplier code of conduct
  8. Understanding where criminal law can be used to hold companies accountable for human rights abuses: in a recent case by the Paris Court of Appeals a judicial investigation into Amesys (part of Groupe Bull) to proceed regarding alleged complicity with surveillance and torture by the Gaddafi government[5]
  9. Understanding trends in regulation, for example harm to people resulting in impacts on the economies may lead to governments imposing more regulation. GCs are well placed to monitor these issues and to advise on matters such as the cost of conflicts.
  10. Providing input in Joint Venture agreements: these type of agreements are common to many major organisations, especially where they are involved in major infrastructure projects. GCs can play a critical role in the negotiation of these agreements and particularly addressing human rights in these contracts.

For a fuller overview of the findings from the interviews see 'Business and human rights: what is in-house counsels' role?' in Lexis®PSL In-house adviser.

Written by Colleen Theron,  Solicitor and founder of CLT envirolaw

[1] https://www.unglobalcompact.org/library/1351

[2]John Ruggie and John Sherman http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2657885&download=yes pg 5

[3] ibid, pg 15

[4] For a free guide see www.clt-envirolaw/resources

[5] See IBA page  32 http://www.ibanet.org/Article/Detail.aspx?ArticleUid=67452738-0438-4ad3-88ab-0d1b2c4323af 

 

 

 

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