The Doctrine of Laissez-Faire Capitalism Holds That the Common Good Is Best Served By

Human Rights Advocates

Vol. 40Winter 2002-3

1

HRA PARTICIPATION AND INTERVENTIONS

AT THE 54TH SESSION OF THE U.N. SUBCOMISSION ON

THE PROMOTION AND PROTECTION OF HUMAN RIGHTS

HRA participated at the session with a number of Frank C. Newman Interns, including two USF law students, Jennifer Lenga (Class of 2002) and Conchita Lozano (Class of 2003), and two Boalt students in the Class of 2004, Kathy Roberts and Aaron Siri. Doug Herbek also participated on behalf of HRA, providing an intervention on the Rights of Women in Afghanistan, see E/CN.4/Sub.2/

2002/NGO/2 and

The U.N. SubCommission on the Promotion and Protection of Human Rights, comprised of 26 experts, is the main subsidiary body of the Commission on Human Rights, established by the Commission in 1947 under the authority of the Economic and Social Council (ECOSOC). It meets annually in Geneva to undertake studies in the light of the Universal Declaration of Human Rights and to make recommendations to the Commission concerning the prevention of discrimination of any kind relating to human rights and fundamental freedoms and the protection of racial, national, religious and linguistic minorities; and to perform any other functions which may be entrusted to it by the Council or the Commission. It has also organized six working groups on: Communications; Contemporary Forms of Slavery; Indigenous Populations; Minorities; Administration of Justice; and Transnational Corporations.

This year, HRA’s representatives and Frank C. Newman interns provided the SubCommission with information and analyis on the issues of transnational corporate responsibility, migrant workers, and women in Afghanistan.

The following three articles were written by Frank C. Newman interns to describe the issues and their participation in this year’s session.

The Working Group on the Working Methods and Activities of Transnational Corporation

By Kathy Roberts

The Kukdong factory opened in Puebla, Mexico in 1999. It promised its mostly women workers substantial benefits, including breakfast and lunch every day, free transportation to work, and wage increases every three months. The factory soon began production of fleece for Nike and Reebok. The following spring, company officials told employees that they would be fired if they did not affiliate with the Revolutionary Confederation of Workers and Peasants (CROC), a union with which the management had already signed a collective bargaining agreement. With this protection contract in place, regular wage increases stopped, the cafeteria began serving food so rotten and unhygienic that it made several workers sick, and security personnel began invasive body searches of women workers. The workers began to organize, and in December, they boycotted the cafeteria. The CROC representative blamed a group of supervisors for the boycott. As a result, these supervisors were fired, precipitating a wildcat strike that lasted 3 days. It ended in a violent clash with police.[1]

For an international business enterprise to violate human rights is nothing new, and neither is it new for consumer groups to protest against it. In the colonial period, for example, consumer groups protested the British and Dutch East India Companies for their involvement with the slave trade.[2] Nor is the idea of a comprehensive legal document enumerating the responsibilities of international businesses particularly new. In 1974, the United Nations Commission on Transnational Corporations started drafting the first such code, though it never finished.[3]

What is new is the growing global movement to hold transnational corporations accountable for human rights abuses in an international legal context.[4] The Draft Norms on Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (Norms) represents an extremely important development emerging out of and in response to this movement.[5] The United Nations Sub-Commission for the Promotion and Protection of Human Rights (Sub-Commission) and its Working Group on the Working Methods and Activities of Transnational Corporations (Working Group) considered these Norms at the Sub-Commission’s 54th Session in Geneva this past August.

I was honored to attend and participate in this session of the Sub-Commission as a Frank C. Newman Intern. It was my pleasure to work with Aaron Siri, Jen Lenga, and Valerie Dermendjian on the research team. Conchita Lozano, Connie de la Vega, and Michelle Leighton provided invaluable guidance and support throughout our time in Geneva. In this report, I will review some of the problems and prospects for global corporate accountability and how our interventions at the Sub-Commission addressed these concerns. I will close with some reflections on the Frank C. Newman Internship Program.

In the last decade increasingly broad-based concern has emerged both for profits gained from current human rights violations and for those stemming from past violations, such as the profits Ford and Siemens made during the Holocaust.[6] At the same time, multinational trade agreements have made it increasingly cheap and easy for large businesses to move in and out of domestic markets at great speed, further increasing the potential for human rights abuses.

Before trade liberalization, large multinational business enterprises would build and operate factories inside countries with target markets. In this way they would become “domestic” producers and avoid paying tariffs. Now that many tariffs and other trade barriers have been removed, such businesses are using new strategies. Particularly in the garment industry, businesses are finding ways to “outsource.” That is, they increasingly rely on locally-owned affiliates, sub-contractors, and suppliers to make their products. This way, a large business can enter several short-term contracts, requiring suppliers to compete with each other, one product at a time. Suppliers often work for several multinational businesses at once, and there is no reason they should not be multinational businesses themselves.

In this context, domestic governments are even more beholden to foreign investors than they once were. Nations, like sub-contractors, must compete for investment. Many developing nations find it difficult to enforce their own laws because it might make domestic businesses (many of which are sub-contractors) less competitive. Raising or enforcing labor standards may mean higher unemployment. Thus, lower prices in the form of suppressed wages and lax environmental standards may be the unfortunate but necessary price of attracting business.

Many of the injuries people suffer in the context of globalization are prohibited as human rights violations by United Nations (UN) and International Labor Organization (ILO) conventions. For example, the ILO’s Declaration on Fundamental Principles and Rights of Work, a compact list of minimum human rights at work, includes the right to freedom of association, the right to collective bargaining, the right to freedom from forced and child labor, and the right to freedom from discrimination in employment. There is nearly universal recognition of these rights but no international regime for enforcing them.

In the absence of domestic and international action, non-governmental organizations, consumer groups, universities, company shareholders, and even transnational corporations themselves have attempted to fill this regulatory void with voluntary codes of conduct. As voluntary codes, they are obviously limited in what they can achieve. In 1999, the Sub-Commission asked the Working Group to develop a legally binding, universal code of conduct for transnational corporations.[7] The Norms represent a near realization of that goal. Our research team focused on the proposed Norms. My research focused on the implementation of voluntary codes in hope of informing their future implementation.

I focused this work on Kukdong for three reasons: First, Mexico has strong labor laws on the books, but it has significant problems with enforcement. Second, in the US-based garment industry there are really two major voluntary codes and monitoring systems that apply to transnational corporations, both of which applied to this factory: the Fair Labor Association, which was formed under the Clinton administration in collaboration with business interests, and the Worker Rights Consortium involving union organizations and human rights groups (formed largely as a result of the anti-sweatshop movement across US campuses). Third, it was a success story. The workers at that factory had an independent union when I started my research, and they signed a collective bargaining agreement with management just before I finished.[8]

Nike admits that its own internal monitoring “missed key elements of the factory labor situation, including reports of abuse and questions about wage calculation.” The Worker Rights Consortium began its investigations in response to a worker complaint filed in January 2001. Verité (affiliated with the FLA) began its investigations at the request of Nike and Reebok, possibly in response to the WRC’s first, preliminary report, published January 24, 2001. Both Verité and WRC found significant violations at the Kukdong factory, but there were some significant differences in their findings and in their methods.

Most significantly, the WRC received a worker-initiated complaint. Without that, the problems at Kukdong might never have come to light. To make that possible, their work started early: They instituted local complaint procedures before any problem was known. To do that, they had to locate subcontractors and suppliers and to coordinate with other NGOs that could stay in touch with workers. To make that possible, the WRC code of conduct required disclosure of all supplier locations, and a brand, Nike in this case, had to comply with that requirement. Because of this, we requested clarification in our lobbying materials that the Norms would require disclosure of subcontractor and supplier locations. In all of our oral interventions (and with the most emphasis in mine), we argued that this would be essential for future effective enforcement. Based on this example, we noted that transnational corporations have the power to affect significant improvements within their supply chain when human rights violations receive public attention. The success in defending trade union rights at the Kukdong factory depended at least in part on organized pressure from students and universities. Yet, university-based initiatives are significantly hampered when monitors simply do not know where to find subcontractors and suppliers. We noted that within some industries, supplier location is considered a trade secret and that without this carefully guarded information, independent monitoring is virtually impossible. I understand that this concern will be addressed in the revised Commentary to the Norms.

We also urged the Sub-Commission to focus future efforts on developing local, community-based, reporting procedures and a UN oversight mechanism. Without local, accessible, reporting procedures that are independent of both business and government, and a UN oversight body to receive reports, we argued that the promise of the Norms might remain unfulfilled. Potential victims of abuse need to know their rights, and they need to know where to turn should their rights be violated. We argued that internal procedures within businesses often would not be sufficient since victims of abuse by a business might not trust it. The most recent draft of the Norms, appended to the Working Group’s report, adds language that monitoring shall “includ[e] complaints of violations.”[9] The most recent draft also clarifies the role of domestic courts in enforcing compliance with the Norms.[10]

We suggested that the United Nations could facilitate implementation by coordinating with local, independent, non-governmental, and community-based organizations, that is, with people who know the local situation and who have the trust of their community members. Under the oversight of a UN body, these organizations could take the responsibility of notifying potential victims of their rights and establishing contacts for communicating human rights abuses. We emphasized that workers employed by transnational corporations and the communities that live in the vicinity of their operations can often provide the most current information regarding how company practices affect them.

We suggested that a UN oversight body specializing in transnational corporations, for example, a panel of experts such as the current Working Group, a Theme Procedure, or a Special Rapporteur, could receive and act on reports. Such a body might have several other functions including: developing a list of local contacts and approved independent monitors; facilitating dialogue between businesses, workers, NGOs, national and community leaders, and the IMF or World Bank if appropriate; determining remedial steps for businesses not in compliance with the Norms; promoting the use of human rights impact statements and investigations; and soliciting and receiving information disclosures required by the Norms. Because the mandate of the Working Group has been extended for one year, our more ambitious ideas regarding implementation are likely to be taken into account as the document moves forward. Research and exploration into exactly how different implementation mechanisms might work could prove very useful to those who attend the Sub-Commission next year.

Attending these meetings as a Frank C. Newman intern was a tremendous experience both in terms of the thrill of being at the United Nations and in terms of the sheer volume of information presented on the state of human rights in the world. It was intense! We made three oral interventions, one at the Working Group and two at the Sub-Commission, and it was very gratifying to have so many people coming up to ask us for copies of our speeches. Several people I met at the Sub-Commission said they knew or remembered Frank Newman. Naturally, there were several events that honored him, including a luncheon I attended where high-school students presented their ideas for promoting peace.

We also met a huge number of concerned activists who attend Sub-Commission meetings regularly, a possibility I had not previously considered. In particular, on my last night in town, I had dinner with a number of interns and staff members who have been attending the Sub-Commission for years. I should not have been surprised when they started reminiscing about Frank Newman. One woman I met there remarked on how Frank was always thinking of new, creative ways to achieve key human rights objectives. For example, when efforts to lobby against female genital mutilation were bogging down in the Sub-Commission (conventionally addressed by the Special Rapporteur on Traditional Practices Against Women), Frank suggested thinking of FGM as a human rights violation against the child. This opened up the advocacy options considerably and put a whole new spin on the problem.[11]

I want to encourage interested law students to apply for a Newman internship. The kind of real-world, real-time training and education we received from talking with HRA board members and activists, with government Experts and Representatives, with members of NGOs and from collaborating with them on language, law, and politics is simply beyond anything we could have received in a classroom. Further, and perhaps more importantly, this internship gave me the opportunity to work on an issue I care about and to help make better law. Even if nothing I helped lobby for were taken up into the final document, I would feel I had nonetheless contributed meaningfully to the process. Thanks again for the opportunity!

Transnational Corporation Human Rights Accountability at the Sub Commission on Human Rights

By Aaron Siri

“‘The doctrine of laissez-faire capitalism holds that the common good is best served by the uninhibited pursuit of self-interest. Unless it is tempered by the recognition of a common interest…, [our democratic open society] is liable to break down.’”[i] George Soros, President of Soros Fund Management, Chief Investment Advisor to Quantum Fund, Founder of Open Society Institute

I attended the 54th Session of the Sub Commission on Human Rights as a Frank E. Newman Intern under the supervision of Human Rights Advocates in Geneva this past summer. Before delving into the experience of being a Frank E. Newman Intern or the issue of transnational corporate human rights accountability I will start by telling a story that illuminates the difficulties in applying a regime of international corporate accountability.

The Dabhol Power Corporation (DPC) is the largest single foreign investment in India and the largest power project in the world. Amnesty international reports that environmental activists and local organizations believe DPC will have serious consequences on the surrounding environment and thus have peacefully demonstrated to oppose it.[ii] However, the DPC has not taken kindly to these demonstrations.

A 166-page report by Human Rights Watch provides evidence of systematic suppression of freedom of expression and the use of excessive force by police such as arbitrary detention ranging from a few days to a few weeks and brutal arbitrary beatings. In one of these incidents, in June 1997, local police raided a fishing village whose residents had been vocal opponents of the power plant. The police arbitrarily beat and arrested dozens of villagers, including the wife of a well-known plant protester. They broke into her bathroom “and dragged her naked out into the street, beating her with batons. [She] was three months pregnant at the time.”