In the course of globalisation, the power and influence of transnational companies have continued to increase. Such companies make use of complex supply chains and value chains. Some have purely profit-oriented business models, while others lack awareness of threats to human rights. As a result, the risk of human rights violations by companies has risen overall. States often fail to take sufficient counter measures, since they are vying with one another to be attractive business locations.
Business activities may come into conflict with human rights in various ways. For instance, companies that produce in developing and emerging countries often do not pay living wages. Further examples are:
Many companies have developed voluntary transnational corporate social responsibility (CSR) initiatives. Those include, for instance, company codes of conduct, multi-stakeholder initiatives, i.e. voluntary alliances between public, civil society and private-sector actors, and the engagement of consulting and audit firms. That makes an important contribution. However, such voluntary initiatives have not resulted as yet in major improvements for those affected, chiefly because of the lack of monitoring and sanctioning possibilities.
To oblige companies to conform with human rights, the United Nations developed the UN Guiding Principles on Business and Human Rights (PDF, not barrier-free). They were unanimously endorsed by the Human Rights Council of the United Nations in June 2011. Although they are not legally binding, they represent a consensus between the international community, business and civil society.
The UN Guiding Principles rest on three pillars. The first emphasises the state duty under international law to protect and implement human rights. States have a duty to protect all those living on their territory.
The second involves the independent responsibility of companies. They should take due care to ensure that human rights are respected in the course of all their activities.
The third focuses on those affected and their right to remedy. The state and companies need to establish complaint mechanisms that those affected can turn to and that guarantee suitable compensation in the event of damage.
The Guiding Principles assign a key role to National Human Rights Institutions (NHRIs). Pursuant to the UN Guiding Principles, states need to identify whether their relevant laws are aligned with their human rights obligations and are being effectively enforced. The NHRIs have an important part to play in helping states in that task, as well as in providing guidance on human rights to business enterprises and other non-state actors.
The German Institute for Human Rights is involved in the development of a National Action Plan on Business and Human Rights and is auditing implementation of the UN Guiding Principles as part of that process.
German Institute for Human Rights (2015): National Baseline Assessment: Implementation of the UN Guiding Principles on Business and Human Rights (only available in German)
In addition, on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), the German Institute for Human Rights is researching human rights risks in sectors where violations of human rights are particularly prevalent, i.e. the mining of raw materials, the production of textiles and investments in land. In order to do so, it is working together with other National Human Rights Institutions. Such cooperation is designed to strengthen the role of all NHRIs in the field of business and human rights. The results of the research are incorporated into the advice given to the BMZ. That chiefly revolves around how development policy can promote respect for human rights in the transnational business context.
The priorities of the German Institute for Human Rights in the field of business and human rights are:
Researcher and Policy Adviser
Business and development cooperation, arms exports, climate and energy
Phone: +49 30 25 93 59 - 243
Senior Researcher and Policy Adviser
Access to justice, investment and trade agreements
Phone: +49 30 25 93 59 - 461