Any of our business? Human Rights and the UK private sector - Human Rights Joint Committee Contents


1. During the past year, in the coverage of the "credit crunch" which led to the recession, politicians, academics and commentators have consistently called for increased responsibility on the part of the banking and wider private sector as corporate citizens. Opening the G20 summit in London, the Prime Minister advocated new "family values" for the financial sector and argued "markets need morals". [1]

2. In this climate of renewed interest in private sector responsibility, we decided to return to the issue of human rights and UK business. Over the course of our work, we have often considered how human rights obligations apply to the private sector; what implications the private sector may have for the human rights obligations of the UK; and how the UK should regulate the private sector to protect individual rights. We have reported on a number of occasions on the scope of the Human Rights Act 1998 and the circumstances in which private sector entities, performing a public function, will be subject to the duty to act in a Convention compatible way.[2] It is now widely accepted, including by many businesses, that business can affect the human rights of individuals not only when performing public functions, but also in their everyday activities.

3. There are many reasons why we consider that this inquiry provides a timely opportunity to consider the relationship between the activities of the private sector and the human rights obligations of the UK. For example, over the course of the past year several issues have been raised in Parliament and reported in the press raising concerns about the impact of private sector activities on rights such as the right to respect for home and private and family life:

  • Increased repossession activity by banks and other lenders during the recession led to the widespread publicity of the need for effective procedural and other protection for the right to respect for home and family life. In 2008, we raised our concern that judgments of the UK's domestic courts had led to the outcome that lenders being able to evict homeowners without due process after only one missed mortgage payment. We asked the Secretary of State for Justice whether allowing individual lenders to enforce their own right to recovery in this way was a disproportionate interference with the right to respect for home and private life, as guaranteed by Article 8 ECHR.[3]
  • The launch of Google Street View across Europe led to a number of challenges, including in the UK, Switzerland and Greece, alleging that the operation of the service was incompatible with the right to respect for private life (as guaranteed by Article 8 ECHR) and EU data protection law.[4]
  • The European Commission has begun proceedings against the UK in respect of the operation of Phorm, (a behavioural based advertising tool, tested by BT on its customers without prior consent) for alleged breaches of the protection of privacy contained in EU data protection law.[5]
  • In July 2009, after an investigation by the Information Commissioner's Office, Ian Kerr was fined for breaches of the Data Protection Act in relation to the operation of a database or "blacklist" of construction employees, which infringed the employees' right to respect for their personal information. In August 2009, enforcement notices were issued against several companies alleged to have used the services of Mr Kerr's company, The Consulting Association.[6]
  • In July 2009, the Guardian reported that the News of the World had settled litigation after allegations that the newspaper had been involved in phone-tapping.[7] The interception of communications engages the right to respect for communications, the home and private life. Although no new prosecutions resulted from the revelations, representatives of News Group Newspapers and the News of the World were called to answer questions about the allegations by the House of Commons Culture, Media and Sport Committee.[8]

4. Most public discussion of these cases focused on the practical impact of business activities on the right to privacy, on the assumption that the right to privacy is just as important where the interference is caused by a company rather than a public body. These stories are in addition to the well publicised human rights issues arising in the provision of social services by private providers, particularly in the health and social care sectors. For example, Parliament and the UK's domestic courts have recently had to grapple with the implications for the right to respect for private and family life when private care home providers propose to evict elderly residents, such as Mrs YL, who faced losing her home after her private care providers entered into a dispute with her family members.[9]

5. It is also relevant to consider the impact of UK companies operating overseas on the UK's international human rights obligations. Over the past decade there have been a number of high-profile stories about the role of UK companies in alleged human rights abuses overseas. For example:

  • In July 2006, BP settled a claim in the High Court by Columbian farmers who had alleged that the company's involvement with the military in the construction of the Ocensa pipeline had led to breaches of their human rights. No admissions of liability were made.[10]
  • In August 2008, the UK National Contact Point concluded that Afrimex UK Ltd was in breach of OECD Guidelines for Multinational Enterprises in relation to its minerals' operations in the Democratic Republic of Congo. The NCP's conclusion included a decision that Afrimex had failed to respect human rights. This finding followed separate investigations on the trade of natural resources during the conflict in the Congo by both the United Nations and the House of Commons International Development Committee.[11]
  • In June 2009, Royal Dutch Shell, an Anglo-Dutch company, reached a widely reported settlement in a claim in the New York Courts under the US Alien Torts Claims Act, in respect of its operations in Nigeria. No admissions of liability were made.
  • In September 2009, commodities trader Trafigura reached a settlement in a High Court claim in respect of allegations of negligence causing serious injury and loss of life in connection with the dumping of allegedly toxic materials in West Africa. No admissions of liability were made, but again the case gained widespread publicity in the UK and overseas. [12]
  • In September 2009, the UK National Contact Point concluded that Vedanta Resources Plc was in breach of OECD Guidelines for Multinational Enterprises in relation to its mining operations in Orissa, India. The NCP's conclusion included a decision that Vedanta had failed to respect the rights and freedoms of the local indigenous people affected by their operations.[13]
  • In October 2009, Labour behind the Label published its third report on respect for labour rights on the UK high street. These reports focused on the garment industry and criticised the performance of a number of UK retailers in relation to working conditions in their overseas suppliers.[14]

6. These issues, all widely reported, have led to public concern about how businesses respect human rights in their operations and whether firms have a role to play in securing protection for human rights, especially in countries with weak governance systems.

Our inquiry

7. We held a mini-conference at the start of this year to consider the scope of our inquiry, inviting representatives of NGOs, business organisations and individual businesses.[15] We issued a call for evidence on 6 March 2009. We asked a number of broad questions based upon the framework proposed by Professor John Ruggie, the UN Special Representative on Human Rights and Transnational Corporations and other Business Entities ("the UN Special Representative"), about the roles of UK Government and UK business and the impact of the private sector on the fundamental rights of individuals in the communities where UK businesses operate. We focused on:

  • the way in which businesses can affect human rights both positively and negatively;
  • how business activities at home and abroad engage the relative responsibilities of the UK Government and individual businesses; and
  • whether the existing UK regulatory, legal and voluntary framework provides adequate guidance and clarity to business as well as adequate protection for individual rights.

8. We asked for information on three principal areas:

  • the scope of the duty of the UK to protect human rights;
  • the responsibility of UK businesses to respect human rights; and
  • effective access to remedies for individuals whose human rights have been affected by the activities of UK businesses.

9. In June, we issued a supplementary call for evidence, drawing attention to recent developments and Government proposals, including the draft Bribery Bill and the Foreign and Commonwealth Office ("FCO") Consultation on Private Military Security Companies, published in April 2009. We received over 85 submissions and supplementary submissions, from international organisations, NGOs, businesses, business organisations, academics, individuals, trade unions and Government.[16] This included evidence from a range of witnesses who had not previously engaged with our work, particularly from businesses and individuals who have focused on the corporate responsibility of UK companies in their activities overseas. Most of this evidence is published in full in the second volume of this Report.

10. We held five oral evidence sessions. At our first session, on 3 June, we heard from Professor John Ruggie. We are particularly grateful to the UN Special Representative and his advisors for being able to give oral evidence at relatively short notice. We then heard from:

  • NGOs and lawyers representing individuals affected by the human rights impacts of business and from the TUC and the Institute for Employment Rights on labour rights (9 June 2009);
  • Representatives from the CBI and a number of individual UK companies: Tesco, Associated British Foods (parent company of Primark), Rio Tinto and BP (30 June 2009);
  • The Equality and Human Rights Commission (EHRC) and the Scottish Human Rights Commission (SHRC), on the role of National Human Rights Institutions (NHRIs) in respect of the impact of the private sector on human rights (7 July 2009).
  • Global Witness about the particular impact of business in areas of conflict (7 July 2009).

11. At our final session, on 14 July, we heard from Lord Malloch-Brown, then Minister for Africa, Asia and the UN, Foreign and Commonwealth Office (FCO), Ian Lucas MP, Minister for Business and Regulatory Reform, Department for Business, Innovation and Skills (BIS) and Michael Wills MP, Minister for Human Rights, Ministry of Justice.

Visit to the United States

12. As part of our inquiry, we visited New York and Washington DC, where we met with the UN Global Compact,[17] a number of US businesses, NGOs, academics and attorneys representing both businesses and claimants, politicians and policy makers in the Departments of State and Justice.[18] A similar debate is underway in the United States about the responsibility of business for its impacts on the community and on fundamental human rights. In 2008, the Senate Judiciary Sub-Committee on Law and Human Rights conducted a series of hearings on corporate responsibility and the rule of law. These focused principally on the internet and the extractive industries, but otherwise covered similar issues to our inquiry. Opening its inquiry, the Senate Committee Chairman, Senator Durbin, stressed that the actions of the US Government and individual US companies could impact on the rights of individuals in countries where those companies operate. While he did not doubt that US companies would favour human rights protection, its inquiry intended to consider whether Congress should take steps to convert any moral obligation to respect the rights of the communities where US companies operate into a legal one.[19] US law provides an express statutory cause of action for foreign nationals against private citizens for breaches of international law, including certain fundamental human rights standards, in the Alien Torts Claims Act (ATCA).[20] We found this visit invaluable in informing this Report.

13. We are grateful to everyone who has assisted us with this inquiry. We are particularly grateful to our hosts and interlocutors during our visit to the United States.

Structure of this Report

14. In Chapter 2, we provide a brief introduction to the legal framework, including how the activities of the private sector are affected by the human rights obligations of the UK and how those obligations may require the regulation of business. In Chapter 3, we summarise the evidence we received on the positive and negative impacts of business on human rights. In Chapter 4, we consider the international debate on business, responsibility and regulation of human rights impacts. In Chapter 5, we consider the responsibility of business to respect human rights. In Chapters 6, 7 and 8 we consider how the UK can meet its duty to protect individual human rights within the UK and support its businesses to take a human rights based approach to its activities in the UK and overseas. In Chapter 9, we consider the role of National Human Rights Institutions. In Chapter 10, we consider remedies and next steps for the UK. In the final Chapter, we summarise the main conclusion of this report: that the UK needs a national strategy on business and human rights.

1   BBC News Online, Markets need 'family values' - PM, 31 March 2009. Back

2   See Ninth Report of Session 2006-07, Meaning of Public Authority under the Human Rights Act, HL Paper 77/HC 410, Seventh Report of Session 2007-08, Meaning of Public Authority under the Human Rights Act, HL Paper 39/HC 382. Back

3   HC 174-I, Uncorrected transcript oral evidence of Rt Hon Jack Straw MP and Michael Wills MP, 20 January 2009, Q43. Back

4   Information Commissioner's Office, Common sense must prevail on Street View, 23 April 2009 (UK); BBC News Online, Switzerland takes Google to court, 13 November 2009 (Switzerland); BBC News Online, Greece puts brakes on Street View, 12 May 2009 (Greece).  Back

5   BBC News Online, EU starts legal action over Phorm, 14 April 2009. Back

6   The Guardian, Firms bought secret personal data on staff, 6 March 2009. Back

7   The Guardian, Murdoch papers paid £1M to gag phone-hacking victims, 8 July 2009. Back

8   See HC 275-xiii, Uncorrected transcript of oral evidence dated 21 July 2009.Since this session, the Press Complaints Commission has reported dismissing the concerns expressed by the Guardian.See Press Complaints commission, Report on phone-hacking allegations, 9 November 2009. Back

9   YL v Birmingham City Council [2007] UKHL 27; Health and Social Care Act 2008. Back

10   The Independent, BP pays out millions to Colombian farmers, 22 July 2006.  Back

11 information about the operation of the OECD Guidelines, the UK NCP and this case is provided below at paras 75-86. Back

12   Press Release, Shell, Shell settles Wiwa case with humanitarian gesture, 8 June 2009, Press Release, Center for Constitutional Rights, Settlement reached in human rights cases against Royal Dutch Shell, 8 June 2009. Back

13 information about the operation of the OECD Guidelines, the UK NCP and this case is provided below at paras 75-86. Back

14   Labour behind the Label, Lets Clean-up Fashion 2009: The state of pay behind the UK high street, October 2009. Back

15   A full list of attendees is available at Annex 1. Back

16   The Ministry of Justice coordinated the Government submission and supplementary memoranda, herein "the Government submission". Back

17   See Annex 3 and paragraph 73 below. Back

18   The full programme of our visit is provided at Annex 2. Back

19   Serial No JO 110-923, 20 May 2008. Back

20   We return to the Alien Torts Claims Act, below in Chapter 10. Back

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Prepared 16 December 2009