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


Examination of Witnesses (Questions 380 - 399)

TUESDAY 14 JULY 2009

MR MICHAEL WILLS MP, IAN LUCAS MP, LORD MALLOCH-BROWN AND MS CARMEL POWER

  Q380  Chairman: When do you expect the study to finish? Do not say soon!

  Mr Wills: No, no, I was wrestling with the temptation! I do not know but I would hope by the end of this year.

  Q381  Chairman: At the end of this calendar year?

  Mr Wills: Yes.

  Q382  Chairman: This calendar year?

  Mr Wills: Yes, the end of this calendar year.

  Q383  Chairman: When do you anticipate being in a position to publish something?

  Mr Wills: Shortly afterwards.

  Chairman: Shortly afterwards! Soon! Soon after!

  Q384  Earl of Onslow: To all of you: in your supplementary memorandum you make clear that the survey results show that UK businesses more closely associate human rights with their activities overseas and in developing countries, and I must admit that that is also the impression I have had from businesses who have given us evidence. I think it is perhaps because they think it is normal here but may not be normal overseas, but that is perhaps just my impression. Did you work together on this or was there rivalry between you?

  Mr Wills: Between us?

  Q385  Earl of Onslow: Lord Malloch-Brown is giving the impression of innocence sublime! Which may be why he is rather a good diplomat and it may be while he is moving elsewhere later., but that is another story.

  Lord Malloch-Brown: It is a very easy mutual inter-departmental interest. As Ian said earlier, I think British companies understand that the environment in which they are operating in developing countries is getting steadily trickier, whether you are in a mining business or any kind of natural resource business, but equally whether you are in consumer goods or financial services, the issue of corporate behaviour is rising up the agenda everywhere. It is often not just limited to human rights issues; it is limited to whether or not corporations are putting back into the communities where they are operating in terms of social and other developmental services, a lot more is expected of the company than before. For British companies which have traditionally been long time investors in the countries where they operate this has just become an intrinsic bit of their business model—a respect for human rights, a respect for investment in the communities where they operate—because if they do not they will suffer political costs over the medium term. There will be a change of government, at worst an election campaign will even focus on why the last government protected corporations which were behaving in a way which was not consistent with good human rights practice. So a combination of philosophical commitment by the management of many companies and a pragmatic understanding for the political context in which they now operate means that our efforts as departments—and again I mention the Kimberley Process as a very good example of this, which deals with dirty diamonds—you get hit in the countries where you are digging those diamonds, you get hit in the countries where you are selling them and you get hit globally in terms of your reputation if you do not respect these codes. So I think we are living in a very new environment where any international company realises that some breach of human rights or other standards in the furthest corners of its far-flung global operations can come back and bite it in terms of its share price or its annual shareholders meeting.

  Q386  Chairman: I think it has all become pretty clear that that UK business is beginning to get it in terms of overseas operations and I think that has come out in your supplementary memorandum. So I think the real question about the survey work that the Ministry of Justice is doing is join the dots between domestic and international because the survey does not actually raise questions about overseas activities, although the answer has come back that way. Why was the FCO not involved—or was it—in designing the survey and indeed as the answers have come through?

  Mr Wills: They are not part of the steering group but they have been copied into all the papers, as indeed have DFID and of course we will work closely with them. But one of the things emerging from this is actually that there is a need to join up the dots and we would agree with that. That will be one of the valuable outcomes of this; we do need to do that and we do need to try and encourage companies to take a much more seamless approach to what they are doing because it is clear that in terms of their overseas operations they do often conceptualise things in human rights terms and in terms of their domestic operations often although they are pursuing human rights policies they do not always see them as such and personal I believe that they would derive value from articulating some of these domestic operations in human rights terms.

  Q387  Chairman: I would agree with that last point and this is really I suppose the thrust of the issue.

  Mr Wills: So we actually both agree with each other.

  Q388  Chairman: That makes a change, does it not! However, as far as the first point you raised—this is what I am concerned about—if British businesses are starting to get it in relation to the overseas operation but we still have some way to go in conceptualising it, as you say, in the UK, I am very surprised that the FCO was not more involved in the process of devising this survey and much more involved actively than simply being copied in on what is going on. If what we are trying to do is to translate international good practice into the domestic agenda and it seems to me that the FCO has an important role to play there and simply being copied in does not really do justice to being involved in the process.

  Mr Wills: Our responsibility is for human rights in the United Kingdom and what we are trying to do is to look at the scope for promoting a human rights culture within the operations of business. Part of that is to do with cope of the Human Rights Act, which we have already discussed, in a very particular sector of the business community, but, as I have said, we think that there is value in promoting a human rights culture more widely and that is primarily a domestic matter. That is why all the other departments that have been involved—Ian's department, DWP, DCRG, the Home Office, Department for Transport, the Office of Government Commerce, the GEO, the Audit Commission, the Equality and Human Rights Commission, the Scotland Office, Wales Office and Northern Ireland Office, there is a broad swathe of the domestic departments that are involved on the steering group not copied in but on the steering group precisely because this is primarily a domestic issue. That is not to say that we do not have a lot to learn from the FCO and that input has been very valuable and will continue to be so; but it is primarily a domestic matter.

  Lord Malloch-Brown: Just in defence of Michael, I gather that actually the Foreign Office was invited to participate in the steering group and therefore the responsibility for not participating is more ours than the Ministry of Justice, but I think the reason we did not was that we at that time felt that it was going to have a strong domestic focus and therefore we asked to be copied in and follow it. With the benefit of hindsight, Chairman, I agree with you that it has exposed this international link. And just going forward we need to engage more in this work.

  Q389  Baroness Prashar: Can I pursue this a little further because a number of witnesses to the inquiry have expressed concern that the current division of responsibilities across the government is inherent and it actually undermines the government's approach. If you look around there are about six departments across with this responsibility for business human rights and, of course, on the social responsibility it has changed hands a number of times in the lifetime of this Government. I would like to hear a bit more about how do you ensure that there is a coherent strategy for approaching the question of human rights and business?

  Mr Wills: I think that does fall to me primarily. What we have identified independently and what you are identifying is the need for further work in this area, there is no question about that. The history of human rights in the last ten years, 15 years has been difficult and complex. We had the Human Rights Act brought in and we then had to deal with a whole range of issues that came up after 9/11 and a very concerted media campaign in certain parts of the media and a political campaign against the Human Rights Act; so we have had to deal with a whole host of different issues and the government cannot always operate on every front at once. What has become clear and I am personally very committed to and the Department is very committed to is you have to look at how you promote a human rights culture, and this is not about more regulation in business, it is important to say that, it is about the promotion of a human rights culture. How we do that is complex and we do not have the answers, we are learning together and that is why we have set up this project and that is why I started by welcoming what you are doing and I have no doubt that the report you produce will be invaluable in helping us learn the lessons that we clearly need to learn, and our businesses are giving you that.

  Q390  Baroness Prashar: Is this something about the machinery of government and how you ensure a joined-up approach?

  Mr Wills: Of course. First of all you have to find out what the policy objective should be and that is what we are involved in. We have already discovered that we need to coordinate better into the domestic and international areas of operation. But when we have gone through this process we will have to see what machinery of government will be needed in this. So let us conclude the research first, get the evidence and then make a decision. Let me just say that we accept the case for looking at this and we also accept that there may well need to be changes to the machinery of government to ensure better coordination and better certainty for business.

  Q391  Baroness Prashar: I do not find that very convincing because to me it is a question that you need to get the machinery of government right to achieve an objective and not set up the machinery after you have begun to do the research.

  Mr Wills: With respect, I was saying that I think it is a good idea to get the evidence before we decide on what the proper objectives are and then we can work out how to achieve them. I would suggest that is the best way forward.

  Ian Lucas: If I could just give one example of an area in which my department has a lead, which is on the OECD guidelines for multinational enterprises which is dealt with by a steering board across government with various departments, including the Foreign Office, the Department of Work and Pensions, DFID and the Export Credits Guarantee Department. That steering board is chaired by a BIS official at a high level and we see corporate responsibility as an issue that should operate and be considered right across government, and we try to ensure that this is done through official machinery including that steering board.

  Q392  Baroness Prashar: My next question is really for you, Mark, which is about the main point of contact on the work of Professor Ruggie which is the FCO "Conflict Group", as I understand. Does the Government only see the business and human rights debate as a means to avoiding conflict? Or could we send much more of a positive message about integrating human rights in foreign policy?

  Lord Malloch-Brown: I think it is much broader. It happens to be that Professor Ruggie has made conflict one of his priorities and, therefore, we have picked that up and are running with it and are in a taskforce with him, but that does not mean that we think this is something limited just to that, quite the contrary, we see that it needs to be integrated into foreign policy across all sets of countries, all sets of company actors, et cetera.

  Q393  John Austin: A question to Ian Lucas. Lord Malloch-Brown was earlier saying that British companies by and large are increasingly, whether through altruism or pragmatism, taking on board human rights issues. Amnesty, however, in its evidence to us suggests that the government's failure to recognise responsibility to respect human rights is quite distinct from general corporate responsibility measures. Do you agree with Amnesty on that?

  Ian Lucas: I do not think of them as entirely separate. I think that corporate responsibility is clearly a grouping of itself, but for me human rights are fundamental and a sensible and appropriate corporate responsibility policy would flow from the foundations that human rights give us. So I certainly do not see them as separate. I think that sometimes businesses may initially not see a corporate responsibility policy as being something that derives from human rights. I think people, and perhaps businesses, have a tendency to compartmentalise issues and corporate responsibility might be something that business thinks it should do, whereas some businesses may think that human rights are something that are to do with government and nothing to do with them. An important role for us within Government and within my Department is to break down these compartments and I like to think of the words dignity and respect for others as being an extremely important part of both human rights and corporate responsibility, and I think that bringing those together and ensuring that your business sees them together is an important role for government to play.

  Q394  John Austin: In your Corporate Responsibility Report you publicise the benefits of corporate responsibility, but have you issued specific guidance to business on what the Government might expect of them in order to meet the responsibility to respect human rights as identified by Professor Ruggie in his report?

  Ian Lucas: I think that we have various methods of engaging with business through offering advice on an individual basis to businesses when they are looking at corporate responsibility in issues to having a broad policy as far as the Department and, indeed, Government is concerned. What we are very keen on, and I think the Foreign Office in particular provides very detailed advice on human rights for businesses that are looking to improve their practice in different parts of the world—

  Q395  John Austin: Giving specific advice to specific companies in their operations?

  Ian Lucas: That is right. I think for the UK missions in parts of the world it is very high on their list of priorities in terms of engaging with British business abroad; that we want this to be at the front of the minds of businesses when they are conducting business in different parts of the world, rather than at the back.

  Q396  Lord Morris of Handsworth: As I understand it both departments are currently working together to develop a toolkit for FCO posts on business and human rights. Could you share with us the purpose of this toolkit?

  Ian Lucas: I think this leads on from what I have just said to John Austin. We want to create a more straightforward and presentable way of putting these matters to business and getting them to consider them as easily as they can, but to ensure that they do consider them. We see the missions across the world being able to use the toolkit working with UK business as it operates in different parts of the world, and this is a tool for them to do that.

  Lord Malloch-Brown: Can I just add to that just to put it in context. The Foreign Office has produced a series of theses guides or toolkits. We have done one on children's rights, one on LGBT rights and another one on democracy, religion and rule of law, and now with BIS we are doing this one that has been referred to about business operations, and it includes the OECD guidelines and the other baseline material that business needs to understand in terms of international standards. Let me just also add that the Foreign Office, before our people go abroad, one of the training modules they have to do is on human rights and that is also available to people from other departments who go out, so we hope that there is a high consciousness of these issues across our overseas missions.

  Q397  Lord Morris of Handsworth: Just to explore this a little bit further, will the toolkit help to clarify the expected standards of UK business before promoting those UK businesses abroad?

  Lord Malloch-Brown: By its reference to the OECD guidelines, yes, which are the accepted standards across a lot of business.

  Q398  Lord Morris of Handsworth: Which will obviously include human rights issues?

  Lord Malloch-Brown: Yes.

  Q399  Lord Morris of Handsworth: What about the resource implications? Does the Government intend to make any additional resources available for the purposes of providing training on human rights issues appertaining to cases?

  Lord Malloch-Brown: We are already training our staff and these toolkits are already budgeted for and being prepared. In terms of additional outreach to business, I do not think we do have plans for additional things at the moment.

  Ian Lucas: We like to think that is an intrinsic part of the service that we are offering to business, both abroad and in the UK. In the UK people tend to think of it more as corporate responsibility than human rights and I think that is an interesting issue that we touched on earlier; but as far as abroad is concerned then we see human rights as part of the advice that we would offer to businesses trading abroad.


 
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