Examination of Witnesses (Questions 380
TUESDAY 14 JULY 2009
WILLS MP, IAN
LUCAS MP, LORD
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
Mr Wills: Yes.
Q382 Chairman: This calendar year?
Mr Wills: Yes, the end of this
Q383 Chairman: When do you anticipate
being in a position to publish something?
Mr Wills: Shortly afterwards.
Chairman: Shortly afterwards! Soon! Soon
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 modela respect for human rights, a respect for
investment in the communities where they operatebecause
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 departmentsand again I mention
the Kimberley Process as a very good example of this, which deals
with dirty diamondsyou 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
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 involvedor
was itin 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
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 raisedthis
is what I am concerned aboutif 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 involvedIan'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
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
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
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
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
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
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.