Claudio Schuftan, Ho Chi Minh City
cschuftan@phmovement.org
Abstract
The paper explores the role transnational corporations under the capitalist accumulation regime have been playing globally in the non-sustainable exploitation of natural resource and the environment. It does so from a human rights perspective focusing on issues of corporate impunity of special business interests and of corporate social accountability to society at large. It adds a list of ‘iron laws’ legal activists in this field should keep in mind as they represent claim holders interests in litigation. The paper is not intrinsically anti-business. It is for fair business and for responsive government as it denounces the ongoing violations of economic, social and environmental rights by corporations. The paper concludes that we all are and should be critical and assertive about the deeply felt aspirations of affected communities. It brings the issues into a more widely shared vision and mission of what needs to be done.
THE SAD TRUTH IS THAT WE PAY SO MUCH MORE ATTENTION TO THE GLOBAL FINANCIAL CRISIS THAN TO THE ECOLOGICAL CRISIS
If unchecked, Capitalism destroys the environment. And careful: For TNCs, the Global South is where the action is.
It is at the local level that all contradictions of Capitalism explode. The capitalist system thrives on these conflicts and uses them to its advantage. Take for instance our increasing worries about climate change. In the last several years, the ideologues of the capitalist system have wanted to sell us the idea of a green economy as the salvation of our model of society. But this does not really mean an inch more than the mercantilization of nature — which is the actual bottom line of the proposed ‘Green Capitalism”.
Or take another example: TNCs playing no minor role, our planet is being exhausted of clean water, fertile soils, strategic minerals, energy and the rich fishing wealth of our oceans. Extractive industries are exploiting and killing all that. As a result, huge corporations suck-in whatever there is. Water is contaminated, energy is squandered, soils are desertified and overfishing is rife.
I fear our hopes for advancing environmental justice are slim. Justice demands a recalibration of power and that requires us to better understand it. Power is hidden and concealed. The peasants who lose land or whose river is polluted by mining may not know the name of the owner or corporation threatening their livelihood. Corporations have systematically and silently appropriated power and authority through lobbying, trade and investment agreements, and through unaccountable expert and lobbying groups and bodies. This concealed corporate power threatens to become further entrenched.
Constant vigilance is needed as TNCs power morphs into ever new arenas and, beware, State and Capital are often an ‘inseparable duo’. They depend on each other both to dispossess and also to build legitimacy for their ongoing appropriation. For instance, the fateful triangle of big energy, big finance and complicit governments prevents a desperately needed radical response to climate change. Disassembling this fateful triangle requires that we better and more proactively use our creative skills, alternative knowledge and values to overturn neoliberalism by launching practical and feasible alternatives that embody the values of solidarity, social justice, co-operation, human rights and democracy we all aspire to. 374
A TRANSNATIONAL CORPORATIONS’ ARCHITECTURE OF IMPUNITY
The power of special interests is far greater than that of the public opinion’s sentiment.
Obtaining results, for TNCs includes achieving political results –and the capacity to obtain them from governments is inexorably growing.* Democracy the world over is gradually succumbing to the disease of neoliberal ideology so that more and more functions of legitimate governments are being taken over by illegitimate, unelected, opaque agents, lobbyist and organizations. For neoliberals, every aspect of the welfare state is abhorrent, because it consists in taking resources from the rich –those who supposedly created them– and giving that wealth to those who do not deserve it. “The rich owe nothing to the poor; nor do the rich owe anything to nature”, they say.
*: Commercial entities’ power is not only in the room of national or international meetings; it is also outside the room, in lobbying, sponsoring, financing good-for-them strategies. They only attend meetings to inform themselves and to perfect their strategy elsewhere. The challenge is: How can we compete with that?
Therefore, among many other reasons, as economic, social and environmental rights activists, we should care. Why? Because unless and until we can compel TNCs to adopt, among other, ‘country-by country’ reporting, they will continue to pay –usually quite legally– minimal taxes in most of the countries where they have branches. With total impunity, they can and do place their profits in low or no-tax jurisdictions and their losses in high-tax ones. At present, if they so choose, they can report simply on the home country where they have their headquarters and then forget to do it in the rest of world.
Much law is now made beyond national borders and, in the international sphere, much of this law concerns ways to allow corporations greater scope and freedom. Large numbers of new trade treaties are allowing TNCs to infiltrate executive, legislative and even judicial State functions. Even the United Nations is now a TNC target –and the UN agencies welcomes their presence…
Moreover, TNCs ignore conflict of interest issues until the same enter the public discourse. They dismiss such criticism and ridicule any suggestions of its validity. They hire public relations firms to characterize available studies as ‘junk science’. They attack scientists, sometimes personally, claiming they are biased against industry (the same for human rights activists). They pay scientists to undertake studies that plant doubt. They call-in favors from community groups and professional associations they have supported to discount the critical claims. They begin public relations campaigns to counter the concept. They make self-regulatory pledges to care for the public good and issue promises to change business practices (such as marketing certain products to children). They spend massive amounts to lobby against policy changes that would alter their ability to continue business as usual. They work to have industry figures or supportive political figures installed in key regulatory agencies in order to stall, subvert or weaken all regulatory action.
Furthermore, it is not exactly news that most governments have always governed on behalf of certain class interests. But this is different from allowing those interests to actually write the legislation and to make policy directly, including budgetary, financial, labor, social and environmental policy, in place of elected legislators and civil servants. It is different from allowing corporations to disseminate deception and lies and to undermine the public’s right to know. It is also different from allowing such interests to replace the established judiciary with ad-hoc courts in areas such as trade dispute arbitration, even in jurisdictions where the justice system is known to be fair and independent.
TNCs also benefit from the unbalanced commodification of scientific progress (which is contrary to human rights aims) in a way that is almost always detrimental to claim holders. This is particularly done through the patent system. It is high time to end the privatization of knowledge that deprives individuals and impoverishes society overall.
Our concern thus is with the damage done as a result of the unbridled commercial freedoms that, since the 1980s, have been recklessly ceded by elected governments to TNCs of all types, whose activities are contributing to the fuel, finance and food crises that now beset us, and are, among other, undermining and displacing healthy food systems.**
**: A caveat: Working with the more forward looking progressive corporations –the ‘good ones’– is still risky. In our experience, the corporations that are most criticized (and dangerous) tend to have the most highly developed public relations machinery. These corporations claim that their aims/purposes are indeed in line with those of UN agencies. The problem is made worse if these corporations are used as the ‘messengers’ for, for example, laudable WHO health messages, because then they so whitewash their reputation. Decisions about corporate privileges and roles should be based on what entities are rather than what they do. What they do changes (and needs careful ongoing monitoring), but what they are tends to remain the same.
For these and so many other reasons, belatedly as it is, it is high time to develop concrete strategies to fight against these actions of TNCs. We acknowledge it is not easy with the overhanging danger of more and more repression. We cannot ignore that governments use police to do this –and even private armies are used by certain TNCs.
FOR TOO LONG IT WAS CONSIDERED THAT TRANSNATIONAL CORPORATIONS COULD NOT BE HELD ACCOUNTABLE FOR HUMAN RIGHTS VIOLATIONS. THIS HAS NOW CHANGED
Let me share with you some ‘Iron Laws’ that I think apply in this case:
1. State parties have to ensure access to effective remedies to victims of corporate abuse of the environment.
2. No distinction is to be made between violations committed by a State, a physical person or a legal person.
3. There are no international means of enforcement for the rights of nature since available means are not legally binding –so impunity continues.
4. Regarding corruption, the UN has adopted a legally binding instrument. Existing norms on corruption are thus also applicable to TNCs, but they have no coherent implementation.
5. It is now possible to bring the management of TNCs before the International Criminal Court. They are indeed bound to respect human rights. The question is: also respect the rights of nature?
6. TNCs have greatly influenced commercial treaties in their own favor. They typically short-circuit national courts, but have the right to bring states before the World Bank’s tribunal which is unfailingly favorable to them.
7. Make no mistake: TNCs are bound to respect human rights. All that remains is to clarify the human rights obligations of these entities and to establish binding enforcement mechanisms.
8. Measures must be taken to require accountability before the courts. Simply put, the people must have the possibility to defend their rights when their environment is being destroyed.
9. In this, TNCs cannot be subjected to statues of limitation.
10. The most powerful TNCs can and do so far escape all democratic, administrative and legal control. Therefore, legal responsibility must reach all the way to their downstream contractual chains.
11. There is a treaty now under negotiation at the UN pertaining TNCs human rights obligations. Liabilities will establish universal jurisdiction for their offenses committed regardless of where they occur. The treaty will further reassert the hierarchical superiority of human rights norms over trade and investment treaties.
12. Victims will hopefully then be guaranteed the right to justice and the right to compensation. There will have to be: i) no court costs to claimants, ii) the possibility of class action suits, iii) speedy trials (justice delayed is justice denied), and iv) limits to out-of-court settlements. Lawyers’ fees will have to be assumed by the State or supported by a special tax on TNCs.
13. Bottom line here: The new treaty will hopefully also take into account environmental crimes and even killings of human rights defenders.
14. People must mobilize and network to back these negotiations.
15. Fighting TNCs impunity also means fighting the danger that TNCs represent for democracy.
16. We acknowledge: Not all corporations are averse to responsibilities in the field of human rights.
17. Whenever and wherever human beings endure suffering and humiliation, we have to take sides! Indifference is always the friend of the enemy.
18. We cannot do indispensable needed work with our youth from our desks.
19. More and more, environmental disruptions and social conflicts are interacting in complex ways. It is a human rights-based approach that must ultimately displace the current domination of nature. Our countries must use human rights to spare nature, not to bloat profits for corporations.
20. Needed is for TNCs to actively be held accountable for the countless broken commitments they have been making the world over for years.
21. In economic, social and environmental rights work we are in a struggle not only for accountability, but also against impunity. Impunity for a neglect of nature goes against the principle of accountability. We simply have to also deal with severity with the perpetrators.
22. Demanding accountability gives a) the victims a chance to at least know the truth, and b) society a chance to learn the lessons of the past and act upon this experience. With the new Optional Protocol on Economic, Social and Cultural Rights, there is now an established Right to Petition by individuals or groups that are victims of the violation of the rights of nature. 194
23. The task of the agents of accountability is to make sure that those who have the duties carry out their obligations towards those who bear the rights. Thus, to describe a rights system, we also need to know the procedures through which a government (and/or civil society) assure(s) that the duty bearers meet their obligations towards the claim holders. These accountability mechanisms include, in particular, the remedies and restitutions available (or not) to the claim holders themselves. 178
24. Bottom line, it is high time to do away with the illusion that markets will take care of everything best, if simply left alone. Politicians and society at large must impose clear and binding human rights (and other) duties on corporations. If we are not willing to stand for what is right –and shy from boycotting companies whose business practices and products harm society– then we cannot expect to move beyond the current state of affairs. 405
CORPORATE SOCIAL RESPONSIBILITY DOES NOT REVOLVE AROUND HUMAN RIGHTS CONCERNS OR CHARITABLE INTENTIONS; IT REVOLVES AROUND BUSINESS INTERESTS
-“There is one and only one social responsibility of business –to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engage in open and free competition without deception or fraud”. (Milton Friedman)
-Corporations are quick to mention international human rights covenants, but often fail to mention the concrete duties contained in them.
Corporations need clear, binding human rights rules
Corporate Social Responsibility is a vague term. Corporations adopt definitions that basically suit them best. Moreover, the emphasis is on ‘voluntary’ enforcement…and without binding-human rights-duties, social responsibility remains a very disputable concept.
In HR work, we prefer to speak of ‘corporate social accountability’ rather than of corporate social responsibility, i.e., companies having to fulfill human rights duties as defined by law, as enforced by the state and as monitored by public interest civil society.
Moreover, experience with the implementation of voluntary-codes-of-conduct shows that this approach does not suffice; at best, it has led to some isolated temporary improvements. So we are left with the questions: How can pressure be put on powerful corporate players open to voluntary codes? How can they be made to truly respect HR principles? 190
EPILOGUE
As human rights workers, we are not anti-business; we are not anti-progress; we are not anti-government. We are for fair business and responsive government. We are against violence, against political and economic bullying and manipulation and we denounce ill-health, malnutrition and deaths as overwhelmingly preventable, as well as denouncing the flagrant violations of any economic, social and environmental rights. We are against the powers that are responsible for and condone these and that thus oppress and abuse people and the planet. We seek only justice, a caring body politic, for people to live with dignity since we all have inalienable rights, the right to speak out and for our voice not only to be heard, but to have influence, not forgetting the right to redress. We all are and should be critical and assertive about such deeply felt community aspirations; we must bring the same into a widely shared vision, into a joint mission and into a journey together. Therein lies the challenge.