Business plays an influential role in society, one that extends beyond its economic impact. From its employees to its consumer base, a business’s activities have both tangible and intangible effects on individuals’ rights.
To date, a catalyst for corporate attention to human rights has been reputation. The advance of globalisation, the rising economic presence of corporations and the spread of communication technologies have culminated in greater awareness of the effects of business activities. With this shift has come a change in expectations of business conduct.
According to an international survey by Globescan, eight in 10 people think companies should be responsible for reducing human rights abuses. Ninety percent of shareholders in Europe and North America agree that CEOs and boards should monitor corporate social responsibility policies, of which human rights play an important part. These perceptions are not relegated to the developed world: Globescan’s Africa Report survey finds that the majority of respondents think global companies are responsible for improving the lives of the poor.
As various high-profile cases have demonstrated, if a business is perceived to be complicit in human rights abuses its reputation is compromised. Given the strong links between reputation and brand value, share price often drops after negative exposure. Overlooking human rights can be expensive.
While human-rights-related risks escalate when companies operate in politically volatile areas, they are evident across the entire gamut of business activity. From workplace safety to supply chain management, each area touches on a valid human-rights principle. The notion that human rights is an issue external to business operations is an assumption that must be challenged.
Encouragingly, there is evidence that businesses are realising the widespread applicability of human rights. About 100 corporations have acknowledged the Universal Declaration of Human Rights and about 150 companies have specific human rights policies. More than 3 000 prominent companies have signed the Global Compact, a United Nations initiative whereby companies voluntarily agree to abide by 10 universal principles, two of which address human rights.
These trends provide a further impetus to the human rights and business agenda: competitive advantage.
There is also evidence that human-rights policies may improve productivity. According to a study by the Philippine department of labour and employment, measures taken to improve working conditions within certain companies resulted in a 23% increase in production capacity, while absenteeism declined by nearly 5%. The International Business Leadership Forum also reports that employee retention rates improve when labour-rights policies are enhanced.
Although factors of risk, reputation and competitiveness are encouraging companies to implement human-rights policies, a more subtle influence is at play. The steady entrenchment of corporate social responsibility issues into core business operations reflects the ongoing exploration of business’s larger role in society. Business is no longer seen merely as a profit-maximiser, but also as a valued stakeholder in development.
Although the private sector, government and civil society can share a common goal in promoting human rights, their roles are different. Mary Robinson, the former United Nations High Commissioner for Human Rights, stresses: “It’s not a question of asking business to fulfill the role of government, but of asking business to promote human rights in its own sphere of competence. Each actor has a separate, yet crucial, role to play.”
Increasingly, the private, public and non-profit sectors are using their unique perspectives to collaborate on solutions to lasting development challenges. This partnership approach has the potential to produce innovative solutions to a number of societal issues, including human rights.
This realisation underpins the Human Rights and Business Project South Africa, a multi-stakeholder network coordinated by the African Institute of Corporate Citizenship, which takes a collaborative, cross-sectoral approach to advancing human rights in South Africa.
The upcoming National Human Rights and Business Conference 2008 — jointly organised by the South African Human Rights Commission, AICC and the Office of the High Commissioner for Human Rights — will provide a platform where business, government and the non-profit sector can discuss human rights in a constructive environment. Through initiatives such as these, each sector present at the conference may realise new opportunities for partnerships and future engagement surrounding human rights and development.