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Voluntary vs Mandatory Human Rights Action:
Is There a 'Smart Mix'?

Day one of the UN Forum on Business and Human Rights 2024 debated the validity of a ‘smart mix’ of both voluntary and regulatory action on business and human rights, when companies cannot succeed alone in combatting systemic problems.

When the late John Ruggie came up with the concept of a “smart mix” to endorse both voluntary and regulatory action on business and human rights, it helped end decades of deep polarisation between business and other stakeholders on the issue.

As day one of this year's UN Forum on Business and Human Rights in Geneva revisits the whole concept of the “smart mix,” the question is whether significant moves towards mandatory due diligence legislation around the world will cause the previous consensus to be threatened?

However, it was the business leaders at the opening session who were adamant that the new laws are the right next step for companies to ensure respect for human rights in their global supply chains.

Most outspoken was Annie Agle, Senior Director of Impact and Sustainability at US apparel retailer Cotopaxi: "I'll speak out on what some companies are more reluctant to say: Our supply chains are riddled with abuses and we have to do better," Agle told the Forum.

Her argument was that individual companies could never succeed alone in combatting what are systemic problems.

"Two years ago — despite all our individual efforts to remediate in particular situations — we decided that the way forward was to gather together like-minded companies to work with trade associations, to get governments to strengthen labour laws," she said.

Agle gave the example of producers in Taiwan, where she told the Forum that the problem of predatory migrant forced labour can only be addressed at the government — not at the individual company — level.

These sentiments were echoed by Sanda Ojiambo, Chief Executive of the UN Global Compact, who described the shift towards mandatory due diligence as "undeniable" and argued that "hard measures drive impact."

Ojiambo's appeal to the Forum was to "see beyond the obstacles and seize the moment.”

Key themes

Aside from the debate about more versus less government, other key themes are beginning to emerge:

Consistency, cooperation in implementing new legislation

Calls for consistency rather than a patchwork of legislation — for better understanding and effective implementation of the new laws, and for greater international partnership in applying the regulation — were repeatedly raised.

Despite internal wrangling in Brussels, Europe's Corporate Sustainability Due Diligence Directive (CSDDD) was presented as a “done deal,” with implementation due to begin from next July.

Outgoing European Justice Commissioner Didier Reynders addressed this global audience, insisting that European companies would not be able to use unfair contract causes to shift the burden of responsibility — that larger companies are expected to invest in their value chains and to provide support to help small businesses to be able to comply, including in countries outside Europe.

Reynders committed the European Union itself to working with international partners to implement the CSDDD. International collaboration on new due diligence laws may well be an important part of the next phase.

The OECD released a new paper at the Forum on the role of certification and other sustainability initiatives in effectively implementing due diligence and announced the establishment of a new, inclusive 'cooperation policy platform' on due diligence — open to governments around the world and due to meet for the first time in March 2025.

In the debate about new regulatory moves, Hannah Koep-Andrieu — Head of Due Diligence at the OECD's Centre for Responsible Business Conduct — argued that this is about better implementation of principles with which companies are already expected to comply.

"The UN Guiding Principles and the OECD Guidelines are the common denominator for both voluntary and regulatory action — and that isn't changing," she said.

Sustainable development

A final, new emphasis suggested on day one came from Chantal Mwavita, Minister of Human Rights for the Democratic Republic of the Congo, who insisted that respect for human rights had to be accompanied by improved trade relations for the Global South.

UN High Commissioner for Human Rights Volker Türk also talked about a "human rights economy.”

Coming one week after disappointing North-South commitments at the COP29 climate talks, this is the argument which will not go away.

Acceptance

Overall, there appears to be wide acceptance that a new era of mandatory human rights due diligence for companies is about effectiveness.

The suggestion that companies would retreat into an anti-regulation mindset was the dog that didn't bark.

Perhaps the “smart mix” has just gotten even smarter.


Read recaps of day two and three at the UN Forum on Business and Human Rights 2024.

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