Organizational Governance

The UN Forum on Business and Human Rights 2022, Day 1:
Holding Business to Account

This is the first of three daily updates from the UN Forum on Business and Human Rights 2022. Day one started a week that focuses not on holding individual companies to account, but where the systems that will enable this are being framed.

By Richard Howitt | Published 2 years ago | About a 4 minute read

Image: The Belo Monte mega-dam on Brazil's Xingu River | Bruno Batista/VPR

Responsibility, sustainability, ethics, citizenship, purpose … There is no end to attempts to define and redefine the responsibility companies have to society and to the environment.

At the start of this week’s UN Forum, the words on speakers’ lips have shifted to a different term: “Corporate accountability.”

There was a danger that this is interpreted too narrowly or used as a proxy for what is more familiar. A number of speakers appeared to define this as ‘access to remedy’ for victims — a constant refrain at the Forum and where the obstacles remain too high. However, not all stakeholders are victims; and while violations need to be subject to remedy, there are many aspects of corporate performance which do not.

Meanwhile, some companies at the Forum appear to hear the word “accountability” by falling back on to the well-trodden ground of corporate transparency and reporting — with its terminologies, methodologies and technologies — arguably too often framed by companies themselves.

Part of accountability, certainly; but only one part.

A broader definition

The concept of accountability at its broadest is about companies being actors in society, undertaking active engagement with societal stakeholders. There is mutual recognition that we are all part of a value system in which stakeholders have a right to influence a company and the company has the obligation to respond — in actions, not just words.

Clearly, any companies still clinging to shareholder-centric models will perceive accountability in a very different way; but there seem to be few of those present, or at least voicing that viewpoint, in Geneva this week.

As the Forum debated how business impacts the environment (in the colourfully titled session, “Human Rights in the Anthropocene”), business in conflict situations and in regions from Central and Eastern Europe to Latin America, the common theme of accountability is in how corporate behaviour is influenced and how companies respond. Some of this is characterised by the usual debates between mandatory action in which corporate behaviour is subject to the rule and instruments of traditional justice systems; against voluntaristic “soft law” and industry-led initiatives, which reflect the results of stakeholder engagement, guidance and a company’s own values.

For activists present at the Forum, as would be expected, the emphasis was on the enforceability of accountability mechanisms for those companies where there is a reluctance to collaborate.

Plaudits

However, on a day when Novartis and Telenor openly discussed responsible exit strategies — and where both Henkel and Maersk were praised for disengaging from Russia whilst maintaining financial compensation to their workers — it was Brazilian energy company Eletrobrás that perhaps won the most plaudits.

Social Responsibility Manager Pedro Vilela Campanena told the opening session that his company was open about the challenges it faced in respecting UN Convention requirements for “prior and informed consent,” where indigenous peoples are affected by extractive industries: “Companies want to talk about doing good; but we need to have the courage to accept that the company may be doing bad,” he told the Forum.

He appealed to fellow companies to treat stakeholders as rights-holders, embrace dissidents’ voices and engage with the most difficult issues at the core of their business.

Citing controversies over the hydroelectric power generated from the Belo Monte mega-dam on Brazil's Xingu River, Campanena said the company was openly addressing how it could “repair the impact on people living down the river.” He said the grievance mechanisms used by the company were crucial but were only effective if “backed up by social communication mechanisms, especially with indigenous people.” For example, the company installed mailboxes for local comment along the riverbank.

Challenge

Mexico’s Fernanda Hopenhaym is incoming Chair of the UN Working Group on Business and Human Rights. She is also a member of the Corporate Accountability Working Group at the NGO coalition ESCR-net, which interprets accountability as building the capacity of communities to be able to “challenge corporate abuse.”

Yet in this, she is not so far away from Eletrobrás — a company willing to be challenged.

In her speech to the opening session, Hopenhaym pledged to enable all voices to be heard and committed the Forum to undertake collective analysis from a multi-stakeholder Forum — with companies fully included. The first day’s proceedings upheld those commitments and started a week where individual companies will not be held to account, but where the systems which enable this to happen are being framed.

It’s not just about putting out the mailboxes — but reading and acting on what is said.

Richard Howitt

Richard Howitt is a strategic adviser on Corporate Responsibility and Sustainability, Business and Human Rights. He is also a Board member, lecturer at Audencia Business School and host of the Frank Bold ‘Frankly Speaking’ responsible business podcast. Richard was Member of the European Parliament responsible for the EU’s first rules on corporate sustainability reporting and subsequently Chief Executive Officer of the International Integrated Reporting Council.

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