Download Corporations and Human Rights—Lecture Outline UN effort to

Corporations and Human Rights—Lecture Outline
UN effort to establish responsible corporate practices that respect human rights, by Harvard law
professor John Ruggie. The first time UN takes up corporations and HR relationship. (Editor et
al. web rdg.)
 “Protect, Respect, Remedy” is basic framework (define each part)
 Criticisms of his approach, as well as more cautiously optimistic view…
o Voluntary vs. enforceable… Other means of pressuring corporations—
trade sanctions, consumer pressure, exposure to public of HR violation
practices cause bad PR and can reduce sales, etc.
 “Human Rights Due Diligence” (define) -- new term Ruggie has introduced and
gotten accepted by many leading corporations and many international
organizations (OECD, EU, etc.). Various reasons corporations have for following
HR norms (include lawsuits)
o Recent US court ruling on “Alien Tort Claims Act” limits reach of US
lawsuits re: corporate HR violations in foreign countries.
 In prior years, there were a few settlements of ATCA cases ourt of
court, with oil companies paying millions in damages to avoid a
trial and bad PR… (Editor et al. web rdg.)
Sjoberg (1999 & 2009) takes up topic of need to hold powerful corporations morally and socially
accountable when they violate human rights.
 Corporations as a form of bureaucracy -- hierarchy, division of labor, rules, stress
on efficiency (for profit), and use of secrecy (latter is often part of HR problems).
o Profit and efficiency are social constructed – accounting rules can be
manipulated to inflate profits, etc. and this has lead to scandals and even
corp. bankruptcies .
 Relationship between Human Agency and Bureaucracy—unequal and dynamic
o Mind is social product, & individual can engage in critical thinking and
critical reflection, think of alternative arrangements
o Organizations are made up of individuals but are greater than sum of
individuals and have an existence that is separate from individuals.
o Individuals also shape organizations, but more often vice versa… Still
individuals do not just robotically conform to organizations, they resist
and reinterpret, etc. and can make change, but as underdogs…
Bureaucratic Organizations / Corporations Shape and Manipulate Markets (Sjoberg 1999)
 E.G., GM et al. tearing out mass transit systems to increase car sales…
 [LIBOR global banking interest rate manipulation scandal is current 2012 example]
 Corp link to informal economy (Illegal vs. quazi-legal & legal—ruile violation vs. rule
avoidance and manipulation—again, accounting rules and accounting fraud cases provide
examples in banking sector)
Social Triage (Sjoberg 1999), general definition of concept, and then look at examples such as
very high-cost banking services for the poor (pay day loan operations, etc.), environmental
hazards such as waste disposal sites located near poor neighborhoods, etc.
(Sjoberg 2009) Power of Corporations in Modern World is greater than that of most nations
(financially). Yet Corporations are product of the nation state and its laws.
Key features of Corps. - are poorly suited for moral or social accountability. Some of these
key features are: “Legal personality” (corporate personhood) treating corps. as natural
persons with same rights as individuals, but with fewer responsibilities / duties, due to
“Limited Liability” laws that shield individual leaders of corps. of much accountability.
Corp. responsibility for profit maximization for shareholders limits broader social and moral
accountability. Some morally objectionable areas of profit making should be prohibited
on HR grounds (e.g., corporate mercenary security organizations in wars)
To hold Corps. morally and socially accountable for upholding Human Rights, need to
reform legal structure on which corps founded, esp. legal personhood of corps. and
limited liability. (Sjoberg 2009)
Example of this is recent 2013 PA court ruling that corps. are not natural persons and
thus have fewer rights than do persons, that corps. are creations of law and thus not
people. Specifically that corps have fewer privacy rights. In this case specifically,
natural gas drilling corps. have to reveal chemicals used in drilling that may be
causing pollution and environmental harm (& health hazards for residents). This
could lead to some accountability for damages and harm…