The Global Goals and the Ruggie Principles - Squaring the Circle on Private Sector Engagement

By Francis West, Head of Private Sector Policy & Advocacy, Unicef UK

 “The Sustainable Development Goals represent the biggest opportunity for awareness-raising on business and human rights since the UN Guiding Principles [on Business and Human Rights] were introduced.” So said a respected speaker at the recent Business and Human Rights Symposium organised by the International Organisation of Employers. Equally, there is a consensus that the skills, expertise and resources of the business community are crucial to jump-starting action on the delivery of the SDGs.  It remains a surprise, therefore, that business and Government alike continue to struggle to integrate their emergent approaches to these two crucial processes. Two truisms – that core business operations must be harnessed and that Government has a critical role in setting an appropriate enabling environment – remain central to the most effective private sector engagement on these human rights and international development challenges:

 

1. Harness the scale and sustainability of core business operations rather than discrete Corporate Social Responsibility projects.

There is a risk that the sheer number of SDG targets (there are 169) could encourage an outdated approach to CSR, where companies might cherry-pick the goals to which they want to contribute. This is not to suggest that businesses should address all goals, but instead they should prioritise action according to the salience of the impacts of their business on people. This requires a shift away from the traditional approach to materiality within corporate sustainability that focusses on impact or risk of stakeholder concerns on the business. It is by design rather than luck that the UNGPs, and their central concept of human rights due diligence, provide a blueprint for how to operationalise that shift. The due diligence process of identifying, preventing, mitigating and accounting for impacts on human and child rights across business operations and supply chains should result in a tangible action plan for a business, which can then be cross-referenced with SDG targets.

 

While full implementation of the Guiding Principles on the part of businesses would contribute greatly to the achievement of the SDGs, if we are to realise the transformational change implied by the Goals, there needs to be much more than a mapping exercise of existing commitments (and this goes for both public and private sectors).  Once again, the UNGPs provide an avenue for these more ambitious actions.  Most businesses we work with at Unicef UK understand the need to address impacts on children that their business either cause or contribute to. We see more challenges with respect to those issues that a business is linked to by a business relationship. For a tour operator or travel agent, this might mean being linked to child labour via the fruit and vegetable supply chain in the hotels and accommodation which they offer to their customers, or to the children selling trinkets to hotel guests on the beach; for a consumer goods company with supply chains heavily reliant on migrant workers,  there may be a link to exploitative conditions characterised by employers withholding employee passports or workers paying upfront fees to secure a job. In any of these scenarios, the problems faced are deeply embedded, many tiers down the supply chain, are often undetected by ethical auditing processes, and reflect systemic flaws and challenging cultural norms. They are not problems that businesses can face down on their own and there may be little reward in doing so. They demand collective, multi-stakeholder action, which the energy behind the SDGs can catalyse.

 

This might result in sector specific partnerships – for instance in the travel and tourism industry to determine the actions that might be considered as the ‘policies to promote sustainable tourism’ under target 8.9. Alternatively, cross sector partnerships (the creation of which hits various targets under Goal 17) could focus on specific issues. The Global Partnership to End Violence Against Children is one example of an initiative that has been established to address a specific target within the SDGs (16.2), and could form the basis for business collaboration to define the policies and practices that could end entrenched problems within supply chains, such as trafficking and exploitation of children. 

 

All of this is not to devalue social investments made by individual businesses. But these too can be more effective if shaped by a high quality due diligence process. If a company integrates the voices of the most vulnerable into its human rights impact assessments, it will be better placed to determine where to focus its efforts to proactively support the delivery of the SDGs. This is very clear from the experience of the telecoms company Millicom. After conducting a child rights impact assessment across its supply chain with Unicef, birth registration was identified as a significant blocker to children in their supply chain realising their rights. As a result, Millicom supported the creation of a new SMS service in Tanzania that allows parents to register new births as well as those of children under five on any mobile phone, straight to a centrally-run database. Birth registration – which is the subject of another SDG target – rose from 9% to 40% in the pilot region of Mbeya in six months.

 

What is clear is that more needs to be done to set out specific policies, practices and collective advocacy interventions – perhaps on a sector level – that businesses can undertake that tackle human rights challenges in their supply chains and that simultaneously contribute to SDG targets.

 

2. Government needs to lead by example and practice what they preach on responsible supply chains

For some business and human rights advocates it may be a source of frustration that globally Governments are more likely to develop a plan to implement the SDGs than publish a National Action Plan on Business and Human Rights. But it would be more constructive to see this as an opportunity. After all, the crossover between the SDGs and human rights is huge, with approximately 47% of the indicators expected to yield data that is directly relevant for monitoring of specific human rights instruments, and another 13% having more indirect human rights relevance.

 

There are clear hooks in the SDGs to further the state’s responsibility to protect human rights in relation to business activity. Target 12.7 aims to ‘promote public procurement practices that are sustainable.’  This is a fantastic opening that cannot be overlooked. Government buys a huge amount of goods and services from business and could do much more to use this purchasing power to scale up socially responsible business practice. In the UK alone, £45 billion worth of contracts are awarded to private firms each year – around three per cent of the UK's GDP. Directing this capital only towards companies that are undertaking effective human rights due diligence would realise Government’s commitments under both UN Guiding Principle 6 and SDG target 12.7. It would also help level the playing field for companies that are taking these two agendas seriously. Apart from a broad requirement of all companies on human rights due diligence, procurement is the strongest lever that Government has to capture a large enough group of companies to ensure a critical mass are operating in this way.

 

There is also significant precedent for such action. President Obama’s Executive Order on Strengthening Protections Against Trafficking in... is an example of Government action on procurement that could help tackle numerous SDG targets if scaled up across different countries. And businesses would support Government intervention of this type. Research by the Economist indicates that nearly a third of business leaders see mandatory reporting on human rights for their companies as a good thing. The fact that companies such as Tesco lobbied for UK businesses to disclose the steps they are taking to ensure that their supply chains are free of slavery banishes the myth that business opposes all regulation. When Government develops its SDG implementation plans and national indicators, we hope that it is brave enough to consider the views of the business community as they stand, rather than the caricature of those views that is often presented in the media.

 

It is difficult to overstate the importance that these two processes – the UN Guiding Principles and the Sustainable Development Goals – succeed. As businesses start to consider their approach to the marketing-friendly SDGs, existing standards such as the UN Guiding Principles should remain the entry point. It is worth remembering that while there are 17 SDGs that took 3 years to establish, there are 31 Guiding Principles that took 6 years to agree. This hard work and consensus about the role of business in delivering social value needs to be harnessed in the Global Goals if either process is to succeed.  

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