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What are Business and Human Rights Issues?

Tax Avoidance

In writing this blog for the past few months, I have sort of taken it as a given that my readers were starting from a common understanding of what the landscape of business and human rights is to most people. However, in discussing my research with a colleague over lunch last week, I realized that my understanding may not be universal. I was going on about my latest idea for business and human rights and with one very simple (and incisive) question he brought my rambling to a halt: “Can you give me some examples of business and human rights?” The example I gave him (its one of the scenarios discussed below but I’m not telling which one it is until next week) provided a direct link between businesses and the human rights impacts they can create.

But this conversation also gave me pause. Specifically, it made me wonder what other scenarios might be considered human rights violations? The issue can have very real consequences. One of the challenges that I found in doing this work is that many people who write on issues that touch business and human rights (labor scholars, trade practitioners, investment experts) may not even realize that they are writing on a “business and human rights” issue. That’s one reason that this is such an exciting field – it is incredibly dynamic. But it is also incredibly challenging, not least of all because it’s an additional obstacle – trying to get everyone to sit down and have the conversations that are needed.

Let me illustrate with a question: Which of the following issues could be labeled “Business and Human Rights” (or BHR as I have taken to calling it)?

A. A Dutch multinational company hires off-duty military personnel to act as security in an unstable community. The security officers assault, torture, and intimidate a number of people in the community.

B. A small U.S. corporate board has appointed mainly white males to act as directors for the company.

C. A Canadian multinational corporation creates tax shelters in the Bahamas to avoid paying taxes at its headquarters in the United Kingdom.

D. A French mineral company regularly dumps hazardous material into a nearby stream, polluting the water and endangering the neighboring community’s health.

Would it surprise you to hear that the answer is – E. all of the above? Yet, a survey of links from the sites herehere, here, and here show that a version all of these issues has been categorized by one group or another as a human rights issue. This is at the heart of the challenge – until you get the relevant constituencies to understand just how broad based the idea is of what constitutes a potential “human rights impact” for businesses, you won’t be able to bring together all of the parties who can contribute to a solution.

Part of the challenge stems from the terms that we traditionally use to address those issues. Gender issues have been cast as “diversity” issues; tax shelters and tax avoidance have been labeled as, well, tax issues. And indeed, each of those are accurate labels.

But they are also more than that.

For instance, issues of diversity implicate human rights because it may indicate an underlying, pervasive gender bias. This gender bias, in turn can manifest itself in wide ranging behavior – from failing to improve diversity to more blatant discrimination such as disparate pay or sub-par working conditions for members of different groups. Of course, failing to bring women onto boards can, on its face, also implicate human rights issues because it speaks to a lack of equality for women in society. Indeed, some countries are acknowledging the link between diversity and human rights. In the United Kingdom, the Equality and Human Rights Commission has done research on gender bias in the executive ranks. At the European Union level, calls have been made to impose quotas for women on boards.

Tax avoidance is a trickier issue. At first glance, there was, to me, no direct correlation with tax avoidance and business and human rights issues. However, the Business and Human Rights Resource Centre makes the connection this way. “NGOs are increasingly reporting on companies that avoid paying a fair share of taxes and royalties in developing countries, thus depriving governments of essential revenues that they need to deliver to their people on development, health education, housing, access to water and other human rights.” (the emphasis is mine) Discussing the issue in this way suddenly frames the issue as a human right. But a far more nuanced (and probably controversial question for those in my field) is ?

Is this a good idea?

Stay tuned next week, where I’ll explore the issue in-depth.

In the meantime, please feel free to leave comments on other scenarios that have not been discussed as human rights (but you feel should be) or that are discussed as a human right impact and you feel it shouldn’t.

Picture taken from the following website: http://frontfin.wordpress.com/2011/06/30/double-taxation-avoidance-treaties/

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