NYU Stern Center for Business and Human Rights Comments to the International Bar Association (IBA)’s Working Draft, “Business and Human Rights Guidance for Bar Associations”

Sarah Labowitz and Michael Posner
March 26, 2015

International Bar Association
Business and Human Rights Working Group
4th Floor, 10 St Bride Street
London, EC4A 4AD
United Kingdom

                                                                                                                                               March 25, 2015

To the International Bar Association:

We write to offer our comments to the International Bar Association (IBA)’s working draft, “Business and Human Rights Guidance for Bar Associations.” We wholeheartedly welcome the International Bar Association’s very timely attention to these issues and recognize the important role lawyers and bar associations play in advancing respect for human rights in business.

However, we are concerned that the IBA’s draft guidance devotes too much attention to a due diligence exercise focused of internal company processes and insufficient attention to substantive industry standards that are essential to measuring human rights outcomes. In our view, this is insufficient. On a range of issues that are essential to businesses, lawyers have played an essential role in establishing appropriate standards, from compliance with anti-corruption laws, to environmental safeguards to financial regulatory and reporting.  In much the same way, lawyers affiliated with the IBA are ideally suited to counsel the companies they represent on how to develop and apply industry-specific substantive standards and metrics relating to human rights. This is the key contemporary challenge with respect to business and human rights, and the IBA needs to play a leadership role in addressing this challenge.

By way of background, the NYU Stern Center for Business and Human Rights at New York University is the first human rights center at a business school. We co-founded the Center in 2013 with a mission to challenge and empower companies and future business leaders to make practical progress on human rights. We advocate for the adoption and implementation of human rights standards across business sectors as the most effective way to advance respect for human rights in business operations and the essential next step in the evolution of this field.

The importance that businesses attach to these issues was underscored by the Economist Intelligence Unit’s recent survey of leading global businesses, “The road from principles to practice: Today’s challenges for business in respecting human rights.” The survey finds that “companies overwhelmingly perceive a responsibility to respect human rights,” with 83% of respondents saying that business, as distinct from governments, is an important player in respecting human rights.

The survey echoes the working draft’s assertion that “a strong business case exists for respecting human rights and that the management of legal risks increasingly means that business lawyers need to take human rights into account in their advice and services.”

Reflecting the priority that business leaders now place on human rights, the IBA’s working draft contains a number of valuable elements, including:

Yet the central focus of the Working Draft is the UN Guiding Principles for Business and Human Rights. It proposes the Guiding Principles as the primary substantive tool for lawyers to advise their clients on how best to address human rights challenges in their business operations. We support the Guiding Principles which offer a broad and useful starting place for consideration of these issues. They have helpfully juxtaposed the respective role of governments and of private companies, and rightly assert that states have the primary duty to respect human rights.

But as Professor John Ruggie, the author of the Guiding Principles, has made clear, the adoption of these principles is “the end of the beginning” of the effort to develop the field of business and human rights. The next phase of the effort is companies’ adoption and implementation of industry-specific human rights standards and metrics. The working draft fails to contemplate, much less advance, this essential next step. It does not offer the tools lawyers and bar associations need to advise clients on the practical measures they should be taking to address the substantive human rights challenges facing each industry.

Consider the following examples of specific business and human rights challenges that affect companies across different business sectors:

In each of these cases, individual assurances from some companies that they are applying internal due diligence processes simply don’t go far enough. The test for companies today is whether they are abiding by concrete standards for the specific human rights or environmental issues in their respective industries. Companies also need to measure their performance against their competitors through metrics or key performance indicators so that consumers, investors, and other key constituencies can assess meaningful differences among companies and reward those that demonstrate the greatest respect for human rights or the environment. Business leaders often make reference to the “race to the top”. This is what a race to the top will look like in the human rights and environmental fields. 

The development of these types of substantive standards and corresponding benchmarks is what lawyers do and do well. For lawyers involved in regulatory work, this is the bread and butter of a successful practice. Whether addressing challenges relating to foreign corrupt practices, compliance with clean air or clean water environmental standards, or adherence to reporting requirements to securities regulators, lawyers are experts in developing and interpreting compliance mechanisms linked to standards. For companies that seek to make compliance with human rights a comparable operational priority, a similar standards-based approach is essential.

In a growing number of industries, important initiatives are  now emerging that  aim to  set, implement, and measure industry-specific human rights standards. The IBA should encourage local bar associations to be part of these evolving efforts. Examples include:

People can and will debate the strengths and weaknesses of each of these initiatives. But what is important about them is that companies in specific industries are participating in collective efforts to develop and implement substantive human rights standards tailored to their own industries. As they work to implement these substantive standards, companies and external stakeholders also are developing common metrics – benchmarks or key performance indicators – to help evaluate adherence to the standards.

We strongly urge the IBA to revisit the substantive portions of your working draft to explore how the IBA can help advance this standards-based approach to human rights as an essential element of your guidance for bar associations and lawyers. To be sure, development of these standards and metrics is difficult. But in the major industries that have already undertaken such efforts, companies that are commercial competitors, along with their external stakeholders, are building models based on clear standards that hold real promise in successfully tackling business and human rights challenges.

Reporting against common standards in each industry is beginning to give consumers, investors, and regulators the information they need to evaluate and compare the human rights performance of companies operating in the same sector. More importantly, it gives companies in each industry a common benchmark and encourages them to pursue and achieve concrete progress in addressing the most important human rights challenges they face. As these standards are developed and implemented, there will be significant opportunities to help develop reporting procedures. The IBAs involvement in these efforts would be extremely beneficial.

We are eager to work with those involved in developing the working paper to incorporate a standards-based component into the final version of the guidance. We welcome the IBA’s engagement in this important area and stand ready to work with you.


Michael Posner                                      Sarah Labowitz

Co-director and Professor                    Co-director and Research Scholar


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