French Corporate Duty of Vigilance Law: A first step towards a binding global commitment for the private sector on human rights and the environment?

Our global economy companies have a responsibility to make sure that their supply chains, stretching into the far corners of the globe, are free of forced labor”, stressed Barack Obama, former President of the United States of America, during the annual meeting of the Clinton Global Initiative in September 2012. Since this landmark speech, awareness about this issue has been continuously rising. And even if forced labor impacts mainly developing countries, developed countries share a part of the responsibility. Illustrating a better understanding of the topic, some national initiatives have been implemented in the last years to end these practices.

On February 2017, France adopted the “corporate duty of vigilance law”. “The law marks a historic step towards improving corporate respect for human rights and the environment” stated the European Coalition for Corporate Justice. With this law, multinational businesses headquartered in France now have to annually assess and address the adverse impacts of their activities on people and the planet. But the most important step forward, is that these plans must not only include an assessment of the impacts of companies under their control, but also those of their suppliers and subcontractors.

Indeed, if these companies don’t respect the new legislation, then judges will be able to apply fines ranging up to €30 million, particularly if the failure to comply resulted in damages that would otherwise have been preventable.

miners-1046845_1920For the first time, therefore, we are in the presence of a law that requires companies to be aware of the social and environmental impact they can have through their supply chain. Therefore, it should prevent some companies from dealing with suppliers where exploitative recruitment practices are the norm.

Moreover, this law also represents a great victory for French civil society. “This law shows how people power can lead to the end of transnational corporate impunity”, explained Lucia Ortiz, from Friends of the Earth International, which have been fighting for the adoption of the law. “It will oblige the world’s largest companies to respect human rights in a way they have never had to do so before” she stated. But beyond its status symbol, the actual efficiency of this law remains to be demonstrated particularly as companies are not required to guarantee results, but only to prove that they have done everything in their power to avoid causing any damages (to the environment or the communities they operate in).

In other countries, such as the Netherlands, human rights protection in labor is being increasingly considered. In the United Kingdom, the 2015 Modern Slavery Act also requires companies to detail what steps they have taken to ensure human rights violations are not occurring throughout their global supply chain.

un-1190183_1920But what can we expect from the global community? At the United Nations, negotiations for a binding treaty on transnational corporations and other business enterprises with respects to human rights have already begun. Encouraged by their success in France, Friends of the Earth International now call for a “legally binding instrument to control transnational corporations with respect to human rights”. Even though these current awareness raising efforts have not yet led to an international agreement, ongoing actions in different countries may lead to further change in the future.

To learn more about the French corporate duty of vigilance law please visit: http://www.foei.org/press/france-adopts-corporate-duty-care-law

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