Read below the CEMSOJ’s submission during the public consultation for the targeted update of the OECD Guidelines for Multinational Enterprises. The submission is based on CEMSOJ’s experience of using, or challenges thereto, the Guidelines while supporting a land rights advocacy campaign struggle to restore a historical pond and surrounding indigenous lands encroached by a recently built mega business complex called Chhaya Center that houses a local franchise of Marriott International in the tourist district of Kathmandu in Nepal. For more information about the campaign, see https://cemsoj.wordpress.com/tag/chhaya-center/.

CEMSOJ’s submission for the targeted update of the OECD Guidelines for Multinational Enterprises

Community Empowerment and Social Justice Network (CEMSOJ) welcomes the consultation draft for targeted update of the OECD Guidelines for Multinational Enterprises (MNEs) and their Implementation Procedures as well as the public consultation process undertaken on the draft. We strongly urge the OECD to revise the 2011 Guidelines as they are out of date and incomplete and acknowledge that the consultation draft reflects some progress on the 2011 Guidelines.

However, serious concerns remain in the consultation draft and many issues still need to be addressed. At the same time, the consultation process should have been carried out more effectively, including through in-person consultations with targeted stakeholders and groups, such as Indigenous Peoples’ representatives, human rights and environmental defenders, and women’s rights organizations, among others, engaged in promoting Responsible Business Conduct (RBC). The consultations should have been carried out over a longer period of time and in different regions/countries with targeted outreach to representatives of communities and groups affected by operations of MNEs and their support groups. Such consultations should be carried out in culturally appropriate manner and with provision of interpretation in local languages understood by the representatives. The consultations further should have been undertaken in phases so that those consulted could see if their comments have been addressed in the revised drafts before finalizing the updated Guidelines.

In particular, CEMSOJ welcomes the additions on Indigenous Peoples’ rights under the chapter of “Human Rights” of the consultation draft. However, the changes made are minor and inadequate given the serious impacts on the rights of Indigenous Peoples, including to their lands, resources and life with dignity, due to business operations. We thus call on the OECD to modify the draft to explicitly note that:

1. Indigenous Peoples have rights to their lands, territories and resources and to self-determination, among other rights as guaranteed in the UN Declaration on the Rights of Indigenous Peoples (UNDRIP) that MNEs should respect regardless of the protections provided, or lack thereof, in national laws and policies in the countries they operate.

2. MNEs must undertake human rights due diligence (HRDD) as described in the UN Guiding Principles on Business and Human Rights. Such HRDD measures must include, among other things, human rights impact assessments carried out at the outset of the business operation to determine the viability of the operation through meaningful consultation with affected individuals or communities, and other relevant stakeholders while giving special attention to those facing heightened risks of business related human rights abuses, such as women and Indigenous Peoples, among others. MNEs must respect the findings of such assessment and refrain from undertaking any business operation with serious human rights impacts.

If Indigenous Peoples will be affected by any business operation of MNEs, the HRDD measures must include consultations at the outset of the operation to obtain their free, prior and informed consent (FPIC). MNEs must then respect that the concerned Indigenous Peoples have the right to provide or withhold their consent for such operation or provide consent with conditions, and accordingly cancel, suspend or proceed with their operation. HRDD measures to obtain FPIC of the affected Indigenous Peoples must be undertaken throughout the operation, including when there is any change in the operation that may affect the Indigenous Peoples, and must include effective remedy for harms caused by the business operation determined in conjunction with the concerned Indigenous Peoples with respect to their laws and customs.

3. MNEs must carry legal liability for human rights abuses that may arise from their own business activities or from their business relationships in line with international human rights standards as determined by UN human rights mechanisms, regardless of national legal and policy framework in the countries they operate in. States must ensure that their domestic law provides for or establishes effective, proportionate, and dissuasive criminal, civil and/or administrative penalties for human rights abuses of MNEs, including through suspension of or sanctions from public funding or procurement, blacklisting from public stock markets and/or cancellation of registration and defaulting such MNEs as per the gravity of the abuse. In particular, criminal offences against human rights and environmental defenders by persons associated with MNEs, including through business relationships, must carry serious criminal penalties against the MNEs, including their leadership.

Further, CEMSOJ welcomes the improvements towards strengthening the Implementation procedures in the consultation draft. However, the National Contact Points (NCPs) with critical implementation role of the Guidelines need significant change in mandate and authority for effective implementation of the Guidelines. The NCPs must be provided with quasi-judicial powers so that they can make effective determinations on the complaints submitted to them on violations of the Guidelines. At the same time, they should be provided with powers to impose temporary suspensions and sanctions as mentioned above on the MNE against which credible complaint of human rights abuse or other violation of the Guidelines has been registered. The NCPs should also have stronger role in ensuring that the individuals or communities harmed by business operation of MNEs against the Guidelines are provided effective remedy through the MNE or other responsible authorities, such as the concerned government entities within their jurisdiction.

Click here for the PDF of the submission.