Ruggie renews appeal to companies to reduce business-linked human rights risks

John Ruggie, the Harvard professor who authored the UN’s Guiding Principles on Business and Human Rights (the ‘Ruggie Principles’), has renewed an appeal to companies to focus less on social development initiatives in countries where they do business and focus more on reducing the negative impact their business may have on human rights.

Ruggie’s appeal follows the creation at last month’s World Economic Forum in Davos of a commission to promote the UN’s Sustainable Development Goals (SDGs) among companies. The body is co-chaired by Paul Polman, CEO of consumer products giant Unilever and Mark Malloch-Brown, a former Deputy Secretary-General at the UN.

In Davos, Polman said at a news conference that fulfilment of the SDGs – which include abolishing poverty, hunger and gender discrimination as well as action on climate change – could unlock trillions of dollars in new business for companies.

The commission’s creation has prompted an open letter from Ruggie, in which he says that while the development is “heartening”, companies have a responsibility to do more than just promote social development initiatives like new schools or other necessary infrastructure.

“Too many companies put resources into these initiatives that are worthy on their face while ignoring serious negative impacts on people in their own operations and value chains,” he says.As a result, “the companies end up giving with one hand while taking away – or enabling others to do so – with the other. This is not a pathway to sustainable development,” Ruggie adds. Indeed, the second pillar of the UN principles that he drafted calls on companies to respect human rights throughout their business – and inform shareholders about the effort.

Ruggie also argues that, as with environmental protection, companies that respect human rights reduce their legal, reputational and financial risks. This in turn creates “real opportunities to attract new customers, investors and employees”.

The body chaired by Polman, the Global Commission on Business and Sustainable Development, has funding from the Rockefeller Foundation and the Bill and Melinda Gates Foundation as well as from Australia, Denmark, the Netherlands, Sweden and the UK. It has five aims:

• Decode the SDGs and show why it makes sense for business to engage on sustainable development
• Show how new business models can align profitability with social purpose
• Map out how new financial tools can attract private capital and align economic and social returns
• Show how business, government and society can work together to achieve the SDGs
• Quantify the efficiency gains if business is fully aligned with the SDGs