Business, Human Rights & a Level Playing-Field

As part of its annual World Report 2006, Human Rights Watch has just published the following:

Private Companies and the Public Interest: Why Corporations Should Welcome Global Human Rights Rules by Lisa Misol

Because voluntary commitments are insufficient in themselves to prevent corporate implication in human rights abuses, there have been increasingly frequent calls for binding standards. Indeed, regulations already have begun to emerge in some sectors on some issues, but coverage and enforcement is spotty, far short of the kind of comprehensive framework many believe is necessary. Multinational corporations have long responded to calls for any kind of binding human rights standards with the claim that self regulation or voluntary guidelines are enough. But there are signs that this opposition may be beginning to change.

In private, some multinational executives have started to question whether industry’s antagonism to regulation makes sense when it comes to human rights. They realize that only binding standards can ensure a level playing field and that, increasingly, the choice facing them is not between adopting voluntary codes of conduct and doing nothing. It is a choice between continuing to compete on an uneven, ever-shifting playing field and participating in the creation of universally binding and enforceable rules that apply equally to all companies.

The “level playing field” argument is a good one, generally. It basically says that in some situations, business should actually welcome some form of regulation. We all want to do the right thing; no one wants to see human rights violated. But the best intentions sometimes run up against competitive pressures. In the face of competitive pressures, personal conscience may fall by the wayside. One way to fix that is to invite regulation (either by government or by industry groups) so that all companies are able to do the right thing, without fear of competitive disadvantage.

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