Bridging The Business And Human Rights Gap In Asia – Analysis

By Seth Hays and Morgan Hughes

The regulatory drive to encourage businesses to adhere to environmental and human rights standards in their global supply chain operations was exemplified by the European Council’s March 2024;approval;of the;Corporate Sustainability Due Diligence Directive. The approval was;followed by;the 2024 United States Government’s National Action Plan on Responsible Business Conduct.;

These rules and action plans will most likely impact the Asia Pacific due to European and US businesses’ deep supply chain integration in the region.;

A raft of guidelines and voluntary best practices have existed for years, such as the OECD’s Due Diligence Guidance for Responsible Business and the United Nation’s Business and Human Rights Guidelines. Multilateral discussions at the United Nations on best practices are ongoing, most recently at the 37th session of the Working Group on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises. Cross-sectoral and geographically diverse stakeholders continue to convene around the world, including at the 13th United Nations Forum on Business and Human Rights to be held in November 2024.

While the United Nation’s efforts are notable, other multilateral activity and developments in ‘soft law’ evidence the growing attention paid to the nexus between business and human rights. Trade agreements in Asia — such as the;Comprehensive and Progressive Trans-Pacific Partnership;(CPTPP) — contain obligations to address labour rights violations. Chapter 19 of the CPTPP obliges member states to affirm their commitments to the 1998 International Labour Organization Declaration on Fundamental Principles and Rights at Work. The commitments include allowing freedom of association and collective bargaining. The chapter also promotes initiatives to reduce forced labour, child labour, and discrimination in employment and occupation.;

The evolution of binding ‘hard law’ shows that compliance with the rules governing businesses and human rights is moving from ‘good to have’ to ‘must have’. Examples of this shift include the;2021 US;Uyghur Forced Labor Prevention Act,;which addresses a form of infringement of rights in a specific country, and Germany’s more broadly applicable 2023;Supply Chain Due Diligence Act.

Within the ecosystem of firms and non-profits that assist businesses in navigating these rules, international business associations seek to bridge the gap between commerce and rights advocacy.

Though business associations are non-profits, they represent the interests of their for-profit members. But their diverse corporate memberships empower them to assess the impacts of due diligence and supply chain rules across industries, identify industry-wide problems with due diligence reporting on rights and engage both host governments in Asia and home governments in the West. This is especially useful when individual companies may not be politically positioned to advance discussions on human or environmental rights.

The COVID-19 pandemic saw rapid policymaking embolden many infringements of rights. International business associations played a significant role in Asia during the crisis as force multipliers, ‘matchmakers’, fundraisers and lobbyists for rights-based principles, according to a;survey;conducted by non-profit management consultancy;APAC GATES.

The research found that business associations active in Asia during the height of the COVID-19 pandemic advocated for human rights where business interests aligned with rights-based principles such as access to information, freedom of movement, equal treatment and non-discrimination. Some associations undertook even greater social and public interest roles in organising the distribution of personal protective equipment and matchmaking civil society needs with the resources of member businesses. They occasionally collaborated with national human rights committees and lobbied local governments over policies relating to internet access and access to medical treatment.

Businesses have long self-regulated using strategies aligned with the concepts of corporate social responsibility (CSR), ESG and ethical financing to maximise their social impacts. Leading enterprises such as OpenAI have chosen to incorporate as non-profits or accredit themselves under standards such as the B Corp certification to signal to stakeholders their commitments to public interest principles.

Business associations can play a vital role in advocating for and supporting international businesses in Asia and those bound to adhere to US and EU laws as their rights-based obligations become increasingly fundamental to strategic and operational decisions. They can also ensure that politically motivated or superficial ‘rightswashing’ — the deceptive promotion of a business’s social responsibility — is identified and avoided.

Important advocacy is already underway in relation to the EU;Corporate Sustainability Due Diligence Directive;(CSDDD). In June, the European Business Organisation Worldwide Network — a group of 54 European Chambers of Commerce — issued a;white paper;to the European Union identifying practical challenges in complying with the Directive. For example, one chamber noted that in China national security laws may make due diligence impractical or impossible legally and emphasized that it’s provisions ‘must also be commercially viable to ensure that the CSDDD does not become unenforceable…contrary to the [European Union’s] aims of advancing human rights and responsible environmental stewardship’.;

Beyond direct advocacy to governments, there is room for improvement in the communication and collaboration between civil society organisations (CSOs) and business associations’ corporate members. Business associations across the Indo-Pacific should establish a platform and forum for their respective CSR committees to convene regularly. This would enable them to more effectively review the impacts of certain laws and would also allow for improved sharing and aligning of their views on best practices, allocating resources and publicising the value of these efforts.;

An example of how a business association is actively collaborating to uphold rights in supply chains is the EuroCham Cambodia’s;Responsible Business Hub. This initiative is a help desk which provides support for local businesses in Cambodia to mitigate negative social and environmental impacts in the country’s export supply chain — in particular the garment and textile industries. In addition to education, the Hub provides business actors with toolkits, education and research on a range of issues, from child rights impact assessment for mobile operators to feasibility studies on fabric recycling.;

As international businesses increasingly focus on their supply chains’ impacts on human rights and the environment, CSOs should consider establishing constructive advocacy channels with international business associations representing these enterprises.

It is essential for enterprises, CSOs, and associations in Asia to actively participate in shaping the rules directly implicating both human rights and business in order to successfully bridge the commerce and rights advocacy gap.

About the authors:

• Seth Hays is a lawyer and co-founder of non-profit management consultancy APAC GATES.
• Morgan Hughes is Director of Research at and co-founder of APAC GATES.

Source: This article was published at East Asia Forum and draws upon the APAC GATES report Bridging Commerce and Rights Advocacy: International Business Associations in the Indo-Pacific and How They Engaged on Behalf of Human Rights Amid the COVID-19 Pandemic.