Time to deliver on responsible supply chain commitments

As G7 leaders meet in Japan later this week, will we see scaled up joint action to ensure that all business activity, wherever it takes place, is undertaken in ways that respect the rights of workers and communities and enhance economic, environmental and social sustainability?

At last year’s G7 meeting in Germany, government leaders made an important commitment to promote responsible supply chains, including through strong support for implementation of the UN Guiding Principles on Business and Human Rights, which mark their 5th anniversary next month. The 2015 G7 declaration called for industry-specific standards and encouraged companies to develop human rights due diligence processes, as well as ensure access to remedies for business-related harms. The 2015 G20 in Turkey made a related commitment to fostering "safer and healthier workplaces also within sustainable global supply chains."

Collective action needed

Unfortunately, there haven't been many signs that the G7 aims to build on last year's statement or put in motion follow up efforts.

Expressing frustration with the lack of momentum in this area, a group of NGOs recently issued a joint statement calling out G7 nations for inadequate action on their 2015 commitments. They urged G7 governments to "require, by law, that companies implement human rights due diligence in accordance with the highest international human rights and environmental standards”.

We shouldn’t under estimate the need for collective action in this area.

Efforts by companies working with trade unions and civil society representatives to improve supply chain practices, such as IHRB’s own work to eliminate the practice of charging recruitment fees to workers, indicate what can be done through collaborative approaches.

Equally important, valuable guidance by inter-governmental bodies like the UN and OECD demonstrate how governments can advance awareness and action on this agenda.

And yet…

But serious shortcomings in state and business practices remain.

In the area of labour rights protections for example, evidence points to ongoing enforcement gaps in global supply chains that pose serious risks, in particular for migrant workers and others most vulnerable to exploitation.

As economic actors themselves, governments clearly can push companies operating within their borders to undertake more extensive due diligence processes as set out in the UN Guiding Principles and other international standards.

For example, in their roles as major purchasers of goods and services from business (global trade in public procurement is worth an annual one trillion euros) states can incentivise better business practices across the supply chain. They can also shape the terms under which businesses deliver essential services and public goods such as new infrastructure so critical to achieving the 2030 international development agenda.

While individual state actions are critical, more effective efforts across national borders are needed to make global supply chain practices consistent with international norms.

Earlier this month, the Council of the European Union released its conclusions on the EU and Responsible Global Value Chains. The Council "encourages the (European) Commission to enhance the implementation of due diligence and to foster dialogue and cooperation amongst all relevant public and private stakeholders, in order to achieve a global level playing field and to implement policy measures aimed at promoting e.g. human rights due diligence at company level." (para 9)

The Council conclusions express support for the EU Garment Initiative as well as agricultural sector efforts on deforestation and sustainable palm oil. They also highlight the need for faster uptake of internationally agreed principles, guidelines and initiatives.

Some would question, however, if these conclusions signal European governments are actually moving towards more concerted efforts to tackle governance gaps in global supply chains including through the adoption of legally binding frameworks.

From G7 to Geneva

Another opportunity to test the political will for stronger collective action comes at the annual International Labour Conference, which gets underway on 30 May in Geneva.

This year's session will have as a main agenda item encouraging respect for human and labour rights throughout global supply chains. Although some states have taken initial steps to tackle forced labour and human trafficking in supply chains, the scale of this and related problems requires a global response.

A report released in advance of the ILO conference includes recommendations for scaling up efforts to promote decent work in global supply chains. These include increasing space to share knowledge and good practices to bridge supply chain governance gaps, strengthening development cooperation and capacity building targeted at sustainable supply chain management, and improving coherence among bilateral, regional and multilateral organisations dedicated to enhanced performance on these issues.

Tipping the balance

It remains to be seen if such proposals help tip the balance towards more coordinated strategies and effective implementation in the time ahead. Improving the social and environmental performance of global supply chains clearly remains a work in progress.

As a leading expert in the field, Richard Locke, has stressed, reliance on existing approaches won't produce desired results  - this is due to the serious limitations in private voluntary programmes as well as in state efforts to adequately inspect and redress violations of international standards . Locke suggests a third way is needed, focused on blending private interests and public intervention.

Governments will have to play a lead role in making such proposals a reality.

Current attention to improving the way global supply chains work is an opportunity that shouldn’t be lost. Now is the time to recognise and act on our shared responsibility for shaping a more sustainable and rights respecting global economy for all.