Speaking notes for the intervention by Minister Maite Nkoana-Mashabane at the Symposium on Business and Human Rights at the International Peace Institute, New York, 24 September 2010.

Program Director

First, allow me to extend my sincere gratitude to my colleague the Foreign Minister of Norway and the International Peace Institute for inviting us to participate in this panel discussion on Human Rights and Business.  As you know matters of promotion, protection and respect of Human Rights are very close to us.

I will be failing if I do not recognize my fellow panelists – personalities whose reputation and contribution in the field of human rights are well known.

Allow me to single out the Special Representative of the Secretary-General, Prof John Ruggie, for his tireless efforts, leadership role and the guidance he continues to provide to the international human rights system in the area that is the subject of our topic today.
 

As South Africa, we are in full support of the guidelines and the three core principles of the policy framework relating to the management of business and human rights challenges, which are (as we all know): the State duty to protect against human rights abuses by third parties, including business; the corporate responsibility to respect human rights; and the need for greater access by victims to effective remedies.

However, our success in operationalising these principles as countries depends on a number of factors; and I wish to single out here just a few.

First, is the capacity of the state, especially in some developing countries, to implement and enforce these principles.  In some of our countries, Transnational Corporations wield so much power and influence to the point of being above the law – or being stronger than government.  They derive such influence and power from the fact that in some cases their turnover is far bigger than the national budget of some of our countries. And that their position in the country’s economy could be so critical to the national fiscus and jobs to the extent that government may not want to “upset” them. 

Therefore, political will on its own is not enough.  It has to go hand-in-hand with:
 

• The capacity of the state through its institutions and the judicial system to operationalise the three principles;
• And the cooperation and willingness of the corporate sector (especially the TNCs) to play by the rules.

Secondly, is the role that some in the corporate sector, including the TNCs, could play in corrupting state actors through bribery, for example – to prevent government from playing its role to protect and promote human rights or take action against big corporation.

Finally, is the concern that has arisen in many cases whereby some countries use their foreign policy and the global geo-political standing they enjoy to protect the interests of their TNCs, even in instances where they (the TNCs) are implicated in serious cases of the violation of human rights.

For South Africa, human rights are an important pillar of both our domestic and foreign policies – and are deeply enshrined in our Constitution.  They inform both our corporate governance and labour relations regimes domestically as well as our behavior as a country in international affairs (in our bilateral relations and in multilateral organizations). 

Corporate governance in South Africa is informed by the King’s Report on Good Governance, which emphasizes how companies can both positively and negatively impact on the economic life of the community in which they operate; the link between good governance and compliance with law on the part of corporations;  governance models where values-based principles are followed and governance is applied in both form and substance; and that the company is integral to society, particularly as a creator of wealth and employment.

South Africa’s application of human rights to labour practises is governed by the South African Labour Relations Act of 1995 whose purpose is to advance economic development, social justice, labour peace and the democratisation of the workplace.  The labour relations framework of South Africa therefore facilitates for employees and their trade unions, employers and employers’ organisations to collectively bargain to determine wages, terms and conditions of employment and other matters of mutual interest, including an open and transparent process regarding the formulation of industrial policy.

Discussions are currently underway in South Africa regarding the Decent Work Country Programme (DWCP) which aims to translate the International Labour Organisation (ILO) values into national realities.  This has gained momentum and is on track to be achieved.

The other reason that makes us to have particular interest in the subject of this symposium is the fact that Africa is the region that suffers the most from the negative role that TNCs can play in the domain of human rights.   As pointed out in the report  of the Special Representative of the Secretary-General (Prof John Ruggie)  to the UNGA, it is poor countries in our continent and those in conflict or emerging from conflict that are worst affected by violations of human rights by big multinational corporations.  We know of many cases in our continent where big corporations are doing business with no regard at all to basic standards of Human Rights and Fundamental Freedom, including the right to development.  Examples include the use of child labour and contributing to environmental degradation.

Also, Africa has many examples of what has become known as the “resource curse”, whereby the country’s wealth (oil and mineral resources, for example) does not benefit the country and its people – and instead it becomes the source of conflict and political instability.  We all know that some big corporations are at the center of this “resource curse” because of the manner that they exploit our wealth.

Some of you may be aware that one of the four core focus areas of the African Peer Review Mechanism (APRM) is on the problem of corporate governance in Africa.  The aim here is to promote a culture of good corporate practice in Africa for sustainable development.

For our part as the South Africa government, after realizing that our liberation had made it possible for many of our companies to do business on the continent, we decided to develop a code of good business practice, that will regulate and guide these companies on basic standards of corporate social responsibility as well as respect for Human Rights and Fundamental Freedoms across our borders.  South Africa is one of the largest investors on the continent having invested an annual average of 1.4 billion USD since 1991 and is currently the largest trading partner to most countries on the continent, particularly in Southern Africa. South Africa’s total trade with the continent has grown by roughly 659% since 1994 when we got out freedom.

The Code of Conduct that we are still working on is not to be a legally binding document at the first instance but we believe that it should be enforceable on moral grounds. It is expected that our business formations will use the Code and integrate it in their membership criteria, thus providing an enforcement mechanism for the Code. However, this will still require buy-in from the private sector.

We believe that such a Code (for South African companies operating across our borders in Africa) should try to achieve the following:

• It should address labour specific issues such as conditions of service for workers, the use of child labour and so forth.
• It must talk to issues of political rights such as the right of association (e.g. formation of trade unions).
• It must address issues related to development – such as skills development, local economic development, beneficiation, technology transfer, recruiting managers locally as opposed to the use of expatriates, and corporate social responsibility.
• It must encourage South African business to partners with local business wherever they go on the continent;
• It must say something about good corporate governance – the democratic, exemplary and responsible manner that our companies should run their business entities.
• Finally, it must urge business to play a positive role in the protection of our environment, on the continent and everywhere.

In summary, our view on the issue of Business and Human Rights is that:

• The notion of voluntary corporate responsibility has become moribund in contemporary international human rights law. Non-State Actors must be held accountable for their actions, especially when these actions result in human rights violations;
• There is an imperative need to develop an international regulatory framework in the form a legally binding instrument to regulate the activities of TNCs and to ensure universality of application of uniform standards, on a global scale;
• National legislation in many developing countries is inherently weak and does not cater for regulation of the activities of TNCs.  A complementary international standard is therefore needed to strengthen weak national legislation;
• The phenomenon of globalization and its negative impact on the economies of the developing countries has brought about disparities in the sharing of the benefits of globalization.  Critical issues such as transfer of technology, infrastructure development, and market access should be managed effectively in order to mitigate the challenges of poverty and make the right to development a reality for everyone;

Finally, Chairperson, the South African Government stands ready to support initiatives in this process which will ensure maximum protection of victims of the violation of human rights, the provision of adequate remedies for these victims, and the need to ensure that there are consequences for TNCs which violate human rights. 

I thank you.