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40 D+C  e-Paper  August 2016 Comment Low ambitions The UN Human Rights Council passed guiding principles on busi- ness and human rights in June 2011, defining governments’ duties and private-sector companies’ responsibilities. Five years on, a mere eleven governments have adopted national action plans to meet those guidelines. Germany’s plan is set to be adopted soon. The draft version was published by five federal ministries. It fails to meet the expectations of civil-society organisations, but appar- ently exceeds what Germany’s Finance Ministry finds acceptable. By Armin Paasch The legal concept of “human rights due diligence” is at the heart of the guiding principles. It requires companies to assess the human rights implications of their companies’ activities and business relationships all over the world. Compa- nies have the responsibility to identity and assess human rights risks, to take appro- priate measures and to report in a trans- parent manner. Accordingly, Germany’s draft action plan expresses “the expecta- tion” that German companies will imple- ment human rights due diligence along their entire supply chains. The snag, how- ever, is that the legal language is only binding for 174 corporate entities that belong to Germany’s Federal Government. No other company is threatened with sanctions should it fail to comply. The Federal Government wants half of all German companies with a staff of more than 500 persons to establish management systems that ensure human- rights due diligence by 2020. The plan is to do random checks from 2018. Only should the corporate sec- tor fail to comply, does the government contemplate additional measures, includ- ing legal ones. It is not clear, however, what criteria will serve to assess compa- nies’ performance. It is even less obvious, moreover, that a future Federal Govern- ment will feel bound by the proposals made by the current one. Trade unions and non-governmental organisations (NGOs) that are active in fields of global development and human rights want more to happen. We insist that human rights due diligence must be made legally binding for all corporations based in Germany and include their foreign affiliates and suppliers. Breaches of the principle must be sanctioned with fines, and victims must get legal standing before German courts so they become able to sue for compensation. Moreover, the Federal Government must not procure goods or services from companies that have been proven to disregard their human rights obligations. Finally, we demand that human rights are made a core concern when the EU negotiates or implements future trade deals. Recent research done by various scholars has shown again and again that human-rights breaches in the context of the activities of German-based companies are nothing exceptional. On the contrary, they are a structural challenge that is evident in international activities con- cerning mining, energy, agriculture and manufacturing. To date, not one of the 30 corporations that are included in the DAX stock-market index is implementing the UN Guiding Principles in a compre- hensive manner, though 23 of them have been blamed of human-rights breaches in the past 10 years. According to a study that was funded by the EU Commission, moreover, it has hardly any impact when private-sector companies make voluntary commitments. It had inspired hope that the Federal Government organised a comprehensive and participatory process to discuss pos- sible contents of its national action plan. Apart from business associations, Ger- many’s Trade Union Congress, the Human Rights Forum and VENRO, the umbrella organisation of developmental NGOs, were involved in the consultations. The draft text’s low ambitions, however, prove that our hopes were probably misguided in a rather fundamental sense. The final word has not been spoken. Federal Cabinet, led by Chancellor Angela Merkel, will take the ultimate decision in autumn. Apparently, the Finance Ministry is about to express its disagreement with the current draft. It is set to oppose the very concept of “human rights due dili- gence” and does not want to consider legal sanctions. Should such a view prevail in the end, Germany’s action plan would become meaningless. Armin Paasch is an adviser on business and human rights with Misereor, a non-governmental development agency, and represents VENRO, the NGO umbrella organisation, in the steering committee of Germany’s Federal Government to elaborate the national action plan on business and human rights. [email protected] Peruvian copper mine: human-rights abuses are common in resource extraction. Chuquiure/Lineair Debate