How in non-financial areas such as social responsibility(CSR),

How useful are individual company codes of conduct to promote the human rights accountability of multinational corporations?Through globalisation and the current world trade system, multinational corporations (MNCs) have been held accountable in many cases where human rights have been at the centre of the attention. Pointing out the responsibilities of MNCs on this particular subject is a way of promoting human rights publically and on a large scale to raise awareness throughout the business world. It has been observed that some MNCs have such a rapid growth that they are becoming more powerful and influential than third world countries. This situation leads to abuses of power, conflicts of interests and unethical behaviours. However, it is fundamental to distinguish the responsibility from the accountability of multinationals throughout this writing. Corporate accountability can be defined as “the performance of a publicly traded company in non-financial areas such as social responsibility(CSR), sustainability and environmental performance”. (EJOLT).We understand that codes of conduct, human rights and ethical issues are heard to be major parts of the subject. On the other hand, the responsibility of a corporation is to assure the well being and good development of the society as a whole but does not specifically point out the necessity of these MNCs to be seen as ambassadors of social, ethical and environmental values nor promoters.The question is now: how can individual company codes of conduct be used to make MNCs accountable for human rights violations?It is primordial to expand corporate accountability in order to limit MNCs influence over economical, social and environmental issues.This paper will examine how individual codes of conducts are a well-driven initiative in order to promote human rights. But on the other hand, why are they failing to hold MNCs accountable in an efficient way?-Codes of conduct as an initiative to promote human rights:Codes of conduct can be defined as concepts including “ethical, honour, moral codes and religious laws. It helps to set a standard in the workplace for the members so that they know what could be expected of them in that environment.”The aim of these codes is, therefore, to give employees a guidance on what they are expected to do when they face any kind of ethical issue through their work by using the framework provided.Levis Strauss & Co was the first multinational company to take action against unethical and illegal behaviours by writing their own code of conduct (1991). “We will seek to identify and utilize business partners who aspire as individuals and in the conduct of all their businesses to a set of ethical standards not incompatible with our own” (Ethical Standards) was the first term of their engagement.After this noticed entry into the corporate world, codes of conducts democratised themselves and became a necessity for any multinational corporation (MNC) in order to keep the business going with each other. In order to be publicly recognised as defenders but also promoters of the human rights and to raise environmental awareness, every company had to write a code for themselves. However, in the recent years, it was also primordial to do it because of the appearance of due diligence into the business contexts, which means that investors will seek for background on the company they are interested in. That’s why the companies themselves need to be irreproachable.It is therefore realistic to say that the setting up of the codes of conduct into the business world has been a great way to publicly promote human rights and to make it one of the biggest challenge of the upcoming years. However, the question of the accountability of the MNCs and the way they could be held responsible for some of their actions are yet to be answered.-But codes of conduct fail to punish human rights violations:However, the current situation does not reflect the efforts made in recent decades by the establishment of codes of conduct. Indeed, in the last few years, multinational corporations have been singled out as important figures, for better or worse, in the maintenance of human rights given their economic status and international dimension. In fact, some of the strongest MNCs on the planet have, over time, become richer and above all more powerful than some of the countries in which they invest. This causes a problem in the sense that conflicts of interest between companies and governments will appear, and most of all, MNCs will be in a position of strength because they know how crucial they are to the countries they decide to invest in. At this point, it becomes concerning on an ethical and social issue as the legislation of the country they invest in is not in a position where they can take action against these companies because of their financial power and their primary role in the development and growth of this country.Although governments are not always eager to denunciate the abuses of power made by multinationals, there is a treaty in place defending citizens from around the world. It is called the Alien Tort Statute (ATS) and it has been part of the U.S law for more than 200 years, “allows non-U.S. citizens to sue for violations of the law of nations or customary international law, or of a treaty of the United States, in U.S. courts. It has been used to bring claims for human rights violations against government officials, private actors and multinational corporations.” It was officially adopted as part of the Judiciary Act of 1789.-Several cases where multinationals took advantage of their own code of conduct:The governance gaps that have been created by globalization have permitted an environment for wrongful acts by multinationals without adequate sanctioning or reparation. “How to narrow and ultimately bridge the gaps in relation to human rights is our fundamental challenge”(Ruggies,2008). While this principle comes along with ‘Protect, Respect and Remedy”(U.N, 2008) framework and contains elements capable of having a great impact, all of them together are not sufficient to provide an order strong enough to battle MNCs human rights violation when national regulations are unavailable or ineffective.Consequently, many multinationals know that despite having their own codes of conduct written in their books, they could and still can bypass them without risking serious consequences. But MNCs implication in human rights violation is undeniable in some cases. In fact, one of the worst industrial accident in history took place in 1984, the Bhopal case. Union Carbide Corporation (UCC) had a factory in this city in India when 27 tonnes of a deadly gas spread through the whole city. With 2000 deaths and more than 200 000 people injured, this case became public raised general awareness. However, no legislation nor treaty was strong enough to hold Union Carbide responsible for what happened and to this day the Indian government and UCC are still debating whether it was a lack of management or a sabotage. This case highlights the weaknesses of the Guiding Principles of human rights defence in the assessment of who’s accountable for what and how to punish the party at fault.Furthermore, legitimising predatory or corrupted states is another reason for human rights to be violated as the economic and financial advantages they gain are prioritised over social and ethical respect. These governments are not strong enough to force MNCs to follow their codes of conduct and as consequence, they accept illegal working practices into their frontiers. These conditions in business have led to many events where serious allegations have been made but this time governments were involved and it was made publicly available (Total in Myanmar, 1980-90’s. Coca-Cola, 2000-05. Bridgestone,1995. Drummond, 2001). All of these four cases took place in non-developed or developing countries such as Liberia, Columbia or Turkey which shows the strength of MNCs as they know governments are not crystal clear. In these circumstances, two governments were involved and one paramilitary force.-How can they be held accountable for their actions? The effectiveness of transnationals companies in non-financial areas (ethics, CSR, environment) is becoming increasingly detrimental to them as these issues are supported and scrutinized by the public opinion. This means that the image of the brand will be reflected by their actions, which will directly impact their success or not.In order to assure the image of the firm, MNCs can recruit an audit company that will be responsible to guide their employees and control the way the company applies their code of conduct.  The aim of such an action is to show they are accountable for non-financial issues and well aware of the importance of these. Also, working closely with an audit company will help MNCs to face the Institute for Global Ethics (IGE,1990) as part of an inspection of compliance with codes of conduct. Indeed, this institute has been created in the early 1990’s to promote the behaviours expected from the multinationals as well as encourage them to do it themselves. Another task run by this company is to measure whether the MNCs are accountable internally but also externally in a stakeholder approach. Internal accountability comes from the inside of the company and describes the staff and workers employed by the company and involves the board being held accountable for all of them in case of in the case of ethical, social or environmental negligence. The external point of view is more difficult to control for the board as it includes multiple stakeholders. They can face Non-Governmental Organizations (NGOs), Governments and other firms if a conflict of interest appears. MNCs are confronted to Corporate Social Responsibilities (CSR), stakeholder engagement, transparency beyond Annual General Meeting (AGM) and non-financial reporting which makes them vulnerable in theory. In fact, they are not that vulnerable as it was said earlier and they are still escaping from many crimes committed and have not yet been punished from any of them as shown with the Bhopal Case (1984). Efforts to increase surveillance and restraint MNCs abuses of power have been summarised lately in a report from the United Nations Research Institute for Social Development (Utting and Clap 2008). It includes proposals to create a new institution that would be solid enough to hold MNCs to account by using international and domestic legislation to crack them down when necessary rather than requesting or expect companies to report voluntarily. Conclusion: Corporate accountability cannot be effectively dealt with with the current institutions and legislation as it is a huge challenge that requires more implications. In order to be truly successful, creating legitimate administrations able to mandate MNCs over any matter related to corporate accountability is necessary. In addition, it is imperative to assure compensation and interest to those who’ve been a victim of human rights violation of any kind by MNCs.On another hand, due diligence describes “processes seeking to identify, prevent, mitigate and account for the adverse human rights impacts that they might have either directly or through their business partners”.(Bright, 2016). A study conducted by a professor analyses the “effectiveness of the concept of human rights due diligence for fostering corporate accountability and positively affecting corporate behaviour.” (Bright, 2016). This implies that due diligence could become a parameter capable of attracting investors by claiming more responsible corporate management. To close this writing, it is fair to state that individual codes of conduct are useful to promote human rights to a certain extent. However, they are unable to hold multinationals accountable and punish them when they violate human rights. Will new legitimate institutions and legislation be enough to “make THE WORLD GREAT AGAIN”? (Macron, 2017)

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