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The direct involvement of corporations in shaping norms and the role of multi-stakeholder initiatives

However, this formalization of the status of the preparatory process represents just one dimension of the changing role of corporations within the international law framework. More important than their involvement in preparing regulative drafts is the establishment of corporations as constituent partners within the direct normshaping process itself. This development is linked to the emergence of so-called cross-border multi-stakeholder initiatives in the norm-shaping process. Translated into legal terms, such regulative governance initiatives might best be characterized as public-private partnerships with regulative means. In the area of business and human rights, the actors typically involved in such initiatives are representatives of states, civil society organizations, and corporations. The UNGPs have repeatedly promoted the emergence of such initiatives in the field of business and human rights while at the same time laying claim to a particular role in orchestrating content.[1] [2] [3] [4]

In terms of how the actors/subject question relates to corporations, these initiatives may at first seem of little significance, since they are mainly regarded as operating governance systems beyond the limits of the international law framework.6® The question is whether this assumption is true for all types of initiatives. Recent research has sought to shed some light on the connections between such initiatives and international law and established the term ‘informal international law- making’^9 From an output-oriented perspective, at least, it seems possible to locate some of these instruments within the realm of international law/0 The reflexive consequences of these mechanisms on the national and international legal framework are crucial. At the same time, such a categorization has direct consequences on assessment of the actors involved in the norm-shaping process. These consequences will now be illustrated by a brief examination of two cross-border multi-stakeholder initiatives in the business and human rights arena where corporations take a leading role in the norm-shaping process. Practical example I: The Extractive Industries Transparency Initiative (EITI)

According to its own description, the Extractive Industries Transparency Initiative is ‘a global coalition of governments, companies and civil society working together to improve openness and accountable management of revenues from natural resources’.[5] In short, the basic idea of EITI is to help resource-rich developing countries to avoid the risk of the resource curse and at the same time create a level playing field for any corporations involved.72 The executive organ of the initiative is the EITI Board, where the implementing states, supporting states, civil society organizations, corporations, and investors are all equally represented. The initiative, launched by the UK government, began with the definition of a set of core ‘principles’ in 2003 which became ‘rules’ in 2009. At the EITI Global Conference in Sydney in 2013, the EITI Board adopted the new ‘EITI Standard’, containing a set of minimal requirements that implementing states must fulfil/[6] Central features are inter alia the creation of an effective oversight mechanism via the establishment of a correlated multi-stakeholder dialogue7[7] and clearly defined reporting requirements ‘that include full government disclosure of extractive industry revenues, and disclosure of all material payments to government by oil, gas and mining compa- nies’.75 Furthermore, the reports are subject to an external validation process/[8] Becoming a member state of the EITI initiative is voluntary, but once a state applies for membership—which requires the head of state or government to issue an unequivocal public statement of its intention to implement the EITTh—non- compliance with the EITI Standard and especially with the reporting obligations can lead to suspension or delisting from the initiative/8 Therefore, from the applying state’s perspective the standard, developed exclusively by a multi-stakeholder initiative, works purely on a ‘take it or leave it’ basis. The procedural parallels with the ratification of an international law treaty or covenant are obvious. Yet, in contrast to classical ratification procedures, no reservations are possible. Currently twenty-nine compliant countries are members of the initiative and seventeen candidate countries are in the process of becoming members/9 Practical example II: The International Code of Conduct for Private Security Service Providers (ICoC)

A further example, taken from a different field but with similar features in terms of the role of corporations within the international norm-shaping process via multistakeholder initiatives, is the International Code of Conduct for Private Security Service Providers (ICoC) established in 2010. The ICoC is a highly illustrative example, since it also demonstrates the partly concurring approaches of governance- driven multi-stakeholder initiatives and state-based legislative procedures in international law. Since the late 1980s the issue of private security provider regulation has been discussed extensively within the UN. The establishment in 2005 of the UN Working Group on the Use of Mercenaries as a Means of Violating Human Rights and Impeding the Exercise of the Right of Peoples to Self-Determination was a clear signal of UN regulative ownership, especially regarding the human rights compliance of these corporations. In addition to its monitoring role, the working group’s mandate includes a duty ‘to elaborate and present concrete proposals on possible complementary and new standards aimed at filling existing gaps, as well as general guidelines or basic principles encouraging the further protection of human rights’ as well as ‘to seek opinions and contributions from Governments and intergovernmental and non-governmental organizations on questions relating to its mandate’.80 Surprisingly, corporations are not mentioned as stakeholders of the process at all. To date, the Working Group has not produced any regulative output with regard to its human rights-related task.

The governance-driven approach worked rather differently. The ICoC initiative goes back to a campaign by the Swiss government and the ICRC to clarify the role and obligations of state-related operations by private military and security companies during armed conflict (the so-called Montreux Document^1 and is strongly influenced by the ‘Protect, Respect, and Remedy’ Framework discussed in this chapter. Signatory companies commit to the responsible provision of security services so as to support the rule of law, respect the human rights of all persons, and protect the interests of their clients.82 The central aim of the ICoC is the creation of better governance, compliance, and accountability mechanisms for private security companies. The ICoC was drafted over several rounds of stakeholder workshops involving states, civil society, and business representatives.83 This approach was also applied to the post-drafting structure of the ICoC Association via the appointment of an equal number of states, civil society, and business representatives to the ICoC Steering Committee and within all working groups^4 Currently, more than 700 private security companies have signed the IcoC,85 while the ICoC Association established in 2013 is committed to the creation of an independent governance and oversight mechanism as well as a complementary complaint mechanism.

In contrast to the EITI initiative, the primary addressees of the ICoC are not states but corporations. Nevertheless, the stakeholder-driven code of conduct has

  • 80 E/CN.4/RES/2005/2, para. 12.
  • 81 International Committee of the Red Cross and the Directorate of International Law DIL, ‘Montreux Document’, . In Dec. 2014, the participants of the Montreux Document established the so called ‘Montreux Document Forum’, co-chaired by Switzerland and the ICRC with the aim to ‘support national implementation of the Montreux Document and the development of implementation tools, as well as to encourage more states to actively support it. The Forum further aims to strengthen dialogue on lessons-learned, good practices and challenges related to the regulation of PMSCs.’ See: .
  • 82 ICoC, International Code of Conduct for Private Security Service Providers, 9 Nov. 2010, para. 3, .
  • 83 . 84 ICoC (2010), para. 11.
  • 85 .

direct implications for national legislations. A recent example is the Swiss Federal Law on Private Security Services Provided Abroad86 adopted in 2014: its Article 31 paragraph 1 lit. b makes membership of and compliance with the ICoC a mandatory precondition for private security companies to receive a public contract. This development demonstrates the possible fruitful interrelations between originally governance-driven multi-stakeholder norm-shaping initiatives and their uptake in government driven norm-shaping processes.

The reason for the brief introduction of these two multi-stakeholder initiatives is not to suggest them as paradigms to follow in optimizing the international human rights protection framework. Both initiatives are not without their shortcomings^7 and it is questionable in general whether this turn to multilayer-governance processes in international human rights law is expedient, particularly in the economic context.88 Rather, these two examples serve merely to demonstrate how corporations are already strongly involved in the informal international norm-shaping process and that the lines between informal and formal international law-making processes are fluid. This is demonstrated by the reflexive impact of these standards on other ‘classic’ international and national law domains. Furthermore, both examples clearly show that the involvement of corporations within these initiatives is not limited to the level of preparatory works, but may also cover the standard-setting itself. Returning to the initial question that led us to this short excursion into practice, that is, whether or not the governance dimension of the UNGPs and their uptakes have an influence on the status of corporations within the actor/subject discourse, these fundamental changes in regulative norm-making patterns strongly suggest that a re-evaluation of the theoretical paradigms for the role of corporations in international law is necessary.

  • [1] Ruggie (2014): 10-12.
  • [2] J. Pauwelyn, R. Wessel, and J. Wouters, ‘An Introduction to Informal International Lawmaking’,in Informal International Law Making, ed. J. Pauwelyn, R. Wessel, and J. Wouters (Oxford: OxfordUniversity Press, 2012): 1-10 at 1.
  • [3] J. Pauwelyn, ‘Informal International Lawmaking: Framing the Concept and Research Questions’,in Informal International Law Making, ed. J. Pauwelyn, R. Wessel, and J. Wouters (Oxford: OxfordUniversity Press, 2012): 13-34 at 15-22.
  • [4] J. Pauwelyn, ‘Is it International Law or not, and does it even Matter?’, in Informal International LawMaking, ed. J. Pauwelyn, R Wessel, and J. Wouters (Oxford: Oxford University Press, 2012): 125-61at 139—41; similarly G. de Burca, R O. Keohane, and C. Sabel, ‘Global Experimentalist Governance’,British Journal of Political Science vol. 44 (2014): 477-86 at 477.
  • [5] Extractive Industries Transparency Initiative, ‘What is the EITI?’, .
  • [6] 72 S. A. Aaronson, ‘Limited Partnership: Business, Government, Civil Society, and the Public in theExtractive Industries Transparency Initiative (EITI)’, Public Administration and Development vol. 31(2011): 50-63 at 50.
  • [7] ‘The Extractive Industries Transparency Standard’, EITI, 11 July 2013, . 74 EITI (2013), Requirement 1. 5 EITI (2013), Requirement 4. 76 EITI (2013), Validation Guide. 77 EITI (2013), Requirement 1.1.
  • [8] 78 EITI (2013), Requirement 1.6.
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