Disclosure Systems and Securities Exchanges--On the World Federation of Exchanges Creation of a Sustainability Working Group and the Proposal to Require Extra Financial Disclosure

 

 (Pix (c) Larry Catá Backer 2014)

I have been considering the power of disclosure as a tool to socialize business entities and others into compliance with emerging social norms (that is to behavior rules that are not transposed into the laws of nation-states necessarily but which have binding effect within social, economic and other communities) (e.g., Backer, Larry Catá, From Moral Obligation to International Law: Disclosure Systems, Markets and the Regulation of Multinational Corporations. Georgetown Journal of International Law, Vol. 39:591-653 (2008)).

To that end, it is well known that both state and non-state regulatory systems play an essential role.  (e.g., On the Problem of the State in the State Duty to Protect Human Rights--Fostering National Action Plans as a Means of Refocusing the State Duty on the Business of the State Itself, May 10, 2014).  Among the most important players in the context of structuring markets and business behavior expectations are the securities exchanges vital to the operation of global investment.  The community of exchanges structures its operations and disciplines its members through an organization fo exchanges, the World Federation of Exchanges.  It is self described as "the trade association for the operators of regulated financial exchanges. With more than 60 members from around the globe, the WFE develops and promotes standards in markets, supporting reform in the regulation of OTC derivatives markets, international cooperation and coordination among regulators. WFE exchanges are home to more than 45,000 listed companies."  (WFE, WFE Appoints Nandini Sukumar as New Chief Administrative Officer, May 30, 2014). It thus operates both in the social sphere (as a source of cultural norms) and regulatory sphere (as the source of governance norms and structures) that can substantially affect the way in which enterprises operate and understand themselves. "The WFE is a central reference point for the securities industry, and for exchanges themselves. We offer member guidance in their business strategies, and in the improvement and harmonization of their management practices." (WFE, About Us, What We Do).

From "The Semiotics of Law in Legal Education: Signs in Law--A Source Book" (Jan M. Broekman & Larry Catà Backer, eds): On the Semiotics of Sibelius v. Hobby Lobby, Inc.

My colleague, Jan Broekman and I have been working on the third volume of our study of legal semiotics, The Semiotics of Law in Legal Education: Signs in Law--A Source Book (Jan M. Broekman & Larry Catà Backer, eds., Dordrecht, Springer International, forthcoming 2014). Our draft Preface suggests the scope and purpose of the work:

The materials in this book weave together the fabric of semiosis and significs. It does so quite embedded within the cultural imperatives of the civilization that gave these terms meaning and made them an effective tool for the dissection of law, and its reconstitution as an instrument to be used by the lawyer to advance the interests of her clients, and for judges, as a means of restructuring language as a narrative of law whose power could bend behavior to its strictures. Lawyers make meaning, indeed, but they do so like Croesus making meaning of the oracle at Delphi, and recognizing that meaning may re-make the maker. Judges, legislators and administrative regulators make meaning like the oracle, with the innocent conceit of the gods, but like them, unable to escape the destiny they render through the narratives of their lawmaking and decisions. And both realize their meaning making only through the participation of the community through which this meaning making is put in operation.

Beyond that, the object of this book is to provide a longitudinal framework within which one can better approach the development of our consciousness of the problem of meaning and its uncovering. Semiotics did not arise from the mind of a single individual as an act of will already formed and fully developed. There is a semiotic element to semiotics as well, it is to the business of bio-semiotics that this journey from the 19th century origins to the present best suggests. For lawyers the ultimate comfort of semiotics is the premise of a momentary and specific certainty of meaning. For lawyers, that alone is enough of a reason for undertaking its study. For they operate in a self referential world in which meaning itself is the only source of meaning, piled higher and deeper, and sorted to suit the fancy of the state apparatus that tends to it, for the constitution of its own self-reference. Where this is a simple and singular act, the art of semiotics of the last century, is useful. But in a world of singular objects that serve as multiple signs with even more interpretive possibilities, the complications that follow will ensure that the work of the lawyer, to extract a momentary and instrumental use of meaning for an temporal and temporary end, will move meaning and its construction, that is, will move semiosis beyond its 19th and 20th century structures.

Sibelius v. Hobby Lobby, Inc., 723 F. 3d 1114 (10th Cir., 2013) provides one of the most interesting applications of the insights we try to draw in the book.  What follows is the current draft of Chapter 16, that considers Sibelius and the issue of the ensoulment of corporations for the purpose of determining whether it might apply religious rather than political law to its operations.

Moving Beyond Conventional American Law Institute (ALI) Projects: Mae Kuykendall on "Restatement of Place"

At this time of year, when the American Law Institute, "the leading independent organization in the United States producing scholarly work to clarify, modernize, and otherwise improve the law" (ALI About), holds its annual meeting in Washington D.C., to note the publication of a very interesting set of articles in a symposium, a "Restatement of. . . Symposium" recently published in the Brooklyn Law Review (Vol. 79(2)).

(Mae Kuykendall)

In the symposium introduction, Anita Bernstein, explains:

Throughout the near century of its existence, the ALI has been open to reassessing what it does, a stance that suggests stakeholders can—and I argue here should—opine on the possibility of both expansions and contractions in the Restatement agenda. Our authors were charged to consider the “restateability” of their fields of expertise and then recommend to the ALI and their fellow stakeholders whatever they saw fit. As gathered in this volume, their work product endorses new undertakings, new abstentions from established ALI projects, and particular responses to developments in varied corners of the law. (Anita Bernstein, "Onlookers Tell an Extraordinary Entity What to Do: 'Restatement of. . . ' Symposium Introduction," Brooklyn Law Review 79(2):381-396, at 382).

One of the most interesting contributions, and one especially unconventional given the scope of the ALI's past projects, was the contribution of Mae Kuykendall,  Restatement of Place, Brooklyn Law Review 79(2):757-820). Professor Kuykendall seeks to reframe the formulation of legal re-statement, the core work of the ALI, from its conventional legislative silos grounded in substantive fields of law toward the core premises that serve as the structural foundations of law.  Again, Anita Bernstein:

Suggesting that the ALI prepare a Restatement of Place, Kuykendall sets out “to provide demonstrative examples of the presence of place in the construction of law; to suggest how a rigorous analysis of its presence across dimensions of law might proceed; and to suggest the manner in which principles might be shaped to guide law-making or the application of common law.” Restatement of Place defines place, distinguishes it from space and territory, and finds it ubiquitous as a legal classification. Place is restateable not as a “set of standard doctrines affecting an activity,” Kuykendall argues, but “the unstated premise of much of law. Places organize the operative parts of a legal question; locutions take forms of place metaphor, or they overtly use measurements of space, to define duties and rights.” (Bernstein, supra, at  396 (footnotes omitted)).

The article Introduction follows.

On Moving From Theory to Practice of Corporate Responsibility to Respect Human Rights--Thoughts on the Human Rights Reporting and Assurance Frameworks Initiative (RAFI) Project

I have been considering current efforts to implement the U.N. Guiding Principles on Business and Human Rights  (GPs), a set of principles endorsed by the U.N. Human Rights Council in 2011.  My recent focus has been on issues relating to the operationalization of the state duty to protect human rights (e.g., On the Problem of the State in the State Duty to Protect Human Rights--Fostering National Action Plans as a Means of Refocusing the State Duty on the Business of the State Itself).

(Pix (c) Larry Catá Backer 2014)

This post considers the quite thorny issue of the way enterprises might approach their obligations to respect human rights under the GPs. To that end it considers the quite promising framework, the Human Rights Reporting and Assurance Frameworks Initiative (RAFI) Project.  The RAFI project represents an effort to provide guidance to companies that may be committed to better demonstrate their alignment with the GPs.

As these dynamics develop, the question arises as to what good reporting on company alignment with the UN Guiding Principles – and good assurance of such reports – should involve. RAFI aims to help answer this question. The proposed reporting and assurance frameworks will be public, meaning that they will be non-proprietary and publicly available to all companies and assurance providers to use in their work. They are intended to be relevant to, and viable for, all companies and auditors/assurance providers in any region, and to dovetail with existing reporting initiatives. (The Business And Human Rights Reporting And Assurance Frameworks Initiative (“RAFI”) Project Framing Document, November 2013, p. 5).

This post suggests that while the RAFI project represents an essential advance in the project of providing a usable framework for practicing respect for human rights, the project remains a work in progress.  The post suggests some areas that require continued attention.  Among the most important are RAFI objectives (RAFI cannot be all things to all stakeholders, and the effort to make it so make dissipate its usefulness).  As important, to the extent that RAFI is to be used  as a culture changing project, these cultural components will have to be aligned to corporate interests more directly.  Yet to the extent that RAFI can be understood as  a mapping project, its structures may require some fine tuning.  Lastly, it may be important for RAFI to be sensitive to and avoid a heroic approach to human rights reporting. The work of creating cultures of human rights sensitivities as a core basis of corporate culture requires fewer heroes and many more ordinary people who perform their roles in corporate operations without regarding the human rights sensitive portions of their work as "special" or extraordinary" or somehow not an ordinary part of their work.  It is to that end that RAFI might judge its effectiveness as a vehicle for internal discipline and external disclosure.

Keren Wang and Nabih Haddad on "International Organizations and Participatory Global Citizenship: Civic Education beyond Territoriality"

(Pix (c) Larry Catá Backer 2014)

Two of my former students, Keren Wang (now in a PhD program at Penn State (Communication Arts and Sciences)) and Nabih Haddad (now in a PhD Program at Michigan State (Education)) have presented a very interesting paper at a recently concluded conference. Entitled "International Organizations and Participatory Global Citizenship: Civic Education beyond Territoriality," the paper considers issues at the intersection of civic education, the university and the state within enlarging systems of globalization. They ask: "Is it then possible to give an account of democratic life that transcends the totality of the state?" And they point to the framework within which this question is examined: "The paper would argue that such vision is possible when we let go the static-centric foundationalist view of democracy and civic engagement."

The abstract follows. The paper may be accessed here on the Coalition for Peace and Ethics Website as Working Paper 5/2 (May 2014).

Just Released: The Corporate Social Responsibility Podcast--A Conversation With David Yosifon on CSR and the Business and Human Rights Project

It was my great pleasure to participate in a podcast interview with David Yosifon, Associate Professor of Law at Santa Clara Law, who researches and teaches courses on business law, legal ethics, and legal theory.   Professor Yosifon has organized an excellent podcast series--"The Corporate Social Responsibility Podcast."

My discussion centered on issues of human rights and the corporation, assessing the issue from an international or transnational perspective.   It may be accessed (audio only) buy clicking on the link below and may be accessed as well in iTunes. My thanks to Professor Yosifon for organizing an excellent series and for his deft interview style.

  

9. Human Rights and Corporations - Larry Catá Backer

Released May 14, 2014
Interview with Larry Catá Backer on the responsibilities of corporations regarding human rights.

Just Published: "The Trans-Pacific Partnership: Japan, China, the U.S. and the Emerging Shape of a New World Trade Regulatory Order"

Happy to announce the publication of "The Trans-Pacific Partnership: Japan, China, the U.S. and the Emerging Shape of a New World Trade Regulatory Order" which appears  in the Washington University Global Studies Law Review 13(1):49-81 (2014). My thanks to a great editorial staff.

(Pix (c) Larry Catá Backer 2014)

The abstract and introduction follows.
Digital Commons link to article.
SSRN link to abstract and article.

Views on the State of the Cuban Political Economy From the Association for the Study of the Cuban Economy

The Association for the Study of the Cuban Economy, a non-profit, non-political organization that pursues the study of Cuba in a broad sense, with particular emphasis on the financial, economic, social, legal and environmental aspects of Cuba today, has recently posted several interesting and useful essays to its Blog Site, links to which are provided here:

Recent Developments in Cuban Public Finance by Ernesto Hernández-Catá
Ernesto Hernandez-Cata analyzes recent Cuban budgetary data and uncovers both good and bad news. [More]


Una Cuba Sin Venezuela by Rolando Castaneda
Rolando Castañeda comenta sobre estimaciones de Pavel Vidal acerca del impacto de la posible disolución de la estrecha relación económica entre Cuba y Venezuela. Castañeda menciona que la metodología utilizada por Vidal puede estar subestimando el impacto. [More]


Cuba's Growth Strategy Features Human Capital and Foreign Investment - May it Work? by Luis R. Luis
This post gauges Cuba's growth prospects against the government's own goals paying special attention to the use of human capital and foreign investment. Using a model the author is able to carry out simulations under alternative assumptions regarding savings, non-tourism services exports and foreign investment. [More]

On the Problem of the State in the State Duty to Protect Human Rights--Fostering National Action Plans as a Means of Refocusing the State Duty on the Business of the State Itself

This post considers the quite thorny issue of the way states might approach their obligations to protect human rights as elaborated most recently in the U.N. Guiding Principles on Business and Human Rights for implementing the UN “Protect, Respect and Remedy” Framework (GPs).

(Pix (c) Larry Catá Backer 2014)

Using the framework of National Action Plans recently encouraged by the UN Working Group on the issue of human rights and transnational corporations and other business enterprises, the post suggests that these plans, and the approach undertaken by many states to implement the GPs may be misdirected. Rather than focusing on inward discipline, transparency, and cohesion of domestic law and policy, states have tended to focus outward on efforts to regulate the corporate responsibility to respect human rights. In the process they ignore one of the most important elements of the state duty to protect human rights--the obligations of states to get their own governmental houses in order and to minimize governance and remedial gaps within the architecture of state power.

The post concludes that national action plans may provide useful vehicles for states to conduct internal human rights due diligence and to build a sound governmental (and inter-governmental) foundation on which the management of the human rights behaviors of business might be most effectively undertaken. That might suggest that NAPs to focus on transparent and accessible human rights law and policy mapping, on the articulation fo human rights sensitive governance operations for state owned enterprises and adequate contractual oversight of enterprises performing traditional governmental functions, and the appropriate management of sovereign investment (both internally in development and externally in foreign projects and markets).

May Newsletter from John Knox, Independent Expert on human rights and the environment--Mapping Human Rights and the Environment

John H. Knox, UN Independent Expert on Human Rights and the Environment and Henry C. Lauerman Professor of International Law has been advancing his mandate.  (See HERE)

 (John Knox)

Professor Knox recently provided a report of his activities in his role as U.N. Independent Expert, which I have re-posted here. Also included is Professor Knox's statement to the Human Rights Council presenting the reports.  The most important element of this report is the result of Prof.'s Knox's project of human rights mapping in the environmental context.  That alone makes this report worth reading.

His conclusion is direct and straightforward--"In sum, on the basis of this mapping project, I believe that it is now beyond argument that human rights law includes obligations relating to the environment."  The way he gets there provides some considerable room for discussion ("I recognize that not all States have formally accepted all of these norms. While some of the statements cited in my report are from legally binding treaties, or from tribunals that have the authority to issue decisions that bind the States subject to their jurisdiction, other statements do not in themselves have binding effect. ").

New Essay Posted: "Crafting a Theory of Socialist Democracy For China in the 21st Century: Considering Hu Angang’s (胡鞍钢) Theory of Collective Presidency in the Context of the Emerging Chinese Constitutional State"

I have been considering the development of modern Chinese constitutionalism, and more specifically the unique structures of Chinese constitutionalism beyond the constitutional document and the related issue of its legitimacy within emerging norms of transnational constitutionalism (HERE, HERE, HERE, and HERE).

(MEDIA DEBUT: Members of the Standing Committee of the Political Bureau of the 18th Central Committee of the Communist Party of China meet the press after their election on November 15, 2012 (XIE HUANCHI), From  Collective Leadership, China's Way, Beijing Review, Sept. 2013)

As part of that consideration I have been posting the work of Tong Zhiwei (童之伟), a formidable and innovative constitutional law scholars (Table of Contents for the Series Available Here; and HERE) and Jiang Shigong (强世功), another of the most innovative constitutional law scholars in China today (HERE and HERE).  

Recently I have been considering the innovative work of another Chinese scholar,  Hu Angang (胡鞍钢), a Tsinghua University-affiliated economist who is regarded as a leading figure in what could be translated as ‘China National Exceptionalism Studies’ 国情研究. I had considered his political-economic theories before HERE. One of his most recent and innovative proposals focuses on the collective presidency model of Chinese governance. (Hu Angang, China's Collective Presidency (Berlin: Springer 2014) ISBN-13: 9783642552786).

Further to that engagement, I have just posted a new paper to the Social Science Research Network (SSRN) that considers Hu Angang's collective presidency model within the context of the theory of Chinese constitutionalism and the connection between that construction and global principles of constitutional democracy: "Crafting a Theory of Socialist Democracy For China in the 21st Century: Considering Hu Angang’s (胡鞍钢) Theory of Collective Presidency in the Context of the Emerging Chinese Constitutional State"   In the process I suggest the possibility of an alternative set of mechanisms for the expression of democracy--substituting for its exteriorization in elections, its interiorization in representative collective decision making. The abstract and essay introduction follows. The manuscript may be ACCESSED HERE.