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Cooperation and Development (BMZ). That morsel,
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Sustainable Global Supply Chains is especially important for what it tells us about the governmentalization of markets, and the transformation of economic actors into a privatized administrative apparatus of public policy grounded in the sensibilities of compliance and accountability directed toward a values based productivity, the articulation and assessment of which will become a matter of policy set by superior vanguards in liberal democratic and Marxist-Leninist states rather than by the (uninformed but to be reformed) masses expressed in the form of consumption and production based decisions. Not that this is necessarily bad or good--but either way it appears to be coming and in the process will transform the concept and operation of markets. In this case that is undertaken in the service of important substantive objectives--human rights and sustainability. Yet its principal expression--as due diligence based systematization of human activity undertaken in collective form--can be as easily applied to any aspect of human activity. Most interesting of all is the way that these efforts are built on a foundation of the UN Guiding Principles for Business and Human Rights, which in the process are transformed a driver to a means of legitimating policy., a useful vessel into which to pour objectives for the consumption of others.
The Executive Summary of Sustainable Global Supply Chains appears below, with a few brief thoughts in the form of annotations.
Sustainable Global Supply Chains: G7 Leadership on UNGP Implementation Report by the Office of the UN High Commissioner for Human Rights for the 2022 German Presidency of the G7 (2022)
Executive SummaryIn preparation for the 2022 German Presidency of the Group of Seven (G7), the German Federal
Ministry for Economic Cooperation and Development (BMZ) requested that the Office of the United
Nations High Commissioner for Human Rights (OHCHR) prepare a report focusing on the efforts of
the G7 to promote sustainability, human rights and environmental protection in global supply
chains. The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) commissioned this
Report on behalf of the BMZ.
MY COMMENTARY: This is a very European prosopography. One of the most interesting aspects of the trajectories of the management, including management in markets and through a bureaucratic administrative apparatus (public or private or hybrid) is the quite consistent entangled of a small group of actors who, having been placed at the top of pyramids of status or influence (in part because of status) or otherwise linked by connections and mutually self reinforcing ideological alignments, have tended to driven the regulatory project on and competing views out of the construction of a unified and increasingly orthodox view -- a Lebenswelt (as Husserl would understand it) -- of the implications of the UN Guiding Principles on Business and Human Rights, and its privatization of rule systems in its 2nd pillar, in favor of the marginalization of the state duty under the 1st Pillar of the UNGP, and the hyper focus on the legalization of the 2nd Pillar. In the process intergovernmental enterprises are understood more and more to acquire the sensibilities and working style of public administrative agencies, and the state becomes something like a norm generating accountancy.
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But it is the rise of the vanguard, in the heart of the cultures of liberal democracy--that may hold the greatest interest. To that end prosopography provides a way, at least for us in the West, to understand this collective through which the expressions of governance and the construction of its orthodoxies are now managed. This is a process in which the LIBERAL in liberal democracy is emphasized. For those who still have a taste for the emphasis on DEMOCRACY within liberal democracy, the consequences might be less positively stimulating in terms of the organization of national and international orders. It pught to be underlined that here one moves beyond the interlinked networks theories of the late 20th and eary 21st century--not to the structuring of status based communities or of functionally differentiated governance communities, but of their psychology and sociology, and with that, their intertwined power relations.
There could not be a more important moment for the G7 and other key international actors to show leadership and accelerate efforts to advance implementation of the UN Guiding Principles on Business and Human Rights (UNGPs) in global supply chains. Achieving the interlinked global goals related to the climate emergency, sustainable development and recovery from the COVID-19 pandemic depends in large part on ensuring human rights are respected throughout global supply chains - and the UNGPs is a foundational tool for that undertaking.
MY COMMENTARY: "Selling paragraphs" are always important--more so in a document of this type. One wonders, though, whether the effort to sell suggests a doubt as to the underlying claim (e.g., "not be a more important moment," "key international actors," "show leadership," "accelerate efforts," and "advance implementation").
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Certainly all of those key words and phrases are true enough in themselves. But they are not used --in themselves. Rather they are meant to project a semiotic message--like cluster bombs, each of these phrases are packed with lost of little meanings. For example: "not be a more important moment" can reference strategic calculation among elite players, changes in power relations which sense a weakness in opposing forces, the ripening of a heavily curated narrative, and their alignment of strategic allies to develop a unified front, or it can mean that given the organic development of the UNGP this appears to be a natural point in its maturation to move the project along a particular line; "key international actors" of course references those who count as opposed to those who do not, and the calculus of counting importance is probably much more important for purposes of determining consequences of projects like this than the words that can serve as the platform from which these important actors project their meaning making in ways that suggest inevitability and naturalness; "show leadership," suggests either that authority has been vested on the leader group or that a group has seized that authority and thus the mantle of leadership, and with it the authority to legitimate discretionary discision-making, including decisions about meaning; "accelerate efforts" suggests power rather than authority, that is that the and "advance implementation." The object and focus, of course are the UNGP, which in this case serves as that object that radiates legitimacy and connection with one of the few documents that has seen positive indication from the Human Rights Council. It acquires the semiotic character of a magic wand. The issue, and the function of the paragraph, is to suggest the time and manner of its use to cast the spells necessary to achieve the desired result--in this case a very specific set of further steps toward the legalization of the 2nd Pillar and the governmentalization of the economic sector. This is fair enough, and there is no criticism here respecting the agenda. The manner of its exposition, though, ought to give pause as much for what it assumes as what those assumptions conceal--ambiguity and contention. Yet left completely erased from the equation--and the glorious task that the G7 has set for itself, is the likely far more difficult task of getting the Pillar 1 "State duty to protect human rights" implemented in ways that make sense. One looks in vain in this effort for any indication of an intention to "bring rights home" rather than project rights out from a center that remains untouched by the effort.
MY COMMENTARY: Again a stage setting rhetoric designed to develop a notion of ideological, methodological and strategic solidarity that requires action now for maximum current effect. That certainly would be true for the German administrators and their intro-collective project of achieving success in peer prestige contests. But beyond the value of this for the German ministries funding the study, and their desires (both generally, within the politics of control of the machinery of European power, and an ideological fixation on the 2nd Pillar, it is less clear what is unprecedented about the momentum. There is no question, however, that both this report and the Germans (along with their friends and allies) do mean to "significantly shift" regulatory direction. The key sense is an odd one, speaking of the way that "legal, regulatory and financial markets [ought to] shape business practices in the future." So here is the oddity: the reference to legal, regulatory and financial MARKETS. They might not have meant that unless they also mean to suggest that there are markets for law and regulation (in which case one can argue that the UNGP apply to these as well). Better, perhaps, is the "shifting" idea legal and regulatory FRAMEWORKS along with financial markets are meant to reshape business practice. But maybe not. The reference to policy coherence indeed suggests that the solidarity implied in the prior paragragh is in need of shoring up by a disciplining of the G7 policy apparatus and the development of a single approach (the German approach it appears in this case) which may then be imposed on the rest. Again, fair enough. The object then appears to point to what will become the "smart mix of measures that bends markets, regulation, law and finance toward the achievement of a human rights and sustainability turn in the valuation and operation of economic activity. But not just any old turn--their turn.
The G7 member States have already played an important leadership role by articulating the central
goal of achieving genuinely sustainable supply chains. In the present confluence of global circumstances, they have a unique opening to push for ambitious, comprehensive UNGP implementation to achieve that goal and create meaningful change for people across the globe.
COMMENTARY: The emphasis here is on narrative. From a semiotic point of view what is clearly stated is that substantive progress (implementation) is impossible without first aligning popular conceptions, understandings, and values with the envisioned progress. And here that envisioned progress is interwoven in the conceptualization of an idealized sustainable supply chain that is both achievable and genuine. Nonetheless, there is a very wide chasm between a narrative ideal (articulating a central goal) and its realization. The bridge between them requires the building of collective consensus on meaning--the meaning of "sustainability"; the meaning of "genuine"; the meaning of "supply chain". And that bridge is to be cobbled from the UN Guiding Principles. Somehow. Yet there is also the doubt--"In the present confluence of global circumstances" points not just to the possibility of achieving collective meaning making, but also of the challenges to that effort--from within and outside the liberal democratic camp from which is meant to be centered. This, one is told, is the means through which meaningful change, through the perfection of rights-based sustainable supply chains, may be created "for people across the globe." That, in turn, requires public power to push private markets towards better collective morals to more closer to rights based perfectibility.Global supply chains have brought important gains including steep declines in poverty where countries are integral to global supply chains. However, there are growing concerns about adverse human rights impacts of global supply chains, international trade and globalization more generally. This includes concerns about rising inequality within borders, the expansion of precarious and informal forms of work and the increasing vulnerabilities of workers, especially migrant workers. The energy transition, the COVID-19 pandemic and shrinking civic space pose particular risks for human rights in the context of supply chains. To successfully achieve sustainable supply chains, the broad scope of human rights at risk must be addressed.
COMMENTARY: Here the turn is toward the internal challenge. The first sentence references the liberal democratic ideal of post 1945 globalization--a tightly integrated global order around interlinked production, the purpose of which is to lift all stakeholders even as it makes them impossible to act unilaterally. One cannot exit this markets driven system except at great cost; and market legitimacy-integrity is grounded on moral-political values the responsibility for which is shared with public institutions. It is to to the disjunctions between the narratives of international norms and realities on the ground between the operation of markets (operated for "the good") and the realities of adverse effects of this "good" on human rights that now requires the more vigorous intervention of the state, and of international bodies. And that intervention--to protect the integrity of the market driven global structure on which the liberal democratic post 1945 order is based--must now be understood as a function of the liberal democratic expression of the rights of humans.The UNGPs’ delineate differentiated roles and responsibilities of States and companies for human
rights impacts – including those occurring in global supply chains. This normative clarity has created
a common platform for action supported by all key stakeholders. Furthermore, it has resulted in
unprecedented cooperation among institutions and other actors to work collectively to tackle even the toughest of human rights challenges. The UNGPs’ third pillar on access to remedy is an important reminder that achieving sustainable and rights respecting global supply chains is ultimately about avoiding and addressing harm to people, and that any preventive efforts made by States and companies need to be underpinned by access to effective remedy when such efforts fail.
MY COMMENTARY: One moves quickly here from the challenge ("concerns about adverse human rights impacts of global supply chains, international trade and globalization more generally") to a solution which may be found in the "normative clarity" of the UNGP. Those principles do indeed delineate differentiated roles and responsibilities for states (as regulators) and economic actors in markets (including states). The usual extolling of private-public inter-linkages follows. More interesting is the reminder that remedy is the means through which rights are vindicated--but often forgotten is that remedy is meant as the solution of last resort, when efforts at prevention and mitigation fail. Also forgotten, especially by states who seek to use the UNGP instrumentally to focus on the projection of regulatory power beyond their jurisdiction, strictly construed, is the primary duty of states to protect human rights, in both their role as apex centers of regulatory authority and as centers of domestic legal orders that, at least in its ideal form also embed international law. These forgotten, or marginalized eddies of the UNGP are worth remembering, even as states shift attention from the 1st (largely unfulfilled) Pillar to the second (corporate responsibility to respect human rights) Pillar.
and the EU is due to both:
(i) the wide recognition of the authority of international standards on responsible business
conduct, including the UNGPs and the OECD Guidelines on Multinational Enterprises
(OECD GL); and
(ii) a growing number of business voices, investors and other stakeholders seeking greater
legal certainty, more level playing fields, increased leverage within value chains, and
a chance to build better-integrated risk management.
But these hoped-for outcomes are dependent on legislative and regulatory alignment with
international standards on responsible business conduct elaborated in the UNGPs and the OECD
GL. The G7 can play an important role in welcoming and supporting further legislative
developments on business and human rights as well as ensuring collectively that misalignment risks
are addressed domestically, regionally and globally.
MY COMMENTARY: The implications of the prior paragraph are here realized, though indirectly. The shift is abrupt and complete--regulatory focus shifts from the state duty to protect to the corporate responsibility to respect human rights. That shift is characterized by two quite specific trajectories. The first is the legalization of the markets driven 2nd Pillar. The second is the focus of that legalization on outbound conduct of home state economic actors. There is as well an unquestioned assumption of the failures of markets as a framework for managing the human rights effects of economic activity (and thus the rejection of the core premise on which the 2nd Pillar was structured). That is what the coded language--"greater legal certainty, more level playing fields, increased leverage within value chains, and
a chance to build better-integrated risk management"--is meant to convey. Governmentalization of economic enterprises as risk mitigating administrative centers; and the bureaucratization of the market in the name of enhancing a more certain approach to the human rights effects of economic activity (by private actors certainly; perhaps in more attenuated form for state owned enterprises and financial instrumentalities).
rules and policies to create a conducive environment for human rights respect. This includes
legislative and regulatory action across a number of areas domestically. So far, limited progress can
be noted addressing human rights risks in global supply chains originating in the domestic context
of G7 member States. The G7 member States can demonstrate leadership both by actively
identifying the human rights challenges relating to global supply chains domestically and taking
regulatory and legislative steps address those.
MY COMMENTARY: Here again a curious refocusing of the UNGP. The idea, and one constantly iterated in the National Action Plans of apex states--is that the object of both UNGP and OECD-GL is to provide a principled basis for the development of extraterritorial application of domestic legalization and governmentalization regimes the territories of which are the so-called value chains referenced in the report. This suggest the terrains of post-global empire and the end of the global system crafted after 1945, something on which I have commented extensively (here). It hardly references the core of either, one that would have not distinguished between state duty internally and externally. The G7's role, then becomes quite curious. If they are looking for unified approaches to a singular problem (the coherent regulation and management of supply/value chains) then the focus ought to be on the creation of strong international instruments and to quantitative accountability measures grounded on unified premises for the measurement and valuation of activity. This approach would be critical even when implementation would be delegated to the governmental apparatus of states. If they are looking for national approaches, then the issue becomes the development of parameters of tolerance for "!margins of appreciation" between national approaches and to the construction of workable conflicts of law rules (and rules for the enforcement of foreign judgments) along value chains. They do not mean to do either. . . and thus they may wind up accomplishing less than nothing.
The continued lack of widespread, concrete progress on remedy - particularly in the context of
mitigating and addressing human rights risks in global supply chains - calls into question the extent
to which the UNGPs make a positive difference to the lives of people adversely affected by business
practices and operations. Accelerated action on remedy is needed now, and opportunities to do
so abound. The OHCHR’s Accountability and Remedy Project reports contain recommendations
for addressing specific obstacles and burdens that can fall unfairly on people affected by business-
related human rights harms.
MY COMMENTARY: The issue of remedy is a real one, and one with respect to which great progress has been made under the OHCHR Accountability and Remedy (ARP) project since 2016. That project ought to be given a greater role in the consideration of the issue of effective remedy. At the same time--the linking of remedy with the primary efforts of prevention and mitigation--and the structures for those efforts requires far greater stressing than what one encounters in projects like this one. That is a pity. Failure to foreground this relationship--between ex ante and post facto responses to human rights harms--is critical and here critically overlooked.Even the most robust legal and regulatory provisions cannot create all necessary shifts in business
practices globally to ensure sustainable supply chains. Key components of the “smart mix of
measures” are those supporting measures to help facilitate the changes envisioned by the UNGPs.
For example, diplomatic missions and representation abroad of G7 member States have the
potential to play an important role in promoting and advancing implementation in global supply
chains across the world. A well-trained diplomatic corps in business and human rights would also
help build credibility at home and abroad regarding the G7 commitment to human rights.
G7 member States can also work collectively and individually to develop channels for small and
medium sized enterprises (SMEs) to obtain guidance and support on any number of challenges they
face in pursuing their responsibility to respect human rights. G7 member States can coordinate with
other States and the EU to create a capacity-building facility for all stakeholders, as proposed in
the UN Working Group on Business and Human Rights’ “Roadmap for the Next Decade on Business
and Human Rights”, including companies on human rights due diligence. This could be a useful
avenue for assisting SMEs.
The G7 can collectively and individually support the development of curricula and training for
professionals on international responsible business standards and the practical implementation of
those both at home and abroad.
MY COMMENTARY: The concept of "smart mixes"--usually contextually relevant mixes of national, international, public and private regulatory measures (but curiously not of data driven governance measures)--is very popular now. It suggests the fairly mundane insight that comprehensive regulation requires resort to all regulatory modalities that might be relevant. More importantly, it suggests that this "mix" must be managed centrally (by states) and globally (by some apparatus of the international public institutional community--but NOT the G7). The G7 here serves as a vanguard force, but is not the administrative apparatus for the institutionalization of its leadership insights. Critical to that vanguard role are cadres. And the development of cadres requires the institution of appropriate mechanisms for capacity building and training. That also was the IFI model, now to be deployed in the human rights-sustainability context. It is in that guise that the G-7's suggestions that follow are crafted. At the same time, the proposals are largely anachronistic in some respects. First they ignore the shift from traditional legalities to data driven governance. Second, it ignores the transformative effect of the governmentalization of the private sector as the private administrative center for the implementation and operation of diligence based systems. Third, it does little to coordinate, in a mandatory manner (and thus limits the possibility of the legal certainty goal referenced above), national efforts to project regulatory power down (or up) value chains.G7 member States can also work with partner countries, for example through development
assistance or other avenues, to encourage, support and facilitate the development of National
Action Plans on Business and Human Rights (NAPs) that drive better human rights respect where G7
companies have important business relationships.
opportunities to assist developing countries in their efforts to be part of sustainable global supply
chains by supporting effective implementation of policies reflecting international responsible
business standards. More individual and collective efforts in this direction would be a powerful lever
for fostering sustainable supply chains.
Development finance institutions also present an opportunity to drive UNGPs implementation
through their lending and other activities, through their design and operation of grievance
mechanisms and through their engagement with other development agencies that may put in
place supporting measures tailored to the needs of producing countries to help create more
conducive conditions for UNGP implementation.
Overall integration of the UNGPs into development finance and international financial institutions
remains low, including as a tool for managing risks to people in supply chains. G7 member States
can support and catalyze better UNGP integration and harmonization of approaches across
development finance institutions.
There are key opportunities for G7 member States to support alignment of sustainable finance
initiatives for the private sector with the international standards on responsible business conduct.
Reinforcing the important role to be played by the OECD regarding alignment of Environmental,
Social and Governance (ESG) standards with responsible business conduct is an important place
MY COMMENTARY: This is a nice example of the way in which soft power can be used to discipline the work and the cultures of states downstream in value chains to conform to expectations from apex (usually OECD) states. The model has been well refined both by IFIs (IMF, World Bank and now AIIB) and by apex state institutions like the Financial Stability Board (see eg HERE). The foicus on development finance institutions, for example, makes this clear. And yet if this model is followed, the NAPs from developing states will mimic those of apex states and in few cases will the UNGPs be legalized within the states and only projected outward. That will produce a curious polycentric globalization of states legislating outward but hardly ever inward. This sort of empty center legalization is something that has hardly been studied but it is doubtful that it will move the project of a coordinated approach forward.
and G7 member States as Board members of the Fund, can steer the development of that criteria
to align to international standards on responsible business conduct. Additionally, the newly founded
International Sustainability Standards Board presents an opportunity to deliver a comprehensive
global baseline of sustainability-related disclosure standards that provide investors and other
capital market participants with information about companies’ sustainability-related risks and
opportunities aligned with international standards on responsible business conduct. But such
alignment is not guaranteed. G7 member States can support policy work in this direction to help
ensure such alignment.
MY COMMENTARY: It is a pity that there is little effort to develop more robustly and transparently, the connection between the UNGPs, environmental, biodiversity related, sustainability and climate change objectives. Human rights in or as each of these is an area that merits substantially more development. Reducing that connection to sloganeering does more harm than good.The UNGP are most open to development in its relationship to sustainability, including climate change. Skipping that step and going directly to developing pragmatic approaches undermines the key role of government here to serve as a coordinating center for developing the principles and objectives through which human rights-sustainability measures may be developed, measured, assessed, and implemented. One does not see that here.Achieving sustainable supply chains will also require integration of international standards on
responsible business conduct across investment and trade policy. In the context of ongoing
investment policy reform efforts across global institutions, G7 member States can work individually
and collectively to ensure that (1) States maintain adequate policy space for pursuing human rights
obligations, while providing the necessary investor protection; that (2) reform efforts reflect
international standards on responsible business conduct, to better protect investment value and to
incentivize better investor behavior abroad; and that (3) reform efforts improve access to remedy
for those harmed by foreign investors.
G7 member States also have an opportunity to foster responsible business conduct and a
conducive environment for business respect for human rights by including advisory support on
human rights risk management and responsible business conduct standards in the context of their
negotiation advisory support to developing country partners through the Connex Support Unit and
other initiatives. The UN Principles for Responsible Contracts offers a ready-made resource for this
State efforts to harness trade policy to protect human rights have generally focused on labor issues.
The G7 has also acknowledged the wider impact of trade policy on sustainable supply chains, in
particular related to deforestation, environmental sustainability and gender. Yet, the G7 member
States should more explicitly recognize the links between trade policy and protecting all human
rights in global supply chains. As the G7 member States continue to prepare for WTO reform, explore
collective approaches to trade policy and address issues such as forced labor, they should focus
attention on integrating international standards for responsible business throughout trade policy.
supporting parts of global supply chain operations. Yet, ECAs have not worked multilaterally, for
example in the OECD Working Party on Export Credit (Export Credit Group), in recent years to
update and align their standards either to the UNGPs or to high-level commitments made by their
own governments. Improving human rights performance of ECAs is an important lever for fostering
sustainable supply chains. As an obvious first step, governments should heighten the obligations of
the Export Credit Group’s Recommendation on Common Approaches regarding human rights and
international standards on responsible business conduct.
MY COMMENTARY: "G7 member States have repeatedly affirmed their commitment to the UNGPs and recognized them as a useful tool to foster sustainable global supply chains." (Sustainable Global Supply Chains p. 16). And so they are. But like the Bible, the UNGPs and the OECD GL can be most useful when reduced to a fetish object to be invoked to justify whatever it is that expediency or policy dictates. It is enough to invoke it without reading it very carefully. Alternatively, and again, like sacred work, it can be used like a text mine--extracting key words and phrases like so many unpolished gemstones, to then be set in the jewelry of institutional objectives. These are time honored techniques. They are much in abundance here. That is good news to the extent that the UNGPs especially retain their (soft) authority. It is less good news when one considers that the way they are used suggests a quite sloppy framework for the global coordination of a set of standard that are meant to produce legal certainty but instead serve the interests of post-global empire. Sustainable Global Supply Chains is especially important for what it tells us about the governmentalization of markets, and the transformation of economic actors into a privatized administrative apparatus of public policy grounded in the sensibilities of compliance and accountability directed toward a values based productivity. Yet at its heart it remains a reactionary project--invested in the sensibilities of governmentalism, of the legalization of markets, and indeed of a suspicion of markets and markets driven choices. Most importantly, it serves, at its heart, as the affirmation of hard state centers and of the effort to project international standards NOT THROUGH centralizing international instruments, but rather through a state centered effort of encouraging the extraterritorial projection of national power in the service of what is hoped to be more or less coordinated and consistent human rights and sustainability goals. Nonetheless, even in this project, it remains oblivious to the transformative nature of the new technologies of regulation and control. This is the model of the Financial Stability Board and the Norwegian Sovereign Wealth Fund (here), but on steroids. It makes for good theatre--and better legislation on paper; it will have less useful effect where it is needed most: in the factory, among communities bearing the externalized costs of economic activity, and for rights bearers in general.
frameworks on business and human rights; there are efforts worldwide to build common reporting
standards for sustainable finance; and there are a number of ripe opportunities for meaningful
investment and trade policy reform. At the same time, there are many untapped opportunities or
areas where policy incoherence must be addressed to eliminate blockages to achieving progress
towards more sustainable supply chains.
alignment and implementation in ways that will create meaningful change
for people. The OHCHR stands ready to assist the G7 member States and
other actors to collectively achieve the vision of the UNGPs.