By Mathew Carr
May 10, 2024–British lawmakers say voluntary climate, human rights measures have failed as they debate new law to protect human rights and protect against bad corporate behavior … including in corporate supply chains and in public authorities.
The debate took place Friday in the House of Lords.
“It is not proper for rich people to live off poor people … or to use exploitation as a means of improving their own lives.” Lord Deben
See this:
https://www.parliamentlive.tv/Event/Index/c33106f2-4286-40cc-a6f6-a709a81c8698
Some key paragraphs – they are far reaching
Civil liability
A commercial organisation is liable for damages if it fails to prevent human rights or environmental harms in its own operations, products, and services, those of its subsidiaries, and throughout its value chains.
It is a defence for a commercial organisation to prove that it took all reasonable steps to prevent the harm from occurring, including but not limited to conducting human rights and environmental due diligence as is reasonable in all the circumstances.
Commercial organisations can be held jointly and severally liable for the same harm.
For the purpose of this Act, Courts of England and Wales have jurisdiction over all commercial organisations that are alleged to have breached their duties under section 2, regardless of the location of the harm or part thereof, or the physical presence, registration, or domicile of a commercial organisation more directly linked to the harm.
The regulatory authority or the relevant court may grant, in addition to orders for the payment of compensatory damages, other orders to remedy the harm, including—
–preventative relief such as injunctive orders and orders to cease and desist;
–remedial orders, such as cleaning up or restitution orders;
–supervisory orders that require the parties to report back on progress and remediation after a certain period;
–interlocutory orders;
–other orders as necessary to effectively remedy the harm in line with international law, including rehabilitation, satisfaction, guarantees of non-repetition and other appropriate remedies.
Deben
Lord Offord (below) of Garvel, Parliamentary Under Secretary of State (Department for Business and Trade) (Conservative) spoke against the Bill, saying it’s a bit complicated and Britain should not be dictating law across the world (apologies if I’m boiling him down a bit too much).
Labour’s McNicol (below) spoke in favor of the bill … yet had some concerns.
Baroness Young (below) introduced the bill and debate and said she was disappointed by the response of Offord.
The debate will continue.
Instead of talking it out until 3pm, the lawmakers bunked off more than an hour early … even though lack of parliamentary time is one of the reasons why proper human rights law has not been enacted in the UK.
They were meant to debate until 3pm. If you think 5pm is a more fair end time on a working day … they got off more than three hours early. Not many lawmakers were in the actual room.
The proposed law:
Transcript – not edited (Otter AI), part of the debate:
Keywords
bill
, companies
, government
, modern slavery act
, businesses
, supply chains
, due diligence
, human rights
, legislation
, supermax
, uk
, law
, environmental
, organisations
, harms
, noble lords
, support
, forced labour
, national contact point
, trade
Speakers
Speaker 1 (54%)
, Speaker 2 (46%)
1
Speaker 1 — Baroness Young
0:00
……tokenization and fashion industry interest colleagues, and the good cooperation consultation with businesses has been at the forefront of thinking about this bill.
My lords in many respects, I’m sort of disappointed to be standing here today with this bill. Because I often think about those who fought for the legislation that would abolish the enslavement and trade in Africans in the 19th century. I often wonder who then would have thought that almost 200 years later, legislators still needed to develop laws that seek to eliminate the gross violations and abuses that we know far too many endure in supply chains across the world today.
That apparent trade was also accompanied on a grand scale by deforestation too, with a medium sized Galleon taking around 4000 trees to construct. So we may like to distance ourselves from that history. But it’s become increasingly clear that despite the efforts of organisations such as anti slavery International, and despite the impact of the modern slavery act transparency and supply chains, to many commercial and public entities do not feel obliged to identify and prevent human rights and environmental harms from their supply chains. So what’s brought so many commercial bodies, NGOs, trade unions and so on to the conclusion that we need such legislation? Well, we’re in an era of complex corporate structures where businesses operate with hyper extended supply chains, combined with the UK has current legislative shortcomings in terms of failing to hold companies accountable for their value chain impacts. These presents substantial obstacles for victims seeking justice. This bill highlights a critical need for new legislation to ensure corporate accountability and to protect human rights and the environment. Forced Labour continues to be a widespread and persistent issue within supply chains of UK companies and indeed companies elsewhere and public authorities. The roots of this can be found in weak governance, poverty, discrimination and so on things which I’m sure we’re all familiar. We also have the fact that business models are focused on producing low priced goods turned around very quickly. And companies, extensive outsourcing, outsourcing and long globalised supply chains. These also these factors also contribute to forced abusive and exploitative labour and environmental harms. Added to that the continued reliance on weak auditing and certification schemes and attempts to block workers access to their rights, such as restrictions on unions, has produced the current situation whereby these abuses take place on an all too regular basis. We believe that a due diligence obligation must cover all internationally recognised human rights and environmental standards. Connections between the environment and human rights some people have questioned and so on why we put these two together in the bill. Although it has to be said that the majority of people particularly in businesses are supportive of that, but just to clear that up connections between the environment and human rights have been increasingly recognised by governments, courts, international organisations and societies. This is also demonstrated by the unique and disproportionate ways in which climate change and other forms of environmental damage impact vulnerable marginalised groups, including increasing vulnerability to modern slavery. The United Nations guiding principles on business and human rights was seen as the first global standard for preventing and addressing this this legislation that we’re proposing would put legal responsibility on businesses, including the financial sector and port authorities to prevent human rights and environmental harms in their value chains and to conduct human rights and environmental due diligence as part of that prevention activity. The legislation also allows victims of corporate abuses to access justice before the UK courts. This is a step forward from the modern slavery act in line with some of the most forward thinking laws that are being developed globally to push for corporate accountability. For actions which contravene fundamental human rights. These principles which outline how companies should undertake human rights due diligence, by identifying, assessing, preventing, mitigating and accounting in order to address the potential for negative human rights impacts across operations and in value chains have been widely accepted by governments indeed, we all signed up to those principles. A key point of the due diligence framework, businesses should be proactive. This is a really critical point in addressing potential and actual negative impacts and thinking in terms of harms and risks to people, not just to their own companies. given so many states have signed up to the framework and given that this model of human rights and environmental due diligence has been widely adopted. Why do we need to enshrine such principles in law? Well, it’s because various frameworks are voluntary. And unfortunately, it doesn’t give me any pleasure to say that there are too many companies, commercial and otherwise, who don’t feel obliged to conform to those principles or to follow those principles or to acknowledge that framework. Put simply, the voluntary approach has not worked. If we look at the modern slavery Act, which we knew at the time was groundbreaking, it was a world leading piece of legislation and many of our major most trusted commercial organisations led the drive for transparency in supply chains, which section 54 of the modern slavery act, but it’s no longer the case that the modern slavery act is at the forefront of legislation or section 54 And perhaps most importantly, has not been as effective as we would have hoped anyway. Not going to go into the detail of its merits and shortcomings that’s already been that review has already been undertaken by a committee of noble lords. There are currently several due diligence laws. The EU has recently passed its directive known as the EU corporate sustainability due diligence directive and the the private member’s bill that we are proposing today COPPA for short builds on the EU laws and existing laws such as the German supply chain law the French duty vigilance and the Norwegian Transparency Act. And there’s also draft legislation being considered in Belgium, in Austria in the Netherlands and in South Korea. Now, I realised that no government wants to impose burdensome procedures on business but to claim that this proposed legislation would be too onerous and cumbersome is to miss the point. This bill has been proposed and supported by businesses, again some of our most trusted and successful commercial entities. My law says much that is packed into this bill but I want to make sure that other noble Lords have the chance to express their opinion and indeed to suggest perhaps where we might wish to rethink some of the sections within the bill. We are open to receiving amendments. So I’m just going to sort of finish up by saying that if we adopted COPPA, we’d be more aligned. And that means more aligned in terms of trading, of course, with leading global counterparts, and we’d be able to ensure a level playing field for business. This is the term that frequently comes up with the businesses with whom we’ve consulted to make a level playing field for those businesses that want to do the right thing. And such legislation aligns very much with the trade statement commitments that we made in 2023. So I would say that yes, I started with historical references and I know we like to distance ourselves from that particular period of our joint histories and articulate the importance we feel that trade. But I think that if we want to truly make a distance between ourselves and what happened then we have to take the opportunity to right the wrongs that are currently going on around the world and affect millions of people. My Lords, I beg to move. The question is this bill be now read a second time.
2
Speaker 2
8:55
My pleasure today’s in support of this bill. And in doing so congratulate the novel badness, Lady younger funds here, not just for bringing forward this bill, but on the lucidity and moral force that characterise that opening speech. And opening molars I feel bound to observe that this bill, or rather, and I anticipate this but I think I’ll be proved right. The government’s reluctance to accept it is part of a regrettably familiar pattern. The government identifies an injustice vigorously concurs that it must be remedied before the claim eti even when a proportionate measure of solution is offered them was even a very strict test. To last couple of months this bill, Texas, Texas places but one example of this apparently contradictory approach to policy is to have the employment and trade union rights dismissal in the engagement bill, which had the sub reading and your logic associated with today. It was true of my amendment to the Rwanda bill in which the government was forced to concede only after weeks of self inflicted and now have several recently departed ministers and a couple of incumbents have admitted that they understand the necessity of reversing persistent cuts to the size of the armed forces and again, the government has failed to rally to a clarity and they themselves have sounded so well the government wants more offers this imitation of the Deaf either of Scripture, opportunities are the missing and refusing to support this bill. allows this bill engages a real moral imperative and replaces a patchwork of admittedly valuable provisions under the Companies Act 2006. And the modern slavery act 2015 among others, was something that is at once clearer and more effective. Crucially, it is proportionate and realistic and what it demands close to which establishes a duty for commercial organisations to prevent humanitarian and environmental harms and their own activities. And laws of supply change, so far as is reasonably practicable, is heavily demanding permission and levels of ambition from responsible agencies. Simply establishing and law at the very least anybody should expect. Likewise, I would like to point to the bill stipulations around reporting requirements for companies whose income exceeds a certain level as a welcome adjustment to the current regime, the requirement that they must be both backwards and forwards looking is in my view. Essential if you have to mean anything. Too often reporting under the current regime involves an annual compilation of aspirations in respect of the environment and modern slavery with far too little, if any, at all accountability in terms of their transition into reality. And I don’t think the measures in this bill we would not we would not blame our attractiveness to inland investment or stultify our economy, but ensure future regulatory alignment with France, Germany, the way that EU and Southeast Asian economies who are working on similar provisions. Of course, I understand the need to avoid stultifying regulation, but in many cases, it’s the very companies themselves who have asked for the promulgation of these measures. These include Jupiter asset management, Tesco Charles Stanley PLC, Legal and General investment, wealth and investment and Microsoft. These are agents of what the current Prime Minister’s predecessor enjoys referring to as the anti growth coalition, and its parameters must be much wider than even she has suggested. And 20 Thank you to the noble Lord Lord Callanan. sent a letter to Darren Jones now the shadow chief treasury, explaining why the government has not made it to introduce a comprehensive due diligence framework like that proposed in this bill. And it he asserts that any attempt to mandate due diligence in law must be an practical proportionate and would deliver tangible improvements to human rights and environment. He goes on to outline the government’s preference for voluntary due diligence approaches, and voluntary compliance with the UN guiding principles on business and human rights and the OECD guidelines and multinational enterprises. And so what should be a punishment awaits those businesses who fail to meet this test of voluntary compliance? The grim prospect of the national contact point for businesses and a further quote making voluntary recommendations and following up with businesses to implement these allows for companies of public bodies that are indifferent to environmental and humanitarian concerns or whether they are an afterthought it seems unlikely that these powers of the national contact point will be a stimulus to action. I understand that there are supply chain transparency requirements in place for large UK companies under the modern slavery act, and some due diligence requirements because the act is clear increasingly, that we will be an international outlier and failing to adopt mandatory as opposed to optional or anaemic due diligence. We’ve been told of the possible unintended consequences of a more robust regulatory regime, but equally it must be, we must examine the conspicuous failures of the current approach, mindful of time will remain your large chips host of just one notable public procurement failure this legislation will prevent. In 2015, a UK subsidiary of the Malaysian supermax Corporation, received a contract of around 350 million pounds from the NHS. As the pandemic looms the NHS bought if further 311 million pounds of PPE from a supermax health care brand. By December 2021, the UK Government in the shape of the supply chain, had named supermax an approved supplier entitled to pitch for contracts worth 6 billion pounds of UK taxpayers money. I repeat that 6 billion pounds of UK taxpayer taxpayers money this was even though three months earlier, the US government had decided to institute a ban on supermax products, owing to concerns around forced labour, detention, inhumane living conditions and passport confiscation. It was a further year before a high court challenge compelled NHS supply chain to place a ban on supermax products and to review the procurement processes. This is one consequence of a company’s YouGov. polling suggests that four fifths of UK adults support mandatory and active rather than passive due diligence in human rights and environmental concerns. Many of the companies upon whom these obligations would devolve have requested rigour and certainty. Why does the government neither accept the spill or seek constructively to amend and so doing provide funding to reduce and either British companies who are more seriously still British taxpayers money and ever inadvertently support the destruction of our planet? On the exploitation of workers? I look forward to supporting this bill as it makes its way through Your Lordships house.