So let's start by asking the simple question: why should companies be interested in human rights?

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1 Opening Speech by Richard Howitt MEP, European Parliament Rapporteur on Corporate Social Responsibility, to CSR Europe Conference on "Shared Responsibility on Human Rights and Global Supply Chains", Brussels, 16 March Good morning. I'm very aware that there will be some people here who are deeply involved in the whole issue of 'business and human rights' and others who may be coming to the subject afresh. So let's start by asking the simple question: why should companies be interested in human rights? It's because the UN declaration on human rights applies to 'every organ of society' and that must include corporations. Because the UN Guiding Principles on Business and Human Rights have been widely accepted by all the countries in the United Nations - and strongly supported by the major business partners: the International Organisation of Employers and the International Chambers of Commerce. Because this is not an 'add on' on what it means to be a responsible company. It's about recognising different companies and different sectors have different issues which are 'material' to their impact on the environment, society and on human rights - and identifying and working on those that which are most relevant to you and your company. The UN Guiding Principles are cross-referenced by other international initiatives including the OECD Guidelines on Multinational Enterprise, the Global Compact and the International Framework for 'Integrated Reporting'. And just as international institutions are embedding human rights in international initiatives towards business responsibility, so businesses are embedding human rights in their company functions - why we are here today.

2 It's because doing so has become more possible. Frankly, very few people in the world say they are against human rights. But the part of the agreement of the Guiding Principles in which I was personally honoured to have been involved, on behalf of Europe, was their being operationalised. Companies have been helped to understand how they can embed human rights. The UN Guiding Principles Reporting Framework says a company can begin in the first year by asking just eleven questions of itself. The 'Blueprint' which CSR Europe is launching here later this morning, shows how companies can manage for human rights, communicate for human rights, train for human rights, purchase for human rights and incentivise for human rights. This is an issue for companies because, although very few people in the world say they are against human rights but that the length and complexity of global supply chains means any company can wake up one morning and find out it has been implicated in complicit with a repressive regime or in the employment of child labour or - to take the example which has seized the world - the collapse of a factory while the workers are still inside. But it's also about how companies treat their own staff, in the wider world, but right here in Europe too. Which brings me to the next question it is important to ask at the outset: why is this an issue for a conference in Brussels? Why is it 'material' to the European Union and thus to EU-based businesses? Again, some simple answers. It's because the EU has embedded human rights ourselves, for example integrating implementation of the Guiding Principles in to the EU Action Plan on Corporate Social Responsibility, in Section 4 of the European Commission Strategy 'Trade for All' and in the agreed Directive for Non- Financial Reporting by business. Because a European Commission Working Document produced in the last year called the UN Guiding Principles the "authoritative policy

3 framework" for the European Union. And the same document described how the public consultation on the EU's corporate social responsibility strategy showed 81% say it is 'important or very important' for the European Union to assist in implementing the UN Guiding Principles on Business and Human Rights. By the way, that included 78% of business respondents - showing clear European business supports an EU role on this. It's a European issue because President of the European Commission Juncker said at the G20 last year (I quote): "We must deal urgently with the question of the supply chain. We cannot continue with a situation where our prosperity rests on social dumping in other parts of the world. This perverse process must be brought to an end." Also for the European Union, the Dutch Government which is in the current Presidency of the European Union, is preparing Council Conclusions on the EU and global supply chains. I congratulate them for that, it is an important signal for Europe and thank them for their cooperation with me and with the European Parliament. And 'business and human rights' is an issue here because the European Union devised a method for implementing the Guiding Principles through National Action Plans, a model which is now being copied around the world, including by the United States. And because fundamental rights are fundamental to European values too. Now there are many important participants today and you are all very welcome in Brussels and we all look forward to the contributions and the discussion. But let me use the privilege of being asked to deliver these opening remarks to share some personal hopes for your work both today and in what follows. Please do embrace the concept I have called the 'true genius' of the Guiding Principles - that of 'due diligence'. It is no longer sufficient for the Company Executive to say "I didn't know." The concept of 'due diligence' says: "You should know." Or perhaps

4 even better: "You should have a method in place to find out, so that you do know." I hope this is an area which the next CSR Action Plan will do some work on at the European level, and I hope today will herald your company working out - if it has not already done so - which 'due diligence' processes have been or should be put in place for your business and your market? Next, please don't be put off by the 'supply chain' argument, thinking you are somehow baking asked to be responsible for 100 per cent of what goes on in the world. Many of you will not be. This event follows the meeting of some of you yesterday to set up 13 supply chain initiatives amongst companies representing different sectors in Europe, which will be discussed here this afternoon. But if you are not yet involved in these initiatives, it is likely that you and your company will be familiar with doing 'risk assessments'. 'Business and human rights' is only about doing such a risk assessment, to find out where your company might have the most severe human rights impact. And where it might have most influence or leverage to impact human rights positively. That is all very possible. Next, please do what our next panel us asking and what the title of the CSR Europe 'Blueprint' asks: do embed this. We say it on all questions of corporate responsibility, make it part of business strategy, your business model, your corporate governance. I hope the European Union has helped with the Non-Financial Reporting Directive specifically including human rights, which I am also associated with. We deliberately made it integrated, non-prescriptive and avoided setting out long lists of performance indicators. The aim is not just 'integrated reporting' but 'integrated thinking'. Please make that very much part of the conversation today. But don't just look inside the company, look outside of it too.

5 Later in the morning we will talk about the stakeholder role. A human rights focus might introduce some different stakeholders to your company. But with the EU process on 'National Action Plans' somewhat slowed down, I would also use today to ask you to go back to the national capitals in the countries where you are based, and to dialogue with governments in Europe about advancing each of theirs. And I hope today will enable you to ask the hard questions. And a very hard one but not one that should be avoided is: who are the victims or potential victims of human rights abuse with which the company may be associated? We would all prefer the answer to be: none. But pillar three of the Guiding Principles requires 'access to remedy'. In order for companies to comply with this, you have to work out remedy for whom as well as how? And this too is a crucial part of what we always also say in CSR debates: it's not just about process, it's about outcome. The outcome is some humans enjoying better rights. So don't forget to ask which humans as well as which rights? Finally, pillar two of the Guiding Principles says it is the company's responsibility to respect human rights. And I want to end by focussing on that word: 'respect'. In my view, that is all we are talking about. All of us want to be respected by eachother, in our workplaces and in our communities. I believe today we are discussing no more than our companies showing that same level of respect. It doesn't seem unreasonable, does it? It doesn't make us responsible for torture or killing.

6 It makes business responsible for treating people with respect. And, respectfully, I suggest you would want to do no less. Thank you. Richard Howitt MEP is European Parliament Rapporteur on Corporate Social Responsibility.