Human-rights due diligence and Myanmar

Myanmar is a test case for engaged global companies’ commitments to due diligence. They must act to ensure suppression does not prevail.

In front of our eyes the most blatant human-rights violations are taking place in Myanmar. The military is breaking the constitution, imposing a state of emergency, arresting democratically-elected representatives and shooting its people. Hundreds of thousands are demonstrating in the streets. Workers in airlines, railways, docks, public services and textile factories are refusing to work.

The courage of Burmese people to defend their freedom is impressive and admirable. Defying threats and military force, a general strike brought millions on to the street in hundreds of cities and towns throughout the country. The world should not look on, but help.

The generals are yesterday’s men. They believe they can return to the dark days of military rule. At the same time, they want investors to stay in the country as they want to continue enriching themselves as they did in past years. They want free markets and unfree people. And they calculate that business will continue doing business where money can be earned.

Clear signal

In this situation, a clear signal is needed: no co-operation, no diplomatic recognition and no business with the military. Governments and international organisations, especially the United Nations Security Council but also the UN Human Rights Council and the International Labour Organization, should make clear that the junta is isolating the country and its actions mean the end of international aid and trade preferences.

The commander-in-chief, Min Aung Hlain, main perpetrator of the genocide against the Rohingya, now wants to put an end to democracy throughout the country. The denial by the Nobel Peace Prize laureate Aung San Suu Kyi of the crimes against the Rohingya—and her willingness to squander her stature by even defending the military at the International Court of Justice—was not only a moral dereliction but, as it turns out, a self-defeating mistake. It confirmed the military’s belief that even their worst crimes were inconsequential.

If only for its own credibility, the European Union must suspend the ‘everything but arms’ preferences which allow, for example, the duty-free import of textiles from Myanmar. A regime of coup plotters must not benefit from preferences intended to promote democracy and human rights. Undoubtedly, their withdrawal would also and especially affect ordinary people. But at the moment maximum pressure is needed, so that the military realises its perspective is skewed and that the protests can succeed.

There is also a global dimension, on whose application the credibility of human and labour rights in trade agreements depends. Withdrawing the preferences might not immediately change the political situation in Myanmar but it would result in a relocation of production to countries with a better human-rights record. Countries need to find that violating human rights comes at a cost, while respecting them is a competitive advantage in a global economy.

Legal enforcement

Companies, too, must act within the framework of their human-rights due-diligence obligations. Failure or a lukewarm reaction would confirm one more time the claim of many non-governmental organisations that, without legal enforcement, due diligence mostly remains wishful thinking.

That has also been the conclusion of the German government after the vast majority of German companies failed voluntarily to meet basic due-diligence requirements. After tough negotiations, it has just agreed a due-diligence law. This will oblige companies to prevent or eliminate human-rights violations in their supply chains.

The coup in Myanmar is an undeniable case of egregious violations. Even the most hard-headed business representative and even Germany’s minister for economic affairs, Peter Altmaier—who did what he could to water down the German law—would find it difficult not to see the need for action.

A due-diligence law could ensure a tough and uniform reaction from the business community. The people of Myanmar cannot however wait until such legislation is passed, in Germany or at EU level.

Decisive action

Companies which have expressed support for such initiatives need to back up their words with deeds. By taking decisive action in this urgent case, they would increase the pressure for national and European legislation guaranteeing a level playing-field. Neither the German government nor the European Commission can want those companies that take due diligence seriously to lose money and market share to immoral competitors.

The trade unions in Myanmar have come forward with clear proposals on what international companies need to do now:

• publicly condemn the coup and affirm that it will have a negative impact on future investments;
• ensure there are no business or investment relationships in their supply chains with companies owned by and linked to the military;
• ensure that other business activities and suppliers do not contribute to human-rights abuses and that workers and trade unionists are not punished for participating in protests and strikes against the coup.

International companies must at the same time make concessions to their suppliers who cannot fulfil their supply contracts because of the protests and strikes. Only if they not only demand that human rights be respected but also promise that they will accept goods despite delays in delivery—and that no contractual penalties will be incurred—can they effectively demand that suppliers remain neutral.

The people of Myanmar are not striking against these companies but against a junta destroying the future of their country. They are defending or fighting for conditions that are the human-rights minimum for socially-responsible business within the framework of due diligence.

Their success would also be a success for Myanmar as a production location: entrepreneurial support for the democracy movement is not only a human-rights imperative but an investment so that production in Myanmar can be carried out in compliance with due diligence in the future. Silent companies send a fatal signal to the military that they are happy to stay in Myanmar—as long as the price is right—even under conditions of dictatorship.

Deep concern

Some companies involved with the global union IndustriALL in the ACT Initiative (the author is a former ACT executive director) for freedom of association and living wages expressed their deep concern about developments in Myanmar last week.

As businesses, we are committed to fully respecting human rights and labour rights in our operations and supply chains, in particular, the right to freedom of peaceful assembly, freedom of opinion, and freedom of association under the Universal Declaration of Human Rights … As global retail brands and trade unions, we are monitoring developments in Myanmar. Responsible business requires a context where fundamental human rights are respected.

As much as it is welcome that these companies are not silent—and it is to be hoped that Adidas, KiK, Marks & Spencer and others engaged in Myanmar will follow suit—the statement remains unclear as to what the companies intend to do in the face of fundamental rights violations.

The military is asking factory owners to disclose the names and addresses of trade union leaders, to arrest them, and is going door-to-door in worker dormitories and hostels searching for them. On February 24th, it issued arrest warrants against 27 central-executive-committee members and leaders of the Confederation of Trade Unions Myanmar, the Industrial Workers’ Federation of Myanmar and other affiliated unions.

Public condemnation of the coup and severance of all economic contacts with military companies are imperative. Of more immediate urgency, however, is an agreement with suppliers to refrain from any reprimand or harassment of protesting and striking workers. In return, there must be an assurance suppliers will not suffer any disadvantage as a result of delivery delays.

Such an assurance would show that due diligence does not only mean additional demands on suppliers but includes assistance to partners to enable them to meet requirements. More importantly, it would be a sign of solidarity with the brave women and men on the streets of Yangon, Mandalay and Naypyidaw.