When President Biden’s trip to Europe took center stage last week, his administration made a welcome but neglected promise that the US government would update the so-called National Action Plan (NAP) on responsible business conduct. According to Secretary of State Antony Blinken, “companies have the ability to help shape society and the environment, raise local wages, improve working conditions, build trust in communities and operate sustainably.” To this day, the NAPs, including that of the outgoing Obama -Government introduced in 2016 didn’t make much of a difference. Now the Biden team must create a plan that makes meaningful new commitments to improve the lives of working people in the US and around the world with specific benchmarks and schedules that measure progress.
As of 2014, 29 countries, most of them from Europe and North America, have created NAPs. Another 14, mainly in Latin America, Africa and Asia, have agreed to do the same. The impetus for these plans came with the adoption of the United Nations Guiding Principles on Business and Human Rights (UNGPs) a decade ago. The UNGPs stated that governments and companies should pay more attention to how business conduct affects human rights. The national action plans should encourage governments to set new standards, for example, with regard to their own procurement of goods and services, and set measures and timelines for governments and others to measure progress.
Unfortunately, even in the US, governments did not take the NAPs seriously. They have filled their plans with summaries of what they are already doing and declined to make specific commitments for future action or to include specific metrics to measure progress. Too often, commercial ministries of commerce have successfully wrestled right-wing voices in foreign ministries to block a more ambitious approach.
The first US NAP was rushed to completion in the last few weeks of Barack Obama’s presidency. His team rightly assumed that human rights were not a priority for the Trump administration. The introduction of the plan by then Secretary of State John Kerry focused almost entirely on combating corruption. The Biden government has also made corruption a high priority and the updated NAP should reinforce that commitment.
But it needs to go much further – for example, by outlining steps to tackle the growing economic inequality exposed by the global pandemic. A good starting point would be global supply chains, where human rights abuses are the order of the day. The NAP should address this issue by primarily focusing on government purchasing practices and recognizing that the U.S. government is a huge customer buying around $ 600 billion in goods and services annually.
Last September, the NYU Stern Center for Business and Human Rights, which I lead, released a report calling on the new administration to put in place stricter rules and controls to ensure responsible global sourcing by the US government. The aim would be to ensure that the US government’s supply chains are free from forced and child labor, unsafe working conditions and irresponsible purchasing practices. The report suggested a phased implementation, possibly with an initial focus on apparel and electronics manufacturing. Prioritizing procurement practices in the US would offer these workers better protection around the world and help American companies level the playing field.
One area in which the US government has started setting standards for its business partners is in the provision of private security services. In 2013, the US government helped set up an organization called the International Code of Conduct Association, ICoCA. Its mission is to set and enforce human rights standards for private security companies around the world. The Foreign Ministry’s diplomatic security department has made ICoCA membership mandatory for the private security companies it has commissioned. With the new National Action Plan, the federal government should oblige all US government agencies and especially the Department of Defense to follow this example.
The National Action Plan also offers the opportunity to set stricter standards for combating child labor. UNICEF describes the exploitation of nearly 160 million underage workers worldwide. This problem is particularly acute in some industries, such as cocoa growing in West Africa, carpet making in South Asia, and cobalt mining in Central Africa. Cobalt is an integral part of batteries that power electric cars, computers, and cell phones. A recent report from the US Department of Labor estimates that around 25,000 children mine cobalt in the Democratic Republic of the Congo (DRC). The US National Action Plan should propose adding cobalt to the existing work reporting requirements for so-called conflict minerals in the Democratic Republic of the Congo. The U.S. government should also work with American auto and electronics companies to advance a now-ongoing multi-stakeholder initiative that sets standards and metrics for child labor and worker safety in cobalt mines in the Democratic Republic of the Congo.
The Biden administration should also expand its labor diplomacy, adding specialized labor officials at U.S. embassies in countries where serious labor law violations are widespread. In the Persian Gulf, for example, more than 10 million construction workers, mostly from South Asia, are exposed to various forms of exploitation. Most of these employees pay their own recruiting costs, which often correspond to an annual wage. This can lead to debt bondage, especially if those fees are paid with loans that have very high interest rates. In Qatar, where the government is building a massive expansion of the Al Udeid air base, which is primarily used by the U.S. Air Force, our government should require contractors to pay the cost of recruiting in accordance with the Federal Acquisition Regulation.
These are ambitious but very practical commitments that, if enforced, would make a strong National Action Plan a useful tool for good business conduct. But as any successful business knows, if these commitments are to be successfully implemented, they must be accompanied by dedicated resources and tight schedules. In conjunction with business, the National Action Plan can help the Biden administration shape what the president means when he promises to build better.