Can Corporations Care?
Posted 21th December 2000
By ROLAND-PIERRE PARINGAUX writing in Le Monde diplomatique

The battle of Seattle showed that, in today's global village, multinationals operate under the critical gaze of the media, international organisations and ordinary people. Public opinion is coming to believe that the big corporations must show regard for human rights, the environment and the wishes of local populations - especially in places where politics are violent and arbitrary. Yet many companies shrug off responsibility in the countries they do business in. "Human rights is not the business of business." For a long time this was the guiding principle of transnational corporations working in the third world, and they used it to salve their consciences. Even if their success owed much to the abuse that tyrannical regimes inflicted on the local population, it was still measured primarily in terms of industrial performance - that is profits. For the rest, it was understood that the companies in question "did not get involved in politics"; they were "neutral" and their presence "encouraged the development of democracy". Though often far from the truth, these platitudes are still used by many oil companies. But increasingly they are being challenged.

Economic globalisation, combined with the growing power of civil society, has changed things. It has ridden roughshod over ideologies and borders, providing a global market for the multinationals that are changing the face of the world. It has also given them new responsibilities. After all, according to the United Nations, 50 of the world's 100 greatest powers are multinationals. And their decisions are affecting a greater number of countries and populations every day. Compared with the environmental lobby (with the protests launched by Greenpeace in the 1970s and 1980s), human rights campaigners have taken time to win the ear of the transnationals. It was not until 1995 that Amnesty International (AI) in the United Kingdom and Human Rights Watch in the United States launched their campaigns to get the giant conglomerates to assume economic and social responsibilities commensurate with their power and influence, especially in the matter of human rights. Their basic argument was simple: the Universal Declaration of Human Rights (1948), which most countries have ratified, calls on "every individual and every organ of society" to promote respect for its principles. Human rights are therefore the concern of everyone - individuals, companies, legal entities. To those who reject such an obligation and argue that the private sector is not there to moralise, former Shell director Sir Geoffrey Chandler, who now heads the business group of Amnesty International-UK, replies that "big business cannot and must not be the arbitrator of world morality.

There is no question of it usurping the role of governments or solving all the social problems with which they are faced. But its influence over world economic policy is steadily growing and its presence is increasingly affecting the societies where it operates. All this gives it new responsibilities." Initially campaigns targeted the textile multinationals and parts manufacturers who exploited cheap third world labour, including children, working in conditions banned by international law. Then, after a sometimes stormy internal debate, Amnesty International decided to extend a hand to the multinationals, considering them partners in the matter. Abandoning the virulent accusations and boycott calls of the 1970s and 1980s, it developed a policy of meetings and exchanges of ideas with a view to reaching a common objective. Specific structures were set up in a number of countries, such as in France where representatives of multinationals and of Amnesty International-France meet at a business club several times a year. While retaining a critical stance, Amnesty International seeks to understand and persuade rather than condemn. On this point, Sir Geoffrey's address to senior oil industry figures at a forum held in Oxford in 1997 was perfectly clear: "Amnesty International," he explained, "takes no view on boycotts or disinvestment, nor does it criticise companies engaged in legitimate business in countries of whatever political complexion or behaviour. But Amnesty, backed by increasingly critical public opinion, does believe that companies have a responsibility to use their influence to protect human rights and promote the rule of law".

The strategy had changed, but the objective was the same. The first stage in the campaign met with some success. It helped some companies, whose business impact owes much to the image they project with a young clientele, to recognise the problem, accept dialogue and work with the voluntary organisations on codes of conduct that include respect for human rights. Companies like Gap, Nike or Levi Strauss that were criticised for the working conditions in their overseas factories were thus able to improve their image. In a brochure entitled "Human Rights Production Standards", Reebok writes that "the incorporation of internationally recognised human rights standards into our business practice improves worker morale and results in a higher quality working environment and higher quality products". An important step forward has been made and the dialogue is continuing. But there is still a lot of resistance, as the UN high commissioner for human rights, Mary Robinson, noted in 1999: "Some business leaders may think that the political and social environment of the country where they are doing business is none of their affair. That is a short-sighted attitude and one that is not borne out by experience. Successfully facing the corporate human rights challenge will be crucial to business success nationally and internationally in the years ahead." The whims of geology are such that oil deposits have always been scarcer in democracies than in countries that trample rights and freedoms under foot. It is therefore the oil companies, one of the main driving forces in world economic growth, that Amnesty International and Human Rights Watch (the one more carrot, the other more stick) have, in the past few years, set out to persuade to change their business culture and behaviour. At the beginning it was difficult. "We were naïve," Sir Geoffrey recalls. "We believed that if we blew the trumpet, the walls of big business Jericho would fall down." What finally got the oil barons to talk was a series of disasters that tarnished their image.

Key offenders

The case of Shell in Nigeria is the best known. In Africa's biggest oil producing country, whose people are still among the poorest in the continent, the manna extracted by the western oil giants has for decades helped tyrannical elites and their corrupt clients to get rich and hold on to power. Benefiting from a system in which Shell held the lion's share, some amassed considerable fortunes (1). In the early 1990s the oil-rich Niger delta became the scene of violent confrontations between the local ethnic minorities, who accused Shell of damaging their environment and their culture, and the Nigerian security forces who had orders to protect the oil installations. In 1993 the Movement for the Survival of the Ogoni People, led by writer Ken Saro-Wiwa, mobilised tens of thousands of people against Shell. It became an international issue. The pressure was enough to force the world's leading oil company to stop production. To get it started again, General Sani Abacha's government unleashed a murderous repression. Hundreds of Ogoni were arrested, imprisoned and sometimes summarily executed. Two years later Saro-Wiwa and eight Ogoni activists were executed in spite of international protests. There was tremendous outrage. Since then the company has admitted that it had been "forced" to pay the Nigerian security forces directly on at least one occasion in 1993. In 1998 British Petroleum (BP) came under fire when it was revealed that it had signed agreements with the Colombian army to protect its installations in a guerrilla zone.

Shortly afterwards its security arm, Defence Systems of Colombia (DSC), was accused by Human Rights Watch of importing weapons and training the Colombian police, which was well-known for its brutality. When an inquiry was launched, DSC refused to co-operate. Recently Business Week accused Mobil Oil of complicity with the Indonesian armed forces in massacres perpetrated close to the US company's installations in Aceh province. Since 1980, when the Gerakan Aceh Merdeka (Aceh Liberation Movement) separatists began attacking Mobil's installations and martial law was imposed, there have been constant rumours of disappearances and mass executions. Following the fall of the Suharto regime in 1999, the Indonesian Human Rights Committee uncovered a dozen mass graves containing hundreds of bodies. Many had been tortured. Mobil denied any involvement. But, according to Business Week, the company admits having supplied food, fuel and equipment to the soldiers protecting its installations. According to a collective of Indonesian non-governmental organisations (NGO), some of that equipment was used to dig the graves. The Aceh region supplies about one third of Indonesia's gas and oil output. Oil and human rights do not mix in Sudan either. The Islamist leadership in Khartoum, at war with the Sudan People's Liberation Army guerrillas in the black, partly Christian south, is regularly accused of atrocities, forced displacement and tolerance of the slavery practised by the militia in its pay. Against this background, Amnesty International has published a report in which it states that most foreign oil companies "turn a blind eye" to these human rights abuses. It provides a list of oil companies operating in the Western Upper Nile region.

They include, with a greater or lesser degree of involvement, the China National Petroleum Corporation (China), Petronas (Malaysia), BP Amoco (Anglo-American), Talisman Energy (Canada), the International Petroleum Corporation (Sweden), Agip (Italy), TotalFinaElf (France), the Gulf Petroleum Company (Qatar), the National Iranian Gas Company (Iran) and Shell (Netherlands). In late 1999, when there was no sign of the slightest improvement in the human rights situation, the Sudanese minister of energy, Awad Ahmed al-Jaz, announced that half a dozen foreign oil companies were awaiting new concessions. In Burma, the French Total company and its American partner Unocal have been the focus of an international campaign since 1996. These two companies, which joined with Myanmar Oil and Gas to exploit the Yadana gas deposits and build a pipeline, are accused of profiting from human rights violations committed by the Burmese military in a dozen villages in connection with this work. The International Federation for the Rights of Man (IFRM) and other NGOs have reported population displacements by the military, forced labour and even summary executions. Total and Unocal have denied being directly involved in any of this. The French company, which has begun a rehabilitation programme for the villages concerned, and its American partner still maintain that their presence will ultimately benefit the local population. But their defence is undermined by the grotesque behaviour of the junta in power since 1988. So much so that the US, the European Union and the United Nations have adopted resolutions critical of them and several multinationals, including Heineken, Pepsi Cola, Motorola, Eastman Kodak and the US Texaco and Atlantic Richfield oil companies have packed up and left because of "the lack of democracy". After their departure, Nobel peace laureate and opposition leader Aung San Suu Kyi said that Total had become the mainstay of the military regime. In Angola, oil revenues are feeding an endless civil war that has already claimed several hundred thousand lives.

NGOs report that in 1999 more than half the $900m paid by the international oil companies in operating rights were used to fund yet another military offensive against Jonas Savimbi's Unita (National Union for the Total Independence of Angola). The rest was used to feed corruption. Last year the UK organisation Global Witness accused high-ranking Angolan officials of using oil royalties to buy arms from the Russian underworld and re-selling them to the government through "front" companies at inflated prices (6). In a hard-hitting report, it also accused the oil multinationals and western banks of complicity in Angola's "humanitarian disaster". Some 20 oil companies, including BP (now part of BP-Amoco), Exxon, Gulf and TotalFinaElf, are operating in the country and plan to invest billions of dollars there in the next few years. Finally, in January 1999, Human Rights Watch accused the Enron conglomerate, an American energy giant, of complicity in serious human rights violations in India. The organisation wrote that the Dabhol Power Corporation, which is 50% Enron owned, "employs security forces who routinely beat and harass people demonstrating peacefully against the power plant"; it accused the US and Indian governments of "looking the other way". The biggest foreign investment in India, Dabhol is a joint venture between Enron, two of America's largest companies, General Electric and Bechtel, and the Maharashtra State Electricity Board.

We could add to this black list of countries where oil companies operate in almost total disregard for moral principles: China, Russia, Turkey, Saudi Arabia, the Caucasus and Central Asia, where there is much manoeuvring over oil, as well as Algeria, Pakistan, Libya, Congo and a number of other African states. Most of the cases recorded by NGOs involve abuses by security services protecting oil installations against the local population which is opposed to them for a variety of reasons: environmental damage, disregard for their culture, broken promises, etc. But according to Human Rights Watch, most oil companies deny all knowledge of such things. None have made any public protest at the abuses perpetrated in connection with their operations. No attempt has been made to restrict the activities of armed forces often renowned for their brutality. Unless the international press gets wind of something, indifference and inaction prevail. Many countries where the transnational oil companies operate are marked by conflict and violence, and they legitimately require security for their personnel and property. But, as Human Rights Watch notes, "there is an even greater need for companies to ensure that such protection does not result in further human rights abuses". Indeed, while the oil companies cannot really choose where to go, they can choose how to behave and do what is necessary to limit the damage they cause. Amnesty International has proposed a range of "common sense measures" to prevent their operations harming human rights.

Utopia and hypocrisy Internally, for example, they could adopt a human rights policy that includes express support for the Universal Declaration of 1948. They could then adopt a code of conduct to translate that policy into action. Externally, their contracts could include clauses guaranteeing respect for the local population and compliance with international agreements. Security agreements could be made public. In areas of armed conflict, they could refuse to make use of armed forces known for their brutality. Where there are abuses, they could protest to the authorities, go to court and compensate the victims. And they could ensure that all these commitments can be verified, so they can be seen to be reality and not just empty promises. In the UK, with a combination of dialogue and pressure, things have started to move. That was where the campaign started and it is where the first results have been achieved. Towards the end of the 1990s several transnationals, including three of the larger oil companies, Shell, BP-Amoco and the Norwegian state oil company Statoil, announced policies putting the stress on human rights. In the Norwegian case, the decision came with a statement of faith.

Company chairman Harald Norvik said in August 1998: "In Statoil we are of the opinion that the need for democratisation, poverty eradication and social development is urgent. To promote human rights is right and it is in the interest of the business community". Despite such examples, most oil companies are still sticking to supposed political neutrality and pragmatism. "So long as there is no UN embargo like in Iraq, we shall continue," is how one of them put it. "The rest is up to the politicians". This is more or less the American and French position. The most indulgent of Shell BP and Statoil's competitors regard their "humanistic" option as utopian, while others denounce "the hypocrisy of lavish promises that are impossible to keep" - especially at a time when oil prices are rising. However, most of them are aware of the way things are moving and of their public image and are reluctant to break off the dialogue with Amnesty. TotalFinaElf, for example, does not rule out including a specific reference to human rights in a proposed new business charter. Elsewhere, too, the "human rights culture" is making progress. In April Amnesty International, the Ashridge Centre for Business and Society and The Prince of Wales' Business Leaders Forum turned the transnationals' favourite argument on its head with a campaign on the theme "Human rights is the business of business". A survey of the world's 500 largest companies revealed that 36% of them had decided not to proceed with a proposed investment project because of human rights concerns and that 19% had disinvested and left some countries for the same reason..