The Politics of Poverty

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Private sector accountability & the SDGs: What is the role of the UN Guiding Principles?

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As the SDGs get into full swing, a robust framework is needed to assess and regulate private sector contributions. The UN Guiding Principles for Business and Human Rights are a logical place to start.

Uwe Gneiting is the Research and Evaluation Advisor in Oxfam America’s Private Sector Department.

This week’s UN Forum on Business and Human Rights brings together a diverse community of stakeholders to debate the future direction of the UN Guiding Principles on Business and Human Rights (UNGP). Less than two months ago, the world saw an equally diverse community come together in New York City to adopt the UN Sustainable Development Goals (SDGs), which make up the 2030 Agenda for Sustainable Development. Despite the proximity of the two events, the future relationship between the SDGs and the UNGPs remains unclear. Is the minimal mentioning of the UNGPs in the Agenda 2030 report simply a sign of the continuing chasm in discourse and debate between the business-development and the business-human rights communities? Or asked differently, what can the UNGPs potentially contribute to the SDGs?

Let’s start with the need for accountability. As the UN Office of the High Commissioner for Human Rights has stated, the establishment of a robust accountability framework will be critical to achieve the SDGs. And this includes the private sector since the ambitious scope of the SDGs implies a role for the private sector that goes far beyond its traditional contributions to development (i.e. jobs, tax income and technological innovation). This new role has its promises, but it also creates new risks and governance challenges in the context of sustainable development.  . Only through a robust and comprehensive accountability framework can we ensure that  business contributions are harnessed while the risks and potential negative business impacts are mitigated. This framework has to include provisions for the private sector that should accompany and complement the SDGs’ formal follow-up and review process, and should be built on standardized definitions, measurements, and mechanisms to track business contributions to the SDGs.

The UN Guiding Principles represent a logical starting point for thinking about how private sector performance on SDGs could be assessed, by whom, and based on what indicators. Already, their three-pillar approach which emphasizes the responsibilities of states and businesses in represent the most widely endorsed human rights framework for private sector accountability. Thus, incorporating the UNGPs into the SDG accountability process is the logical next step to further expand the influence of the UNGPs and thus and extend the idea of a rights-based approach to development to the private sector.

At the same time, the UNGPs alone won’t address all the accountability problems related to the private sector and the SDGs. Instead, making the UNGPs part of the SDG framework will require a process of close cooperation and harmonization with ongoing indicator development and accountability process – which include the indicators being developed by the Inter-Agency Expert Group on the SDGs,  the Human Rights Guide to the SDGs by the Danish Institute on Human Rights, and the SDG Compass developed by the Global Reporting Initiative , the UN Global Compact, and the World Business Council for Sustainable Development . By building on and working to harmonize these existing efforts with the UNGPs, the Business and Human Rights community can play an important role in elevating a rights-based lens as basis for assessing the private sector’s performance around the SDGs.

Given number of initiatives already existing, integrating the UNGPs and their associated processes and institutions into the SDG accountability frameworks will not be a frictionless task. In addition, there are a few key issues to be mindful of that will determine the value of the UNGPs for the SDGs:

  1. The UNGPs have to demonstrate their value in safeguarding against human rights abuses as well as providing guidance to the private sector on how to make positive development and human rights contributions.
  2. An effective accountability framework building on the UNGPs needs to be applicable to the different roles and contributions of the private sector in the SDG context; including their role in public-private partnerships, development finance, and, most importantly, their core business policies and practice.
  3. The value of elevating the UNGPs within the SDG monitoring and review process will depend on their ability to empower affected groups and civil society to hold the private sector accountable for its performance, which will require transparency and inclusive participation mechanisms.

The UN Forum on Business and Human Rights presents an important opportunity to build further momentum to promote private sector accountability around the SDGs and to ensure that the UN Guiding Principles are central to gauging private sector effectiveness and accountability in the development space. It will be critical for the UN Working Group, private sector and civil society to create a common roadmap this week that will create the conditions to pursue it collectively over the next 15 years.

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