Course Synopses/Outlines:

Panel #1: Non-State Actors and Their Impact on International Human Rights Law

"Multinational Corporations and International Human Rights Law: The New Lex Mercatoria"

Ralph G. Steinhardt

I. The traditional distinction between international human rights law and corporate law (and the correlative distinction between public and private international law) has been rendered increasingly obsolete by the emergence of four regimes of corporate responsibility in the human rights field.
  1. A market-based regime, under which corporations compete for consumers and investors by conforming to international human rights standards ("human rights entrepreneurialism, voluntary codes of conduct and statements of corporate principles, industry coalitions, social accountability auditing)
  2. A regime of civil liability enforced through private lawsuits in domestic courts (recent developments in the Unocal, Banque Paribas, and Nike cases)
  3. A regime of domestic regulation, exemplified by directives and legislation in the United States, which, through human rights conditionality, recruit the transnational corporation as an instrument of foreign policy (the Burma decision and proposed securities regulations in the human rights field)
  4. A regime of international regulation by intergovernmental organizations which have attempted to channel corporate conduct in ways that are thought to be socially responsible (recent developments within the State Department (Security and Human Rights in the Extractive Industries), the OECD, the IFI's, and the UN Human Rights Commission (Proposed Draft Human Rights Code of Conduct for Companies))
II. The objections to these developments, though far from trivial, are ultimately insufficient to derail the corporate human rights initiative altogether. Instead they define and illuminate a middle path, maintaining the general impetus toward corporate responsibility in the human rights field but justifying a global standard that is so grounded in international law as to offer corporations a measure of protection from aggressive or idiosyncratic approaches to human rights.
  1. The most pressing objections from the corporate side include the following:
    1. That social responsibility movements subvert the implicit promise of corporations to their shareholders or require an expertise that corporations cannot be expected to have;
    2. That none of the four regimes adequately distinguishes degrees of corporate culpability or gives adequate notice of the corporation's human rights responsibilities;
    3. That Unocal and its progeny impose a uniquely American form of liability that disadvantages U.S. corporations in the global marketplace;
    4. That imposing greater human rights obligations just as corporations are voluntarily beginning to undertake them demonstrates the adage that no good deed goes unpunished.
  2. The most pressing objections from the human rights side include the following:
    1. That the current body of corporate human rights concerns is pretextual, unambitious, skewed to ward labor rights, and unenforceable.
    2. Any argument to the effect that a corporate human rights agenda is "good business" commodifies basic principles of human dignity and thereby surrenders the moral high ground.
    3. Shifting the focus to economic rights or forcing all human rights under the "rule of law" undermines whatever coherence the human rights movement has achieved over the last half century.
III. It is possible to see in these developments the emergence of a new law merchant, a contemporary version of the medieval lex mercatoria, a set of good mercantile practices, growing out of the needs of the marketplace, comprising a body of authority that is international in scope, and ultimately codified (or otherwise followed) in the law of the various nations and international law.