Guidelines

National Contact Point

Knowledge Center

concepts-principles-and-human-rights

Homepage / Guidelines / Concepts, Principles and Human Rights

Concepts, Principles and Human Rights

Concepts and principles

1. The Guidelines are recommendations jointly addressed by governments to
multinational enterprises. They provide principles and standards of good
practice consistent with applicable laws. Observance of the Guidelines by
enterprises is voluntary and not legally enforceable.

2. Since the operations of multinational enterprises extend throughout the
world, international co-operation in this field should extend to all countries.
Governments adhering to the Guidelines encourage the enterprises operating
on their territories to observe the Guidelines wherever they operate, while
taking into account the particular circumstances of each host country.

3. A precise definition of multinational enterprises is not required for the
purposes of the Guidelines. These usually comprise companies or other entities
established in more than one country and so linked that they may co-ordinate
their operations in various ways. While one or more of these entities may be
able to exercise a significant influence over the activities of others, their degree
of autonomy within the enterprise may vary widely from one multinational
enterprise to another. Ownership may be private, state or mixed. The Guidelines
are addressed to all the entities within the multinational enterprise (parent
companies and/or local entities). According to the actual distribution of
responsibilities among them, the different entities are expected to co-operate
and to assist one another to facilitate observance of the Guidelines.

4. The Guidelines are not aimed at introducing differences of treatment
between multinational and domestic enterprises; they reflect good practice
for all. Accordingly, multinational and domestic enterprises are subject to the
same expectations in respect of their conduct wherever the Guidelines are
relevant to both.

5. Governments wish to encourage the widest possible observance of the
Guidelines. While it is acknowledged that small- and medium-sized enterprises
may not have the same capacities as larger enterprises, governments adhering
to the Guidelines nevertheless encourage them to observe the Guidelines
recommendations to the fullest extent possible.

6. Governments adhering to the Guidelines should not use them for
protectionist purposes nor use them in a way that calls into question the
comparative advantage of any country where multinational enterprises invest.

7. Governments have the right to prescribe the conditions under which
multinational enterprises operate within their jurisdictions, subject to
international law. The entities of a multinational enterprise located in various
countries are subject to the laws applicable in these countries. When
multinational enterprises are subject to conflicting requirements by adhering
countries, the governments concerned will co-operate in good faith with a
view to resolving problems that may arise.

8. Governments adhering to the Guidelines set them forth with the
understanding that they will fulfil their responsibilities to treat enterprises
equitably and in accordance with international law and with their contractual
obligations.

9. The use of appropriate international dispute settlement mechanisms,
including arbitration, is encouraged as a means of facilitating the resolution of
legal problems arising between enterprises and host country governments.

10. Governments adhering to the Guidelines will promote them and encourage
their use. They will establish National Contact Points that promote the
Guidelines and act as a forum for discussion of all matters relating to the
Guidelines. The adhering Governments will also participate in appropriate
review and consultation procedures to address issues concerning interpretation
of the Guidelines in a changing world.

General policies and human rights

Enterprises should take fully into account established policies in the
countries in which they operate, and consider the views of other stakeholders.
In this regard, enterprises should:

1. Contribute to economic, social and environmental progress with a view to
achieving sustainable development.

2. Respect the human rights of those affected by their activities consistent
with the host government’s international obligations and commitments.

3. Encourage local capacity building through close co-operation with the
local community, including business interests, as well as developing the
enterprise’s activities in domestic and foreign markets, consistent with
the need for sound commercial practice.

4. Encourage human capital formation, in particular by creating employment
opportunities and facilitating training opportunities for employees.

5. Refrain from seeking or accepting exemptions not contemplated in the
statutory or regulatory framework related to environmental, health,
safety, labour, taxation, financial incentives, or other issues.

6. Support and uphold good corporate governance principles and develop
and apply good corporate governance practices.

7. Develop and apply effective self-regulatory practices and management
systems that foster a relationship of confidence and mutual trust between
enterprises and the societies in which they operate.

8. Promote employee awareness of, and compliance with, company policies
through appropriate dissemination of these policies, including through
training programmes.

9. Refrain from discriminatory or disciplinary action against employees who
make bona fide reports to management or, as appropriate, to the competent
public authorities, on practices that contravene the law, the Guidelines or the
enterprise’s policies.

10. Encourage, where practicable, business partners, including suppliers and
sub-contractors, to apply principles of corporate conduct compatible with
the Guidelines.

11. Abstain from any improper involvement in local political activities.