Indonesia is the only country in Southeast Asia to be a member of the G20 and, in the first quarter of 2019, was recorded as having the third-largest economic growth among the G20 countries, which was 5.07 percent. Indonesia only lost to China by 6.4 percent and India by 5.8 percent. The International Monetary Fund (IMF) said Indonesia’s GDP ranked 16^th among the G20 countries, with a nominal GDP of US$1.07 trillion. With such great economic potential, Indonesia has increasingly strengthened its position as an investment-friendly country. Along with this, however, companies have become one of the top three actors violating human rights in the country.

Between 1 January 2016 and 31 December 2016, 7,188 reports were submitted to the National Human Rights Commission (Komnas HAM). Corporations ranked second of the three major institutions reported. The police ranked first with 2,290 complaints files, followed by corporations (1,030 complaints files) and regional government took third place with 931 complaints. This makes the issue of business and human rights very crucial for Indonesia.

In 2015, Indonesia had to deal with cases of forced labour on the island village of Benjina involving Thai-flagged fishing companies operating in its territory. Following reports of these incidents, the Ministry of Marine Affairs and Fisheries quickly issued a regulation to protect the human rights of fisheries sector workers namely, Ministerial Regulation No. 35/2015 concerning Human Rights and Certification Systems for Fisheries and Ministerial Regulation No. 2/2017 concerning Requirements and Mechanisms for Human Rights Certification for Fisheries.

In harmony with these developments, Komnas HAM, together with the Institute for Policy Research and Advocacy (ELSAM), launched the National Action Plan (NAP) on Business and Human Rights on June 16, 2017. This is a significant manifestation of Indonesia’s commitment to human rights and made Indonesia the first country in Southeast Asia to launch a NAP on business and human rights initiated by National Human Rights Institutions and civil society organizations. This NAP on Business and Human Rights was launched under Komnas HAM Regulation No. 1 of the year 2017 on Ratification of the National Plan of Action on Business and Human Rights, State News No. 856.

The NAP on Business and Human Rights received public recognition from other stakeholders. It was almost the same with the National Guideline on Business and Human Rights, a bold initiative led by the Ministry of Foreign Affairs in making the principles of business and human rights accessible and comprehensible to people across the country. These two policies are important although the government does not optimally campaign for them. Thus, these regulations are not very well known to the public.

A multi-stakeholder dialogue—led by the Coordinating Ministry for Economic Affairs as the National Focal Point on Business and Human Rights—produced a roadmap, entitled Bogor Outcome Declaration. This moment shows how collective efforts to improve awareness and capacity on business and human rights among stakeholders can be achieved through the development of training guidelines, sensitization training, and multi-stakeholder dialogues organized by government, civil society organizations, Indonesia Global Compact Network, the private sector, and academics.

In pursuing the business and human rights agenda, Indonesia is working towards a policy commitment, which will be formalized in the form of either a stand-alone National Action Plan on Business and Human Rights or a chapter in the next National Action Plan on Human Rights 2020-2024. Under the leadership of the Ministry of Law and Human Rights, the Indonesian government conducted baseline and mapping studies in the plantation, mining, and tourism sectors; and are producing tools to assess and improve the application of human rights standards in businesses, with potential for replication in other sectors.

Despite this progress, Indonesia still faces challenges in implementing the United Nations Guiding Principles on Business and Human Rights (UNGPs), including the overlap of existing human rights instruments and the lack of coordination among key players that currently implement national initiatives on business and human rights. This is a common problem in the polycentric system where the current state of a regulatory regime is a difficult proposition, especially with the presence of many rapidly changing variables.

According to Professor Elinor Ostrom, “polycentric systems are characterized by multiple governing authorities at differing scales rather than a monocentric unit.”^[1] Every authority understands the meaning of each element of the polycentric system, their specific roles as well as the contributions of their respective roles to the issue of business and human rights, especially to victims of harms related to corporate operations, services and products.

It is clearly illustrated in research conducted by ELSAM that there are critical gaps in implementing the UNGPs. For instance, while translating and describing the UNGPs in Indonesian is one of the government’s basic tasks and functions, its efforts to contextualize the UNGPs within the conditions and character of Indonesia create more compromised spaces. In addition, company efforts to capture both business value and human rights are still very minimal as companies do not feel it is important to develop a policy framework following the UNGPs. Finally, the pattern of advocacy carried out by civil society is still very partial and tends to be unconsolidated.

There needs to be a dialogue between civil society organizations for collaboration in advocacy to produce a strong push for the government. More multi-stakeholder forums are also needed to overcome gaps in each critical point, not merely incidental forums carried out with the support of development agencies. The government must create budgets to develop a set of derivative regulations to establish the National Action Plan on Human Rights and implement them as soon as possible. Preparation of National Action Plan on Human Rights 2020-2024 could be a good start for implementing a consistent multi-stakeholder forum which includes the government, companies, civil society, and academia. However, it must be followed by the preparation of regional human rights NAPs to ensure the process of localization of the value of the UNGPs.

[1] Elinor Ostrom, Polycentric Systems for Coping with Collective Action and Global Environmental Change, 20 GLOBAL ENVTL. CHANGE 550, 552 (2010).

Sekar Banjaran Aji is a public interest lawyer and researcher with the Institute for Policy Research and Advocacy (ELSAM) who works on business and human rights issues daily. Read more about related topics from Business and Human Rights Journal.