There is a good deal of discussion these days about a change of paradigm in the prevailing business model of most companies. There is said to be a shift from the model of shareholder primacy, where the company’s overriding concern is to generate more profit to keep its shareholders content, to a -rediscovered- model where the companies care about other “stakeholders”: workers, communities, customers and others potentially affected and interested in the company’s operations, success or failure. Some, like Nobel Laureate Joseph Stiglitz say that the debate is a smokescreen and doubt the sincerity of the business community’s declarations, while Matt Levine among others point to a mere reflection of a long-lasting fight between shareholders and managers for the control of the company, with the “new” model no more than an excuse for the latter to prevail over the former in controlling the company. Yet, there is limited attention to the key issue of the correlation between the company’s statements and its actions. Whether a company’s transformation is genuine or not has to be seen in the facts, observing how the company operates and how it addresses the issues that concern their stakeholders.

While there might be important components of tactical discourse relating exclusively to self- interest and self-preservation in the proposed change of paradigm, there is also value in taking the words of the CEOs at the Conference Roundtable at face value and looking at the facts. Looking at the facts means looking also at the way companies continue to operate and how the interests of stakeholders are taken into account, how they address concerns, issues or even problems created by their operations among their stakeholders. It is here where the value of models of grievance mechanisms such as the one proposed by the International Commission of Jurists lie.

The interests and concerns of company stakeholders can be better taken on board in company operations if these groups have direct participation and have their voices heard in the various ways and levels in which a company organizes itself and carries out operations, and especially in the way the company addresses their grievances. Stakeholder participation in the design, implementation, evaluation and reporting about the grievance mechanism is essential for a new paradigm of company truly centered on stakeholders. But few companies do that, or even try it.

Some companies are already creating new mechanisms, while financial institutions and investors increasingly require their borrowers to have a grievance procedure. Plans at the European level for mandatory human rights due diligence are said to contemplate a section on grievance procedures. Some companies, such as Facebook, have established human rights policies and procedures to prevent and correct human rights infringements in the posting of content in their platforms. The new Facebook oversight board (FOB) is hiring human rights specialists and is developing specific procedures and steps. But it is not transparent how the millions of stakeholders that Facebook has over the world will be empowered to take part, or whether the newly created unit will really have the resources, independence and power to influence policy when it matters. Nor is it totally clear how the new mechanisms interplay with existing processes to report infringement of community standards.

One crucial area where company attitude and policies should visibly change is in the area of its relationship with the world of human rights defenders and organizations, which are traditionally seen as adversaries to keep at arms-length. The proposed ICJ performance standards recommend that companies change their vision and attitude to human rights and to human rights defenders such as labour unions, CSOs, activists, community leaders, from a confrontational approach to one of collaboration and mutual benefit. The work of civil society organizations should be seen as beneficial for the company and their representatives included in the design, operation and reporting about the grievance procedures. Crucially, the ICJ performance standards (4.1 and 4.2) require the adoption of anti-retaliation policies within the company whereas performance standards 3.7 and 6.3 establish a role for these groups in ensuring procedural equity or as recipients of information about specific outcomes of the procedures. Similarly, the Office of the High Commissioner for Human Rights’ project on Accountability and Redress has as one of its workstreams the issue of safeguards against retaliation towards rights-holders. Retaliation that may come from various sources, not only companies themselves.

But little can be accomplished on this matter without action by governments in the form of regulation that lays the ground for a level playing field enabling leading companies to move boldly in the right directions without fear of unfair competition from laggard companies. For this to happen, still important sectors of the business community have to accept that today’s realities and urgencies require States to move away from deregulation and free market fundamentalism and towards robust regulation requiring common standards of human rights due diligence and grievance mechanisms in accordance with the international highest standards and best practices. The international human rights normative framework and the need to provide for effective remedies and reparations to the victims of abuses require this approach.

To discuss these and other key issues relating to the adoption and implementation of operational level grievance mechanisms, the Business and Human Rights Journal and the International Commission of Jurists are hosting a series of blogs by experienced practitioners from various backgrounds. This exercise will hopefully shed some light to key developments and outstanding concerns in this area to also provide useful insight to ongoing international efforts. We do this in the midst of a global health crisis caused by the rapid spread of a virus, COVID 19, that is posing a severe test to societies and nations as well as to the business community to rapidly respond to protect health and life of millions of people.

In the blogs to be posted in the following days, Antonella Angelini analyses rights-holders participation in all stages of OGM’s design and operation and its potential to address deep inequality issues; Katerina Yiannibas makes a case for an input-driven interlocked system of dispute management mechanisms where arbitral tribunals play a role; Charline Daelman highlights some of the key issues in the operation of grievance mechanisms in the context of global supply chains from the perspective of business-based associations; the Office of the High Commissioner for Human Rights discusses the interface between private grievance mechanisms and the powers and functions of State-based institutions as a particular focus of its Accountability and remedy Project; and Jenny Domino discusses how the differentiated position of private and State actors has an impact in the way content they post in Facebook is moderated. Taken all together, these blogposts provide a varied and rich set of approaches and content that will no doubt be found useful and engaging by readers.

Editor’s note: the topic of grievance mechanisms and related aspects of the right to remedy have been explored in a number of Business and Human Rights Journal articles. Jonathan Kaufman and Katherine McDonnell have written on community-driven operational grievance mechanisms, Benjamin Thompson on effectiveness criteria for operational-level grievance mechanisms, and Karyn Keenan on the Canadian Corporate Responsibility Ombudsman. Two articles, one by Joana Nabuco and Leticia Aleixo, one by Baskut Tuncak, have explored different remedy-related issues following the collapse of the Doce river dam in Brazil. There is also a review by Manoj Kumar Sinha of a 2016 book on ‘The Role and Impact of Non-Judicial Grievance Mechanisms’. The latest issue of the journal is available here.

Carlos Lopez – International Commission of Jurists.