This chapter examines corporate responsibilities and accountability to anticipate and redress human rights violations relating to the environment in their spheres of operations. After this introduction, section 2 examines the drivers and contours of the growing recognition of corporate accountability relating to environmental damage. Section 3 unpacks the key scope and content of emerging human rights obligations of corporations to protect the environment. These obligations are as follows: participation, accountability, non-discrimination and equality, empowerment and legality (the PANEL principles). By implementing the PANEL principles in the design, approval, finance and implementation of their operations and projects, business enterprises can proactively anticipate and tackle environmental risks across their entire business value chain. Section 4 highlights practical challenges that must be addressed by national authorities and business enterprises in order to fully translate these norms to reality. Section 5 is the concluding section.

Courts, practitioners, and academics alike have long considered corporate officers and directors to be fiduciaries of the public corporation and its shareholders. As corporate law has evolved, however, with the business judgment rule strengthening, the duties of care and loyalty narrowing in scope, and executive compensation schemes further introducing self-interest into corporate decision making, the fiduciary paradigm is no longer an accurate description of the nature of the relationship between corporate managers and the corporation. Corporate officers and directors have significant latitude to make decisions that take into consideration their self-interest while still satisfying their duties to the corporation. Further, the “best interests” of the corporate entity and its multitude of stakeholders are highly variable and often ill-defined, such that it would be impractical to pursue those interests as a singular goal. This Article argues that corporate officers and directors are not governed by fiduciary duties in the truest sense of the term. This misconceptualization inhibits an accurate understanding of the dynamics underlying corporate decision

In this Chapter, we survey the common law’s adventures with creditor protection over the course of American history with a special focus on Delaware. We examine the evolution of the equitable doctrines that judges have used to answer a question that arises time and again: What help, if any, should the common law be to creditors that suffer losses due to the purported carelessness or disloyalty of corporate directors and officers? Judges have struggled to answer that question, first deploying Judge Story’s “trust fund doctrine” and then molding fiduciary duty law to fashion a remedy for creditors. This reached a high point in the early 2000s as judges flirted with recognizing a “deepening insolvency.” Delaware’s judges effectively abandoned this project in a series of important decisions around the time of the financial crisis. In this “third generation,” judges told creditors to look to other areas of law to protect themselves from opportunistic misconduct, such as bankruptcy law, fraudulent transfer law, and their loan contracts. The question has arisen time and again and today’s “settled” law is unlikely to represent the end of history in creditor protection.

The chapter critically examines and classifies the main approaches to the relationship between WTO law and international human rights law (IHLR). In so doing, it shows why none of these can be considered able to adequately manage this relationship. Thereby, the chapter goes on to examine the rise and consequences of the sustainable development goals (SDGs) and the affirmation of the MS principle in the international legal arena. And this is in order to develop in its last part a new alternative approach to the WTO-human rights relationship grounded on a combined use of the MS principle, the SDGs and their related targets.

This chapter explores the extent to which businesses have assimilated in their practice the internationally recognized standards of responsible business conduct and the SDGs framework in an integrated and mutually reinforcing way in an effort to contribute as partners to the realization of sustainable development. To this end, the UN Guiding Principles on Business and Human Rights (UNGPs) will be under focus for two reasons: first, they are cited in Agenda 2030; second, they constitute the most authoritative source among global standards of expected conduct by businesses to address and prevent the negative implications of their activities on the dignity and welfare of affected individuals and communities. Human rights pertain to all three aspects of development as put forward by the SDGs, whereas the latter are suffused with language that reflects clearly the substance and underlying norms of human rights law. Hence, the interplay between the two regimes, i.e. human rights and development, cannot be refuted. As such, the UNGPs are the predominant, until such time as the proposed Business and Human Rights Treaty is adopted, ‘normative’ roadmap for businesses to achieve the SDGs.

This chapter starts from the premise that business and human rights is much more complex than the impact of corporate practices on the fulfillment of human rights and environmental law. Rather, it is crucial that one identifies the underlying causes of this tension, namely: a) the broader corporate perspective in its transnational context; b) the inter-state investment relations and; c) the international financial architecture. Within all three of these, home and host states interact with each other, as well as with corporations. Powerful home states are lobbied by multinational corporations (MNCs) to create an international framework that better guarantees investment and trade. This is taken up as a policy imperative and reflected in international treaty making. States, both home and host, are clearly central to this process and their achievements, good or bad, will ultimately shape, or open up the space for subsequent corporate conduct. Hence, the starting point for our understanding of business and human rights should not be based on corporations themselves, but rather extend to all the contextual and underlying grounds that shape their existence, regulation and performance.

This chapter discusses the United Nations Global Compact (UNGC) and the OECD Guidelines for Multinational Enterprises as voluntary standards for business and human rights. Both standards have received significant scholarly attention. Although both initiatives differ with regard to some dimensions (e.g., in terms of their scope), they also share a number of similarities (e.g., their voluntary and principle-based nature and their lack of monitoring). It is therefore appropriate to discuss both initiatives and to also compare them with each other (whenever possible and feasible). The discussion in this chapter proceeds as follows. The next section discusses the theoretical background by emphasizing the rise of voluntary standards related to corporate sustainability and responsibility. The following two sections provide a more practical discussion. Section three and four take an in-depth look at the UNGC and the OECD Guidelines and discuss (a) the basic idea underlying both initiatives, (b) their link to the business and human rights agenda, and (c) their enforcement mechanisms. The discussion of both standards shows one important similarity: the lack of a robust system to implement and enforce the promoted principles.

The goal of the business corporation traditionally has been understood to be the maximization of shareholder wealth. A growing demand for social enterprise has led to the creation of various new forms of business organization, including the benefit corporation, that have the goal of creating both shareholder wealth and other public benefits. Although benefit corporations were developed to overcome the shareholder wealth maximization norm, it is not fair to say that they also overcome shareholder primacy. Properly understood, benefit corporations are shareholder-centric: they exist to allow shareholders to pursue altruistic goals rather than to require them to do so. This essay demonstrates this from the history and structure of the Model Benefit Corporation Act and argues that benefit corporation legislation ought to remain essentially enabling rather than mandatory in nature.

This chapter examines the main issues and achievements in the process of making MNEs human rights compliant. This involves, first, some understanding of the complexities of MNE organisation to highlight the problematic nature of attributing responsibility within what is a transnational network of interlocking entities linked either by ownership or contract or a mix of both. A distinction is made between integrated corporate group structures and looser transnational production and distribution networks between legally independent firms, often referred to as Global Value Chains (GVCs). Both have the capacity to violate human rights, but each has different control and accountability profiles.Secondly, the chapter will cover the main regulatory problems. These begin with the modalities of regulation. The UNGPs have stressed self-regulation through the corporate responsibility to respect human rights and the use of human rights due diligence (HRDD). MNEs operate as integrated enterprises, and GVCs as production and distribution networks, across national borders, while regulation remains bounded by the limits of sovereign state territory creating tension between the limits of national laws and the transnational nature of human rights claims against MNEs and GVC firms. The remainder of the chapter will cover substantive liability issues.

This chapter argues that corporate law is unique in a way that is not widely recognized, and is not unique in the way it is widely thought to be. First, unlike other fields of law where fiduciary obligations play a key role, in corporate law, not one, not two, but three distinct actors owe fiduciary duties—executive officers, directors, and controlling shareholders. The beneficiaries of those actors' duties, the reasons for imposing duties, and the scope and demands of fiduciary duties differ for the three actors. Thus, there is not a singular duty of care and loyalty in Delaware corporate law, but multiple variations of those duties owed by multiple actors. Delaware has a law of fiduciaries, not a fiduciary law. Second, this chapter challenges the supposed standard of conduct-standard of review divergence first hailed in 1993 by Professor Melvin Eisenberg as unique to corporate law.The construct was descriptively inaccuratewhen Professor Eisenberg first wrote, it has been little used by the Supreme Court since then, and the standards often converge rather than diverge.

Financial firms that offer investment advice to retail clients are beset by conflicts of interest: they may receive compensation tied to particular products, operate the financial products themselves, or be subject to other distortions. Regulators and lawmakers have looked to fiduciary and quasi-fiduciary duties to mitigate these conflicts. The paradigmatic example is the rigorous fiduciary standard imposed on registered investment advisers, but the Department of Labor’s now-defunct fiduciary rule, and the Securities and Exchange Commission’s recently adopted Regulation Best Interest similarly aim to mitigate problematic conflicts by imposing duties on those giving investment advice. These interventions largely focus on conflicts affecting which investment products investors are advised to hold, but other types of distortions, less discussed, may be just as important. This chapter offers an expanded account of conflicts of interest, how conflicts might interact, and how the fiduciary rule and Regulation Best Interest should be evaluated in light of this expanded menu of problematic incentives.

In this chapter, we first discuss the growing expectations for companies to address human rights and the need to develop business models that enable profits and human rights principles to co-exist. We then describe and discuss two empirical cases of companies that are experimenting with new business models to align the expectations for profits with the protection of human rights. The first case from the sportswear industry shows how Decathlon, a French sports retailer, has revised its purchasing practices to create partnerships with its suppliers with a view to improving both productivity and working conditions. The second case, from the extractives sector, discusses how Trafigura, a Swiss-based commodity trading company with headquarters in Singapore, has set up a collaborative project with a mining company to formalize the artisanal mining activities of cobalt in the Democratic Republic of the Congo (DRC) to mitigate human rights risks. Both cases illustrate actions taken by companies to embed human rights into their core activities while also developing their businesses. These cases provide anecdotal evidence for the hypothesis that systematically integrating respect for human rights can indeed go hand in hand with financial success and be considered ‘good business’.

Concluding that even if economists cannot agree why shareholders should have priority, they are nevertheless agreed that this is the case, the chapter goes on to examine the legal position of different stakeholders in the context of the company by referring to the thorough reform process observed in the UK some two decades ago. Noting then that, despite such a comprehensive debate, the enlightened shareholder value solution (ESV) arrived at remains controversial, and recognising that, in any case, such formal statutory provisions by no means exhaust the arrangements in place for corporate governance, the chapter goes on to look at the hugely influential development of essentially self-regulatory, best-practice based arrangements that are now a feature of stock markets throughout the world. Insofar as the experience of the jurisdiction from which this approach emerged has not been uniformly positive, the chapter proceeds to examine the alternative approach of a strict rule-based approach to corporate governance, taking the US as an example. Despite the problems associated with any alternative, these apparent limits perhaps explain the ongoing and indeed intensified interest in the notion of corporate social responsibility. The chapter goes on to seek clarity in a definition of CSR which draws a distinction between what society requires corporations to do and what it is willing to regard as optional. Noting, however, that encouraging legislators to take firm action in the face of the fear of capital flight can be difficult in the absence of some clear evidence of a problem (and even then, in some recent cases), the question is then whether the recent enthusiasm for environmental, social and governance (ESG) reporting is a reasonable way forward.

Recent developments in investment arbitration have reaffirmed that corporations are not only recipients of rights under bilateral investment treaties, but also subjects of international law and can thus bear at least some human rights obligations under international law. Moreover, in a growing number of cases such as Philipp Morris, civil society intervened as third party by relying heavily on human rights arguments, thus enabling affected communities to voice their interests. The present contribution thus investigates the multiple roles of human rights in investment law and arbitration. It argues that human rights play an important role for state parties, foreign investors, and affected communities alike. They are not only conflicting and complementary to investment treaties, but can both expand and restrict the scope of jurisdiction of investment tribunals. For states, investors, and third parties alike human rights can be used as a sword or a shield in international investment law and arbitration. The different roles human rights play in investment law and arbitration very much depend on the underlying concept of human rights.