Towards a binding treaty on business and human rights: Despite progress, still no final outcome in view

With its extended value chains, economic globalisation has brought numerous opportunities while also creating specific challenges, including in the area of human rights protection. Loose regulatory frameworks in developing countries, corruption, and a lack of accountability resulting from legal rules shielding corporate interests have facilitated human rights abuses related to operations of transnational corporations, their subsidiaries and supply chains. This situation has created a pressing need to establish an international normative framework for business operations in relation to human rights. So far, the preferred approach has been 'soft', consisting of the adoption of voluntary guidelines for businesses, such as the United Nations Guiding Principles on Business and Human Rights. Nevertheless, while such voluntary commitments are clearly useful, they cannot entirely prevent gross human rights violations. To address the shortcomings of the soft approach, an intergovernmental working group was established on Ecuador's initiative within the United Nations framework in June 2014, with the task of drafting a binding treaty on human rights and business. The EU became more actively involved in the negotiations once its initial concerns with regard to the type of businesses covered were taken into consideration, but lacks a formal mandate from the Council and therefore has to rely on ad hoc consensus among its Member States. After seven sessions, the negotiating process remains divisive for participating states, despite continuing strong support from civil society. Disagreements also run deep among legal experts on the technical merits of the current approach. The European Parliament supports this initiative and has encouraged the EU to take a positive and constructive approach. This is a further update of a briefing the last edition of which was published in October 2018.