Where is the Discussion of Corporate Capture in the Working Group’s Thematic Report on Corporate Capture?
This post was originally published by Just Ground.
The UN Working Group on Business and Human Rights submitted their thematic report to the 77th session of the UN General Assembly on “corporate political engagement and responsible business conduct.” First envisioned as an information note, the consultative process framed the topic as “[e]nsuring business respect for human rights in the political and regulatory sphere and preventing “corporate capture.”” This language of corporate capture was in the title of the initial call for inputs, summary of an expert consultation, and a session at the 2021 UN Forum on Business and Human Rights.
In the context of business and human rights (BHR), the phenomenon of corporate capture can be understood as the private sector using its influence over decision-makers and public institutions in ways that undermine human rights. Basically, it involves the various ways that corporations dominate political and regulatory spaces so that issues that should be decided in the public interest instead favor business interests. Given the scope and severity of the harms that corporate capture entails, it was encouraging to have this issue taken up by the Working Group.
When the Working Group decided to develop the topic further and draft a thematic report, the second call for inputs similarly stated that one of the topics for the report would be to explore “how to prevent what constitutes undue political influence by businesses— sometimes termed “corporate capture.”” So imagine the surprise upon seeing that the topic of corporate capture is not actually in the report. The term “corporate capture” appears only twice, in reference to a previous Working Group report on corruption and a passing mention that “some definitions” of irresponsible political engagement use terms like “undue influence” or “corporate capture.” “Undue influence” appears only three times, the third in a recommendation to States on grievance mechanisms. But the phenomenon is more widely-recognised than that passing mention implies. The Working Group itself reminded us at the 2021 UN Forum how the related concept of “regulatory capture” goes back decades and is widely-written about. It was considered a serious enough issue to warrant a thematic report. So why the sudden distancing?
There is no shortage of examples of corporate capture in the report. They are just not acknowledged as such. The report even includes sections on “corporate influence over academia and the sciences” and “corporate influence over public narratives around political issues” in addition to the usual suspects of lobbying, financial contributions, and revolving door hiring practices. In the expert convening, these were called “new areas of undue political influence,” but in the report they are described as “prominent modes of corporate political engagement and patterns that may lead to business-related human rights harms.” This subtle shift in focus waters down the harmfulness of these actions.
The report seems to focus on issues of coherence or alignment. Say, for example, a company has made human rights commitments, but hasn’t applied those commitments in the context of their political engagement. There is a lack of coherence there, a misalignment, and that can result in negative human rights impacts. Hence the call for improved human rights due diligence specifically regarding political engagement in the report. This makes sense, given the Working Group’s mandate to promote and implement the UN Guiding Principles on Business and Human Rights (UNGP), which emphasises human rights due diligence as a central part of a company’s responsibility to respect human rights.
And sure, private sector capture of a regulatory space is certainly misaligned with any human rights commitments made by those actors. But this framing seems to treat corporate capture (while avoiding those actual words) as a passive result of an oversight on the part of a company, or irresponsible behaviour, rather than acting “as a ‘root cause’ of many corporate human rights abuses.”
My point here is not to try and explain corporate capture, there are others much better placed to do so. ESCR-Net’s Corporate Capture Project is a helpful source for gaining an understanding of the scale of the issue and why it needs serious scrutiny. The point that I am getting at is that up until the report, it seemed like the Working Group agreed on the need for that scrutiny.
If we do not critically engage with these practices of corporate power, then we are reinforcing them. And that is exactly what corporate capture is, exercises of corporate power. Don’t take my word for it. Read John Ruggie’s 2018 article “Multinationals as Global Institution: Power, Authority and Relative Autonomy” and you will see most of the examples of “prominent modes of corporate political engagement” from the report discussed as examples of exercises of different facets of power. How we articulate issues in many ways shapes how we identify possible solutions. So while the report provides some helpful guidance on where we can see corporate capture happening, its framing – which distances itself from corporate capture – makes it ill-equipped to address the issue.
There are a number of other elements in the report (or rather, missing from the report) that it’s disappointing to see were given little or no attention.
The report leads with the very contested assertion that the private sector has a “right” to participate in policymaking without examining how this perceived political legitimacy came to be. While it may be a common practice, not everyone agrees that the private sector should be allowed in these spaces at all, or what role they should be allowed to play.
The examination of remedy, particularly with regard to non-judicial grievance mechanisms, was very cursory. The corporate influence in normalizing an interest-based rather than rights-based approach to remedy should be considered “corporate influence over public narratives around political issues,” and needs greater scrutiny.
In the context of remedy and accountability, the Working Group has emphasized the “centrality of the rights holder,” yet there is only a brief mention in the report about how States and multilateral institutions should give “greater attention to ensuring that consultations are balanced among businesses and other stakeholders, [including rights holders].”
The tone regarding the impacts of corporate capture on rights holders feels dismissive, and the recommendations on mitigating them were lukewarm. The numerous and varied examples in the report highlight that the situation is significantly more serious than “sometimes entail[ing] negative impacts for some rightsholders.” And while trade-offs may be a reality in politics, one would expect a stronger emphasis on human rights in a report written by human rights experts.
The tone and choice of language in the report calls to mind the similar watering down of the final language and framing in the UNGP, which received strong, and legitimate, criticisms. Given the critiques of the corporate influence in the development of the UNGP and the ongoing concerns over the corporate capture of the UN, the report’s discussions about corporate influence in multilateral spaces should have included some critical self-reflection.
There is much that could, and should, be said about all of those elements in the report. But most immediately, the question remains, why was corporate capture not addressed in a report that many were led to believe was intended to look at corporate capture?
If the Working Group felt that the issue itself was addressed without that language, that is certainly not clear in the report. Surya Deva reminds us of the important role that language plays in human rights and how “adequately potent concepts” are required if we are to take human rights seriously. Will there be a part two that fills in the gaps in this report? That offers recommendations on “preventing corporate capture” as outlined in the consultative documents? Because there urgently needs to be.
Photo by Bernd 📷 Dittrich on Unsplash