Business Conflict Blog by Peter Phillips
The current issue of IBA Global Insight (Feb/March 2013) features an excellent article by Rebecca Lowe that, on first glance, studies the defenses to liability under the Alien Tort Claims Act as presented by the U.S. Supreme Court’s consideration of Kiobel v. Royal Dutch Petroleum. The article, however, is both broader and deeper, questioning whether the legal arguments in the Kiobel case implicate the UN Guiding Principles on Business and Human Rights, recently promulgated by UN Secretary General’s Special Representative for Business and Human Rights, John Ruggie.
The problem is neatly articulated by Ruggie, and the problem has a lot to do with lawyers: Are a legal advisor’s responsibilities confined to litigation strategy in a particular case, or is it also the lawyer’s job to assist the client to confront ”the entire range of risks” including not merely business reputation but also ”collateral damage to a wide range of third parties?”
The Guiding Principles were endorsed by the UN in 2011 and have been absorbed into the OECD Guidelines for Multinational Enterprises, the ISO guidelines, and the work of the European Commission in this area. The Principles call on (i) governments to protect human rights from encroachment; (ii) companies to respect human rights in areas in which they operate; and (iii) all stakeholders to ensure the availability of grievance mechanisms for claims sounding in human rights.
The article asks whether leading international law firms — notoriously conservative and slow to adopt change — might be drags rather than leaders in this field as they discount (or, worse, remain ignorant of) their clients’ responsibilities to act consistent with broadly recognized standards of socially responsible behavior. While no one argues that law firms should be moral arbiters, at the same time most would (presumably) concede that moral considerations, and norms of international law, ought to inform legal advice if that advice is to be deemed comprehensive.
Moreover, global law firms are themselves actors on the world economic stage. In addition to the professional and ethical commitments they owe to their clients, don’t they also owe independent obligations to the communities effected by their own conduct? “With the 100 largest firms taking a total revenue of $74bn in 2010, their influence cannot be understated,” writes Lowe, adding: “lawyers’ ability to shun the spotlight may be on the wane.”
Corporate activity and human rights is no longer an esoteric field, a favorite of NGOs and the soft-hearted. Thanks to the ever-widening acceptance of the Ruggie Principles, lawyers who advise their global clients on tax and corporate structure may soon be obligated to advise them on their responsibility to the communities in which they do business.
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