Decent work and Due diligence: ILO and OECD update their guiding principles for multinational companies
Two reference texts upadated: ILO revised its landmark Declaration on multinational enterprises adding especially guidance on decent work while the OECD published a new guide on Responsible Business Conduct (RBC) for investors on due diligences.
ILO landmark Declaration on multinational enterprises: addition of decent work principles
The ILO has just validated the revision of its landmark MNE Declaration. It is the only global instrument in this area that was elaborated and adopted by governments, employers and workers from around the world. It was adopted close to 40 years ago and amended in 2000 and 2006.
The revision of March 17, 2017 has enriched the MNE Declaration by adding principles addressing specific decent work issues related to social security, forced labour, transition from the informal to the formal economy, wages, access to remedy and compensation of victims.
It also takes into account “developments since the last update in 2006 within and outside the ILO, including new labour standards adopted by the International Labour Conference, the Guiding Principles on Business and Human Rights endorsed by the Human Rights Council in 2011, and the 2030 Agenda for Sustainable Development. ”
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“Responsible Business Conduct (RBC)”: the OECD publishes a new guide
This guide is a tool for institutional investors in terms of due diligence to implement to ensure the respect of OECD guiding principles for Multinational companies to prevent negative impacts related to human and labour rights, the environment,
and corruption in their investment portfolios.
Expected benefits of carrying out due diligence under the OECD Guidelines include:
- Increased ability to implement the OECD Guidelines, as well as the UN Guiding Principles on Business and Human Rights (UNGPs) and other relevant frameworks, such as the UN-supported Principles for Responsible Investment (PRI);
- “Knowing and showing” that the investor meets expectations under the OECD Guidelines, and makes a positive contribution to sustainable development;
- Increased ability to meet expectations of clients (in the case of investment managers) and beneficiaries/members (in the case of asset owners such as pension funds) related to RBC standards (e.g. the OECD Guidelines);
- Increased understanding and management of investment risks that may be material.
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Vigeo Eiris pays a particular attention to the integration and respect by companies of « OECD Guiding Principles for Multinational Companies » and « ILO landmark Declaration on multinational enterprises », two texts that are an integral part of the agency’s normative framework.
Vigeo Eiris exclusive methodology measures the relevance of companies and organisations’ commitments, the efficiency of their managerial systems, their ability to manage risks and to improve their performance on all the environmental, governance, social and societal responsibility factors.
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