Five-Year Overview + Overview of Company Perceptions of the Principles
Perceived Strengths and Weaknesses of the Principles
Member companies identified three primary strengths of the Voluntary Principles that emerged during the implementation process:
- The Voluntary Principles provide critical guidance on managing security and human rights, especially for companies that operate in challenging environments where expectations regarding human rights and security may be inconsistent: An overwhelming majority of company participants believe that the primary strength of the Voluntary Principles is that they provide a set of guidelines on best practice in managing security in regions of conflict or alleged human rights abuses, thereby offering a much needed base from which companies can develop policies and processes tailored to their operations and needs. Moreover, the Voluntary Principles process itself offers a much needed forum for companies to discuss security and human rights issues.
- The multi-stakeholder endorsement of the Voluntary Principles increases their credibility: There is a strong belief that the tripartite approach to the development and implementation of the Principles affords the process greater credibility than if the process had been driven by one group of stakeholders alone. Through the Principles, a diverse set of stakeholders can gain cohesion and a united front in their approach to security and human rights issues. Specifically, one company highlighted “NGO support” as a key strength of the Principles. Another noted “home government participation and the ability to access diplomatic channels for engaging host government” was also a strength. Many companies also credited the multi-stakeholder approach with improving communication among NGOs, governments and the energy and extractives industries in general.
- The Voluntary Principles help to raise both the profile and internal awareness of security and human rights issues: Another strength of the Principles is that they create a heightened awareness–often a cultural shift—of security and human rights issues among senior and line management. Some companies also emphasized that the voluntary nature of the Principles–which at least one company credited with fostering broader management acceptance–had also stimulated information exchange between companies.
Companies also identified four main weaknesses of the Voluntary Principles that became evident during the implementation process:
- The Voluntary Principles suffer from a lack of clarity and vague language: The Principles were frequently criticized for using vague language and for a general lack of clarity, which often results in confusion among operations-level staff.
For example, some companies are uncertain about how best to involve host nations in security arrangements, particularly in countries lacking capacity and where companies perceive that they have limited opportunities to have influence. Some companies noted that they would welcome specific tools and implementation guidelines on how best to engage governments. One company has specifically asked for more guidance in implementing the Principles in medium-risk countries where there may be some human rights issues, but local law enforcement are reasonably well established.
One company acknowledged that engaging host governments has been particularly difficult to implement but suggested some steps for helping to build relationships with state forces and heighten awareness: (1) include the Voluntary Principles in government agreements and in contractual agreements with local police; and (2) engage in human rights and humanitarian law training with state forces through a third party, and in a transparent manner.
- The Voluntary Principles are difficult to monitor and audit and, thus, the process risks being perceived as lacking transparency: There was acknowledgement that some form of independent verification is needed to ensure that companies and institutions actually put the Voluntary Principles into practice and that, to foster greater transparency, their progress should be publicly reported. There is a concern that one bad actor could potentially tarnish the image of the entire process. In the words of one company executive interviewed: “The good name is fast losing currency because of this lack of transparency.”
Another company shared two review strategies that it has found to be successful in addressing this challenge. The first is a peer review, whereby a security manager from one country visits a security manager in another region to exchange best practices. The second involves an external review by a human rights lawyer, who conducts an audit of the company's security management that incorporates feedback from human rights NGOs. These external reviews, which are made publicly available to NGOs and others, have proved to be very helpful for the company in identifying areas for improvement. The company has also extended offers to a few international human rights NGOs to visit operations and review security arrangements first hand. The guiding principle behind this external review process is that the company “would rather see problems early than see them erupt later through allegations.”
Another company also mentioned coordinating site visits with international NGOs interested in reviewing security arrangements first hand. The company noted that although they have received several requests for such visits over the last few years, not all requests have been met because of the highly political and unstable nature of conflict zones in which they operate. Likewise, host governments have expressed concern that NGO visits be used as an opportunity to assess the country's human rights situation.
- The Voluntary Principles are perceived by some members as exclusive: One company official suggested that the current governance structure of the Principles is a significant weakness and that they may be perceived to be an exclusive “club” by those not involved in the process. Some companies that have been excluded from the Voluntary Principles process have nevertheless unofficially adopted Voluntary Principles and have also created internal systems for implementation. Some members consider it a lost opportunity not to engage such companies in sharing best practices and addressing challenges more collectively. Others suggested that perhaps the Voluntary Principles process should not only seek to be more inclusive within the energy and extractives industries, but also should consider expanding membership to include relevant services companies—such as engineering and construction firms— that serve the extractives sector, or even companies in other sectors, such as food and agriculture, that may face similar security and human rights challenges.
While the voluntary nature of the Principles was generally seen as a strength in that companies can apply the Principles in ways that best fit their business cultures and operating environments, some companies also considered it a weakness. In addition, external parties—in particular host governments–may not recognize the Voluntary Principles or might view company implementation efforts as a criticism of public security forces. Also, conducting trainings in culturally diverse settings where it is difficult to explain what the Voluntary Principles are and how they are applied was identified as another challenge. A few companies also argued that the Voluntary Principles concentrate solely on relationships with public and private security and do not take relationships with communities into account. These companies believe that the security of local communities should also be addressed in the Voluntary Principles, and not just that of company assets.
Measuable Impacts
It is difficult and, in many cases, too early to measure the impacts of implementing the Voluntary Principles; however, greater recognition of the Principles themselves is seen as valuable: A few companies reported early “wins,” such as improved practices related to the use of force, improved communication with authorities and a directional move to employ internal security trained to Voluntary Principles standards. The most common impact identified by company staff has been a shift in company culture. Many have noticed a greater awareness among staff of the human rights risks faced by their companies and their operations, and an understanding of the need for improved management of these risks. One company executive stated, “When an incident comes up, the Principles are the first thing to cross managers' minds.” Another company noted that the Voluntary Principles has allowed for an increased ability to more quickly reach an alignment of policies and expectation with joint-venture partners, specifically with regard to security and human rights.
One company credits its engagement efforts with the adoption in Turkey of a new legislation regulating private security. Under the new legal system, obligatory training (including a human rights component) for security personnel has been implemented, with a certificate of attestation now required for employment. Furthermore, the law has established increased standards for human rights that allow private security companies to provide armed guards in a manner that is in keeping with the spirit of the Voluntary Principles.
Company Advice
Secure support from CEO and Executive Management: Top-down support from executive officers is important, indeed necessary, for the Principles to receive the attention and support they deserve at the operations level. Successful implementation is better ensured when written policy is transformed into specific guidance at the operations level.
Employ a multi-stakeholder approach to implementation: A number of companies emphasized the point that implementation— from risk assessment to engaging host governments— is best achieved by way of a multi-stakeholder approach that involves companies, NGOs, and home and host governments. Companies that have raised the issue of the Voluntary Principles with host governments emphasized the need to do so concurrently and in concert with home governments and NGOs. Additionally, while many companies are prepared to implement the Principles independently of other companies, there is a desire among some to implement them jointly with other companies to encourage broader implementation, harmonization and to stimulate exchange on best practices.
Embrace the Principles as a core value: Many companies suggested that the Voluntary Principles must become an integral part of how the company manages its business — that is, the Principles must become a core part of its management process and must be regularly assessed to ensure compliance and continual improvement. Additionally, companies must integrate the Voluntary Principles with existing processes, trainings, management systems and implementation tools to make them useful for operational staff at specific sites. Operation-specific guidance and case-by-case evaluation are crucial for implementation at the site level.
Share best practices internally and externally: Many companies noted the importance of sharing best practices within their companies and among their peers. Developing a formal information exchange process is crucial to ensure that security managers employ the most effective guidelines and tools for implementing the Voluntary Principles company-wide. Additionally, sharing best practices externally is an important step toward collectively addressing implementation challenges. Moreover, companies that are new to the Voluntary Principles process will greatly benefit from the wisdom and experience of those companies that have been part of the process for some time.
Link security with community relations: Security and community relations are two closely aligned topic areas that should be addressed within a holistic management framework. Community relations efforts are just as important to protecting assets as security efforts, and should be treated as such. A company’s community relations department can effectively engage community stakeholders to identify potential conflict and opportunities for non-violent resolution, as well as communicate important security-related information to the community.
Perceived Challenges
Engaging Host National Governments
Most companies have had limited, if any, experience in engaging directly with host governments on the Voluntary Principles: However, companies that have engaged host governments report encountering few significant challenges. The challenges that were identified include: operating within weak political systems where, for example, politicians may attempt to turn a company's transparency on human rights issues into political currency, and a lack of capacity for governments to adequately train security forces or take appropriate actions as prescribed by the Voluntary Principles. One company that has not yet engaged its host government specifically on the Voluntary Principles has begun a more general conversation regarding key issues such as corruption and community relation as a means of first assessing the government’s experiences and challenges addressing sensitive issues prior to discussing the Voluntary Principles. Another company noted that is much easier to engage host governments in a more general way that includes the Voluntary Principles, rather than focusing the engagement specifically on the Voluntary Principles.
One company highlighted that the variation of cultural, legal and political approaches to human rights has added additional challenges to implementing the Principles: As one executive we spoke with noted, while most countries have ratified the Universal Declaration of Human Rights, how the covenant is codified into national or local laws, interpreted and implemented may vary greatly by country. Furthermore, implementing the Principles may be further complicated by the organizational interactions between internal host country governments at the federal, regional and/or local levels. Many companies reported that they would like their home governments to play a more active role in engaging with and building the capacity of host governments. A few companies would also support NGOs acting as facilitators of host government engagement.
Engaging NGOs
A significant number of companies have had limited engagement with NGOs regarding implementation of the Principles: One company specifically stated that implementation of the Voluntary Principles is a shared effort, and NGOs should be more involved in the implementation process, particularly with engaging host governments on transparency issues. However, another company noted that human rights NGOs have limited resources, and therefore tend to focus their efforts in regions where they have the most material impact, which may or may not overlap with the regions where a specific company is operating.
Some companies do formally engage with a number of international NGOs, including many NGO members of the Voluntary Principles. One company also annually convenes international NGOs to discuss a variety of issues of common concern, including human rights and security. Another company regularly engages with local NGOs at the country level. An official at a different company noted the difficulties associated with engaging local NGOs, such as identifying appropriate local interlocutors and forums in which such engagement can take place.
In addition, a few companies believe that NGOs are reluctant to engage constructively on the Voluntary Principles. There is a perception that some NGOs may be afraid of damaging their reputation by engaging with corporations and that others will exploit increased publicly available information on human rights incidents— the result of greater transparency efforts by companies— to advance an anti-corporate agenda.
Engaging Internal Company Departments
Engaging internal company departments has been a smooth process for most companies especially where senior executives engaged early: Many companies reported that they found success by beginning the process of internal engagement at a high level within the company and securing buy-in from senior executives before engaging broadly across departments. One company relied on “champions” within each country to secure downstream endorsement, while another company formed an internal, cross-functional Voluntary Principles working group tasked with mapping an implementation strategy.
Human rights have been interpreted differently across business units and diverse, global workforces: Among other challenges, companies note a tendency for some departments to assume that human rights issues do not apply to their function. Diverse workforces with different cultures, languages and politics may also interpret human rights differently from one region to another. Training and “mission overload” — i.e., implementing several EHS and/or social responsibility initiatives in a short period of time — were identified as other challenges that may make it difficult to provide operational personnel with clear and concise guidance that does not result in overwhelming time burdens. One company reported a need to develop more effective communication and training material to better integrate the Voluntary Principles into their standards and guidelines. Another company noted that the language of the Voluntary Principles has been easily inserted in the company policies and procedures, thereby signaling commitment; however, the Voluntary Principles need more unbundling for company personnel to truly understand what is expected of them.
Engaging Home Country Governments
Many companies acknowledged a high level of support from home country governments, particularly those headquartered in the U.S.: While engaging home country governments has not been a problem for most companies, a few companies identified the need for home country governments to better fulfill their responsibilities associated with the Voluntary Principles, such as providing a diplomatic channel for engaging host governments and working more closely with host governments on capacity-building measures.
Legal Issues
Companies did not identify any significant legal issues arising during implementation, and many noted that their legal departments have been consulted regularly throughout the implementation process.