Original HRC document


Document Type: Final Report

Date: 2018 May

Session: 38th Regular Session (2018 Jun)

Agenda Item: Item3: Promotion and protection of all human rights, civil, political, economic, social and cultural rights, including the right to development



Human Rights Council Thirty-eighth session

18 June–6 July 2018

Agenda item 3

Promotion and protection of all human rights, civil,

political, economic, social and cultural rights,

including the right to development

Report of the Working Group on the issue of human rights and transnational corporations and other business enterprises

Note by the Secretariat

The present report, prepared pursuant to Council resolutions 17/4 and 35/7,

examines the duty of States to protect against human rights abuses by business enterprises

to whom they provide support for trade and investment promotion. It explores how States

can incentivize business respect for human rights in this context, including through

withdrawal of trade and investment support in situations where businesses fail to meet their

corporate responsibility to respect human rights.

United Nations A/HRC/38/48



I. Introduction ................................................................................................................................... 3

A. Background, focus and rationale of the report ...................................................................... 3

B. Definition and objectives ...................................................................................................... 4

II. Trade and export promotion .......................................................................................................... 4

A. Respect for human rights as a requirement and condition of State support .......................... 4

B. Trade missions ...................................................................................................................... 5

C. Trade advocacy ..................................................................................................................... 6

D. Training and guidance for trade and embassy personnel and for businesses ........................ 7

III. Role of export credit agencies ....................................................................................................... 8

A. Examples of good practices among export credit agencies................................................... 13

B. Gaps in the OECD Common Approaches............................................................................. 14

C. Moving beyond the OECD export credit agencies ............................................................... 15

D. Export credit agencies and access to remedy ........................................................................ 16

E. Relationship between the human rights record of a company and future support

by the State ........................................................................................................................... 16

IV. Import and export restrictions to prevent trade in goods with links to human rights abuses ......... 17

V. Conclusions and recommendations ............................................................................................... 18

A. Conclusions .......................................................................................................................... 18

B. Recommendations ................................................................................................................. 19

I. Introduction

A. Background, focus and rationale of the report

1. The starting point for the present discussion is the Guiding Principles on Business

and Human Rights: Implementing the United Nations “Protect, Respect and Remedy”

Framework. Since their unanimous endorsement by the Human Rights Council in 2011, the

Guiding Principles have become the authoritative global reference for preventing and

addressing adverse human rights impacts arising from business-related activity.

2. In an earlier report, the Working Group examined how States — pursuant to pillar I

of the Guiding Principles, the State duty to protect — should lead by example as economic

actors by ensuring that State-owned enterprises respect human rights (A/HRC/32/45). The

present report focuses on another area where States play an important role as economic

actors: trade promotion, also referred to as economic or commercial diplomacy.

3. States act as gatekeepers when they provide much needed support to businesses by

providing trade finance and advisory services aimed at expanding export opportunities. As

gatekeepers, States can use their leverage to promote a race to the top by setting out clearly

the expectation that businesses respect human rights as a precondition for receiving

government support for export activities. States can also promote responsible imports by

restricting the flow of goods in supply chains that involve serious human rights abuses.

4. Why should States focus on human rights and the role of business in relation to

human rights in the context of trade and investment promotion? The short answer is that

global supply chains in cross-border trade present significant human rights risks and

challenges. In the export context, sellers of products in global markets need to ensure that

the products they are selling will not cause, contribute or be directly linked to adverse

human rights impacts. In the context of imports, a buyer of goods in the global marketplace

also needs to ensure that the goods it is purchasing were not produced or manufactured in a

way that caused, contributed to or was directly linked to adverse human rights impacts,

such as forced labour or human trafficking.

5. While there is a much larger connection between the global trading system and

adverse human rights impacts, the present report focuses solely on the role States play as

service providers and public financiers, insurers and guarantors to companies seeking

support for export/import transactions. The report does not address issues of global trade

rules or the role of trade treaties and multilateral trade organizations with respect to adverse

business-related human rights impacts.

6. In the present report, the Working Group unpacks Guiding Principle 4, which sets

forth the expectation that States should take additional steps to protect against human rights

abuses by business enterprises that receive substantial support and services from State

agencies including, where appropriate, by requiring human rights due diligence. The

commentary to Guiding Principle 4 indicates that if State agencies do not explicitly

consider the actual and potential adverse impacts on human rights of beneficiary

enterprises, they put themselves at risk and may add to the human rights challenges faced

by the recipient State.

7. Furthermore, in general comment No. 24 (2017) on State obligations under the

International Covenant on Economic, Social and Cultural Rights, the Committee on

Economic, Social and Cultural Rights calls on States to revise relevant tax codes, public

procurement contracts and export credits, and other forms of State support, privileges and

advantages in the case of human rights violations, thus aligning business incentives with

human rights responsibilities. In 2017, the leaders of the Group of 20 also recognized the

connection between human rights and trade when they referred to the Guiding Principles in

a call for more sustainable supply chains.1

1 See “G20 Leaders’ declaration: shaping an interconnected world” (July 2017).

8. For the present report, the Working Group solicited input from all stakeholders,

including States, and from the Export Credit Group of the Organization for Economic

Cooperation and Development (OECD) and its separate working group of environmental

and social practitioners, which includes representatives of non-OECD States as well.

Consultations also included an open consultation in Geneva in September 2017 and a

dedicated session at the 2017 Forum on Business and Human Rights.2

B. Definition and objectives

9. States provide a wide range of services for businesses engaged in trade and export.

Those services include selecting companies for participation in trade missions, export

promotion and marketing for companies through trade and commercial officers in

embassies overseas, advocacy by senior government officials of companies who are

bidding on major overseas projects, political risk insurance, guarantees and support at

major trade shows. The present report refers to such trade promotion activities by public

actors as “commercial” or “economic” diplomacy.

10. There are innovative models being deployed in some States, but the promise of

Guiding Principle 4 remains mostly unfulfilled. In the report, the Working Group explores

opportunities for States to take the lead and promote greater respect for human rights. As

noted in the report, in related areas such as combating corruption and business integrity,

models exist in trade and investment promotion that could be adapted to encompass

business respect for human rights. While anti-corruption commitments may be linked to

State commitments via international treaties (for example, the United Nations Convention

against Corruption), the principle is still a useful one: that by embedding a requirement into

a contract between trade promotion agencies and companies, if there is a breach of such an

agreement, that would be a basis for further action, such as the withdrawal of future trade

support or other government services.

11. The first objective of the report is to understand how States can use their leverage

with respect to trade and investment promotion and the export/import process to also

promote greater corporate respect for human rights. The second objective is to explore

where, pursuant to the State duty to protect against business-related human rights impacts,

there are opportunities for States to require businesses with whom they interact, to align

their activities with the Guiding Principles through the requirements of human rights due

diligence and addressing issues relating to access to effective remedy.

II. Trade and export promotion

A. Respect for human rights as a requirement and condition of State


12. Many States provide ongoing advisory services for companies seeking to export

their goods into foreign markets. Such services often reach small and medium-sized

enterprises, which may lack the in-house expertise and financial resources for individual

market research. To date, few States have asked businesses to demonstrate a commitment to

the Guiding Principles as a prerequisite for receiving services from State export promotion

entities. For those who have asked for human rights commitments, there have been no

studies to examine how well such commitments are monitored and implemented by States.

13. Canada has asked for specific commitments from the extractive sector. As part of

the country’s enhanced corporate social responsibility strategy, Canadian extractive

companies are expected to align their operations overseas with Canadian corporate social

responsibility guidelines and will be eligible for enhanced economic diplomacy only after

2 The following States responded to the Working Group’s survey: Costa Rica, Denmark, Finland,

France, Germany, Italy, Mexico, Mongolia, Namibia, Netherlands, Philippines, Portugal, Russian

Federation and United States of America.

doing so. Those commitments include adherence to the Guiding Principles and to the

OECD Guidelines for Multinational Enterprises.

14. Chile notes in its National Action Plan on business and human rights that it intends

to establish, if relevant, requirements about sustainability and respect for human rights, as

criteria to choose business enterprises to participate in programmes to promote exports and

corporate activities. 3 The Ministry of Commerce, Industry and Tourism in Colombia

intends to link access to trade and investment support to business commitments to respect

human rights.4 The Danish Ministry of Foreign Affairs requires Danish companies with

which it interacts to comply with a code of conduct. That includes requirements not to

practise discrimination, not to use child labour and to recognize workers’ rights.5

15. The South African Department of Trade and Industry has developed guidelines for

good business practice by South African companies operating in the rest of Africa, setting

out the expectation that companies will respect human rights and adhere to the principles of

the United Nations Global Compact.6 While the guidelines are voluntary, they demonstrate

how a State can tie responsible business conduct to an export promotion and trade agenda.

16. Asking companies to demonstrate a commitment to ethical standards is not new.

States have often required businesses to make anti-corruption pledges as a condition of

trade-related support. As part of the 2017 G20 process, the Business-20 (B20) issued a

policy paper on responsible business conduct and combating corruption, noting that: “An

adequate and robust compliance program should also be a requirement for officially

supported export credits and trade insurances.”7

17. For example, the Kenya Export Promotion Council has an anti-corruption policy

which includes enhanced due diligence of its potential local export partners.8 Austrade,

Australia’s trade promotion service requires companies to certify ethical business practices

as part of their terms of service: “Your organization must be committed to maintaining

business ethics and legal obligations including anti-bribery laws in Australia and

overseas.”9 Such processes could be expanded to require applicants to also demonstrate

commitments to the Guiding Principles and the OECD Guidelines alongside an anti-bribery

or business ethics pledge.

B. Trade missions

18. Trade missions are an important tool in export promotion and commercial

diplomacy. They allow potential exporters to learn how business is conducted in a foreign

market and to find potential overseas buyers. They are often facilitated by a State export

promotion agency or department and/or with the assistance of trade or commercial officers

located in embassies in the country that the delegation will visit. High-level government

officials may also head a trade mission delegation.

19. The Council of Europe recommendation on human rights and business discusses

trade missions. It notes that “Member States should, when business enterprises … are

represented in a trade mission to member States and third countries, address and discuss

3 See www.ohchr.org/EN/Issues/Business/Pages/NationalActionPlans.aspx.

4 See “National Action Plan on human rights and business”, available at www.ohchr.org/EN/Issues/Business/Pages/NationalActionPlans.aspx.

5 Danish submission in response to the call for stakeholder inputs.

6 See, for example, www.rmi.org.za/guidelines-for-good-business-practice-by-south-african-


7 See B20 Cross-thematic Group on Business Conduct and Anti-corruption, “Promoting integrity by

creating opportunities for responsible businesses”.

8 Kenya Export Promotion Council, “Revised anti-corruption policy” (2011).

9 See www.austrade.gov.au/Australian/How-Austrade-can-help/Trade-services/Opportunties-terms-


possible adverse effects future operations might have on the human rights situation in those

countries and require participating companies to respect the UN Guiding Principles …”.10

20. Only a handful of States have sought to integrate human rights issues into official

trade missions. The United Kingdom of Great Britain and Northern Ireland did so in

relation to Myanmar. Finland involved human rights civil society organizations in a joint

trade mission led by its trade and development ministers to the United Republic of

Tanzania and Zambia.11 In its recent National Action Plan, Ireland committed to advising

companies who will participate in trade missions about human rights in destination

countries and providing information about its laws prohibiting foreign bribery.12 Belgium

will also ensure that the trade missions it organizes include awareness-raising regarding

respect for human rights.13

21. The Netherlands now has a routine requirement for all trade missions to brief

businesses on human rights issues. It takes one more step in selecting mission participants.

Dutch companies that wish to participate in government-sponsored trade missions must

demonstrate a commitment to the OECD Guidelines for Multinational Enterprises, with an

emphasis on human rights risk analysis. The Government verifies to what extent the

business is aware of the Guidelines and, shortly before departing on a trade mission, the

business is provided with training on standards of responsible business conduct.14

22. Trade missions provide unique opportunities for States to raise awareness of

business and human rights dilemmas related to the market they are visiting.15 For example,

in countries where attacks on human rights defenders are a significant risk, that should be

raised in the context of trade missions. Civil society organizations have suggested to the

Working Group that this may be a particularly useful avenue for addressing the risks faced

by defenders when there is a link to businesses receiving trade or investment support from

their home Government.16

23. States already vet companies that participate in foreign trade missions to ensure they

meet certain criteria. The United States of America, for example, screens applicants for

trade mission for bribery concerns and also asks them to sign a no-bribery pledge as a

precondition to participation. 17 States should consider developing similar procedures

whereby companies are asked to demonstrate a commitment to the Guiding Principles and

responsible business conduct as a precondition to participation in a mission. The Dutch

example appears to be the only model that uses vetting for human rights as a precondition

for mission selection.

C. Trade advocacy

24. Trade advocacy support is characterized as those activities for which embassy

personnel and high-ranking government officials will advocate on behalf of domestic

companies with foreign public officials. The purpose of such advocacy is to highlight the

strengths of a national company when it is competing against companies from other

countries for a government contract in a foreign market.

10 Council of Europe, “Human rights and business” (recommendation CM/Rec(2016)3 of the Council of


11 Institute for Human Rights and Business, “State of play. Human rights in the political economy of

States: avenues for application” (March 2014).

12 See “National Plan on business and human rights 2017–2020”, available from


13 Belgian National Action Plan available from https://globalnaps.org/country/belgium./

14 OECD, “Responsible business conduct and economic diplomacy tools” (June 2017).

15 Institute for Human Rights and Business, “State of play”.

16 See consultation summary note on scaling up initiatives to protect human rights defenders, (November 2017), available from www.ohchr.org/Documents/Issues/Business/


17 See, for example, United States Government Publishing Office conditions for trade missions,

available from www.gpo.gov/fdsys/granule/FR-2017-08-01/2017-16082.

25. Having a senior minister advocate for a company is a substantial benefit. States

should only advocate for companies that respect human rights and screen requests to make

that determination.

26. The Working Group has not received any information about States requiring

companies for whom they advocate to demonstrate respect for human rights or further

adoption of the Guiding Principles. As noted above, what some States have done is to

require companies to make commitments focused on integrity and combating corruption.

27. In Canada trade advocacy may include providing support to a company in

interactions with foreign public officials and in certain circumstances in the public sphere

generally. This may also include making representations on behalf of the company to

foreign public officials, accompanying clients to meetings with foreign public officials, or

supporting and/or participating in, events tailored to a particular company. The Government

of Canada requires companies seeking such support from its Trade Commissioner Service

to sign an integrity declaration. A company must attest that it understands the ethical

expectations of Canada and has not been “charged, convicted or sanctioned for bribery or

corruption, and will not engage in such illegal activities”. 18 If a company has been

sanctioned for bribery, it must disclose past misconduct, which may affect the support it

receives from the Government of Canada.

28. The United States International Trade Administration also has an advocacy centre. A

company interested in receiving United States advocacy assistance must first file an

advocacy questionnaire and anti-bribery agreement with the advocacy centre. The anti-

bribery agreement requires a company to certify that neither the company nor its affiliates

will engage in bribery of foreign officials.19

D. Training and guidance for trade and embassy personnel and for


29. OECD has noted in relation to the promotion of responsible business conduct that

“for some countries, the NAPs have provided an impetus to step up specific training and

capacity building of diplomatic personnel”.20

30. There is still room for greater training and education of trade officers within national

export promotion agencies and of those officials working within embassies or missions in

host States.21 However, at present this need is not matched by relevant guidance.

31. Existing guidance (for example from the International Trade Centre) mentions the

need to train trade representatives on issues relating to combating corruption and fleetingly

mentions social compliance and corporate social responsibility as other issues of which

trade representatives should be aware, but does not elaborate further on the subject. A trade

promotion officer may not feel comfortable providing guidance to companies on human

rights risks. The language of risk mitigation in the Guiding Principles and the framework of

human rights due diligence therefore provide a useful framework for speaking about the

processes companies need to undertake to respect human rights.

32. Germany intends to provide training on its National Action Plan and the Guiding

Principles for trade officers in embassies and consulates. The training will enable trade

officers to provide support to German companies that wish to exercise human rights due

diligence in the respective host countries. Staff members of German export and investment

18 See http://tradecommissioner.gc.ca/how-tcs-can-help-comment-sdc-peut-aider.aspx?lang=eng.

19 See https://2016.export.gov/advocacy/eg_main_092202.asp.

20 See OECD, “Responsible business conduct and economic diplomacy tools.

21 International Trade Centre, Entering New Markets. A Guide for Foreign Trade Representatives


guarantee agencies are offered classroom training on the Plan and environmental and social

specialists act as a helpdesk.22

33. In addition to training trade officials, some States are providing tools for their

officials as well as for companies.

34. The Belgian National Action Plan briefly mentions that diplomats do not always

have the necessary tools or knowledge of human rights and business in particular, to inform

and guide companies to ensure that their extraterritorial activities take account of their

impact on human rights. As a result, Belgian trade representatives will receive a toolbox to

better inform companies that seek to export. The toolbox will include elements on

grievance mechanisms enabling the Belgian diplomatic network to better inform businesses

and victims of possible business-related abuses about access to remedy in Belgium. The

United Kingdom has developed a government business and human rights toolkit, which

aims to give guidance to political, economic, commercial and development officers in

embassies as to how to promote responsible business conduct by British companies

operating overseas.23

35. Some training for companies is done via partnerships between States. Sweden has

entered into memorandums of understanding with certain countries on corporate social

responsibility. For example, there are two memorandums between China and Sweden,

including an action plan establishing a centre for corporate social responsibility at the

Swedish Embassy in Beijing. Among other activities, the centre provides training for

companies. 24 Chile and Sweden signed a memorandum of understanding on corporate

social responsibility in 2012. India and China have a partnership agreement to promote

trade and investment, which includes a commitment to fostering stronger cooperation

between national chambers of commerce and encourages companies in both States to

include corporate social responsibility in their corporate development strategies.25

36. China has also focused on providing sectoral guidance to its companies. The 2014

guidelines for social responsibility in outbound mining investment produced by the China

Chamber of Commerce of Metals, Minerals and Chemical Importers and Exporters call for

Chinese mining companies undertaking outbound mining investments, cooperation and

trade to strictly observe the Guiding Principles during the entire life-cycle of the mining

project and to strengthen responsibility throughout the extractive industries value chain.

37. The increasing number of States that are including training and educational

resources on corporate social responsibility and on business and human rights for both trade

and embassy personnel and companies operating or trading abroad is a positive step.

Training and counselling help to raise awareness of key human rights issues in the private

sector. States need to consider how to move such training beyond theory into actual

practice. To that extent, training needs to include discussions of real-world dilemmas that

occur to enable trade officers to start thinking critically about the advisory role they play

with companies. At the same time, training and education is at most a partial step towards

States fulfilling their duty under Guiding Principle 4. Few States link providing trade

promotion services or benefits, such as participation in a trade mission, to requiring

businesses to demonstrate respect for human rights and use of the Guiding Principles.

III. Role of export credit agencies

38. Export credit is a tool used by Governments to provide trade finance to the private

sector. Under an export credit regime, States provide loans and other types of risk cover

(for example, insurance) for a domestic exporter’s international buyers. Providing financing

22 National Action Plan. Implementation of the UN Guiding Principles on Business and Human Rights

2016–2020, available from https://globalnaps.org/country/germany/.

23 See OECD, “Responsible business conduct and economic diplomacy tools”.

24 See, for example, http://csr2.mofcom.gov.cn/article/media/201709/20170902652354.shtml.

25 See Five-Year Development Program for Economic and Trade Cooperation between the People’s

Republic of China and the Republic of India (September 2014).

to potential buyers offers an incentive to foreign buyers to choose an exporter. Insurance

and guarantees reduce the risk to the domestic exporter of non-payment by the overseas


39. In practical terms, export credit agencies provide three main instruments to support

domestic exporters (a) insurance, (b) short-, medium- and long-term export credits and (c)

guarantees, often coupled with advisory services (market information).26

40. There are various models of export credit agency including:

(a) Those which are State agencies or departments;

(b) Government-owned State corporations that are operated independently

but have government oversight;

(c) Consortiums of public/private companies that may be controlled by a

Government through funding or regulation.27

41. Export credit agencies fulfil the basic financial needs of exporters, including pre-

export working capital to short-term credit extended to importers; medium- to long-term

financing support to overseas importers; and project financing and/or special export

structures. Although their share of the overall financing of global trade remains small, they

play an increasingly important role. 28 In 2015 alone, export credit agencies in OECD

member nations provided $125 billion in credit, insurance, guarantees and interest

support.29 In the period 2012–2016, public export and investment insurance via export

credit agencies totalled between $920 billion and $1.031 trillion. 30 They are also a

significant source of public financial support for infrastructure projects in developing

countries. While their mandate and objectives are commercial, they may produce positive

impacts in developing countries, such as the creation of more and better jobs, or the

provision of capital and climate finance in or to developing countries.31

42. Although export credit agencies support domestic exporters, they do so typically by

providing financing for a project sponsor who is purchasing goods as part of a larger

infrastructure project or supply chain. A significant number of the projects supported by

export credit agencies, particularly large dams, oil pipelines, coal and nuclear power plants,

chemical facilities, mining projects and forestry and plantation projects, may lead to

adverse human rights impacts (A/66/271). Projects by export credit agencies have been

associated with the forced displacement of local populations, poor conditions of work,

suppression of the rights to freedom of expression and association and exposure to

environmental complaints, as well as the destruction of cultural sites. 32 Export credit

agencies have also been scrutinized by civil society for more systemic issues, such as the

nature of the projects and industries they finance (for example, the arms trade) or their

linkage to sovereign debt in developing countries.33

26 See Edna Shöne, Sustainable ECA business — an irreversible global trend, Global Policy Journal

blog (February 2015).

27 See Karyn Keenan, “Export credit agencies and the international law of human rights”, Halifax

Initiative (2008). Although export credit agencies take various organizational forms, they are usually

backed by a Government and operate in accordance with a government mandate.

28 Both Ends, “Balancing risks: what export credit agencies can do for sustainable development”

(January 2007).

29 See https://globalnaps.org/issue/export-credit/.

30 Berne Union aggregate statistics, 2016 year end, available from www.berneunion.org/DataReports.

31 See Trinomics, “Pilot study of private finance mobilised by Denmark for climate action in developing

countries” (2015).

32 See Jubilee Australia, “Risky business. Shining a light on Australia’s export credit agency”

(December 2009); ECA Watch, “Race to the bottom, take II” (September 2003); and Robert

McCorquodale and Penelope Simons, “Responsibility beyond borders: State responsibility for

extraterritorial violations by corporations of international human rights law”, Modern Law Review,

vol. 70, No. 4 (July 2007).

33 See European Network against Arms Trade, “European export credit agencies and the financing of

arms trade” (2007) and European Network on Debt and Development, “Exporting goods or exporting

debts? Export credit agencies and the roots of developing country debt” (December 2011).

43. Civil society groups have raised and continue to raise concerns about specific

projects financed by export credit agencies.34 The case of the Ilisu dam is often cited as an

example of a project which has had significant human rights impacts, such as population

resettlement and the destruction of cultural heritage. In 2005, a consortium applied for

export credit guarantees in Austria, Germany and Switzerland for the construction of a

hydroelectric dam. The respective export credit agencies offered their support based on 153

environmental and social commitments but the Governments of Austria, Germany and

Switzerland ultimately withdrew funding for the dam project. That followed independent

expert assessments, which concluded that the dam project was not meeting the agreed

standards, including in relation to social and environmental impacts. The lesson drawn from

the Ilisu project was that export credit agencies needed to put in place due diligence

processes and project monitoring. 35 More recently, in at least one instance, a national

contact point has noted that an agency may not have fully used its leverage or engaged in

the proper level of human rights due diligence as required under the OECD Guidelines.36

44. Other human rights impacts that arise outside of a traditional project finance context

may relate to the nature of goods being exported in a global supply chain. For example, in

information and communications technology an exporter may sell goods to a customer

(State or non-State) that will use the equipment for surveillance, leading to adverse impacts

on a person’s right to life, to arbitrary detention, torture and potential violations of other

civil and political rights.37

45. Given the connection between export credits and finance linked to adverse human

rights impacts, are there requirements in place that businesses who receive support in the

form of export credit respect human rights, conduct due diligence and align their operations

with the Guiding Principles? The answer is mixed, with only a subset of public or publicly

supervised/funded export credit agencies currently requiring some form of human rights

due diligence, and then only for a subset of transactions, typically with a term of two years

or longer.

46. One of the largest gaps in terms of export credit and alignment with the Guiding

Principles is that many public export credit agencies have no explicit focus on human rights

due diligence as part of their operations, either for their own decision-making or as a

requirement for their clients.

47. The largest export credit membership organization is the Berne Union, which is a

network of private and public entities. Its 85 members include government-backed export

credit agencies, private credit and political risk insurers and multilateral institutions which

provide insurance products, guarantees and, in some cases, direct financing in support of

cross-border trade. 38 The insurance products its members provide offer protection for

exporting companies, investors and financial institutions against losses as a result of buyer


48. At present, the Berne Union has no explicit mandate to address human rights or

social impacts as part of its activities, although its operating principles do refer to

34 See Export Credit Watch list of reports focusing on human rights concerns surrounding projects

financed by public export credit agencies, available from www.eca-watch.org/ecas/export-credit-

agencies; Amnesty International, “A history of neglect: UK export finance and human rights” (June

2013); Halifax Initiative and others, “Export credit agencies and human rights: failure to protect”


35 See Michael M. Cernea, “Population displacement and export credit”, Brookings Institution (December 2011). See also Christine Eberlein and others, “The Ilisu dam in Turkey and the role of

export credit agencies and NGO networks”, Water Alternatives, vol. 3, No. 2 (June 2010).

36 See www.oecdguidelines.nl/latest/news/2016/11/30/final-statement-both-ends-associacao-forum-


37 Institute for Human Rights and Business, “Telecommunications and human rights: an export credit

perspective” (February 2017).

38 See www.berneunion.org/Members.

sustainable growth, respect for the environment and operation with high ethical values.39

Within the Union, there is a committee of export credit agencies from emerging markets

known as the Prague Club Committee. The majority of members are from smaller markets

in Eastern and Central Europe, the Middle East, Central Asia and Africa.

49. In 2012, the United States and China agreed to discuss a set of new global guidelines

on export credits through a new international working group on export credits. The

International Working Group is led by China, Brazil, the United States and the European

Union as rotating chairs. It currently has 18 participants, including South Africa and the

Russian Federation. India is an observer in the process.40 Neither environmental nor social

impacts of export credit agency activities are currently on the agenda of the Working


50. Brazil, China, India, the Russian Federation and South Africa currently meet to

discuss export credit policies in the BRICS Forum.41 The principles of the Forum include a

commitment to supporting sustainable development, strong, balanced and inclusive growth,

financial stability, and a balanced combination of measures ensuring social and economic

development and protection of the environment, providing an opening for a discussion of

human rights. At present, the priority areas of cooperation do not include social risks or

human rights.

51. OECD is currently the main organization that has incorporated human rights into

export credit decision-making. The OECD Working Party on Export Credits and Credit

Guarantees (Export Credit Group) was established in 1963 to carry forward the work of

OECD on export credits, including working out common guiding principles, such as on

environmental and social issues. OECD has developed recommendations for export credit

agencies with respect to environmental and social due diligence, which are intended to

guide the work of the official export credit agencies of member States.

52. The Export Credit Group currently has 33 Members. Chile and Iceland do not

participate in the work of the Group as they do not have official support programmes in

place. Non-members such as Brazil, Romania and the Russian Federation regularly attend

Group events as invitees.42 There is a separate export credit arrangement, whereby a group

of OECD member and non-member States meet to develop common practices focusing on

price and terms of credit to ensure a level playing field.43

53. The Export Credits Group has negotiated several successive OECD instruments (the

Common Approaches) designed to provide a framework for export credit agencies when

addressing the potential environmental and social impacts of projects. The two most

relevant documents are the 2012 and 2016 revisions of the Common Approaches.44 In

undertaking work on environmental and social issues, the Group has been assisted, since

2004, by its practitioners’ group, consisting of the environmental and/or social experts from

export credit agencies who are responsible for undertaking due diligence and monitoring of

projects. The practitioners meet separately from the Export Credits Group several times a

year to discuss implementation of the Common Approaches.

54. The 2012 recommendation was the first instrument to mention human rights

reflecting the adoption of the Guiding Principles, which were referenced in its preamble,

asserting that “social impacts” encompassed relevant adverse project-related human rights

impacts and that such impacts included forced labour, child labour and life-threatening

39 See Berne Union value statement, available at www.sid.si/sites/www.sid.si/files/documents/splosni-

dokumenti/berne_union_value_statement_2004.pdf. Berne Union members discuss environmental

and social issues but have no publicly available guidelines or programmes.

40 See http://capexil.org/background-note-iwg-on-export-credit/.

41 See brics.itamaraty.gov.br/images/pdf/BRICSMOU.doc

42 Information provided by the OECD Export Credit Group secretariat.

43 The Participants Group is not an OECD body and does not, therefore report to the OECD Council, however it meets under the auspices of OECD with support from the OECD export credits secretariat.

44 See OECD Council recommendation on common approaches for officially supported export credits

and environmental and social due diligence, adopted by the Council in June 2012 and the revision

adopted in April 2016.

occupational health and safety situations. In the 2012 recommendation members were

asked to consider the issue of human rights, with the aim of reviewing how project-related

human rights impacts might be further addressed in future. There were, however, no

specific recommendations on human rights due diligence.

55. In 2016, the OECD Council approved a revised version of the Common Approaches.

In that document, there is an explicit statement to the effect that export credit agencies

should now screen all applications covered by the Common Approaches, according to

whether or not there might be a strong likelihood of severe project-related human rights

impacts occurring.45 Participating export credit agencies should then assess the potential

environmental and/or social risks in applications relating to all existing operations for

which their share is equal to or above SDR 10 million and all existing operations and

projects, irrespective of their share, where screening has identified a strong likelihood of

severe project-related human rights impacts occurring.

56. In screening an application, export credit agencies will then place the project into

category A, B or C, which imply a requirement for varying levels of environmental and

social review, including environmental and social impact assessments. In addition, where

screening has identified a strong likelihood of severe project-related human rights impacts

occurring, the environmental and social review of a project may need to be complemented

by specific human rights due diligence.

57. A footnote to the 2016 recommendation provides examples of severe project-related

impacts. For example, impacts that are particularly grave in nature (threats to life, child or

forced labour and human trafficking), widespread in scope (large-scale resettlement and

working conditions across a sector), cannot be remediated (torture, loss of health and

destruction of the land of indigenous peoples) or are related to the operating context of the

project in question (conflict and post-conflict situations).

58. Specific methods for human rights due diligence are left to the discretion of

individual export credit agencies. Moreover, the due diligence approach described above is

only applicable to applications covered by the Common Approaches and therefore excludes

transactions, such as short-term credit under two years, working capital, support for bonds

and transactions that may be considered outside the current definition of “project”, such as

mobile equipment (for example, ships) and communications equipment. The 2016

recommendation allows for projects backed by an export credit agency to be benchmarked

against the World Bank environmental and social safeguard policies or the International

Finance Corporation (IFC) Environmental and Social Performance Standards, depending on

the financial structure of the transactions. Some export credit agencies have decided to

benchmark all projects against the IFC Performance Standards, but again practice is


59. For export credit agencies, the OECD Guidelines should also serve as a key tool

alongside the Guiding Principles. The Guidelines state that the ownership structure of a

multinational enterprise (whether public or private) does not change their applicability. The

Guidelines, which incorporate a human rights chapter aligned with the Guiding Principles,

require export credit agencies, which are business entities themselves, to engage in

appropriate human rights due diligence with respect to their business relationships and to

the extent that they are representatives of the State or public entities, to use their leverage to

require their business partners and clients to do the same.

60. A recent decision by the Dutch National Contact Point clarifies the status of export

credit agencies. In June 2015, the national contact point system received a complaint

alleging that Dutch export credit agency, Atradius DSB had failed to comply with the

OECD Guidelines in the context of its financing of a dredging project in north-eastern

Brazil, which had resulted in severe human rights and environmental impacts. The

complaint against Atradius stated that it had failed to ensure that the Guiding Principles and

the IFC Performance Standards had been effectively applied to the project. In its initial

assessment, accepting the complaint of 3 December 2015, the Dutch National Contact Point

45 Para. 6.

found that Atradius qualified as a multinational enterprise under the Guidelines and

concluded that the specific instance merited further consideration.46

A. Examples of good practices among export credit agencies

61. The environmental and social practitioners group associated with the OECD Export

Credit Group include representatives of countries which are not OECD members, such as

Brazil, Kazakhstan, the Russian Federation and others. The fact that a wide range of

publicly-backed export credit agencies from both member and non-member OECD

countries take part in the meetings of the group is a positive step in terms of peer learning

and development of good practice. It appears, however that even within the OECD group,

export credit agencies are still in the early phases of developing good practice. It is

important for them to share their good practices more widely, as evolving public

expectations continue to shine a spotlight on the critical role they play in the business and

human rights arena.47

62. The Norwegian Export Credit Guarantee Agency was one of the first to incorporate

human rights due diligence into their screening procedures. The Agency indicates that its

environmental and human rights due diligence procedure is based on the OECD Common

Approaches and the Guiding Principles.48 Although the Agency uses the IFC Performance

Standards, it states that in order to address any potential gaps in practice, its due diligence

process will take into consideration all internationally recognized human rights in a manner

that is consistent with the Guiding Principles.49 The Agency is also unique in describing

how it understands and intends to use its leverage to advance respect for human rights in its

clients’ operations.

63. In the Netherlands, Atradius goes beyond the Common Approaches in conducting

human rights due diligence if there is a risk of severe human rights impacts in smaller or

shorter-term transactions. It recognizes that the most severe risks to stakeholders may occur

in any transaction, unrelated to the duration of cover, the amount of a transaction, or the

fact that the policy covers a mobile asset. Atradius was also the first export credit agency to

make public a gap analysis, in which it examined its policies and procedures against the

Guiding Principles.

64. The Swedish export credit system has developed specific policies and portals that

address human rights impacts in the telecommunications sector and make reference to

freedom online in documents providing them with annual appropriations. 50 Swedish

policies regarding telecommunications provide an interesting model because they focus on

a series of impacts that may not be captured by the IFC Performance Standards, which

focus on large-scale projects. The development of sector specific guidance is a welcome

addition to the export credit area.

65. Even within the OECD Export Credit Group, good practice is still emerging. As a

point of comparison, a number of export credit agencies require companies seeking export

finance support to make anti-bribery commitments. This includes non-OECD agencies that

are parties to the OECD Convention on Combating Bribery of Foreign Public Officials in

International Business Transactions and have taken this step to implement the relevant


46 Relevant documents are available from https://www.oecdwatch.org/cases/Case_365.

47 See Chair of the OECD working party on responsible business conduct, Roel Nieuwenkamp, on the

role of export credit agencies, available from www.permanentrepresentations.nl/



48 Environmental and human rights policy, available from www.giek.no/responsible-business-


49 Ibid. 50 Institute for Human Rights and Business, “Telecommunications and human rights: an export credit


66. According to an OECD study, 44 export credit agencies require exporters and/or

applicants to provide an undertaking/declaration that neither they nor anyone acting on their

behalf, such as agents, have been engaged in or will engage in bribery in the course of the

transaction. They include the Russian Federation, which exceeds standard expectations by

using multiple channels of communication regarding the requirement for an anti-bribery

undertaking/declaration. The Russian export credit agency obtains an

undertaking/declaration through both the application forms and stand-alone documents.

Brazil similarly uses stand-alone documents submitted by the exporter or applicant.

B. Gaps in the OECD Common Approaches

67. As noted above, a large number of non-OECD States do coordinate on export credit

policies but have yet to do so on social issues and human rights. Thus the 2016

recommendation on Common Approaches is currently the key document, which sets out

good practice for export credit agencies. As noted above, some non-OECD States take part

in meetings of the environmental and social practitioners, with an eye to aligning their

processes with the Common Approaches.

68. As the Common Approaches only apply to exports for medium- and long-term

export credits with a repayment term of two years or more, a variety of export credit

financing, insurance and guarantees provided by export credit agencies are not subject to

their application. As noted above, there are examples of export credit agencies applying the

Common Approaches and hence human rights due diligence across all their product lines,

as in the case of the Dutch, but this is still an exception. A key issue is therefore how to

extend the role of human rights due diligence across a broader spectrum of products and


69. A second issue is which criteria are applied when human rights due diligence is

conducted. The Common Approaches default to the IFC Performance Standards, which are

not identical to the Guiding Principles. Again, as noted above, some export credit agencies

have supplemented their due diligence processes when they needed to address other human

rights scenarios, as was the case with Sweden in the telecommunications sector.

70. The Dutch National Contact Point indicated that for Atradius there needed to be a

clearer explanation of the gaps in alignment between the Guiding Principles and the

Common Approaches. For example, the scope of human rights due diligence is not limited

under the Guiding Principles, whereas the Common Approaches apply only to transactions

longer than two years.51

71. Another area where improvement is needed relates to the transparency of decision-

making at export credit agencies. Civil society groups have been critical of them because

they do not share the results of their screening with civil society, affected communities and

other stakeholders. A recent study of seven Central and Eastern European export credit

agencies, also pointed out that greater transparency was needed.52

72. The Common Approaches address the disclosure of information. They include

recommendations for public information disclosure as follows: (a) limited project

information, including environmental and social impact information, in the case of category

A projects, to be made available as early as possible in the review process and at least 30

calendar days before a final commitment to grant official support and (b) environmental

51 See Both Ends, “Gaps between the Common Approaches and the OECD Guidelines” (June 2016) and CORE Coalition and Amnesty International UK joint submission to the United Nations Working

Group on Business and Human Rights.

52 Finance and Trade Watch and CEE Bankwatch Network “ECAs Go to Market. A Critical Review of Transparency and Sustainability at Seven Export Credit Agencies in Central and Eastern Europe

(December 2017).

and social information on projects classified in categories A and B at least annually after a

final commitment to provide support.53

73. In exceptional cases, the Common Approaches allow for the information for

category A projects, referred to in paragraph 71, not to be disclosed. In those cases, export

credit agencies are only required to report to the OECD Export Credit Group. As category

A and B projects cover only a small part of the total portfolio of projects supported by

export credit agencies, civil society groups have criticized the Common Approaches for

lack of transparency across product lines.

74. Based on the mediation which took place between Atradius and two civil society

groups before the Dutch national Contact Point, Atradius agreed to change its information

disclosure policy in order to be more transparent, as required under the Guiding Principles.

The final statement of the National Contact Point indicates that Atradius and the Ministry

of Finance agreed to develop a more specific information disclosure policy that starts from

the assumption that relevant information should be public, unless specific clearly defined

considerations bar such disclosure (as in the case of confidential business information).

Atradius agreed to improve the ex-post publication of information on all project categories

(A, B, C, M and E), for example by disclosing the nature of the product for each relevant

transaction. For category A projects, including transactions with a repayment period of less

than two years, an adequate summary of the transaction and the framework of the

assessment will be published.54

75. Because of the national contact point decision, Atradius took the step of crafting a

new environmental and social policy, effective in 2018, that will presumably, among other

changes, make more information public, with limited exceptions. It asked Shift, a non-

profit organization, to review its prior policies and procedures. The review explored the

extent of the alignment of its policies and processes with the Guiding Principles and what

changes would be needed to create greater alignment. The report done by Shift recognizes

that Atradius goes beyond some of those requirements in practice, but that the Guiding

Principles expect even more when it comes to transparency. The authors found that the

environmental and social policy framework of Atradius did not articulate a broad approach

that recognized the potential value to the business that greater transparency and

communication could play. As a result, public disclosure was positioned more as a burden,

where the company must meet very narrow and specific requirements, rather than as an


C. Moving beyond the OECD export credit agencies

76. A larger issue is whether other forums can provide platforms for discussion of State

responsibilities with respect to environmental and social considerations, including human

rights. The OECD Common Approaches are evidence of the value of multilateral

harmonization to avoid a race-to-the-bottom approach to human rights and business.

However, while the Common Approaches are an important precedent, export financing is

no longer an activity carried out exclusively by OECD member States. As of 2013, 44 per

cent of global official export support came from export credit agencies outside OECD,

including Brazil, China, India and the Russian Federation. As a result, the BRICS Forum

could play an important role in aligning State duties under pillar I of the Guiding Principles

in the area of export credit. The Berne Union could provide another vehicle for such

dialogues, as could the International Working Group on Export Credits.

77. The European Union is yet another forum where export credit agencies could better

align their practices with the Guiding Principles. The European Union export credit agency

regulation refers to the obligation of member States to comply with the Union’s general

53 See OECD Council recommendation on common approaches for officially supported export credits

and environmental and social due diligence (2016), section VII.

54 See final statement notification Both ENDS- Fórum Suape vs Atradius DSB (30 November 2016). 55 See Shift, “Integrating human rights due diligence: a review of Atradius DSB’s environmental and

social policy and procedure”.

provisions on external action, such as consolidating democracy and respect for human

rights, when establishing, developing and implementing their national export credit systems

and when carrying out their supervision of officially supported export credit activities.56

D. Export credit agencies and access to remedy

78. Current National Action Plans do not include discussions of the ways in which

export credit agencies address and enable access to remedy by rights holders who are

harmed in connection with a project or transaction funded or supported by an export credit

agency. As a result, civil society groups have recommended that export credit agencies

make it easier for rights holders to know about and access relevant complaint

mechanisms.57 There are several possible options. One would be to have a grievance or

complaint mechanism at the export credit agency itself and a second would be to require

clients who receive export credit to have an effective grievance mechanism, as outlined in

Guiding Principle 31. Finally, export credit agencies should use their screening, assessment,

support and leverage roles to strengthen their client-level mechanisms and outcomes for


79. In 2011, the Global Alliance of National Human Rights Institutions submitted

comments when OECD first revised its common approaches to address the Guiding

Principles. At that time, the Global Alliance called for OECD to include explicit

requirements regarding access to remedy for company-related human rights abuses,

including through the provision of grievance mechanisms at the project level and at the

national or export credit agency level that would be accessible to individuals and

communities affected by projects. 58 Although the 2016 revision of the Common

Approaches does request that export credit agencies consider measures to prevent,

minimize, mitigate or remedy potential adverse environmental and social impacts, it is

silent on the issue of complaints and grievance mechanisms. The issue of how export credit

agencies can use their leverage to enable effective remedies has not been actively explored

to date and deserves significant attention.

E. Relationship between the human rights record of a company and future

support by the State

80. The Common Approaches specify that export credit agencies “should where

appropriate … consider any statements or reports made publicly available by their National

Contact Points (NCPs) after a specific instance procedure under the OECD Guidelines for

Multinational Enterprises”.59 States that have committed to imposing trade and investment-

related consequences for businesses refusing to participate in the national contact point

process include Canada, Germany and the Netherlands.

81. For example, Canada has adopted an integrated approach to economic diplomacy as

part of its enhanced corporate responsibility strategy for the extractive sector, which was

launched in 2014. A key component of that approach is making government support in

foreign markets conditional on a company’s good faith participation in the two voluntary

dispute resolution mechanisms, namely the Office of the Extractive Sector Corporate Social

Responsibility Counsellor and Canada’s national contact point. In 2015, that approach led

to the withdrawal of Canadian trade commissioner services from China Gold International

56 Regulation 1233/2011 of the European Parliament and of the Council of 16 November 2011.

57 See Finance and Trade Watch, and CEE Bankwatch Network “ECAs Go to Market”. The authors

recommend that each export credit agency needs to have an independent complaints mechanism with

clearly defined procedures and that they formulate and adopt information disclosure and public

participation measures.

58 See www.business-humanrights.org/sites/default/files/media/documents/icc-submission-to-oecd-


59 OECD Council recommendation on common approaches (2016), para. 16.

Resources after it refused to engage with the National Contact Point when a complaint was

brought against it.60

82. The German National Action Plan also recognizes the need for linking the decisions

of the National Contact Point to support in trade promotion. It includes a proposed measure

that the National Contact Point be upgraded to a central complaints mechanism for projects

relating to foreign trade promotion. The Plan also created a link between business

participation in a specific instance procedure and the grant of export credit guarantees,

providing an additional incentive for a company to participate in mediation. The Dutch

National Contact Point has also committed to applying consequences to businesses that

refuse to participate in its process, a commitment that will be tested for the first time in an

ongoing case.

83. Three States (Germany, Switzerland and the United Kingdom) reference the linkage

between national contact point procedures and export finance in their National Action

Plans, although with a nuance regarding the outcome of the case versus good faith

engagement by the company in the process. For example, UK Export Finance will consider

any reports made publicly available by the National Contact Point in respect of the human

rights record of a company when considering a project for export credit.

84. While some export credit agencies, such as that of Japan, indicate that national

contact point reports (or other credible findings) will be factored into export credit

decisions, to date it is unclear how or when this has happened, apart from the one example

in Canada cited above. Other States should follow suit in terms of linking national contact

point and other remedial processes to whether a company continues to receive trade

support. In combating corruption, a company will often lose its right to participate in

government procurement exercises because of a determination that it was engaged in

bribery and a similar approach should be explored in relation to human rights-related


IV. Import and export restrictions to prevent trade in goods with links to human rights abuses

85. States are using restrictions on exports and imports as a means of ensuring greater

corporate respect for human rights. This takes the form of export/import restrictions on

certain types of goods that are linked to human rights violations in global supply chains.

86. One example is the Alliance for Torture-Free Trade, an initiative of Argentina, the

European Union and Mongolia bringing together countries from around the world. Its aim

is to end the trade in goods used to carry out the death penalty and torture. The countries of

the Alliance commit themselves to taking measures to control and restrict exports of such


87. The European Union has drafted a regulation that will add certain cybersurveillance

tools to the list of goods and technologies that need to be approved prior to export. The

draft regulation introduces the new concept of “human security” to export controls, to

prevent the human rights violations associated with certain cybersurveillance technologies.

The proposal mirrors amendments to the German Foreign Trade and Payments Ordinance

in 2015, which made companies that sell surveillance products subject to new mandatory

export licence requirements to prevent misuse of surveillance technologies for internal


88. In 2016, via the Trade Facilitation and Trade Enforcement Act, the United States

Congress closed a loophole in section 307 of the Tariff Act of 1930, which barred products

made by convict, forced or indentured labour. Until now, the law has exempted goods

60 See OECD Watch, “Remedy remains rare: an analysis of 15 years of NCP cases and their

contribution to improve access to remedy for victims of corporate misconduct”, p. 46.

61 See European Parliamentary Research Service briefing, available at www.europarl.europa.eu/


derived from slavery if American domestic production could not meet demand. Section 307

prohibits the importation of merchandise mined, produced or manufactured, wholly or in

part, in any foreign country by forced or indentured child labour.62

89. Since 2016, U.S. Customs and Border Protection has issued four orders to seize 50

shipments of goods suspected to have been made with forced labour. There were no

seizures between 2001 and 2015. On 2 August 2017, Congress passed the Countering

Americas Adversaries through Sanctions Act, which contains a provision affecting the

entry of merchandise with a nexus to forced labour by North Korean nationals. Since then,

there have been 15 seizures of merchandise believed to have been made using North

Korean forced labour.63

90. There are other examples of States linking import and export licensing and customs

clearance to human rights issues. Trade in conflict minerals, illegal logging and conflict

timber, and endangered species are other areas where States have acted to restrict the flow

of goods that are associated with higher risks of human rights abuses. 64 Companies

involved with global supply chains in relevant sectors must engage in human rights due

diligence and impact assessments to comply with import and export restrictions. As such,

the use of export and import controls is another useful tool that allows States to implement

their duty to protect under pillar I of the Guiding Principles.

V. Conclusions and recommendations

A. Conclusions

91. Many States have established export and trade promotion services as part of

their economic development strategies to promote export-driven growth. At the same

time, trade and exports and imports of goods in global supply chains can have

significant adverse human rights impacts.

92. Guiding Principle 4 of the Guiding Principles on Business and Human Rights

reminds States that their duty to protect rights holders from corporate human rights

abuses includes a responsibility to condition public support for trade and investment

promotion, such as export credits, on corporate respect for human rights. In addition

to export credits, there are a range of additional services that States provide to

companies that desire to export, including participation in trade missions, trade

advocacy, general guidance on exporting into foreign markets, embassy services in

overseas markets, and training and other resources.

93. To date, very little has been done in terms of States fulfilling their obligation

under Guiding Principle 4. One area where progress is being made is with respect to

the training of trade and embassy personnel on the Guiding Principles. Some States

are also providing toolkits and guidance to help businesses address human rights due

diligence in their cross-border trade.

94. There remains much to be done in terms of States aligning their trade

promotion with the Guiding Principles and promoting a race to the top. States have

done more in the way of tying trade support to commitments from businesses not to

engage in bribery and to act with integrity. Where States already screen companies

for trade promotion or require an integrity or no-bribery pledge, such commitments

should be expanded to encompass a commitment to respect human rights.

95. In the area of export credits, with the exception of a few OECD-based export

credit agencies, most State-supported or public export credit agencies currently

appear not to be actively using the Guiding Principles as part of their decision-making

62 See, for example, www.cbp.gov/trade/trade-community/programs-outreach/convict-importations.

63 See www.cbp.gov/newsroom/blogs/tftea-two-years-and-counting.

64 See Oli Brown and others, eds., Trade, Aid and Security: an Agenda for Peace and Development

(London, Earthscan, 2007).

on whether to extend financial support for export activities. The updated 2016 OECD

recommendation on common approaches to export credit includes a requirement for

export credit agencies to require applicants to undertake some form of human right

due diligence with respect to projects that pose severe human rights risks.

96. While this is a positive step, to date, there are still only limited examples of

good practice even among the States which are members of the OECD Export Credit

Group. Furthermore, as noted in the present report, the Common Approaches still

have limitations in terms of the transactions to which they apply and the fact that they

leave questions over transactions that are not covered, as well as issues of access to

remedy and information disclosure. Furthermore, the OECD Export Credit Group

represents only a subset of the larger set of global export credit agencies.

97. As the report indicates, there is room for reform in the export credit area as

part of State commitments under Guiding Principle 4. While States may commit to

factoring reports from national contact points and other types of determinations into

export credit agency decision-making, at present there is scant evidence that States

have refused to grant trade or export credit support to applicants because of an

adverse human rights determination.

98. Finally, export and import controls and restrictions seem to be a promising

avenue for States to cause businesses that engage in cross-border trade to engage in

stronger human rights due diligence either as buyers or sellers. In the event that

States take active measures to prevent goods such as those made with forced labour

from entering markets, this does provide a strong incentive for businesses to focus on

the Guiding Principles and human rights due diligence.

B. Recommendations

99. States should require businesses to demonstrate an awareness of and

commitment to the Guiding Principles as a prerequisite for receiving State support

and benefits relating to trade and export promotion. States should condition

participation in trade missions, eligibility for trade advocacy and generalized export

assistance on such commitments. Such forums and tools should be used to raise

awareness of business-related human rights risks in the relevant contexts, with a

particular emphasis on the risks faced by vulnerable groups and individuals. The

situation for human rights defenders and trade unions should serve as a concrete


100. States should look to see where they have required businesses to make existing

integrity and anti-corruption pledges in the context of trade promotion and expand

such commitments to include a commitment to respect for human rights and an

alignment of business activities with the Guiding Principles.

101. States should examine how and when they have withdrawn trade or other

government support from companies in the event that they are found to have engaged

in foreign bribery or corruption, and determine how a similar withdrawal of support

could be structured in the event that businesses have been found to have caused or

contributed or been directly linked to adverse human right impacts.

102. States should also examine how to use withdrawal of trade support more

actively, so as to create incentives for companies to respect human rights and engage

in human rights due diligence and legitimate remediation processes. To the extent that

companies know that there is a risk of losing export financing and other benefits, that

may promote greater compliance with the Guiding Principles.

103. In terms of export credit, States and their export credit agencies should ensure

that their practices are aligned with the Guiding Principles, not just the IFC

Performance Standards. For participants in the OECD Export Credit Group, States

are encouraged to look beyond the four corners of the OECD Common Approaches,

to see how better to align export credit activity with the Guiding Principles. That is

particularly true for transactions that fall outside the scope of the Common

Approaches (for example, short-term transactions, working capital or support for

bonds). Similarly, export credit agencies should develop useful models of human

rights screening and due diligence that relate to transactions that may not clearly fall

under the current definition of project (for example, the sale of mobile equipment

such as ships or communications equipment).

104. States should consider using many of the multilateral forums that exist for

export credit agencies to engage in developing good practices and further

commitments relating to the Guiding Principles. Such forums include the Berne

Union, the International Working Group on Export Credits, the European Union and

the BRICS Export Credit Forum.

105. Export credit agencies should focus much more on the issue of enabling access

to remedy. That includes developing better practices for evaluating, supporting and

incentivizing the quality of the grievance mechanisms of their clients/applicants at the

operational level. At the same time, export credit agencies also need to ensure that

they have effective complaints mechanisms and that such mechanisms are readily

accessible by affected parties, rights holders and communities. That is an area where

the OECD Common Approaches are silent.

106. Export credit agencies should review their current transparency and disclosure

policies and consider revising them to make more information public. Following the

example of the Netherlands, export credit agencies can begin from a presumption that

material is made public and then carve out narrow exemptions. There may also be a

way to present some data in aggregate form or to redact confidential information but

still provide civil society with key facts about both successful applications and those

turned down by an export credit agency.

107. States are encouraged to further develop innovative measures to prevent trade

in goods that are connected to serious human rights risk in global supply chains.

108. While the present recommendations are focused primarily on States, civil

society groups are encouraged to continue their advocacy around issues of human

rights, export credits and trade promotion, and to seek greater alignment of State

policies and regulations with the Guiding Principles. Similarly, businesses are

encouraged to work in partnership with trade promotion entities to develop and

disseminate effective guidance on how business respect for human rights can be

demonstrated in cross-border trade.