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Responsibility in world business Responsibility in world business: Managing harmful side-effects of corporate activity Edited by Lene Bomann-Larsen and Oddny Wiggen United Nations a University Press TOKYO u NEW YORK u PARIS 6 United Nations University, 2004 The views expressed in this publication are those of the authors and do not necessarily reflect the views of the United Nations University. United Nations University Press United Nations University, 53-70, Jingumae 5-chome, Shibuya-ku, Tokyo 150-8925, Japan Tel: þ81-3-3499-2811 Fax: þ81-3-3406-7345 E-mail: [email protected] general enquiries: [email protected] http://www.unu.edu United Nations University Office in North America 2 United Nations Plaza, Room DC2-2062, New York, NY 10017, USA Tel: þ1-212-963-6387 Fax: þ1-212-371-9454 E-mail: [email protected] United Nations University Press is the publishing division of the United Nations University. Cover design by Joyce C. Weston Printed in the United States of America UNUP-1103 ISBN 92-808-1103-7 Library of Congress Cataloging-in-Publication Data Responsibility in world business: managing harmful side-effects of corporate activity / edited by Lene Bomann-Larsen and Oddny Wiggen. p. cm. Includes bibliographical references and index. ISBN 9280811037 (pbk.) 1. Social responsibility of business. 2. Business ethics. 3. International business enterprises—Management. 4. International business enterprises—Moral and ethical aspects. 5. International business enterprises—Environmental aspects. 6. International business enterprises—Social aspects. I. Bomann-Larsen, Lene. II. Wiggen, Oddny. HD60.R473 2004 658.4008—dc22 2004007656 Contents Foreword............................................................... viii Georg Kell Acknowledgements. ................................................. x Listofcontributors.................................................... xii Listofabbreviations................................................... xiv Part I: Introduction.................................................... 1 1 Addressing side-effect harm in the business context: Conceptualandpracticalchallenges............................. 3 Oddny Wiggen and Lene Bomann-Larsen Part II: Theoretical discussion ........................................ 15 2 The idea of double effect – in war and business . ........... 17 Gregory Reichberg and Henrik Syse 3 Business is not Just War: Implications for applying the principle of double effect to business. ......................... 39 G. J. (Deon) Rossouw v vi CONTENTS 4 State responsibility, corporate responsibility, and complicity inhumanrightsviolations........................................ 50 Andrew Clapham 5 Reconstructing the principle of double effect: Towards fixing the goalposts of corporate responsibility . .................. 82 Lene Bomann-Larsen 6 The principle of double effect, revised for the business context............................................................ 99 Oddny Wiggen and Lene Bomann-Larsen Part III: Case-studies.................................................. 103 7 The principle of double effect and moral risk: Some case- studiesofUStransnationalcorporations........................ 105 Patricia H. Werhane 8 An object lesson in balancing business and nature in Hong Kong:SavingthebirdsofLongValley.......................... 121 Robert E. Allinson 9 ShellinOgoniland................................................ 138 Ogbonna Ike 10 DelMonteKenyaLimited....................................... 159 Florence J. A. Oloo 11 The ‘‘just war’’ for profit and power: The Bhopal catastrophe and the principle of double effect................................ 175 Upendra Baxi 12 Dealing with harmful side-effects: Opportunities and threats intheemergingPolishmarket................................... 202 Julita Sokołowska 13 TheOrissacase................................................... 221 Heidi von Weltzien Høivik 14 Child labour in the Brazilian citrus sector: The case of Cargill’s double effect . ....................................... 245 Cecilia Arruda CONTENTS vii 15 A commentary on the principle of double effect . ........... 262 Chris Marsden Part IV: Conclusion ................................................... 271 16 Towards improved business practice: Implementing the principle of double effect. ....................................... 273 Oddny Wiggen and Lene Bomann-Larsen Index................................................................... 279 Foreword The UN Global Compact – Secretary-General Kofi Annan’s initiative on responsible corporate citizenship – aims at ‘‘producing practical solu- tions’’, ‘‘sharing good practices’’, ‘‘rallying around universal principles’’, and ‘‘making the global economy more sustainable and inclusive’’. It is with great satisfaction that Global Compact acknowledges the publica- tion of this book, which so admirably strives to contribute to the real- ization of these goals. It is the Global Compact’s firm belief that business has an important role to play in achieving peace and social development. Launched in Davos in 1999 by the Secretary-General, the Global Compact ‘‘seeks to advance corporate citizenship so that business can be part of the solution to the challenges of globalisation’’. Through its engagement, the Com- pact provides an international platform that facilitates mutual under- standing and the development of practical solutions among business, labour, civil society organizations, government, UN agencies, and leading experts from the academic and public policy spheres. Integrating corporate social responsibility into business behaviour can be achieved only by developing a much clearer understanding of the obligations underlying the term. This involves clearly distinguishing between what is absolutely required from companies and what society expects from them in addition. Through a Policy Dialogue on ‘‘Roles and Responsibilities of Societal Actors in a Global World’’, the Global Com- pact has been exploring these critical issues to help advance a shared viii FOREWORD ix understanding in this area. It is clear that the private sector must consider its overall impact on society, both locally and globally. Indeed, the focus on responsibility for one’s operations found in this volume is a valuable contribution both to the work of the Global Compact and to the debate on corporate citizenship. All jobs require the right tools. And, the more complicated the task, the more important it is to find the appropriate tools for getting the job done. The responsibility for unintended side-effects and the dangers of complicity are indeed among the most complex questions facing us within the field of corporate social responsibility. Finding better tools for handl- ing such questions must be high on our agenda. The Global Compact ‘‘Business Guide on Conflict Impact Assessment and Risk Management’’ is an example of such a tool. It was developed by a multi-stakeholder group to provide a practical means for companies to develop strategies that minimize the negative effects and maximize the positive effects of investing in areas of potential conflict. In this volume, the authors have taken this work to a higher theoretical level. In ethics, as in many other fields, philosophers, theologians, and social scientists have often addressed similar questions to the ones we are grappling with here. But are we resourceful enough in utilizing their ideas and their language? In this book, researchers from the Interna- tional Peace Research Institute in Oslo (PRIO) and the United Nations University, together with top academics from several different fields and from all corners of the world, have taken the centuries-old tradition of ‘‘just war’’ (or, more broadly, the ‘‘ethics of war and peace’’) as their point of departure in addressing some important challenges in this area. Even if all of the intended, direct effects of one’s actions are legitimate (perhaps even morally laudable), side-effect harm may be of a kind that disallows one’s actions from being performed. But what kinds of side- effect are relevant? How much must one do to find out about the possible side-effects of one’s otherwise legitimate actions? If negative side-effects do come about, who is responsible? And, not least, who should be en- trusted to make the final decisions in such complex cases? It is our belief that this book – both its philosophical groundwork and the case-studies – will become an important tool in our continued work on corporate citizenship. It reminds us that the consequences of conduct- ing business are manifold and complex. We at the Global Compact