From: Annual Report on the OECD Guidelines for Multinational Enterprises 2014 Responsible Business Conduct by Sector Access the complete publication at: http://dx.doi.org/10.1787/mne-2014-en Activities of National Contact Points for the OECD Guidelines for Multinational Enterprises Please cite this chapter as: OECD (2014), “Activities of National Contact Points for the OECD Guidelines for Multinational Enterprises”, in Annual Report on the OECD Guidelines for Multinational Enterprises 2014: Responsible Business Conduct by Sector, OECD Publishing. http://dx.doi.org/10.1787/mne-2014-4-en This work is published under the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of OECD member countries. This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. Annual Report on the OECD Guidelines for Multinational Enterprises 2014 Responsible Business Conduct by Sector © OECD 2014 Chapter 1 Activities of National Contact Points for the OECD Guidelines for Multinational Enterprises The main role of the NCPs of governments adhering to the Guidelines is to further the instrument’s effectiveness by undertaking promotional activities, handling enquiries, and contributing to the resolution of issues arising from alleged non-observance of the Guidelines in specific instances. This chapter reviews NCP activities during the June 2013-June 2014 reporting period. 15 1. ACTIVITIES OF NATIONAL CONTACT POINTS Main findings The reporting period marks a number of milestones, in which promotional and peer learning activities increased by 25% from the previous period; dialogue on initiatives in the textiles and garments sector following the 2013 Rana Plaza tragedy in Bangladesh began to deliver concrete results; and an unprecedented number of specific instances involving NCP-facilitated mediation helped parties reach an agreement or create an action plan toward the resolution of the specific instance. At the same time, NCPs continued to face increasingly complex and sensitive specific complaints and persistent pressures from various stakeholders to perform more effectively as a non- judicial grievance mechanism. With the implementation of the Guidelines gaining momentum, the 2013-2014 implementation cycle featured successes, but also revealed several areas requiring improvement. Promotion and stakeholder engagement A primary task of NCPs is the promotion of the Guidelines. Since the 2011 update, NCPs have stepped up their efforts to explain and encourage the effective observance of the Guidelines by enterprises, trade unions, non- governmental organisations (NGOs), national governmental agencies and non-adhering governments, and collaboratively identify challenges and solutions to difficulties encountered with specific products, regions, sectors or industries. NCPs have also encouraged multinational enterprises (MNEs) at home and abroad to proactively partner with trade unions, local communities, and NGOs to open effective channels of communication regarding business activities and create forums for reconciling potential problems. Accordingly, 27 NCPs either organised promotional events or participated in events organised by a stakeholder or other interested actor. With over 200 events, this reporting period saw a 25% increase in the number of events held relative to the last reporting period. Brazil’s NCP and several Brazilian state-owned enterprises (SOEs) signed a Term of Commitment to better promote and uphold responsible business conduct on the Guidelines. Equally encouraging the number of events directly organised by national business associations, trade unions, NGOs or other stakeholders, provide further proof of interest from the public on these important RBC issues. The Guidelines encourage collaboration and mutual problem-solving on issues of shared responsibility. A sign that this goal is achieved is when a multi- 16 ANNUAL REPORT ON THE OECD GUIDELINES FOR MULTINATIONAL ENTERPRISES 2014 © OECD 2014 1. ACTIVITIES OF NATIONAL CONTACT POINTS stakeholder organisations such as the Danish Federation of SMEs invites the Danish NCP to give a presentation on the Guidelines,1 or when TUAC and OECD Watch guides local stakeholders through the specific instance process.2 Even more indicative of the uptake of the Guidelines is the conclusion of a specific instance with reconciliation between the two parties, which demonstrates a company’s willingness and commitment to uphold corporate responsibility principles in practice.3 Initiatives in the textile and garment sector The Rana Plaza garment factory collapse in 2013 exemplified the precarious working conditions in Bangladeshi textile supply chains. Propelled by this tragedy, governments, enterprises, trade union and NGOs have committed to strengthening the standards applied to safety and working conditions. While there may be a long road ahead, there has been significant progress in multilateral and national policy and practice. These efforts include the Bangladesh National Tripartite Plan of Action on Fire Safety and Structural Integrity, the International Labour Organization’s (ILO) Better Work Program, the EU-US-Bangladesh-ILO Sustainability Compact for Bangladesh, the Bangladesh Accord on Fire and Building Safety, and the Alliance for Bangladesh Worker Safety. Compensation schemes for the victims of Rana Plaza have also been set up, namely the Prime Minister’s Relief and Welfare Fund and the Rana Plaza Arrangement Trust Fund.4 In June 2013, NCPs issued a statement5 pledging their commitment to meet their responsibilities under the Guidelines and invited the WPRBC to urgently undertake further work in the textiles and garment sector to improve the situation on the ground. Exemplifying this pledge, the French and Italian NCPs released comprehensive reports on the challenges inherent in the global supply chain in the textiles and garment sector and detailed recommendations to national actors.6 Belgium, Canada, Germany, Italy, the Netherlands, the United Kingdom (UK) and other adhering countries have also engaged in reflective analysis and encouraging solutions by hosting or participating in promotional activities, creating action plans and actively promoting credible multi-stakeholder initiatives. In June 2014, at their 15th meeting, NCPs issued a follow-up statement7 reiterating their pledge on Bangladesh and calling on the OECD to develop specific guidance on the due diligence provisions of the Guidelines along the textiles and supply chain. They also welcomed the organisation of the ILO- OECD Roundtable on responsible supply chains in the textile and garment sector, in September 2014. ANNUAL REPORT ON THE OECD GUIDELINES FOR MULTINATIONAL ENTERPRISES 2014 © OECD 2014 17 1. ACTIVITIES OF NATIONAL CONTACT POINTS Specific instances: Successes and challenges The NCPs handled a similarly high level of specific instances relative to last year, with 34 new specific instances (compared to last year’s 36) and 33 concluded specific instances (compared to last year’s 40). Fourteen NCPs received new specific instances, with high numbers accruing to the UK and the US NCPS (six each). Consistent with last year, many of the new specific instances concerned the provisions introduced in the 2011 update on human rights, due diligence, supply chains, and stakeholder engagement. A number of cases also concerned the chapter on the environment, which tended to be cited along with the human rights chapter. Perhaps the most significant achievement of this year’s implementation cycle is a record number of specific instances in which NCPs facilitated an agreement between the parties. Nine out of ten cases that received dialogue or mediation assistance reached an agreement on a timetable for negotiations. In contrast, out of the 12 specific instances in which NCPs facilitated dialogue or mediation in 2012-13, only two reached an agreement and one agreed on a timetable for negotiations. The increase in positive outcomes seems to indicate that the capacity of the NCPs to facilitate mediation and dialogue is improving. It further suggests that both MNEs and relevant stakeholders are beginning to appreciate this non-judicial grievance mechanism. Even as the benchmark for success rises, the challenges posed to NCPs entail growing complexity. NCPs often face complaints that transcend many borders and encounter multiple conflicting interests from business, government, and stakeholders. For example, during the 2013-2014 reporting period three allegations of insufficient human rights due diligence by companies in the security sector were raised, all of which involved sensitive information and compelled NCPs to carefully examine both the obligations and boundaries of their responsibility. In other instances, NCPs were criticised for their performance and lack of consistency across NCP procedures. Conscious of the importance of enhanced credibility and integrity of the Guidelines and the grievance mechanism, the WPRBC and the NCPs are discussing methods for improving NCP performance and functional equivalence through more frequent peer reviews and feedback mechanisms. The voluntary peer review of Norway’s NCP (the first of its kind) took place in June 2014. It confirmed the need and benefits of conducting more regular capacity-building and peer learning exercises. It