Human rights and decent work in global supply chains

A due diligence instrument at the EU level would be catalytic, says ILO Director-General

News | 06 October 2020
The Director-General of the ILO, Guy Ryder, participated in a high-level conference on Human Rights and Decent work in global supply chains, hosted by the German presidency of the Council of the EU.

Asked about his hopes for a due diligence instrument at the European level, the ILO Director-General mentioned that it would achieve clarity. “We are seeing a multiplication of national initiatives in France, the Netherlands and now in Germany. A single European instrument would have the advantage of creating a level-playing field within Europe and would give the clarity business wants to see in this area,” he said.

“A due diligence instrument at the EU level would be catalytic, it would probably be the most important step in this field since the adoption of the United Nations Guiding Principles on Business and Human Rights in 2011,” he continued. This is a chance to show leadership and it is in line with Europe’s mission to become a geopolitical Union.

Such an instrument would allow European business operating outside Europe to bring these good practices to other countries. It would also stimulate non-European companies operating in Europe to conduct their business in the same way.

The question arises whether such an instrument may bring a competitive disadvantage for companies which are required to do the right things vis-à-vis companies abroad which are not held to the same standards and which may not observe human rights.

Mr Ryder countered this. “Companies which observe due diligence and human rights are often more productive and competitive,” he said. Consumers and the investor community will be looking for this type of behaviour and market advantage will come from it.

But there are limitations as well. First, we need to be clear about which issues we want to address in any instrument. The ILO Fundamental Principles and Rights at Work are a universally recognized package. Yet, there are other important elements linked to due diligence and supply chain management, such as an adequate living wage and safety and health at work.

Second, we have to convey the fact that what we want to achieve is to provide protection to the most vulnerable and disadvantaged in the world of work, and also to strengthen and sustain global supply chains. In emerging countries, there is a great deal of anxiety about the security of their supply chains, and the presence of supply chains in their economy is very important. People may get the impression that all of this may act to their disadvantage.

“We need to make sure that dialogue is at the centre of this endeavour: intergovernmental dialogue (also outside Europe), sectoral dialogue, dialogue between the social partners and between stakeholders, dialogue between big companies and small and medium-sized enterprises,” he concluded.