ELSA DelegationAmidst Human Rights Activists& Hypocritical Alliances

No.4 · II-2011

CSRAn accountability gap withrepercussions

ELSA eventSummer Seminar 2011Patent Law vs. The Access to Medicine

The European Law Students’ Association in Denmark

THEME

Corporate Social Responsibility

JUROPEANE L S A D e n m a r k ' s N e w s l e t t e r

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ELSA DenmarkC/O University of Copenhagen, Law Faculty Bispetorvet 1-3, DK-1167 Copenhagen, Denmarkwww.elsa.dk

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Corporate Social Responsibility

Corporate Social Responsibility (CSR, also called corporate conscience, corporate citi-zenship, social performance, or sustainable responsible business) is a form of corporate self-regulation integrated into a business mo-del. CSR policy functions as a built-in, self-regulating mechanism whereby business mo-nitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. [Wikipedia]

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The national and international focus on Corpo-rate Social Responsibility (CSR) and the continu-ing growth of globalization as well as the increased activities of businesses across national borders have given rise to new challenges concerning the nature and efficiency of CSR and the traditional notion of duty bearers under international law.

A survey made 10 years ago shows that out of the 100 largest eco-nomic entities in the world, 51 are corporations. To a large extent transnational companies (TNCs) have been able to operate in a legal vacuum because international law does not impose legal obligations on corporations.

This article will examine the options for closing the current account-ability gap under international law for transnational companies as non-state actors and will include examples from pharmaceutical companies and their CSR practices regarding access to medicine in developing countries.

CSR is a term covering how business community can take respon-sibility with respect to its impact on people, planet and profit also

known as the Triple Bottom Line, and how corporations can con-tribute to, rather than become a barrier to, sustainable development. CSR is used as a global means of protecting the human rights and environmental protection by including moral and ethical concerns in businesses on a voluntary basis while also increasing profits through business initiatives.

Even though CSR is not mandated by law, it is indeed guided by law and has a normative value. Given that corporations are non-state ac-tors, they are not bound by international law as such. The traditional duty bearers are the states who can be held accountable for not only human rights violations they themselves have committed, but they also have an obligation to protect individuals from horizontal hu-

man rights abuses, e.g. from TNCs, within their jurisdiction. The sanctions for businesses for not complying are of a moral and practi-cal character that relies on the reaction of the stakeholders, such as investors, employees and consumers. This type of informal soft law, such as recommendations or declarations, is what characterizes the international CSR initiatives from the UN, OECD and ILO.

The development of international human rights law has resulted in individuals becoming subject to obligations and rights pursuant to customary law. Thus, nothing prevents establishment of obligations for non-state actors, but it is rather a question of legitimacy whether such regulation will have the required impact on the TNCs. Accord-ing to Jürgen Habermas, democratic legitimacy of norms is created through the participation of businesses in the law-making process because participation leads to acceptance of constraints and effective enforcement.

Two billion people do not have access to essential medicines even though global spending on prescribed drugs has never been higher and the global market for pharmaceuticals is expected to constitute US$880 billion in 2011.

The role of pharmaceutical companies in the developing world is

THEME: Corporate Social Responsibility

"An accountability gap with repercussions"

Tahira SheikhVP Academic Activities ELSA CPH

"Get your act together"

"... promoting Human Rights"

THEME: Corporate Social Responsibility

5 ELSA Juropean

subject to much debate, ranging from those highlighting the aid provided to the developing world, to those critical of the use of the poorest in human clinical trials. One of the more famous scandals in the industry involves the world's largest pharmaceutical company, Pfizer Inc. who was involved in nonconsensual testing of drugs on 200 children in Nigeria.

Other criticisms include an alleged reluctance of the industry to in-vest in treatments of diseases in less economically advanced countries and issues regarding corporations' patent rights and access to medi-cines in the developing countries. Today's pharmaceutical business model is centered on ensuring maximum margins by charging what the market can bear and by defending patents unreservedly and pharmaceutical companies have generally shown reluctance to negotiate with poorer coun-tries over patent rights.

Too much focus on profit-making has so far cost the pharma-ceutical industry US$ 1 trillion. Thus, it has become evident that it is of the self-interest of a pharmaceutical company to be part of the solution to the ac-cess-to-medicines prob-lem, by committing to a human rights-aware and in-novative business strategy and thereby also contributing to the corporation's social acceptance and to its long-term license to operate.

Millennium Development Goal 8E sets out the target for the international community "in cooperation with pharmaceutical companies, [to] provide access to affordable, essential drugs in devel-oping countries". Thus, it is an issue that has international awareness and has great potential to develop and improve.

Even though the primary responsibility for access to medicine lies with the states, the goal emphasizes the need to cooperate with the pharmaceutical industry, which is why the companies' CSR policies on this area have an enormous influence on the success of the set goal.

As regards to the pharmaceutical industry and global health, one of the relevant instruments is the DOHA declaration on the TRIPS agreement and public health.

Documents like this are based on general human rights conventions and call for effective health systems, independent monitoring and accountability, adoption of human rights policies, compliance with national law, transparency, differential pricing and ethical clinical trials but have so far been statements of intent without any require-ment of mandatory action. Even though we now have a vast variety

of soft law regulating CSR approaches, there is still a general inability of the international legal framework to

keep pace with the rise of corporations as a significant non-state actor because of

the lack of effective monitoring and enforcement mechanisms inher-

ent in the soft law approach.

However, the idea of making TNCs direct subjects to interna-tional law without states as intermediar-ies is quite utopian looking at the present international system and there are power-

ful critics against such a proposal. The critics

say that creating liability for corporations will take

focus off the states as the pri-mary duty bearers. Some also

believe that corporations rather pay fines for non-compliance rather than to

reorganize their businesses and engaging in unmanageable tasks of solving the world's prob-

lems. Others think that it will have negative CSR implications due to increased corruption and bribery.

It is unrealistic and undesirable to insist that corporations should not take profit motive into consideration and substitute it solely with objects of protecting and promoting human rights since it would result in both local and global negative CSR implications because of a more strained economy, less growth and fewer employment oppor-tunities. But at the moment, there are very high risks that elaborate CSR policies are PR-stunts and empty words to attract new clients and investors.

THEME: Corporate Social Responsibility

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Therefore states have an ongoing responsibility in creating incentives for companies through for instance public-private contracts and em-phasizing the fact that with duties come rights.

Governments play a big role in mobilizing the private sector to have a general mentality change when it comes shifting from a tradition-al capitalistic way of making profit. As a first step it can be done through national legislation making it compulsory to take CSR into account in business strategies or by giving national law extraterrito-rial enforcement, as the US Alien Tort Act whereby corporations can be held accountable for actions abroad.

Another element in the present inefficiency of CSR standards is the large amount of different standards that now circulate on the inter-national level. A part of the strengthening of international ties should be implementation of one standard-setting instrument instead of competing CSR systems. Furthermore, initiatives should not only

focus on symptom treatment but also treat the core of the problems, such as poverty since numerous studies show the interdependence of wealth and health.

Some of the most influential stakeholders for the pharmaceutical in-dustry are doctors and nurse practitioners because they prescribe the drugs used by the patient. Influencing the physician is often seen as the key to pharmaceutical sales. Stakeholders, such as unions and investors, can and should set conditions for the limits of lobbyism and of a sustainable and active CSR policy before investing in a com-pany. There is also a strong need for pioneers, and EU as a suprana-tional organization can contribute to the acceptance of regulations for TNCs on an international level and by diminishing protectionist trade policy.

Given the power of corporations today, it is evident that soft law ap-proaches are not optimal solutions for implementing CSR standards when the lack of monitoring and enforcement mechanisms over-shadows the potential of corporations. Taking steps to close the ac-countability gap for businesses under international law can be the next step towards evolving international law and using mandatory CSR standards as a tool to advance development and increase socio-economic conditions throughout the world.

THEME: Corporate Social Responsibility

"... our responsibilities as ELSA Members"

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ELSA Denmark 2011/2012

From the top left: Secretary General - Frej Campen Wolthers, Vice President Student Trainee Exchange Programme - Jannie Lærke Bruus Jensen, Vice President Marketing - Fie Cathrine Støttrup Olsen, Vice President Seminars & Conferences - Maria-Christina F. Binau-Hansen, Suppleant - Pernille Dannevig, Suppleant - Maken Tzeggai, Pre-sident - Anne Kathrine Hermansen, Treasurer - Teit Bang Heerup, Vice President Academic Activities - Christina

Bitsch Kirk (fraværende)

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A slightly trembling ELSA delegation with sweaty palms and freshly ironed clothes steps inside the intimidating United Nations building in Ge-neva. Despite months of planning and mental preparation, nothing could have prepared me for the scenery unfolding before my eyes.

In front of us, under the famous multi-colored ceiling in Room XX, hundreds of representatives from the whole world in suits, saris and scarves were talking intensively in small groups, finding their seats, raising hands to get on the speakers list, and anxiously reading through their speech one last time. The atmosphere gave me chills down my spine and automatically made me look for the nearest seat to catch my breath. But being Head of Delegation I had to pull my-

self together and act like I had everything under control even though I most of all wanted to run to the nearest restroom. ‘Get your act to-gether’, I thought while taking deep breaths. ‘This is the 17th session of the United Nations Human Rights Council. I am finally here.’

The UNHRC is an inter-governmental body within the UN system made of 47 states responsible for strengthening the promotion and protection of human rights around the globe.

The council was created by the UN General Assembly on 15 March 2006 with the main purpose of addressing situations of human rights violations and make recommendations on them. The 17th session lasted 3 weeks with intensive plenary sessions and numerous side events with state representatives, experts and NGO’s about serious

violations of and the promotion of human rights and international humanitarian law.

During the three weeks, the ELSA delegation consisting of 8 persons from different European countries gained valuable insight in current human rights issues and international diplomacy. Acting as the Head of Delegation my journey to Geneva began long before I got on the plane because of my responsibility to prepare the delegation for ses-sions, social activities and get everyone accommodated.

So finally being there, amidst highly esteemed and passionate experts in the field of human rights made me feel extremely privileged – and grateful for becoming active in ELSA. And getting a bit star-struck

(but remembering my breathing exercises) became routine for me especially when people like the Special Rapporteur on Business & Human Rights, Mr. John Ruggie, were standing a few meters away from me or when I had the opportunity to shake hands with the President of UNHRC, Mr. Sihasak Phuangketkeow.

No other student organization in the world gives a mere law student the incredible opportunity to witness up-close the development and protection of human rights norms within the UN.

Even though I was also witness to conflicts of interests between states and regions at times, it is clear that all members of the Human Rights Council strive towards the common goal of promoting human rights throughout the world. However, many controversies were about the scope of human rights and whether a certain right classified as a hu-

Delegation to UN Human Rights Council

"Amidst Human Rights Activists& Hypocritical Alliances"

Tahira SheikhVP Academic Activities ELSA CPH

"Get your act together""...promoting Human Rights"

Delegations

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man right. In particular, there were discussions about homosexuals’ rights, racism and xenophobia, the Flotilla report and whether Libya should be represented by the Gaddafi regime or the Transitional Na-tional Council. Other interesting topics on the agenda were the ‘Arab Spring’, women’s rights and empowerment, the fight against racism, climate change and not least Universal Periodic Reviews (UPR) of various countries. The UPR is a unique process which involves a review of the human rights records of all 192 UN Member States once every four years. The ultimate aim of this new mechanism is to improve the human rights situa-tion in all countries and address human rights violations wherever they occur. During the 17th session there were UPR’s presented by the representatives of Rwanda, Myanmar, Saint Kitts and Nevis, Mozambique, Saint Lucia and Oman etc. whereas Denmark was ex-amined in May 2011 at the 16th session of the UNHRC.

At times I experienced that the side events were more interesting in its substance as the plenary sessions could be very formal. I listened to heart-breaking personal stories of torture and abuse - at the end of which the ELSA delegation (8 very emotional females) had to wipe their faces from tears and think happy thoughts.

But being the impatient idealist I am, the anti-climax during the trip was definitely the realization that the UN is a very big and heavy bu-reaucratic machinery where progress is slow and a lot of statements, just words without any action behind. For anyone wanting to work within the UN system a good advice is: guard yourself with patience!

With that said, the most optimistic discovery was the relentless resil-ience coming from the NGO’s. The NGO’s that without breaking a sweat challenged the uncritical statements from governments. The NGO’s that are vital stakeholders when discussing human rights in international forums. The NGO’s, I realized, that actually do make a difference.

Besides attending the session, the ELSA delegation and I gate-crashed a reception with networking opportunities for delegates. The comical thing about the whole scenario was that the middle-aged men with beer belly looked more interested in the food in front of them or the exotic looking lady next to them than in the academic topics discussed.

But I don’t blame them - our main motivation was actually also the thrilling prospects of a free hot meal (!). But for my defense, we had lived on cold sandwiches and chips for days. Off-duty I got to experience Geneva, the third-largest (and very ex-pensive) city in Switzerland, and is the nearest thing the world has to

a truly international city. From its profile in world events, you would imagine a megalopolis on the scale of London or New York, but Geneva is little more than town-sized. During my free time, some of the sights I saw were the big fountain Jet d’Eau in the Geneva Lake, the Cathedral St. Pierre, the University Park and the International Red Cross Museum a stone’s throw away from the UN.

The trip has made me think about our responsibilities as ELSA members and the importance of gaining and acting on knowledge

while keeping our vision in mind - A just world in which there is respect for human dignity and

cultural diversity. In conclusion my advice to you is simple: If you are interested in human rights and international relations, don’t miss out on the exclusive opportunity ELSA provides you with experienc-ing the UNHRC and other international bodies in action! Don’t think, just do!

"... our responsibilities as ELSA Members"

Delegations

E L S A C P H Summer Seminar 2011

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ELSA Denmark

Wanna know more...ELSA Denmark 2011/2012

www.elsa.dk

President - Anne Kathrine Hermansen - president@elsa.dkSecretary General - Frej Campen Wolthers - secgen@elsa.dk

Treasurer - Teit Bang Heerup - treasurer@elsa.dkVice President Academic Activities - Christina Bitsch Kirk - aa@elsa.dk

Vice President Marketing - Fie Cathrine Støttrup Olsen - marketing@elsa.dkVice President Seminars & Conferences - Maria-Christina F. Binau-Hansen - seminars@elsa.dkVice President Student Trainee Exchange Programme: Jannie Lærke Bruus Jensen - step@elsa.dk

ELSA CPH 2011/2012www.elsa-cph.dk

Helle MarquardtsenPresident - president@elsa-cph.dk

Emilie Holse Secretary General - secgen@elsa-cph.dk

Cihan KaraTreasurer - treasurer@elsa-cph.dk

Ida Sofie Miranda PedersenVP Academic Activities - aa@elsa-cph.dk

Sofus Tobias FønsMentor Coordinator - mentor@elsa-cph.dk Sasha ZilicVP STEP - step@elsa-cph.dk

Rasmus Koch-HansenVP S&C - sc@elsa-cph.dk

Nikolaj Jagd SørensenVP Marketing - marketing@elsa-cph.dk Tahira Hinah SheikhVP ELSA School - elsaschool@elsa-cph.dk

ELSA Aarhus 2011/2012www.elsa-aarhus.dk

Anne RubergPresident - president@elsa-aarhus.dk

Sebastian ScagensstierneSecretary General - secgen@elsa-aarhus.dk

Pernille DannevigTreasurer - treasurer@elsa-aarhus.dk

Thea Ballegaard LaursenVP Academic Activities - aa@elsa-aarhus.dk

Sandra KuskMentor Coordinator - mentor@elsa-aarhus.dk

Katja Riedel og Tobias Aaen-LarsenVP STEP - step@elsa-aarhus.dk

Jacob YdeVP S&C - seminarsconferences@elsa-aarhus.dk

Michael Stellian ClausenVP Marketing - marketing@elsa-aarhus.dk

Christina Bitsch KirkVP Fundraising - fundraising@elsa-aarhus.dk

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