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Principles and pathways: Legal opportunities to improve Europe’s corporate accountability framework

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The European Union (EU) prides itself on promoting Europe’s economy alongside protecting the environment and caring for the people. Since the Treaty of Rome, Europe has expanded in size, and sphere of influence. The EU’s legal capacity has put it in an exceptional position to create and implement some of the best environmental and human rights laws internationally, yet the Multinational Enterprises (MNE) it hosts have continually and increasingly been associated with gross environmental and human rights violations within the EU and internationally, documented by civil society groups, academia and the EU itself. The reason for these continued violations of rights is complex and multifaceted, yet of central significance is the European law that governs these MNEs’ legal structure and accountability.

There is much the EU could do to reform these legal structures and accountability mechanisms. After three years of legal research which has been reviewed and developed by an array of high profile lawyers, academics and human rights advocates, ECCJ has identified three areas in which the EU could make a significant difference:

1. Improving the governance in the operations of MNEs concerning foreign subsidiaries and subcontractors

2. Improving disclosure of information

3. Mitigating the practical obstacles facing victims

The UN Secretary-General’s Special Representative on the issue of human rights and transnational corporations, John Ruggie, has as well clearly identified the need for States to be more creative in ensuring their duty to protect citizens against human rights violations. Moreover, the recently published study “Legal Framework on Human Rights and the Environment Applicable to European Enterprises Operating outside the European Union”, done by the University of Edinburgh team and commissioned by the European Commission, also identifies some feasible avenues for the EU to lead on this matter. And it is not a coincidence that both sources point out at some common lines of improvement, which in fact coincide greatly with what ECCJ is proposing.

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