Investors as International Law Intermediaries: Using Shareholder Proposals to Enforce Human Rights
One of the biggest challenges with international law remains its enforcement. This challenge grows when it comes to enforcing international law norms against corporations and other business organizations. The United Nations Guiding Principles recognizes the “corporate responsibility to respect human rights,” which includes human rights due diligence practices that are adequate for “assessing actual and potential human rights impacts, integrating and acting upon the findings, tracking responses, and communicating how impacts are addressed.” Unfortunately, many corporations around the world are failing to implement adequate human rights due diligence practices in their supply chains. This inattention leads to significant harms for the victims of these human rights abuses and a variety of risks – legal, reputational, business, and regulatory – for the companies involved. Over the years, lawsuits have been brought against Walmart, JC Penney, Hershey, Nestle, Purina, Tesla, Google, Chevron, and many others regarding their human rights practices.
As part of Berle XII’s exploration of “Corporate Capitalism and the City of God,” this Article explores how shareholders have attempted to change the human rights due diligence practices of companies by submitting shareholder proposals requesting information on a company’s human rights policies, assessments, and implementation strategies. While many of these proposals are filed by faith based organizations and other members of the Interfaith Center on Corporate Responsibility (ICCR), recent proposals have also received support from actors such as BlackRock and Vanguard. This Article provides a descriptive account of the proposals submitted, evaluates the various shareholder reasons for proposing and supporting these proposals, discusses the outcomes of these proposals (such as approval, exclusion, and withdrawal), and analyzes the possibilities and limitations of enforcing international human rights norms through the mechanism of shareholder proposals.
Kishanthi Parella, Investors as International Law Intermediaries: Using Shareholder Proposals to Enforce Human Rights, 45 SEATTLE U. L. REV. 41 (2021).
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