Government and other stakeholders from Burma/Myanmar discuss responsible investmentedit
Burma/Myanmar is undergoing rapid change and foreign investors are keen to explore opportunities. The UN’s Guiding Principles on business and human rights provide a framework for companies to operate consistent with human rights standards.
Wednesday 7 – Friday 9 November 2012
Burma/Myanmar, business and human rights – setting standards for responsible business (WP1195)
In the year after President Thein Sein’s reform process began, there have been a number of significant developments which are reshaping the political landscape. Ceasefires have been agreed with the majority of armed ethnic groups; the National League for Democracy (NLD) now has elected representatives in the national legislatures, including its leader, Aung San Suu Kyi; Western sanctions are suspended; and the World Bank and other international agencies are returning to set up office in the country, but the jury is still out on whether the reform process will succeed. Those who prefer the status quo may still block change.
Foreign investment is crucial to Burma/Myanmar’s development. Some companies which have stayed out of the country until now are keen to explore opportunities and also ensure their engagement is socially responsible. Our conference ‘Burma/Myanmar, business and human rights: setting standards for responsible business’, held between 7 and 9 November 2012, brought together government, business and civil society representatives from the country, including a personal representative of Aung San Suu Kyi, and persons belonging to ethnic minorities. Together with the UK and other governments, the UN and the International Labour Organisation, international corporates such as Shell, BP, BG Group, Standard Chartered, Coca Cola and Ericsson, and experts on Burma/Myanmar.
The aims of the conference were:
- to assess the current political, economic, social and business context in the country:
- identify what needs to be done to support an enabling business environment consonant with the UN Guiding Principles for the implementation of the ‘Protect, Respect and Remedy’ framework on business and human rights
- and encourage businesses to work collectively and develop principles ensuring their conduct takes into account the specific situation in the country.
The conference was held in partnership with the Institute for Human Rights and Business (IHRB), as part of its larger project on Burma/Myanmar, supported by the UK Government. This includes the establishment of a resource centre in Yangon to guide both international and local business in developing socially responsible operations. Ericsson also sponsored the conference.
Among key issues discussed at the conference were:
- The urgent need to build government capacity and knowledge, as well as strengthen legislative and judicial branches, in particular improving the quality of the courts; not only is it necessary to prepare new laws, for example on land tenure, or electoral issues, and draft transparent budgets, but proper application of existing and new laws is required to promote the rule of law. While the recent Foreign Investment Law is welcome, the subsidiary legislation for its implementation needs to provide clarity. There is concern about the broad powers and discretion granted to the Myanmar Investment Commission.
- Intensive efforts need to be made to bring about an inclusive and lasting peace to the continuing ethnic conflicts, which will otherwise impede foreign investment. There needs to be a Constitutional settlement on issues relating to ethnic nationalities and centre-state relations, and fair and equal access to resources for a sustainable development path. The capacity of regional-state government also needs to be addressed.
- Corruption, which deters investment, should be tackled systematically, from both top downwards and bottom upwards, and a culture of integrity needs to be built. New anti-bribery legislation has been adopted in August 2012. Accepting international standards for accountability, such as the Extractive Industries Transparency Initiative, which the government has indicated its willingness to join, should be a priority. The business community should also accept responsibility for addressing corruption.
- There is concern about ‘land grabbing’, as well as general and specific land tenure issues. While a parliamentary commission was created to look into these concerns, it has not so far been able to examine military land appropriation.
- Other governments have a role to play. The US Government’s reporting requirements on responsible investment in Burma is an example of good practice. Governments can also assist small and medium sized enterprises (SMEs) take both financial and reputational risks, which they are reluctant to do, and trade missions should help in identifying potential risks.
- There is a need to maintain the momentum for reform, but expectations also need to be managed. Consultation is key, and listening to local voices.
The IHRB will be following up the conference discussions in workshops to be held in Rangoon/Yangon in late 2012, and through the on-going work of its local resource centre.