www.lexology.com Open in urlscan Pro
2606:4700::6812:d66  Public Scan

Form analysis
2 forms found in the DOM

Name: SearchForm — GET /search/

<form action="/search/" autocomplete="off" method="get" id="SearchForm" name="SearchForm" _lpchecked="1">
  <span class="search-container-nav">
    <label for="q" class="sr-only">Search</label>
    <input type="text" placeholder="Search Lexology" name="q" id="q">
    <input type="submit" class="submit hidden-text" value="Search">
  </span>
</form>

Name: SearchForm — GET /search/

<form action="/search/" autocomplete="off" method="get" id="SearchForm" name="SearchForm" _lpchecked="1" class="foot-search">
  <label for="qfoot" class="sr-only">Search</label>
  <input type="text" placeholder="Search Lexology" name="q" id="qfoot">
  <input type="submit" class="submit hidden-text" value="Search">
</form>

Text Content

Toggle navigation

 * Search
 * PRO
 * Events
 * Awards
    * Influencers
    * Lexology Index Awards 2024
    * Lexology European Awards 2025
   
   Introducing Instruct Counsel
   The next generation search tool for finding the right lawyer for you.
 * About
 * More
   Blog Popular Lexology Academic
 * Login
 * Register
 * 
 * PRO
 * Resources
    * Latest updated
    * Panoramic Q&A
    * Analysis
    * Practical resources
    * In-Depth
    * FromCounsel
    * In-House View
    * Clause library

 * Research tools
    * Global research hub
    * Data hub
    * Lexy Improved
    * Primary sources
    * Scanner
    * Research reports
    * Instruct Counsel

 * Resources
 * Research tools
 * Lexology Index
    * Find an expert
    * Reports
    * Research methodology
    * Submissions
    * Client Choice 2025

 * Lexology Index
 * Learn
    * All
    * Masterclasses
    * Professional development
    * Videos
    * Audio

 * Learn
 * Instruct Counsel
 * My newsfeed
 * Events
 * About
 * Blog
 * Popular


resources-nav-link
 * Latest Intelligence
 * Panoramic Q&A
 * Analysis
 * Practical resources
 * In-Depth
 * FromCounsel
 * In-House View
 * Clause library
 * Browse by

 * 
 * 
 * 

 * 
 * 
 * 

 * 
 * 
 * 

research-nav-link
 * Global research hub
 * Data hub
 * LexyIMPROVED
 * Primary sources
 * Scanner
 * Research reports
 * Instruct Counsel


 * Compare
 * Topics
 * Panoramic Next


ANALYTICS

Access real-time intent data to measure your success and maximise engagement.

 * Analytics dashboard
 * Top articles
 * Top authors
 * Who's reading?


CONTENT DEVELOPMENT

Use advanced tools to take your marketing strategy to the next level.

 * Trending Topics
 * Discover Content
 * Discover Companies
 * Horizons
 * Ideation


BENCHMARKING

Measure the effectiveness of your content against peers.

 * Content Benchmarking
 * Benchmarking and Insight Reports

Lexology


Back Forward
 * Save & file
 * View original
 * Forward
 * Print
 * Share
    * Facebook
    * Twitter
    * Linked In

 * Follow
   Please login to follow content.
 * Like
 * Instruct

add to folder:

 * My saved (default)
   
   


REGISTER NOW FOR YOUR FREE, TAILORED, DAILY LEGAL NEWSFEED SERVICE.

Find out more about Lexology or get in touch by visiting our About page.

Register


NAVIGATING THE ECOSYSTEM OF NON-JUDICIAL GRIEVANCE MECHANISMS

Covington & Burling LLP
prev
next

OECD March 19 2024

Non-judicial grievance mechanisms (NJGMs), many of which have been in place for
several years or even decades, continue to play an important role in the overall
Business and Human Rights (BHR) landscape. NJGMs provide a range of
stakeholders, including third-party civil society organizations, the opportunity
to submit complaints on corporate behavior that allegedly violates guidelines on
responsible business conduct or otherwise adversely impacts human rights or the
environment. They are intended to provide a forum in which adversely affected
individuals or their representatives can seek engagement with companies and,
where relevant, remediation of the issues raised. While NJGMs are voluntary
processes that do not subject companies to legal liability, they often result in
public statements or decisions that can have significant reputational
consequences for companies. In addition, as BHR-related legal and regulatory
risks continue to evolve, companies involved in NJGM processes increasingly need
to consider how issues discussed in NJGM processes may impact future or ongoing
litigation, arbitration, or enforcement proceedings.

This alert discusses key NJGMs, including the National Contact Point (NCP)
Specific Instance process under the OECD Guidelines for Multinational
Enterprises on Responsible Business Conduct (OECD Guidelines or the Guidelines),
communications from the UN Working Group on the issue of human rights and
transnational corporations and other business enterprises (BHR Working Group),
and other mechanisms implemented by international financial institutions and
national institutions. We also provide some practical tips on how companies can
prepare for and respond to complaints submitted via NJGMs.

The OECD Guidelines and the NCP Specific Instance Process

First published in 1976 and most recently updated in 2023, the OECD Guidelines
are the leading responsible business conduct standards that cover a range of
issues, including human rights, labor rights, the environment, bribery, consumer
protection, disclosure, science and technology, competition, and taxation. The
Guidelines and a host of supporting guidance set out principles to guide
businesses as they seek to address the impacts of their own operations and value
chains on people and the planet. Each government that adheres to the OECD
Guidelines—currently 51—is required to set up an NCP tasked with, among other
things, establishing a complaints process—known as the Specific Instance
process—for the resolution of issues that may arise from allegations of
non-compliance with the OECD Guidelines. While the OECD Guidelines contain basic
guidance on the NCP Specific Instance process, the procedural particularities of
each NCP process vary.

The Specific Instance process can be accessed by any party with a specified
interest in an alleged violation of the OECD Guidelines, including trade unions
and non-governmental organizations. The process is initiated by a submitter (or
submitters) filing a Specific Instance with an appropriate NCP. That is usually
the NCP in the country in which the multinational enterprise is headquartered or
the NCP in the country where the violation of the Guidelines is alleged to have
occurred. Following the submission of a Specific Instance, the named company is
given an opportunity to provide a written response.

As the process is voluntary, a threshold question that companies grapple with is
whether to participate in the process and submit a response. There may be
drawbacks of engaging with adversaries through the process, especially when
dealing with bad faith submitters who misuse confidential information, prolong
exchanges resulting in increased length and cost, and contribute to negative
press. However, there can be benefits to participating, as the response provides
an opportunity for the company to clarify the facts, counter any allegations
with which it disagrees, dispel any unmeritorious claims, and highlight any
other concerns, such as potential prejudice to parallel litigation. The
company’s response will play a role in the content of any statement published by
the NCP and can address many of the reputational risks linked to the filing of a
Specific Instance. Moreover, as the NCP process is considered a credible
stakeholder engagement process, declining to engage in the process at an early
stage may be viewed externally as a signal that the company is not committed to
stakeholder engagement. For example, the EU’s Final Report on Minimum
Safeguards, in relation to the EU Taxonomy Regulation, states that
non-engagement with the OECD NCP process signals that a company does not engage
with stakeholders, which could indicate that a company is not compliant with
minimum safeguards. Moreover, as many companies issue public statements
expressing their commitment to the OECD Guidelines and/or human rights and
environmental due diligence, refusing to participate in the NCP process may call
into question the sincerity of such commitments.

After reviewing submissions from both parties, the NCP conducts an Initial
Assessment and evaluates whether or not to accept the case for further
consideration. During the Initial Assessment, the NCP considers a range of
factors, which vary across NCPs but generally include: whether the issues are
material (i.e., relevant to the implementation of the OECD Guidelines) and
substantiated (i.e., supported by sufficient and credible information); whether
there appears to be a link between the enterprise’s activities and the issue(s)
raised; the extent to which applicable law and/or parallel proceedings limit the
NCP’s ability to contribute to the resolution of the issue and/or the
implementation of the Guidelines; and whether the examination of the issue would
contribute to the purpose and effectiveness of the Guidelines. Some NCPs (but
not all) publish a statement at the conclusion of the Initial Assessment stage
outlining the submissions made by the parties and the NCP’s analysis and
decision on whether to offer its good offices for mediation.

If the NCP accepts the case and offers to mediate, the parties must decide
whether to participate in a voluntary mediation process facilitated and observed
by the NCP. While the mediation process is confidential, some NCPs’ processes
offer stronger confidentiality protections than others (e.g., by imposing
sanctions in the event of confidentiality breaches). Following a mediation or a
decision not to mediate, the NCP issues a Final Statement describing the issues
raised and the outcome of the Specific Instance, including, if there was
mediation, whether the parties were able to reach an agreement. The NCP may also
engage in follow-up reviews; some NCPs do this more routinely than others and
may publish follow-up reports, whereas others may engage in more limited,
confidential follow-up.

According to the OECD’s Database of Specific Instances, there have been 295
human rights-themed Specific Instances brought before NCPs since human rights
were integrated into the OECD Guidelines in 2011. The most targeted sectors have
been manufacturing (58 complaints), mining and quarrying (56 complaints), and
financial and insurance activities (40 complaints). Most human rights-related
cases relate to employment and industrial relations (118 complaints), the
environment (81 complaints), and/or disclosure policies related to responsible
business conduct (76 complaints).

UN BHR Working Group Communications

There is a long-established communications procedure under the Special
Procedures of the UN Human Rights Council through which individuals and civil
society organizations can provide information on specific allegations of human
rights violations by States and others, including businesses, to a number of
thematic and country-specific mandate-holders covering a broad range of human
rights issues.

One of the key mandates for businesses is the BHR Working Group. Its
communications procedure, established in 2012, is instigated by submissions sent
by any individual, group, civil society organization, inter-governmental entity,
or national human rights body through an online Special Procedures portal.
Communications in the form of Letters of Allegation are sent by the BHR Working
Group (often with other Special Procedures Rapporteurs) to companies and other
relevant stakeholders. The letters report on allegations of human rights
violations that they have received and request responses addressing certain
issues and concerns, including questions about companies’ human rights and
environmental due diligence processes. The communications can also request that
action be taken to prevent, stop, investigate, or remedy the alleged violation.
Companies are not legally obligated to respond, but often elect to do so. The
BHR Working Group communications are made public on the Communications Database,
as are any responses received. The communications and any replies are collated
into reports presented to the Human Rights Council at each session and annual
summaries are submitted by the Human Rights Council to the UN General Assembly.
The Special Procedures are fairly active: in 2022 alone, the BHR Working Group
sent 117 communications to companies and other stakeholders related to human
rights concerns.

The BHR Working Group does not have power or authority to enforce their views or
recommendations. Rather, the intended effect of the communications process is to
encourage businesses to engage with the BHR Working Group in relation to the
allegations and to enable businesses to provide information on their business
conduct and alignment with the UN Guiding Principles on Business and Human
Rights (UNGPs).

Other NJGMs

There are a variety of other NJGMs that are implemented by different
organizations. Some of the key mechanisms that businesses should be aware of are
as follows:

NJGMs of National Human Rights Institutions (NHRIs)/Ombudspersons: NHRIs are
autonomous bodies mandated by states to promote and protect human rights. Many
NHRIs/Ombudspersons have dispute mechanisms in place, which are becoming
increasingly active. For example, there has been a recent proliferation of
activity from the Canadian Ombudsman for Responsible Enterprise (CORE), which
was established in 2019 to investigate alleged adverse human rights impacts of
the overseas operations of Canadian companies in the garment, mining, and oil
and gas sectors. CORE’s complaints process follows a similar process to that of
an OECD NCP and involves an initial assessment, mediation, investigation,
issuance of recommendations, and follow-up. CORE publishes non-confidential
reports on its initial assessment, the results and recommendations of any
investigation, the mediation process (when a complaint has been settled), and
follow-up on the recommendations issued. CORE does not have the legal power to
bring enforcement actions, but it can recommend to the relevant government
minister that a matter be referred to enforcement or regulatory authorities.

Independent Accountability Mechanisms at International Financial Institutions
(IFIs): Many IFIs have voluntary external accountability mechanisms, referred to
as Independent Accountability Mechanisms (IAMs), such as the International
Finance Corporation (IFC) and Multilateral and Investment Guarantee Agency
(MIGAs) Compliance Advisor Ombudsman (CAO) and regional mechanisms including the
African Development Bank’s Independent Review Mechanism and the European Bank
for Reconstruction and Development’s (EBRDs) Independent Project Accountability
Mechanism (IPAM). The scope and mandate of each IAM vary, but in general these
mechanisms provide an opportunity for individuals affected by IFI projects (or
their representative organizations) to submit complaints about adverse
environmental or social impacts resulting from the projects, including
grievances directed at the behavior of companies involved in the projects. For
example, in September 2023, the Uzbek Forum for Human Rights, supported by the
NGO Bankwatch Network, filed a complaint through the EBRD’s IAM alleging that
EBRD failed to conduct appropriate human rights due diligence in its continued
financing of one of Uzbekistan’s largest cotton producers which is allegedly
connected to human rights violations (including labor rights violations, land
grabs, and exploitation). The mechanisms have also been used to target
corporates involved in IFI-financed projects, alleging that they have not
conducted adequate human rights due diligence. There are currently 50+ open
cases before the IFC’s CAO. In addition to reputational risk and possible costs
of any remediation measures, involvement in an IAM process may also be
considered by IFIs in the context of assessment of future project proposals.

Practical Tips for Handling NJGMs

Against a backdrop of creative civil litigation strategies, regulatory
enforcement risks, and a growing number of mandatory human rights and
environmental due diligence regimes, multinationals should understand how NJGMs
fit into the broader BHR ecosystem. Implementing robust human rights due
diligence and stakeholder engagement processes may help to avoid NJGM
grievances. In the event that grievances are raised, companies should consult
with outside counsel to navigate the multidimensional risks and benefits of
participation, downstream consequences, and complexities of the issues involved.
Some practical tips companies might consider include:

 1. Educate key internal stakeholders about the processes. Critical functions to
    educate on NJGMs may include litigation, legal and compliance, human rights,
    sustainability, and communications functions, as well as Boards of
    Directors. Companies may also wish to train front-line business personnel
    working in high-risk functions or projects on the types of issues that may
    give rise to NJGM grievances or related risks.
 2. Evaluate human rights and environmental due diligence infrastructure.
    Companies should assess human rights and environmental due diligence
    infrastructure against relevant standards, including the OECD Guidelines,
    the UNGPs, and evolving mandatory human rights due diligence frameworks.
 3. Implement robust internal escalation, investigation, and engagement
    procedures. It is critical for companies to implement robust escalation and
    investigation procedures with respect to human rights-related complaints
    raised through the company’s own grievance mechanisms or compliance
    reporting channels, or other channels such as outreach from rights-holders
    or representative organizations. Grievances are often raised directly to
    companies before they are submitted to NJGMs, and engagement at early stages
    may lead to early resolution of underlying issues and help to avoid a more
    formal public process.
 4. Adapt to the nuances of the NJGM systems. In our experience, NJGMs require a
    different approach to traditional dispute resolution. The processes are not
    intended to be litigious in nature, but rather are intended to serve as
    forums for constructive engagement, development of best practices, and
    ultimately, the identification and mitigation of adverse human rights and/or
    environmental impacts. Approaching the process in the same way a company
    would approach a civil litigation complaint may be counterproductive and
    lead to unfavorable results. There are also unique nuances to each
    particular NJGM.
 5. Consider carefully whether and how to engage in NJGM processes. As NJGM
    processes are voluntary in nature and in some cases instigated by
    organizations that may be viewed as hostile, companies may be reluctant to
    engage with them. As discussed above, there can be benefits associated with
    participation and risks associated with non-engagement. At the same time,
    NJGMs are often accessed by parties that are either threatening litigation
    or already engaged in active litigation against the company, and the risks
    of prejudice to such parallel litigation should be taken into account in
    evaluating the scope of the issues on which a company is prepared to engage
    and what information the company is prepared to share as part of that
    engagement. In addition, the confidentiality risks posed by engagement in an
    NJGM process can be significant, as there are limited mechanisms available
    to enforce associated confidentiality obligations. Public statements or
    disclosures concerning issues discussed in NJGM processes may also give rise
    to regulatory and enforcement risks that need to be considered. In each case
    a careful balancing should be conducted of the risks and benefits of whether
    to participate and the manner and scope of participation.

Covington & Burling LLP - Sarah Bishop, Hannah Edmonds Camara, Daniel F.
Feldman, Cherine Foty, Emanuel Ghebregergis, Peter Koski, Tom Plotkin, Craig
Pollack, Donald J. Ridings Jr., Emma Sawatzky and Kimberly C. Stietz

Back Forward
 * Save & file
 * View original
 * Forward
 * Print
 * Share
    * Facebook
    * Twitter
    * Linked In

 * Follow
   Please login to follow content.
 * Like
 * Instruct

add to folder:

 * My saved (default)
   
 * Read later
   

Folders shared with you
   
 * 
   


FILED UNDER

 * OECD
 * Company & Commercial
 * Human Rights
 * Covington & Burling LLP


POPULAR ARTICLES FROM THIS FIRM

 1. GAO RELEASES NEW VEHICLE DATA PRIVACY REPORT *

 2. GREEN GROCERIES: KEY ESG ISSUES FOR THE FMCG INDUSTRY (INCLUDING FBOS) *

 3. TRUMP ADMINISTRATION RELEASES, REVOKES, AND REISSUES “MOST-FAVORED-NATION”
    EXECUTIVE ORDER *

Interested in contributing?
Get closer to winning business faster with Lexology's complete suite of dynamic
products designed to help you unlock new opportunities with our highly engaged
audience of legal professionals looking for answers.
Learn more

Lexology data hub
News, analysis and research tools covering the regulation and use of data, tech
and AI.
Explore now



RELATED PRACTICAL RESOURCES PRO

 * How-to guide How-to guide: How to create a supplier code of conduct (UK)
 * Checklist Checklist: Modern slavery in supply chains (USA)
 * How-to guide How-to guide: How to assess modern slavery risk in supply chains
   (USA)

View all


FEATURED VIDEO

Pro
Watch now
Video
Limitation of Liability: Section 2 - Caps and Carve-Outs
4m 4s

Watch now


RELATED RESEARCH HUBS

 * OECD
 * Company & Commercial
 * Human Rights

Back to Top
Resources
 * Daily newsfeed
 * Panoramic
 * Research hubs
 * Learn
 * In-Depth
 * Lexy: AI search
 * Scanner

Lexology Index
 * Find an expert
 * Reports
 * Research methodology
 * Submissions
 * Instruct Counsel
 * Client Choice 2025

More
 * About us
 * Legal Influencers
 * Firms
 * Blog
 * Events
 * Popular
 * Code of ethics
 * Lexology Academic

Legal
 * Terms of use
 * Cookies
 * Disclaimer
 * Privacy policy

Contact
 * Contact
 * RSS feeds
 * Submissions

 
 * Login
 * Register

Search
 * Follow on X
 * Follow on LinkedIn

© Copyright 2006 - 2024 Law Business Research


×




Close


COOKIE PREFERENCE CENTRE




 * YOUR PRIVACY


 * STRICTLY NECESSARY COOKIES


 * PERFORMANCE COOKIES


 * FUNCTIONAL COOKIES


 * TARGETING COOKIES

YOUR PRIVACY

When you visit any website, it may store or retrieve information on your
browser, mostly in the form of cookies. This information might be about you,
your preferences or your device and is mostly used to make the site work as you
expect it to. The information does not usually directly identify you, but it can
give you a more personalized web experience. Because we respect your right to
privacy, you can choose not to allow some types of cookies. Click on the
different category headings to find out more and change our default settings.
However, blocking some types of cookies may impact your experience of the site
and the services we are able to offer.
More information

STRICTLY NECESSARY COOKIES

Always Active

These cookies are necessary for the website to function and cannot be switched
off in our systems. They are usually only set in response to actions made by you
which amount to a request for services, such as setting your privacy
preferences, logging in or filling in forms. You can set your browser to block
or alert you about these cookies, but some parts of the site will not then work.
These cookies do not store any personally identifiable information.

PERFORMANCE COOKIES

Performance Cookies


These cookies allow us to count visits and traffic sources so we can measure and
improve the performance of our site. They help us to know which pages are the
most and least popular and see how visitors move around the site. All
information these cookies collect is aggregated and therefore anonymous. If you
do not allow these cookies we will not know when you have visited our site, and
will not be able to monitor its performance.

FUNCTIONAL COOKIES

Functional Cookies


These cookies enable the website to provide enhanced functionality and
personalisation. They may be set by us or by third party providers whose
services we have added to our pages. If you do not allow these cookies then some
or all of these services may not function properly.

TARGETING COOKIES

Targeting Cookies


These cookies may be set through our site by our advertising partners. They may
be used by those companies to build a profile of your interests and show you
relevant adverts on other sites. They do not store directly personal
information, but are based on uniquely identifying your browser and internet
device. If you do not allow these cookies, you will experience less targeted
advertising.

Back Button


BACK



Vendor Search
Filter Button
Consent Leg.Interest
checkbox label label
checkbox label label
checkbox label label

Clear
checkbox label label
Apply Cancel
Save settings
Allow All


We use cookies to give you the best online experience. By clicking "Accept
Cookies" or clicking into any content on this site, you agree to allow cookies
to be placed. To find out more visit ourcookie policy

Cookies Settings Accept Cookies