CORPORATIONS AND HUMAN RIGHTS
Corporations faced continued scrutiny of their human rights performance throughout the world in 1999. The two key sectors under fire were the apparel and footwear industry, for labor rights violations, and the energy industry, for complicity in human rights violations committed through partnerships with repressive governments.
Companies that had previously made human rights commitments continued to develop policies and programs to address the potentially negative impact of their operations on human rights. However, even though some companies, such as the Gap and Royal Dutch/Shell (Shell) pledged to implement socially responsible policies, they faced new controversies. A disturbing new trend emerged as well: companies that were mired in controversy seemed to reject human rights considerations out of hand, even though a growing body of evidence clearly indicated a need to change their practices in order to avoid the risk of public criticism, the potential impact on the companies' bottom-line, and potential legal liabilities.
The Apparel and Footwear Industry
After years of criticism for labor rights abuses, the apparel and footwear industry continued to develop and implement monitoring and compliance programs in order to ensure that the rights of workers were respected in the global workplace. Most efforts focused on the development of two key programs: the White House-sponsored Fair Labor Association (FLA)-formerly known as the Apparel Industry Partnership-and the Council on Economic Priorities (CEP) Social Accountability 8000 program (SA-8000). The FLA gained two new corporate members in 1999. Adidas-Solomon AG and Levi-Strauss joined the association on July 8 and 21, respectively. On September 10, Charles Ruff, former White House counsel, was appointed chairperson of the FLA's board of directors.
Despite the greater industry participation in these programs, companies were not insulated from criticism in 1999. Two key developments increased the pressure on the industry to address labor rights: a series of class-action lawsuits against U.S. companies and their subcontractors manufacturing in the U.S. island territory of Saipan and the emergence of university students as a powerful force against workplace exploitation.
The Saipan Lawsuit
On January 13, a federal class-action lawsuit in the U.S., a lawsuit in the U.S. territory of Saipan, and a third lawsuit in California state court were simultaneously filed against thirty-two apparel and footwear manufacturers and their subcontractors by Global Exchange and Sweatshop Watch, two California-based labor rights nongovernmental organizations (NGOs), on behalf of approximately 40,000 garment workers employed by manufacturers in Saipan. The suit alleged that workers faced repeated harassment, physical abuse, and poor working conditions in the South Korean-owned Sako factory, Global Manufacturing Incorporated, Diovra Saipan Limited, the Concord Garment Manufacturing Corporation, Jin Apparel Incorporated, and other companies that produced products for large U.S. retailers such as Cutter & Buck, Chadwick's of Boston Limited, Donna Karan International, the Gap, Gymboree, J. Crew, Phillips Van-Heusen, Nordstrom, Polo Ralph Lauren, Tommy Hilfiger, and Wal Mart. In addition, the U.S. government joined in and filed two civil rights lawsuits against the Sako factory on June 30. Although the lawsuit filed in Saipan was dismissed, four of the defendants-Cutter & Buck, Gymboree, J. Crew, and Nordstrom-reached a settlement with the plaintiffs on August 9 and agreed to pay U.S.$1.25 million in order to implement an independent monitoring program that would be administered by Verité, an independent monitoring firm. Lawyers for the plaintiffs also announced that they had reached an "in principle" settlement with Chadwick's of Boston Limited, Donna Karan International, Phillips Van-Heusen, and Polo Ralph Lauren. The remaining companies chose to resolve the issue in court.
In response to these events the Clinton Administration announced on September 16 that it was considering expanding U.S. immigration, wage, and trade laws so that they would cover Saipan and in order to punish past abuses and prevent future exploitation.
Student Activism at U.S. Universities
University students emerged as a powerful new voice in the campaign against worker exploitation. Throughout the year, students staged demonstrations at Harvard University, the University of Wisconsin, Duke University, the University of North Carolina, throughout the University of California system, and other universities around the U.S. demanding that their schools only agree to license their university apparel with companies who have credible monitoring programs to ensure respect for labor rights and also urging their universities to support the FLA. In response to student activism throughout the U.S., more than eighty universities had joined the FLA by the end of 1999.
The Energy Industry
Following a year in which oil prices reached all-time lows and placed severe economic pressures on the industry and energy-producing countries, 1999 emerged as a year of "mega-mergers" and acquisitions-including the merger of Exxon and Mobil, British Petroleum (BP) and Amoco, BP-Amoco and the Atlantic Richfield Corporation (ARCO), France's Total and Belgium's Fina, and the announced acquisition of France's Elf Aquitaine (Elf) by Total-and rising oil prices. Consolidation within the industry meant that a smaller group of transnational corporations would have to assume responsibility for the sector's human rights impact globally. Two key issues dominated the human rightsdebate: the use of revenues generated by energy projects to bolster abusive governments and situations of corporate complicity in human rights violations when companies relied on abusive state forces for the protection of company facilities, personnel, and prerogatives. Despite efforts by some companies to address human rights, the overall performance of the industry was poor. Countries where companies were criticized for their operations on human rights grounds included Chad, India, and Nigeria.
The proposed U.S.$3.5 billion Chad-Cameroon pipeline, an Exxon-led joint venture comprised of Exxon, Shell, and Elf, was sharply criticized by political parties, national government representatives, and NGOs throughout 1999 because of the project's potentially negative effect on the environment, governance, and human rights. The World Bank delayed approval of approximately $340 million in direct and indirect financing for the project until the end of 1999 due to concerns over the environmental and human rights impacts of the project; and in July the bank announced that it was developing a "revenue management" program to ensure that the proceeds from the project were used responsibly and did not contribute to corruption, mismanagement, or an overall deterioration in human rights. Although NGOs and U.S. government officials questioned Exxon about its security arrangements and the need to make respect for human rights an integral part of the project's development, the company made no meaningful effort to address these issues directly and was dismissive of efforts by NGOs and representatives of the U.S. congress to urge the company to adopt human rights policies and programs.
On a positive note, Chadian president Idriss Déby released former opposition parliamentarian, Ngarléjy Yorongar, from prison on February 4. Yorongar had been arrested for defamation on June 3, 1998 because he had accused Elf, a joint-venture partner of Exxon, of financing an opposition candidate's presidential campaign and had accused Déby of fostering nepotism and corruption in the oil industry. He had been convicted and sentenced to three years' imprisonment (one year more than the maximum sentence stipulated by law), but international condemnation by governments, NGOs, and pleas from his own community prompted his release. The members of the Exxon-led consortium were silent on this issue.
The Houston-based Enron Corporation took no meaningful steps to make respect for human rights an integral part of the business operations of the Dabhol Power Corporation (DPC), an Enron subsidiary in the Indian state of Maharashtra. The DPC constructed and operates a large power plant on the coast of Maharashtra known as the Dabhol Power project. Since the project's inception in 1992, the deal was repeatedly criticized by key Indian and international economists and condemned by intellectuals, academics, the Indian press, trade unions, opposition political parties, and nongovernmental organizations throughout India because of its lack of transparency, its projected high costs, and potential environmental impacts. The deal was so controversial that it was suspended when a Hindu nationalist government coalition was elected to power in 1995. Then, in an about-face that renewed allegations of corruption surrounding the project, the government renegotiated the project and allowed its construction.
On January 25, 1999, Human Rights Watch released The Enron Corporation: Corporate Complicity in Human Rights Violations, a 165-page report detailing human rights abuses that had occurred as a result of opposition to the Dabhol Power project. Beginning in late 1996 and continuing throughout 1997, leading Indian environmental activists and representatives of villagers' organizations in the affected area organized to oppose the project and, as a direct result of their opposition, were subjected to beatings and repeated short-term detention. In many cases, they were detained for periods ranging from several days to two weeks without being produced before a magistrate as required under Indian law. During mass arrests at demonstrations in villages surrounding the project site protesters have been beaten with canes or otherwise assaulted by the police, in some cases sustaining severe injuries. Police also tear-gassed peaceful demonstrations and frequently used laws providing for preventative detention to arrest demonstrators in anticipation of protests or because police suspected violence. At this writing, many of these charges were still pending against demonstrators and had not been resolved. Under provisions of the Bombay Police Act, the Dabhol Power Corporation was required to reimburse the police charged with providing security to its facilities and some of the same police implicated in the abuses.
In Nigeria, protests against oil production escalated as the handover to civilian rule provided more space for the expression of political demands. In one incident in January 1999, two communities in Delta State were attacked by soldiers using a helicopter and boats commandeered from a facility operated by Chevron, following an alleged confrontation that took place at a nearby Chevron drilling rig. More than fifty people may have died in these incidents. Chevron did not issue any public protest at the killings, nor respond to requests from Human Rights Watch to be informed of its plans to prevent similar incidents in the future.
There was also an increase in kidnappings of oil company staff for ransom, and violence between neighboring communities over matters such as the location of local government headquarters or the oil facilities crucial for the distribution of oil resources. Due to the continuing violence that centered around oil production, flow stations were repeatedly closed down and several companies declared a situation of force majeure. In August, Mobil, speaking for the multinationals operating in Nigeria, said that Nigeria had lost approximately U.S.$1 billion in oil revenues as of August 1999 as a result of protests in the oil producing communities.
The oil companies responded to the threat of production shut-downs and hostage taking by announcing increased development spending in host communities, much of it poorly targeted, and, despite denials, frequently making ransom payments when hostages were taken. In testimony before the U.S. House of Representatives Subcommittee on Africa in July, chair of the Corporate Council on Africa David Miller suggested that U.S. oil companies would contribute towards efforts to train Nigerian police operating in the delta. However, no statements were made regarding the incorporation of human rights content and oversight for training programs and several companies expressed a reluctance to adopt this type of training program.
Corporate Initiatives to Address Human Rights
Norway's Statoil and BP-Amoco, two companies that have human rights policies and programs, each put them to the test in 1999. On January 4, the Norwegian Oil and Petrochemical Workers Union (NOPEF) announced that Statoil had informed the Baltimore-based Crown Central Petroleum that it would not renew its refining contract with Crown or discuss any expansion of its activities with Crown until "normal relationships" were established with the Oil, Chemical, and Atomic Workers International Union (OCAW) at the company's Pasadena, Texas refinery. Crown had been involved in a heated labor dispute and lockout with OCAW since 1996 and had been the target of a national boycott due to alleged race and sex discrimination and environmental damage. Statoil had signed a global collective bargaining agreement with OCAW in July 1998 that required the company to respect the labor rights of its employees and to ensure respect for human rights in the company's areas of operations in order to "affirm their support for fundamental human rights in the community and in the place of work." Commenting on Statoil's decision, OCAW president Robert Wages said, "[b]y pairing one of the worst oil companies with Statoil-which became the first multinational oil company to sign an international agreement to support labor and human rights-the contradiction became too much for Statoil to bear."
On May 18, BP-Amoco announced that it had signed security agreements with Azerbaijan, Georgia, and Turkey, the three countries involved in the transportation of oil and gas through the proposed Baku-Ceyhan Main Export Pipeline (MEP). However, the company stated that it could not begin construction of the pipeline until it received guarantees from the governments involved that their security forces would comply with the company requirements of ethical conduct, respect for human rights, and adequate third-party monitoring of security forces guarding the pipeline. BP-Amoco, the lead operator in the Azerbaijan International Operating Company (AIOC) and other consortia that are developing offshore oil and natural gas fields in the Caspian Sea, was also expected to have significant involvement in the construction of the proposed MEP.
The Role of Governments
Governments that subordinated human rights to the promotion of commercial and strategic interests remained another focus of the efforts to promote corporate responsibility. The most blatant example of this phenomenon in 1999 was the U.S. government's policy towards Turkmenistan.
Although the Turkmen government under president Saparmurad Niyazov continued to deny its citizens their civil and political rights and relied on a powerful, Soviet-style secret police to do so, pipeline politics continued to dominate bilateral relations between Turkmenistan and the U.S. government-the most forceful proponent of a proposed $2.4-$2.8 billion trans-Caspian gas pipeline that would originate in Turkmenistan and terminate in Turkey-often at the expense of human rights. This approach sent the message that the U.S. government's stated commitment to international human rights protection may be set aside where geopolitical and energy interests are concerned.
In late January, at the invitation of the Turkmen government, several Human Rights Watch representatives, including Human Rights Watch's executive director Kenneth Roth, went to Ashgabat on an official visit and fact-finding trip. At approximately 11:00 p.m. on February 2, less than twenty-four hours after Roth had left the country, three agents from the Committee for National Security (KNB) detained Human Rights Watch's Moscow-based researcher Alexander Petrov in his hotel room in Ashgabat. The authorities accused him of unspecified offenses and held him incommunicado, refusing to allow him to notify his colleagues or his consulate (he is a Russian citizen) that he had been detained and was being forced out of the country. The security officers then took Petrov directly to the Ashgabat airport, where he was forced to wait until morning for the next available flight to Moscow.
Nine days later, on February 11, Turkmen Foreign Minister Boris Shikhmuradov announced that the government awarded PSG International, a joint-venture of two U.S.-based companies, the General Electric Capital Corporation and the Bechtel Corporation, the lead role in a consortium to build the trans-Caspian gas pipeline. Later, on August 5, Shell announced its intent to join the consortium. According to press reports, Shikhmuradov said that part of the reason for the choice of U.S. companies to lead the project was because the project needed political support from the U.S. government and that, "You do not need to discover America to be able to work out that America is important to Turkmenistan."
The Turkmen government imprisoned political activists and detained a number of potential opposition candidates for the upcoming parliamentary elections on December 12. For example, on May 28, the Tashauz municipal court convicted Shakhrat Razmetov of "hooliganism," for having sought contact with the U.S. Embassy in Ashgabat. Razmetov had repeatedly been in contact with foreign diplomats and was sentenced to three years of imprisonment after a court hearing in which witnesses openly stated that authorities had coerced their testimony against him.
On August 5, a court sentenced Ayli Meredov, a former deputy head of the Balkan province education department, to five years imprisonment for failing to report the sale of his automobile. Shortly before his arrest, Meredov had expressed his intention to stand for election to Parliament. Later, a judge released Meredov from custody under a recent amnesty and after Meredov signed a statement confessing to the "crime." He remained ineligible to run for elected office for ten years under Turkmenistan's Law on Elections.
On August 14, the same day U.S. Secretary of Energy, Bill Richardson, departed on a tour of Azerbaijan, Turkey, and Turkmenistan, three of the countries slated to participate in a trans-Caspian pipeline, Dr. Pirguli Tangrikuliev was sentenced to eight years imprisonment by an Ashgabat court for purported "abuse of office." Tangrikuliev-a prominent medical scientist, clinician, public health administrator, and a member of the republican Supreme Soviet until 1994-had long been known for his critical views of the government and had repeatedly expressed to diplomats and others in Ashgabat's international community his interest in running for parliament in order to effect political change in Turkmenistan.
Although he had been arrested on June 29, state security officers held Dr. Tangrikuliev, who had no prior convictions, for six weeks before charging him. But immediately following his arrest and before authorities had formally charged him, Turkmenistan's state newspapers ran articles accusing him of financial malfeasance. In addition, several weeks before his trial and conviction, the Turkmenistan Embassy press attache in Moscow, in an article in Nezavisimaia gazeta, called Dr. Tangrikuliev a "criminal" who was therefore unable to run for parliament.
Human Rights Watch believes that the charges were merely a pretext and that he was actually arrested and imprisoned in order to punish him for his outspoken criticism of state policies, and to prevent him from forming a political party and contesting a seat in the upcoming parliamentary elections.
Six days after Tangrikuliev was sentenced, U.S. Secretary of Energy, Bill Richardson, John Wolf, the special advisor to the president and secretary of state for Caspian Basin Energy Diplomacy, and J. Joseph Grandmaison, the director of the U.S. Trade and Development Agency (USTDA), met with President Niyazov to discuss the proposed trans-Caspian gas pipeline and to release a U.S.$150,000 USTDA grant so that the Turkmen government could "formulate documents" related to the project. The U.S. government waited until August 23-three days after Richardson left the country-to issue a condemnation regarding the sentencing and imprisonment of Tangrikuliev.