Implementing UNGPs to hold the industries accountable for environmental damage

Most importantly, the 2011 UN Guiding Principles on Business and Human Rights (UNGPs) sets an overarching global standard of expected conduct for all business enterprises wherever they operate and requires business entities to take adequate measures to prevent, mitigate, and remediate adverse human rights impacts that include environmental pollution.

The economy of Bangladesh has seen tremendous growth in the recent past that helped the country graduate from LDC to middle income country. It is undeniable that business enterprises and industries have played significant role in achieving the milestone of LDC graduation. The other side of the coin is that business entities and industries have been causing excessive environmental pollution while threatening the sustainability of the emerging economic growth of the country. It is reported that industrial waste has a substantial impact on natural resources that lead to excessive air and water pollution while destroying aquatic and forest ecology. It is estimated that Bangladesh loses over $6.5 billion amounting to 3.4% of its GDP due to environmental pollution every year.

The relevant study reports from the recent past have frequently indicated that Bangladesh has been named the world's most polluted country while Dhaka has been ranked as the worst livable city in the world. The capital city becomes unlivable due to rampant industrial pollution and unplanned urbanisation destroying the ecosystem. A large number of industries are located on the bank of the rivers which release tons of waste materials into the rivers every day. A study by the Environment and Social Development Organization (ESDO) of Bangladesh revealed that 6,000 tons of liquid waste is dumped into the Buriganga river every day. All the city waste, industrial garbage, and toxic liquid are directly dumped into the rivers flowing around Dhaka which make them 'biologically dead rivers'. Due to such environmental pollution, Bangladesh is not only incurring huge economic losses (3.4 percent of its GDP) but also witnessing premature deaths amounting to 28 percent of all deaths in Bangladesh.

It is undeniable that companies contribute to society while employing people and producing products and services. However, we need to keep in mind that companies also make profits by exploiting natural resources, extracting raw materials that belong to the 'global commons'. It is argued that since companies contribute to environmental degradation, they cannot avoid responsibility to mitigate and prevent such degradation. In this regard, the Corporate Environmental Responsibility (CER) becomes significant. The CER encompasses legally or morally binding responsibility of a company for its social and environmental performance. It obligates the companies/industries to look beyond the short-term profitability and to undertake responsible business practices while considering the environmental impact of the corporate actions.

Additionally, the CER underscores the necessity of internalising environmental cost with the price of a product since every product has environmental implications. Such internalisation of environmental cost reflects company's commitment to integrate sustainable practices which help the company reduce costs of the products while improving company's reputation. In addition to reputation and new market opportunities, CER mitigates the financial costs associated with a failure to take environmental responsibility. The most significant feature of CER underlies the fact that it reduces the tension between economic growth by massive industrialisation and environmental degradation due to such unplanned industrialisation.

The UNGPs provide human rights enabled complaint and remedial mechanism to redress grievances for environmental harms committed by corporate actors. Such human rights-based mechanism is considered effective to hold corporate actors accountable and to formulate rights-based domestic environmental legislation specifically targeting corporations.

The UN Conference on Environment and Development held in Rio de Janeiro in 1992 highlighted the role of business in achieving sustainable development while protecting environment. The Rio Declaration on Environment and Development stressed on the necessity of internalising environmental costs through economic instruments while making the polluter responsible to bear the cost of pollution. Principle 16 provided guidance to formulate domestic legislation in the apportionment of the costs of pollution. It is argued that the polluter-pays principle along with its underlying features provides an outline which has significant normative influence in formulating not only domestic laws and but also international treaties concerning environmental accountability.

Most importantly, the 2011 UN Guiding Principles on Business and Human Rights (UNGPs) sets an overarching global standard of expected conduct for all business enterprises wherever they operate and requires business entities to take adequate measures to prevent, mitigate, and remediate adverse human rights impacts that include environmental pollution. The UNGPs provide human rights enabled complaint and remedial mechanism to redress grievances for environmental harms committed by corporate actors. Such human rights-based mechanism is considered effective to hold corporate actors accountable and to formulate rights-based domestic environmental legislation specifically targeting corporations. Since its adoption by the UN Human Rights Council, the UNGPs are gaining momentum that asserts to embed human rights due diligence into business decision-making.

The judiciary in different jurisidictions is also referring 'the respect, protect and remedy framework of UNGPs' in defining the responsibility of business enterprises in relation to their corporate action. For instance, recently, a Dutch Court while giving order in the Shell case (Friends of the Earth Netherlands et al v Royal Dutch Shell PLC, 2021) referred to 'the widespread international consensus that human rights offer protection against the impacts of dangerous climate change and that companies must respect human rights.'

It is useful to note that the proposed EU's Mandatory Human Rights and Environmental Due Diligence Law obligates the companies to act to ensure human rights and reduce environmental impacts in their supply chains. This draft law will set the standard for responsible business conduct in Europe and beyond. By virtue of this due diligence law, Bangladesh being the significant trade partner with the EU, will be required to respect not only human rights and labour rights, but also environmental rights in order to continue trade and investment relationship with EU.

In the context of Bangladesh, the Industrial Policy 2016 envisages undertaking measures for environment friendly industrial management. The policy refers that business organisations, NGOs and other social organisations will be encouraged to engage in protection of environment and management of industrial waste. The policy also states that in order to prevent environmental pollution at the industries, the establishment of Effluent Treatment Plant (ETP) and Common Effluent Treatment Plants (CETP) will be encouraged. The Environment Conservation Act (ECA) 1995 attempts to regulate polluting industries while requiring environment clearance certificate (ECC) and undertaking environmental impact assessment (EIA). However, the Department of Environment, being responsible to issue ECC and EIA, with its limited human resources often fails to address the rampant environmental pollution caused by industries. It is quite frustrating that the provision of EIA is often manipulated to serve the interests of the big industries. Under the ECA 1995, the industries are under obligation to establish ETP considering the nature of the industry, however, in reality, very few industries are complying with the law. The big polluters remain largely unaccountable despite their constant contributions to environmental degradation.

Though the law and polices contain provisions (to a certain extent) to prevent industrial pollution, the accountability of the industries for causing environmental damage has not been reflected adequately in the practices. It is reported that Bangladeshi industries have remained below the elementary level of complying with the UNGPs. In this regard, the concept of environmental accountability in light of the UNGPs needs to be integrated into the relevant laws and policies. A separate complaint and remedial mechanism to redress grievances for corporate environmental harms should be established. Considering the limitations of the Department of Environment, a monitoring cell may be launched to assess and scrutinise the impact of industrial activities on environment. It is submitted that implementation of corporate environmental accountability shall not only facilitate the achievement of sustainable development but also shall address the forthcoming challenges of post LDC graduation of Bangladesh.

The writer, an Assistant Professor, teaches environmental law at the University of Dhaka.