CORPORATE
ACCOUNTABILITY IN
TRANSITIONAL JUSTICE
SETTINGS
SOME INITIAL PROBLEMS WHEN REFLECTING
ON CORPORATE ACCOUNTABILIT Y IN THE
CONTEXT OF TJ
 Traditionally, TJ has been dealing primarily with the
responsibility of the state and that of individual perpetrators
for gross violations of civil and political rights in the form of
blood crimes
 The standard mechanism for achieving accountability and
justice have been criminal prosecution, but criminal liability
of corporations is limited under both international and
national law
QUESTIONS TO BE ADDRESSED
 Should corporate accountability be included in TJ processes?
 What role can holding corporations to account for their
complicity in past crimes play for achieving the objectives of
transitional justice?
 Should they only be responsible for harm they caused directly,
or also for harm facilitated through complicity with the regime
or violent groups?
 Through which mechanisms can this liability best be
addressed?
 What are appropriate remedies for corporate violations in
transitional contexts and what is the relationship between
state reparation programmes and remedies against
corporations as private actors ?
 What measures are necessary to prevent recurrence?
WHY ADDRESS CORPORATE
ACCOUNTABILIT Y IN THE CONTEXT OF TJ?
CORPORATE ACCOUNTABILIT Y TO
ENHANCE TRUTHFINDING
 without determining the responsibility of all important actors,
the account of the truth will inevitably remain partial and the
roots and causes of the oppression or conflict will not be
understood
 an inclusion of the role of corporations in truthfinding might
thus be necessary in order to paint the full truth with regard
to the abuses that occurred, the reasons for which they
occurred, and their consequences
CORPORATE ACCOUNTABILIT Y AND
JUSTICE
 To the extent that corporations played a major role in the
commission of gross human rights violations, their impunity
might hinder the goal of obtaining justice;
 in particular, victims, and potentially large parts of society,
might be left with a feeling of dissatisfaction if economic
actors are seen as responsible but receiving impunity
CORPORATE ACCOUNTABILIT Y AND
REPARATIONS
 To the extent that corporations are responsible for violations
it seems fair to make them liable to provide reparations to
victims
 Corporate reparations can have a substantial impact on the
state’s ability to provide reparation
 Remedies can be more easily adjusted to the transitional
justice context if corporate accountability is addressed in the
context of TJ mechanisms
HOW TO ADDRESS CORPORATE
ACCOUNTABILIT Y IN THE CONTEXT OF TJ?
TRC REPORTS AND RECOMMENDATIONS
 TRCs can carry out investigations into the role of businesses,
eg establish to what extent, if any, businesses were involved
in the violations that occurred, either regarding individual
businesses or certain business sectors, like the mining
industry, agricultural businesses etc.
 TRCs can make recommendations regarding corporate
accountability (eg corporate reparations, one -of f taxation,
exclusion from future public contracts; asset freezing and
recovery etc.)
CRIMINAL PROSECUTIONS
 International criminal jurisdiction does not include
corporations
 Corporate criminal liability under national law (outside of the
corruption context) is often limited, but is increasingly
introduced
 Individuals such as company directors can be liable, both
under international and national criminal law
CIVIL LITIGATION
 Can take place in the transitional country itself or abroad,
usually under tort law principles
 Litigation abroad has primarily taken place under the US Alien
Tort Claims Act for aiding and abetting violations of the law of
nations, but also in other jurisdictions like the UK or Canada;
such litigation often ends in settlements
REPARATIONS
 The UN Basic Principles and Guidelines on the Right to a
Remedy and Reparations for Victims of Gross Violations of
International Human Rights Law and Serious Violations of
International Humanitarian Law suggest that legal persons
and entities can be liable to provide reparation to victims
 They also call on states to provide guarantees of non repetition, such as by “[p] romoting the observance of codes of
conduct and ethical norms, in particular international
standards . . . by economic enterprises .”
 Reparations can take many dif ferent forms, from financial
compensation to apologies, restitution ( eg of land),
termination or renegotiation of contracts, excluding
companies from future public procurements
REPARATIONS CONTINUED
 Even where clear legal responsibility cannot be established,
based on principles of reconciliation, solidarity and justice,
there might be a case for corporations that benefited from
dealing with the past regime to assist in the country’s
reconstruction by helping finance reparations —for example, by
contributing to a special fund for reparations or paying an
annual tax to the authorities
 where a corporation is to continue working in the same area
after conflict or repression, the company could help provide
infrastructure for the community by constructing roads, clean
water pipelines, provide employment to surviving victims etc.
 Where corporations have caused or benefited from land
displacement it might be feasible to consider engaging them
in a land restitution process
INSTITUTIONAL REFORM
 Vetting processes seeking to exclude from public contracts
corporations that were responsible for human rights violations
and/or economic crimes
 reforms of state institutions that regulate corporate behavior
 regulation of corporate activities in the light of the UN Guiding
Principles on Business and Human Rights
UN GUIDING PRINCIPLES ON BUSINESS
AND HUMAN RIGHTS
 states have a duty to regulate corporate activity to make sure
that no human rights violations occur, and to help companies
with avoiding their occurrence - requires taking appropriate
steps to prevent, investigate, punish and redress such abuse
through ef fective policies, legislation, regulations and
adjudication)
 Companies have a responsibility to respect all internationally
recognized human rights – includes avoiding complicity in
human rights violations and due diligence responsibilities of
identifying and addressing human rights impact of their
activities
 Remediation, including where company could not foresee or
prevent human rights violations or where abuses were not
committed by the companies but are directly linked to their
operations, products, or services
EXAMPLE OF SOUTH AFRICA
 the TRC investigated the role of international corporations in
apartheid South Africa and held a special hearing on
businesses
 It distinguished between dif ferent levels of involvement:
 first order involvement meant that businesses played a central role in
helping to design and implement apartheid policies
 second-order involvement referred to supplying products or services
knowing that they would be used for morally unacceptable purposes
(eg providing arms and ammunition used for repression)
 third order involvement were ordinary business activities that
benefited indirectly by virtue of operating within the structures of
apartheid; (eg the white agricultural industry benefited from its
privileged access to land
SOUTH AFRICA CONTINUED
 recommendations did not distinguish according to the
dif ferent levels of corporate involvement in apartheid crimes
and included:
 debt cancellation
 a wealth tax
 establishment of a business reconciliation fund to finance small
black entrepreneurs
 a 1% levy of the market capitalisation of company’s registered on the
Johannesburg Stock Exchange to go into a special fund
 a retrospective surcharge on corporate profits
SOUTH AFRICA CONTINUED
 The government did not implement any of the TRC’s
recommendations regarding businesses
 reparations were not to be provided by the perpetrators and
beneficiaries of apartheid but rather by the state, which led to
underfunding of the reparations programme
 A voluntary business trust was set up, but not many businesses
contributed, and there was no real congruence between the
objectives of the trust and the recommendations of the TRC
 Problems with this approach:
 Impunity of corporate actors and dissatisfaction of victims with
reparations led to lawsuits against corporations in the US
 Unaddressed apartheid legacy in the mining sector led to Marikana
massacre and silicosis lawsuits in South Africa and the UK
 Granting far-reaching investor rights caused investment disputes over
black empowerment policies
CONCLUSIONS
 It is doubtful that the recurrence of violence can be prevented
ef fectively without addressing its main causes and without
identifying and holding accountable the main perpetrators,
including corporations for being complicit in the violations if
their complicity was of suf ficient severity.
 to leave the role of corporations outside of TJ processes would
be problematic because it would stand in the way of
 a full account of the truth of what happened,
 achieving reconciliation in society and
 preventing a repetition of conflict or dictatorships