The business and human rights agenda in Malaysia has been 10 years in the making. Efforts began in earnest with a series of roundtable discussions organized by the Human Rights Commission of Malaysia (SUHAKAM) to explore emerging human rights issues in the logging and plantation sectors. In June 2011, the Human Rights Council endorsed the United Nations Guiding Principles on Business and Human Rights (UNGPs) with an aim to implement the UN’s “Protect, Respect and Remedy” framework. Leveraging on this development, SUHAKAM subsequently published the Strategic Framework on a National Action Plan on Business and Human Rights in Malaysia (NAP BHR) in 2015. The Strategic Framework led to the launch of the NAP BHR process in June 2019 through a series of targeted workshops and dialogues.
Recently, more milestones were achieved. Amidst the COVID-19 pandemic, which further underscored the critical need for human rights oversight in business operations, the governance structure for the NAP BHR was enacted through a National Steering Committee chaired by the Minister in the Prime Minister’s Department for Parliament and Law. Shortly after, with several multistakeholder consultations underway, Malaysia’s very first National Conference on Business and Human Rights was organized on 21-22 September 2021 to provide updates on the development of the NAP BHR and mobilize whole-of-society action. This platform was an opportunity for Malaysia to reiterate the country’s commitment to improve its responsible business conduct landscape through the NAP, set to be launched by 2023.
In preparing the zero draft of the action plan, Malaysia will first embark on a national baseline assessment covering Peninsular Malaysia, Sabah and Sarawak. The assessment aims to bring together an analysis of the legal and policy gaps, identify the most salient business and human rights issues, and inform the formulation and prioritization of actions within the thematic areas of labour, the environment and governance.
“We cannot ignore the importance of having a comprehensive public consultation with all the relevant stakeholders during the development process where everyone’s views and opinions are taken into consideration.”
– Dato’ Sri Dr Wan Junaidi bin Tuanku Jaafar. Minister in the Prime Minister’s Department (Parliament and Law)
With a clear pathway forward, the initial implementation of the UNGPs through a NAP BHR in Malaysia has uncovered five key lessons to be considered.
First, while the UN Guiding Principles provide a common language for action, applying the Principles is still inconsistent across businesses based on sector, size, ownership and structure. This implies that the essential needs of various business groups should be taken into account, for example, with Small and Medium Enterprises that employ over 7.3 million people in Malaysia. Responding to these needs means that even small businesses can be standard setters.
Second, business transformation requires a smart mix of measures, both mandatory and voluntary. The future of the business and human rights agenda in Malaysia relies on a combination of top-down and bottom-up approaches, leveraging on existing frameworks while introducing and mainstreaming new interventions such as mandatory Human Rights Due Diligence (HRDD). In addition, a myriad of tools are now available to support these efforts, including UNDP’s Human Rights Self-Assessment (HRSA) Training Tool and HRDD Training Facilitation Guide.
“The role of Human Rights Due Diligence has never been more important to mitigate the impacts of the pandemic. A lot more needs to be done to ensure that we create an environment where human rights abuses cannot occur. And providing free training and easily accessible training materials for businesses that want to operate responsibly is an important step.”
– Niloy Banerjee, Resident Representative of UNDP Malaysia, Singapore and Brunei Darussalam
Third, cross-cutting issues are just as critical as the thematic priorities proposed. While indeed there is a need to focus on key themes to effectively manage the scope of the NAP BHR, elements such as gender are central to its foundation. These different components cannot be seen as “standalone” themes separate from one another, rather, they are complementary in nature. The action plan should explore these linkages that directly address intersectional issues to ensure its overall effectiveness.
Fourth, the “S” in ESG will be increasingly normative. While ESG investing is only part of the solution, the NAP BHR should embrace the ESG framework as a potential transformative agent. Investors are now measuring impact based on how well businesses perform against these criteria. ESG investing, with a focus on the social component, will continue to be reinforced as the business and human rights space evolves - millennial investors are expected to inherit some $30 trillion over the next few decades, while millennial consumers have shown stronger commitments to sustainability than their parents.
Fifth, inclusive participation is key to Malaysia’s progress in business and human rights. As demonstrated over the past year conducting multistakeholder consultations, each of us – from government, the business community and civil society – have an important role to play in fostering respect for human rights. It is no longer the responsibility of any one actor to plant the seeds for change. Importantly, affected communities should be invited to participate meaningfully in the very change that would benefit them.
These lessons represent only a segment of the issues to consider when drafting a NAP BHR. Malaysia is facing newer frontiers of inequality due to the pandemic, from rising levels of poverty and threats of the digital divide to environmental destruction. At the same time, this presents a unique test for national cooperation and our resolve to reduce disparities among us.
Bringing businesses to the forefront of this conversation will enable us to take those crucial steps forward towards addressing social inequality, climate change and economic exclusion in a way that challenges the status quo of business operations and promotes an enabling environment for building back better. The role of business has never been clearer – businesses should shoulder some of the responsibilities of recovery by making better, informed and rights-friendly decisions.
It is also crucial that we engage better with civil society, through the important work of civil society organizations and Human Rights Defenders (HRDs), recognizing them as co-creators of sustainability and fundamental implementing partners. None of this is possible without first and foremost raising the voices of those subject to harm or those who continue to be vulnerable. Malaysia, through the action plan, should intensify these efforts to ensure that rights-holders are able to speak with legitimacy and without fear, in the spirit of Leaving No One Behind.
Emerging business and human rights issues in Malaysia have a wide reach, not only impacting local and migrant groups alike, but also affecting communities through environmental harm. While the challenges are undoubtedly significant, the opportunities, however, have never been greater than they are today.
The announcement by the government of Malaysia that the action plan will be launched by 2023 is therefore encouraging and signals a change in pace in the process of implementing and upholding the UNGPs. Under the overall direction of the Business and Human Rights in Asia: Enabling Sustainable Economic Development through the Protect, Respect and Remedy Framework (B+HR Asia) project, with funding support from the European Union, UNDP will continue to work closely and in partnership with the government, the business community and civil society to ensure that Malaysia’s national action plan, and the larger BHR agenda, reflects the country’s ambitions to achieve its Sustainable Development Goals and truly embody sustainable development.
To catch the replay of the National Conference on Business & Human Rights 2021, please click here.