Maurice Quinlivan (Limerick City, Sinn Fein)
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All those present in the committee room are asked to exercise personal responsibility to protect themselves and others from the risk of contracting Covid-19. Members are required to participate in the meeting remotely from within the Leinster House complex. No apologies have been received, but Deputy Bruton has indicated he is running late. Today's meeting is to undertake further scrutiny of EU legislative proposal COM (2022) 71, a proposal for a directive on due diligence and corporate sustainability. A draft directive on this issue was published by the European Commission on 23 February 2022.

This proposal is being published against a backdrop of a variety of other EU initiatives in the environmental, social and governance, ESG, area. The proposal aims to foster sustainable and responsible corporate behaviour through global value chains. The measure will help to enable the EU to meet its commitments under the European Green Deal and the United Nations sustainable development goals. The proposal will require companies to develop and adopt due diligence policies and procedures to prevent, mitigate or bring to an end adverse environmental and human rights impacts that arise from their operations, those of their subsidiaries and-or their value chains.

I am pleased we have the opportunity to consider these matters further. I welcome Ms Mary Lawlor, the UN Special Rapporteur on the Situation of Human Rights Defenders and Mr. Ed O'Donovan, special adviser to the UN special rapporteur. From the Irish Coalition for Business and Human Rights, ICBHR, I welcome Dr. Rachel Widdis, school of law, Trinity College Dublin, TCD, and Europe, the Middle East and Africa, EMEA, director at Article One; Caoimhe de Barra, CEO, Trócaire, and chair, ICBHR; and Ms Sorcha Tunney, co-ordinator, ICBHR.

I wish to explain some limitations to parliamentary privilege and the practices of the Houses regarding references witnesses may make to another person when giving evidence. The evidence of witnesses physically present or who give evidence from within the parliamentary precincts is protected pursuant to both the Constitution and statute by absolute privilege. Witnesses are reminded of the long-standing parliamentary practice that they should not criticise or make charges against any person or entity by name, or in such a way as to make him, her or it identifiable or engage in speech that might be regarded as damaging to the good name of the person or entity. Therefore, if witnesses' statements are potentially damaging to a person or entity, they will be directed to discontinue their remarks. It is imperative that witnesses comply with any such direction.

The opening statements have been circulated to all the members. To commence our consideration of this matter, I invite Ms Lawlor to make her opening statement.

Ms Mary Lawlor:

I thank the committee for the invitation to participate in this meeting on the EU's human rights and environmental due diligence initiative. I was appointed to my position as a UN special rapporteur by the United Nations Human Rights Council in May 2020. In doing so, the council provided me with a mandate to promote the implementation of the UN Declaration on Human Rights Defenders, which was agreed by consensus at the UN General Assembly in 1998, and to study trends, developments and recommendations for the protection of human rights defenders - those who work peacefully, and often at great risk, for the rights of others in accordance with the declaration.

At the start of my time as a special rapporteur, I set out a list of priority areas for work as the holder of this mandate. Included in them was the intersection between business activity and the work of human rights defenders. This decision was informed by consultations I had held with human rights defenders and advocates following my appointment, as well as by insights from my previous work in civil society and in my role as adjunct professor at the Centre for Social Innovation within the business school at TCD.

Since those early days, the relevance of business activity to my mandate has been confirmed in hundreds of conversations I have had with human rights defenders. Again and again, these defenders have shared details of the impact businesses can, and do, have on the environment within which they seek to carry out their activities.

There are some cases where the impact can be seen to be positive and a handful of progressive companies, primarily EU-based, are leading the way. Adidas, for example, has been leveraging its influence in response to risks for human rights defenders, HRDs, since 2014, and a small group of pioneering companies have made declarations of zero-tolerance for any act of retaliation against human rights defenders within their value chains. We know 30 large companies have introduced policies which include recognition of human rights defenders and the work they do. However, the vast majority of cases shared with me, as well as those documented by others, demonstrate an overwhelmingly negative impact of business practice and activity on human rights defenders. To provide some statistics, between 2012 and 2022, the NGO, Global Witness, documented the killing of 1,540 defenders who were working to protect rights connected to land and the environment. A total of 680 of these have been linked to business activity, and we can be sure this is an undercount. In 2021 alone, the Business and Human Rights Resource Centre documented the killing of 76 defenders and, in the same year, 88 death threats against defenders working in the context of business were documented.

One of those killed was indigenous human rights defender Jose Isaac Chavez, who was murdered in Mexico in April last year. He had been a prominent opponent of open-pit mining in the region, putting him at odds with powerful local actors in an area marked by gang violence. The mine in question is owned by two companies based in Luxembourg, and there has been local reporting on disappearances and murders of defenders opposed to the corporate-run mine for years. While the fatal attacks are concentrated in a number of high-risk sectors, particularly extractive industries and agribusiness, these are only the tip of the iceberg. Alongside its documentation of killings, the Business and Human Rights Resource Centre also maintains a database of attacks on human rights defenders with a link to corporate activity. Their database currently contains information on over 4,000 attacks, with 10% of these linked to EU-headquartered companies and their supply chains.

All of this is continuing, or indeed escalating, more than ten years on from the agreement of the UN Guiding Principles on Business and Human Rights which businesses can voluntarily chose to follow. It is clear that the use of soft-law instruments and voluntary initiatives to foster business respect for human rights has not been effective. To take the situation in Ireland as an example, in recent benchmarking carried out by the Centre for Social Innovation at Trinity College Dublin, the implementation of the UN Guiding Principles by 60 top Irish companies was assessed based on publicly available information. Half of the companies scored less than 20% and just over one third were shown to have taken no action at all to embed respect for human rights into their operations. There is limitation in the current voluntary framework and this has concrete results for human rights defenders.

There is a question as to why this has been allowed to go on for so long. It is clear that people stand to benefit from the silencing of human rights defenders, including those here in Ireland and elsewhere in the EU. As time is short, I will talk about the EU's initiative on human rights and environmental due diligence, which has created an opportunity for its members to begin to address this. The creation of binding obligations for business to identify and assess human rights and environmental risks, and to take steps to address and mitigate them, could be transformative. Coming from the world's largest single market, it could begin a sea change. However, in order to live up to the expectations it has generated, the initiative must keep protection of human rights and the environment at its centre. As I laid out in my position paper which responded to the proposal published by the Commission, acknowledging the important role of human rights defenders within the due diligence process is part of the way this can be ensured. In my paper, I outline three means by which the Commission's proposal can be built on to do this. This is the core issue. These means can be summarized as follows. First, obliging companies to take risks for human rights defenders into account when carrying out their due diligence; second, mandating engagement with human rights defenders as key stakeholders in the due diligence process; and finally, mitigating risks of retaliation against defenders who raise concerns about the environmental and human rights impact of company activities. As a proud supporter of human rights defenders all around the world, I am calling on the Government to prioritise this issue. Ireland needs to champion these provisions and this progressive proposal during any negotiations on the text at Council meetings and in the trilogue negotiations that follow it.

I will be happy to answer any questions committee members may have.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank Ms Lawlor and now invite Dr. Rachel Widdis and Ms Caoimhe de Barra to make opening statements on behalf of the Irish Coalition for Business and Human Rights.

Dr. Rachel Widdis:

I thank the Chair and members of the committee for the opportunity to present this morning. I provide input as a practitioner and in my capacity as Europe, Middle East and Africa director at Article One. I work with corporations globally to advance respect for human rights throughout their operations and supply chains. I teach business and human rights at the School of Law at Trinity College Dublin, and am a non-executive director of a State-owned company. As a member of the Irish Coalition for Business and Human Rights, I support the contribution of my colleagues today.

For context, there have been important changes in what is expected of business regarding impacts on human rights and environment. A decade ago, the UN Guiding Principles on Business and Human Rights set down the expectation that business would respect human rights and "do no harm". Some companies voluntarily adopted these principles and are considered leaders in practice today. However, most did not. In practice, positive change was slow and ultimately occurred at low levels. Now, key trends have altered this landscape. First, interest has come from consumers, employees, and shareholders into better business practices. Countries have adopted single issue laws, for example, the UK Modern Slavery Act. Second, the scope and pace of regulation has accelerated. European countries such as Norway, Switzerland, and Germany in 2021, passed broader so-called supply chain due diligence laws. These laws aim to prevent harm occurring in the first place. Broadly, they require certain companies to identify, assess, and address their negative impacts on human rights across their operations and global supply chains, and to be accountable for this process. The German law, which came into force on 1 January 2021, requires certain companies to report publicly on the effectiveness of their due diligence, for example to prohibit child labour. I work with companies which are evolving their business model and practices. Responsible business conduct is an adjustment. Companies recognise that it is the right thing to do, and no business wants the operational, reputational or legal risk of being linked to human rights abuses and damage to the environment. In short, engaged businesses recognise it is their business to engage.

In March, the EU Commission published the proposed Corporate Sustainability Due Diligence Directive. As its officials stated, "with these rules we want to stand up for human rights and the green transition". The hope or expectation is that this EU initiative will in time lead to a global standard of business practice. National laws and the proposed directive mark a paradigm shift from voluntary principles to hard law. They go beyond reporting out and set down corporate due diligence as a robust process. The EU framework itself needs to be content-ambitious and aim for a level playing field. It requires large EU and non-EU companies, and later companies in identified "high impact sectors", to take appropriate measures to prevent, mitigate and remediate adverse impacts. These measures range from inadequate workplace health and safety and exploitation of workers, to biodiversity loss and ecosystem degradation. They include accountability mechanisms, and oversight by directors of EU companies; both of which are important to deliver remedy for those affected and to underpin success.

It is key that the thrust of the proposed directive should not be watered down. It will evolve and could be strengthened in multiple ways. During the course of my work, I see both positive impacts of business and also terrible abuses affecting people and communities. Companies here in Ireland and across the world are moving to align with new human rights and environmental due diligence laws. They are supportive and seeking guidance. Across the EU, citizens and stakeholders expect products and services to be delivered with responsible business conduct. These laws and the proposed directive are needed along with valuable markers to advance and deliver that.

I am pleased to assist with further detail.

Ms Caoimhe de Barra:

I thank the committee for the opportunity to present this morning. Trócaire is the chair of the ICBHR, which is a broad civil society coalition that brings together organisations working with human rights defenders, development organisations, environmental organisations and trade unions. Through the everyday work we do our organisations witness at first-hand the impact of corporate harms on the communities we work with. These harms include human rights violations such as child labour, land grabs, attacks on human rights defenders and violence against women. We also witnesses significant environmental harms, such as deforestation, oil spills and unchecked carbon emissions. Those who stand up to defend their communities against corporate exploitation are increasingly under threat, as Ms Lawlor outlined. The uncomfortable truth is also that many European countries are linked to these types of harms. In fact, a number of businesses based in Ireland have been linked to human rights violations through their global value chains and our coalition has documented some of these in our recent report entitled, Make it Your Business.

This is a global issue. Through my work I have met many brave men and women affected by corporate harms in communities in Guatemala, Myanmar, Honduras, Palestine and other countries. These have included communities who have had their land confiscated, forests cut down, water polluted and who have even lost family and community members. Those people were murdered for daring to stand up and defend their communities against corporate interests. To meaningfully address these violations, we need stronger legislative frameworks that can prevent such harms from happening and provide access to justice for victims when violations happen. As such, our coalition is encouraged to see the EU propose the corporate sustainability due diligence directive. Our coalition strongly welcomes this new directive and we particularly welcome the inclusion of civil liability within the draft. However, there are significant weaknesses and some serious flaws in the draft text that risk it being ineffective.

First, the scope of the directive applies to far too few businesses. Under these new rules, 99% of businesses will be excluded. We estimate fewer than 700 Irish companies will be covered. Second, we are concerned companies will only be required to assess their value chains where they have established business relationships and, therefore, the full extent of value chains will not be covered. Often, and primarily in many cases, it is in informal work we see most rights abuses. Third, victims and rights holders are not the primary focus of the draft directive. It is weak on meaningful engagement with communities, unions and the protection of human rights defenders. The draft also fails to address the gender dimensions of corporate harm and is weak in its gender response.

There is an urgency to this matter. As this directive is being negotiated in not just the coming months but in the coming weeks at the Council, we recommend the Minister for Enterprise, Trade and Employment leads on outlining a clear policy position of the Government on the corporate sustainability due diligence directive and seeks to raise the ambition of the directive and address the weaknesses I have outlined and the Government outlines a clear timeframe with steps for the preparatory work, development and ultimate transposition and implementation of the directive in Irish law, and we respectfully suggest this committee support these recommendations and conduct further hearings with experts and carry out full pre-legislative reviews of the draft directive. As I mentioned, there is an urgency to this matter. This morning we learned that under the Czech Presidency of the EU Competitiveness Council, proposals may be made available to ambassadors as early as 26 or 28 October. Fundamentally, if we fail to adequately address the exploitation, violence and pollution we are currently seeing in the value chains of our everyday products, such as our clothes, phones and food, then we will have missed a historic opportunity and will have failed in our responsibility to respect, promote and protect human rights.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank Dr. Widdis and Ms de Barra. I invite members to discuss the issue with the representatives. I remind members participating remotely to use the raise hand function in Teams and cancel it when they have spoken.

Deputy O'Reilly was first to indicate.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I thank the Chair. I thank our guests not just for attending but generally for the work they do. It is great to have an opportunity to have this discussion and shine a bit of a light on it.

I was struck by the following line in Dr. Widdis' submission: "we presume no business wants the operational, reputational or legal risk of being linked to abuses of human rights and damage to environment". It would be great if we could but the sad fact is they are willing to expose themselves to that risk. If some businesses are making an assessment of human rights versus profit, or however they work it out on the balance sheet, they are clearly taking that risk now. It would be great to be in a position to presume they do not want the damage. It is possible they do not want the publicity but they are certainly prepared to run the gauntlet of that being a possibility and that is something we need to hone in on a little. I confess I have not done significant research into it but from the small bit I did in the aftermath of the building collapse at Rana Plaza, it seemed there were wheels within wheels and a web of suppliers and small suppliers. It is not all one big corporate entity because if that were the case we could just name the top 50 companies in the world and say, "There is the list, lads, do your business right." That would be the end of it. However, clearly tens of thousands of smaller operations are possibly all part of this chain and that is my concern.

In her submission Ms Lawlor references a company that was "ultimately owned" by a parent company, if we want to call it that, in Luxembourg. Is it possible for us to come up with a way to capture the web? It is easy to identify the big brand, such as the one with the swoosh, or whatever. However it is about the smaller companies that are all part of this chain. Is it going to be possible for us to identify them? Can we cast our net wide enough? If we cannot then, maybe we are not going far. I do not want to be defeatist about it. I am looking for a wee bit of hope from the witnesses that if we get the words right, get the political will and we get this directive done properly we could be leaders on this and we could bring in that web. I am interested in the thoughts of the witnesses on that, in any order.

Ms Sorcha Tunney:

We would love to assume businesses do not want to abuse human rights. They need to engage on that.

On the issue of how far can this go, it cannot be watered down. What is in there needs to be retained. Maybe some important elements, which would be quite detailed to get into, should be redesigned but the first thing is it needs to not be watered down and we need to engage in that process of it not being watered down. The risks are everywhere. Business is engaging, or at least the businesses I work with are engaging in this. They have vast numbers of suppliers. It is a complex operation so it is important that as far as possible we define the terms and the span and scope with clarity so it is implementable and has a real impact on the people who are affected deep down, ten layers down or tier 10 as it is called, in these supply chains. That is the objective but I would start with do not water down the proposals.

Ms Mary Lawlor:

I thank the Deputy for her question. She referred to Primark. Primark has seen the light since. That is what we find with many companies and investors such as the Finnish development bank and the Dutch development bank that had invested in a company in Honduras where a human rights defender was murdered. It is interesting for me that when something terrible happens, companies start to look at the impact of their activities.

In Primark's case the problem was that they signed a-----

Maurice Quinlivan (Limerick City, Sinn Fein)
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I remind Ms Lawlor and Deputy O'Reilly that they must not mention particular companies.

Ms Mary Lawlor:

Okay. It is not an Irish company any more.

Maurice Quinlivan (Limerick City, Sinn Fein)
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It does not matter. Ms Lawlor can refer to the issue but not the company.

Ms Mary Lawlor:

Getting back to the Deputy's question, there are webs, as the Deputy said, but it is up to us to look at the overall company and do some mandatory human rights and environmental due diligence on who its suppliers are and if they are small suppliers that have not been acknowledged. The problem is that they all try to disguise it. One always begins with the first step. One wants hope, and this is really hopeful. If we do this, it will be the start of a really good initiative that will save the lives of human rights defenders. I have no doubt about that. It will require a bit of research. With companies that outsource we must look at who they are outsourcing to and what are the contracts. Human rights defenders can help with this. They are the ones that will be able to implement the directive when it is introduced because they will monitor on the ground what is happening.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I thank Ms Lawlor for that.

Ms Sorcha Tunney:

The current draft is to pull the directive back to the initial draft. At the moment, it includes the whole value chain. It gives a clarifying established business relationship for businesses, and we want to examine that term and what it means. This comes from the French law. As Ms de Barra mentioned, many of the human rights and environmental abuses happen very far down the chain. To make this directive impactful and effective on the ground it needs to cover the value chain. We are hopeful that Ireland will be keen to do that.

We are talking about how businesses communicate and how they put up their suppliers. With Rana Plaza, it was not known who was buying the products until the fire scene was visited and the collars and what they were sown on to were inspected. Businesses were not willing to put their names forward to that disaster. It was the same with KiK fire in Pakistan. We need to make sure we are mapping the full value chain and that this includes informal settings where most of us recognise that women will be working. That includes home-based work. As Ms Lawlor said, human rights defenders and unions are the first port of call when mapping that supply chain. This is why we need them included in this directive and that they be consulted at every point of due diligence.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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That will be essential because human rights defenders and unions will be the eyes and ears. If this directive is done right, they will be the eyes and ears of this directive in every home. Ms Tunney is dead right to make that point. We are talking here predominantly although not exclusively about vulnerable women workers and nobody would be more vulnerable than a woman working in the home with very few protections in place.

Ms de Barra stated that, as the directive is currently constructed, 99% of EU businesses would be excluded from the new rules. I ask her to guess what we can aim for and what would be reasonable. We will all say 100% is reasonable and we will keep going until we reach that. In the context of this directive, I will be honest and say that the Government's record on workers' rights is not brilliant, yet it will negotiate this. What can we reasonably aim for in terms of coverage? Is there a gold standard? What is achievable and what can we realistically aim for in terms of the protections?

Ms Caoimhe de Barra:

I thank the Deputy for the question. It is very important. The principle that lies at the heart of the directive is important. This principle to be borne in mind is that the implementation should apply to the entire value chain and all companies and their value chains. However, the implementation needs to be proportionate to the size, scale, scope control and scope of influence of those companies and their supply chains. We differentiate between a large company that has a high degree of control and a smaller company that has a lower degree of control. That needs to remain at the forefront of the thinking around this legislation.

One aspect we are very concerned about is that we are hearing certain indications that there may be proposals to water down the thresholds. The thresholds are already extremely high. The thresholds currently in place would mean that 99% of European companies would not be affected. There are some suggestions that those thresholds would be raised higher. One area that could be focused on is changing the thresholds for high-risk sectors and broadening the number of sectors that are included as high risk. At the moment, there are only just three sectors that are included as high risk. For example, mining-----

Ms Sorcha Tunney:

They are garment manufacturing, agriculture and extractives.

Ms Caoimhe de Barra:

We think that is very limited because what we see in our work is that the large volume of violations is by no means limited to those high-risk sectors. Those are the sectors that may have received most media attention but other high-risk sectors include arms manufacture, private security, fisheries, petroleum products, plastic products, gas, electric power generation, construction, finance, insurance and tourism. There is work that could be done to strengthen those high-risk sectors. The pivotal point, however, is that the directive should apply to all companies and supply chains and be proportionate.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Expanding the sectors to include more sectors that would be considered high risk seems very reasonable. It is alarming that there are even discussions about watering down the proposal when 99% of EU businesses are already excluded. There is no point in having the directive if 100% of EU businesses are to be excluded. We need to get that right.

On the engagement that either of our witnesses has had with the current Minister and the Department, has there been a high level of engagement? Are moves afoot? Ireland has an opportunity to be a leader in this space but the question is whether are will take it up. I very much hope we do. The intention of the Government will be clear from the level of engagement.

Ms Sorcha Tunney:

I will answer that. The relevant Minister of State is new and we have not had a meeting with him yet. We will have a meeting in the coming weeks. We have had a few meetings with officials from the Department of Enterprise, Trade and Employment on this and while they are open and willing and able to engage, this could be ramped up a bit. When we look at what is happening at the Council, we see that many countries are really engaging in this process. They are doing so by publishing their positions on the proposal. We do not really have a sense of how Ireland feels about various aspects of it. The proposal is being negotiated and it is very worrying to see that Ireland is still saying it is a very early stage in the process. As Ms de Barra has said, the Czech Presidency has upped the timelines and is pushing on this. We are on the third compromise text and we have not heard any comments from Ireland on those texts. We have not seen what the position is and while that is not for us to see, we do not have a sense of where Ireland stands. Even last week, the Spanish Government released draft legislation. The Dutch Government did that six months ago and other countries have legislated. We have ambition as a human rights leader. This directive takes human rights into a different area - business - and we need to have more ambition in this area to bring our human rights knowledge to the international side.

Ms Mary Lawlor:

It is clear that there is not any one person pushing this from the Department of Enterprise, Trade and Employment. There is a delay in Ireland, as Ms Tunney outlined, in developing a position on the file. I was in Brussels a couple of weeks ago where I met representatives of ten of the EU member states, many of which have already taken a position at headquarter level. We would like to see Ireland finalise its position to ensure its voice is clearly heard at the table. Otherwise, we will be left behind. We were told that there would be a public consultation but there is no sign of it. We need to home in on who is going to take responsibility properly within the Department in pushing this forward. At the moment, it is kind of just there.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I thank Ms. Lawlor. I must leave now but it is fair to say that the buck stops with the senior Minister. These are questions we can put to him.

Maurice Quinlivan (Limerick City, Sinn Fein)
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The next block is Fianna Fáil's, but there is a technical issue down here. I apologise, but these are the joys of hybrid meetings. Just to keep the meeting flowing, we will go to the Fine Gael slot first. I call Deputy Stanton.

David Stanton (Cork East, Fine Gael)
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I welcome the witnesses and thank them for their presentation and the important work they are doing in this area. Someone mentioned Global Witness. I read a book over the summer, Very Bad People: The Inside Story of the Fight Against the World's Network of Corruption, by Mr. Patrick Alley. What is happening and has happened is unbelievable. I would recommend the book to anyone. I could not put it down because it was so powerful. The very bad stuff that is happening out there in the world needs to be tackled. In fairness, many governments of EU member states and so on are trying to tackle it, but the work of organisations like Global Witness and our witnesses' organisations is to be commended.

Ms de Barra mentioned something about which I was curious. She stated that informal work was where many rights abuses were seen. Will she expand on that point?

Ms Caoimhe de Barra:

The harms that are the most egregious often happen at the beginning of the value chain, for example, in extractive industries where the raw minerals are being extracted and before they are passed on to more formalised business processes. We work in eastern Democratic Republic of Congo, DRC, which is unfortunately notorious for the kinds of abuse that happen in a wide range of extractive industries.

As Ms Tunney stated, the language is unclear. Something we are concerned about is that, by including language around established business relationships, it allows companies to hold themselves to account for their relationships with formalised contracted suppliers only. Where we work, the suppliers are often informally contracted. There are contracts of forms, but they are informal. In the Rana Plaza example, the supply chain was very dispersed. The protections that one would normally expect to be there for people in different types of employment are not there. We are concerned that naming only established building relationships could drive companies that are operating without a strong ethics dimension towards more work on an informal basis and away from the compliance requirement of having to report and do due diligence because they have formal supply relationships. The risk is that it would incentivise negative behaviour and increase the supply chain quotient of informal business suppliers. I hope I have explained what I mean.

David Stanton (Cork East, Fine Gael)
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I thank Ms de Barra. Many companies are interested in corporate social responsibility, inclusion, diversity and so on. They mean well in this, but perhaps this issue has not been pointed out to them strongly enough and they are not aware of it at a certain level. That is where the law comes in, and we need to strengthen it. Our committee should take a lead on this matter and hold more hearings on it as soon as possible so that we can get ahead of the curve.

The Dutch and Danes are quite ahead of us. Will the witnesses speak about what other EU member states are doing and how we compare?

Ms Sorcha Tunney:

I will reply briefly. Ms Lawlor could speak on this as well, given that she has had a significant number of meetings with them. The French have the Loi de Vigilanceand Germany has a supply chain law. Dr. Widdis can speak to this as well. Those countries are active at Council meetings. The German Government has just come out for civil liability. They are all taking parts of this directive – civil liability, stakeholder engagement and scope – and driving what it means for their respective countries. At this meeting, we are asking Ireland to examine what the directive means for businesses here and how we can implement it.

I was watching the European Parliament last week as it discussed this directive. There was a sense that the world was watching because, as Dr. Widdis pointed out, there are no global laws on this matter at the moment. The directive will be the first law under which it will be mandatory to undertake due diligence. The world is watching and Europe is leading. We are also involved in UN treaty work, where negotiations are happening next week. There is a great deal of movement in Europe and Ireland is falling a little behind.

Ms Mary Lawlor:

The text circulating from the Czech Presidency includes human rights and environmental defenders. We are anxious that that remain the case and that Ireland embrace it.

David Stanton (Cork East, Fine Gael)
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Prior to the publication of the directive, more than 100 companies signed a statement in support of robust legislation and called for it to be applied to all businesses, including SMEs. Some very large companies signed that statement. They acknowledge that responsibility for human rights and the environment is not a matter of a company's size and turnover. Does the scope of the directive reflect this principle? Smaller companies can also have negative human rights and environmental impacts. How can we strengthen the directive in this regard?

Dr. Rachel Widdis:

As proposed, smaller companies are not included in the directive. However, it contains a provision called "contractual cascading" whereby the lead company can get contractual assurances from its direct suppliers that they will cascade compliance with its code of conduct down the value chain. When we speak about large companies, we are automatically speaking about two issues. One is the proposed directive's element of contractual cascading, which is an unusual element. The lead company would still retain responsibility for verifying compliance, but that could be done by third-party initiatives. Ms Tunney mentioned the KiK case. Some jurisdictions have a chequered history in terms of how this process works. Indeed, 260 people perished in that factory fire. Companies and their value chains will be included in the directive to the extent that it has to move down the value chain with contractual cascading.

There is also an element of burden sharing. Where larger companies will be able to tell smaller ones to give them contractual assurances, the costs will fall on those smaller companies. They will be included by default, as it were, in the directive's blast radius. This is something that we need to consider in practical terms.

Ms Tunney spoke about governmental and EU negotiations, but business is also considering this matter. We need to think about what business in Ireland and globally thinks about this as well and include its perspectives. Business is moving on this in a positive sense. We do not want to be behind that movement.

David Stanton (Cork East, Fine Gael)
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It is gratifying that many large businesses are in that space-----

Dr. Rachel Widdis:

Yes.

David Stanton (Cork East, Fine Gael)
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-----and that we may need to catch up with them.

In a previous role, I did a great deal of work on gender equality and women's rights. How can the directive be improved in that regard?

Dr. Rachel Widdis:

Can I say "Entirely"? Stakeholder engagement is ambiguous within the proposed directive and needs strengthening.

The UN working group has very clearly advocated for gender-responsive design. It is just really not present. I will pass over to my colleagues.

Ms Sorcha Tunney:

To amplify Dr. Widdis's remarks, the word "woman" or "gender" is not in the directive. As Dr. Widdis just mentioned, there is so much out there about how to do this. When we are talking about value chains, there are so many frameworks from the OECD and the UN about how to do this. Even in the recital of the directive, recognising that human rights abuses in this context affect women disproportionately would be important. When we talk about stakeholder engagement, we are talking about enabling women to engage in a safe space because some women will not be able to engage in front in men and also recognising the different roles women play within society and gender equality within that society. There is significant work to be done on strengthening the gender dimension.

Regarding the thresholds and the previous question around scope, at the moment, the latter is very high so a certain amount of turnover and workers is needed. We would say that this should be either-or so it is cumulative. We need to look at international standards that address the risk and severity of types of human rights abuse and possibly bring that language into the directive as well. Again, businesses are using those terms and are used to them after ten years of the principles.

David Stanton (Cork East, Fine Gael)
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We have a strong desire to support human rights internationally. That was demonstrated last week at the UN. What else should be included in the directive given our international priorities? What is missing?

Ms Caoimhe de Barra:

One thing that is very important is directors' responsibility. Again, we have heard that there are some indications that in a watered down text, the concept of directors' responsibility could be removed. What we would all recognise is that where the board of directors and senior management take responsibility, company behaviour changes radically and profoundly. We have all seen in the past that where voluntary initiatives fail, it is because directors and senior managers take no notice of them because they are not obliged to in any way observe, measure and report on them. We think that maintaining directors' responsibility in the text is extremely important. We believe this is something Ireland could and should stand over. It is worrisome that there is the potential for this to be removed because it is probably the fastest way to achieve a change in corporate responsibility.

Regarding the Deputy's question around gender and gender responsiveness, this is very important because women are disproportionately affected by abuses within supply chains. Women are disproportionately affected by inequality under legislation and in social norms and practices in all environments but particularly where the egregious human rights violations are most likely to happen. In the case of women human rights defenders, as Ms Lawlor said, companies should be required to protect human rights defenders who speak out about corporate violations. We have to distinguish between what are the risks for female and male human rights defenders. The types of attacks on women human rights defenders will be different in some respects from those directed against men. They will be threatened, harassed and abused on the basis of their gender. They will be accused of being prostitutes, bad mothers and failures in their society. Women cannot simply be protected by being removed from their family homes and communities because they have responsibilities within their families so the protections for female human rights defenders will often be different from protections for male human rights defenders. At the moment, there is no recognition that women workers in the supply chain are disproportionately affected by abuses and disproportionately not protected. The rights of women in terms of the right to own land, the right to a contract in their place of work and the right to protection under labour legislation are often entirely different from the rights afforded to men. We definitely need to see that recognised.

David Stanton (Cork East, Fine Gael)
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I think 100 companies and investors have signed a document supporting this proposed directive, which they want to be as strong as possible. Can the witnesses supply us with a list of those so that we might invite some of them before us, if the Chairman agrees, to look at best practice and what can and should be done? I thank the witnesses for their work.

Paul Murphy (Dublin South West, RISE)
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I thank the witnesses for their presentations and their work. This is potentially a very important directive in terms of putting real pressure on companies to respect human rights and the environment. From listening to what the witnesses have said, however, there is a real danger that it will get watered down. Having been in the European Parliament, I have no doubt that an army of lobbyists is currently working on behalf of large sections of big business to water it down and ensure it effectively remains an exercise in corporate washing and greenwashing. It is concerning that the Irish Government has not taken a public position on the various matters under discussion at Council level. The lack of progress in terms of Irish legislation is also concerning.

An excellent report by the ICBHR, Make It Your Business, Ireland!", speaks about the role of corporations in human rights and some of the abuses that take place. People might be a bit shocked about the role of Irish corporations in this. People can have the idea that Chinese or US corporations are the ones doing bad things around the world. Without speaking about specific companies because, unfortunately, we are not allowed to, is it possible to speak a little about some of the bad practices that are happening down the supply chain in which Irish businesses are involved?

Ms Caoimhe de Barra:

The most important point to be aware of is that Irish companies are no different from companies headquartered in any other European country. We are not immune by nature of our country's long history of support for and defence of human rights. Regarding the kinds of violations we are seeing, some companies that want to do the right thing find that they are stymied by the response they get - the lobbying and counteraction of positive steps they make wish to take. If legislation was in place that required companies to fulfil mandatory due diligence legislation, that counter pressure, which stops companies doing the right thing, would not have an effect and there would be an equal and level playing field for all companies.

Without going into details about a specific company or industry, prevention of harms is key. If due diligence is done on the supply chain in the extractive industry environment and the harms have occurred and will continue to occur are recognised in spite of the efforts of the company concerned to improve, future harms can be prevented and the Government can choose to disinvest in companies where there are evident harms that are not being prevented sufficiently. I will ask Dr. Widdis to speak on the legislative side.

Dr. Rachel Widdis:

I will talk about the lack of access to remedy. We may think there is a lot of regulation but it stands outside the impact of business on human rights. There is very little or no access to remedy for those affected. I have worked on the litigation side. Cases are being taken, particularly in the Supreme Court in the UK, against parent companies for their link to the activities of their subsidiaries in far-flung countries. Civil liability is one of the accountability mechanisms in the proposed directive. It is crucial that it be there because there has been no remedy for people affected due to the destruction of their environments and livelihoods. I will not mention any names. There has been no remedy. It is crucial that civil liability stays.

There are issues with how that would be practically possible because making civil liability available without the supports to make it possible is a problem. Supports must be available and I can give more detail in that respect. I will also say, as a director myself, that if we want this to happen, we should make the directors responsible for making it happen and implementing it. That way it will happen. I wanted to make those points.

Ms Mary Lawlor:

Some 70% of killings worldwide are in the context of land, environment and indigenous people's rights. Regarding Irish companies, without mentioning any names, I was invited to speak to the group of companies that were involved in the Cerrejón mine in Colombia, which I did. They were pleased with themselves. I was quite shocked and very disturbed that their human rights policy, which they were trumpeting, involved referring victims or human rights defenders who were victims to the local authorities, the local police, the very people who were involved with the companies in the abuse of the community's rights. There is an Irish company involved with that.

Ms Sorcha Tunney:

I will come in briefly and will also not mention any names. We are talking about Irish companies and companies domiciled in Ireland. We must raise a flag about countries in conflict. There are countries that are in a setting of conflict and the threshold or need for due diligence is increased in those settings. Where there is a lack of regulation, etc., some companies are land-grabbing without prior consent of the communities and using that land to benefit themselves. I am trying to say that without saying it. We see and have documented examples of that practice. There are Irish companies involved but as Ms de Barra said, companies across the world are acting like this. The law is meant to change the behaviour of companies and when that behaviour does not change, we need to be able to get some remedies for the communities which are most impacted. Irish companies are involved.

Paul Murphy (Dublin South West, RISE)
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One thing that concerned me was that it was reported a number of months ago in Politico that Ireland was one of the countries that was delaying progress in this regard and that it had expressed general reservations about the idea of this directive. Is that story accurate according to our guests' sources at Council level or whatever? Is it an accurate reflection of the situation that Ireland is certainly not pushing ahead in this regard?

Ms Sorcha Tunney:

They are closed meetings. We regularly use Politico to get some information. We are very much aware that Ireland is one of the slowest countries in this regard. There is information out there that we are not asking questions at some of the meetings or even contributing to what those laws should look like. For us, as advocates for this law, it is hard to understand or work with the Irish Government. We are here to work with the Irish Government and to support it in this regard. It is hard to understand where the Irish Government stands compared with other countries.

Paul Murphy (Dublin South West, RISE)
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One of the proposals which is most watered down is that to double the level at which this applies, to increase the threshold to 1,000 employees and to increase the relevant turnover to €300 million. I presume such a change would effectively exclude the vast majority of Irish companies. Are our guests aware of the Irish Government taking any position on that matter?

Ms Caoimhe de Barra:

The problem is that we are not aware of what the Irish Government's position is. This requires a step change. There is increased urgency because there is now momentum under the Czech Presidency to achieve quite a lot by the end of the term. This now needs to be elevated to political level. The officials at the Department of Enterprise, Trade and Employment need to be given that political support around what Ireland's position is. Ireland needs to stand firm in terms of its history and record of protecting, promoting and defending human rights.

Returning to what Deputy Stanton said, this committee could be extremely important by engaging with the Minister of State, Deputy Calleary, and enabling that process to be injected with some fresh energy, given the importance of the issues at stake. As Deputy Paul Murphy said, if this is watered down to the degree we have also heard on the grapevine, it will essentially become meaningless. As Ms Tunney said earlier, the eyes of the world are on this process because the European Union is seen as taking the lead. Countries within the European Union have already set out their policy positions and introduced legislation. This legislation could potentially impact not only European companies but also products and services coming into Europe. The ramifications are broad in terms of the globe and the way the trading system works. We need the Irish Government in political terms to step up to its responsibilities.

Joe Flaherty (Longford-Westmeath, Fianna Fail)
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I thank our guests for coming before the committee. This is a critical issue and they have given us great context and background. A number of speakers have referenced the fact that we have a new Minister of State with responsibility for this area. He is a party colleague of mine and I will certainly be taking it upon myself to follow up with him. I agree with Deputy Stanton that although the committee's membership includes those from different sides politically, everyone on the committee agrees about the importance of this legislation. It is important that Ireland is seen to take a strong lead. I would be somewhat disappointed that our guests have not seen the momentum or interest to date from my Government colleagues. Let it be known that I will be taking the matter up with the Minister of State directly. I will preface that remark by noting he is relatively recently in office. He will be a capable Minister of State and I know this is an area about which he is passionate. I believe he will put his stamp of authority on it.

I know we cannot reference companies by name but I was taken by Deputy Stanton's recommendation that we should try to get some of the companies that have signed up, particularly if they have an Irish footprint, before the committee.

I have some initial questions and hope to come back to our guests on foot of them. I know our guests cannot give names, but of the 100 companies that have signed up, how many have a footprint in Ireland?

Our guests have encouraged the committee to take the lead. I, for one, confirm I will be doing so. What other advice do our guests have? Are our guests aware of other countries or jurisdictions that are further down the road and which we need to look at and engage with to see what they are doing to move this forward?

I ask our guests to recap on the timeline and where we are at EU level at the moment. What will be the critical milestones over the coming weeks and months? Perhaps our guests could respond to those questions initially.

Dr. Rachel Widdis:

In respect of engagement and our offers of engagement, I engaged with the previous Minister of State. I offered to assist in any way. The support is there. It would be truly marvellous if this committee could act as a motor in that process. That would be really marvellous.

The Deputy asked about the companies which have signed up, many of which are global companies with European bases. There is an initiative in IBEC and I know multiple Irish companies are working with IBEC. The Deputy may be interested in talking to some of those.

The Deputy also asked about what is being done in other jurisdictions. I work daily with companies that are seeking to align with the German supply chain Act, which will come into force on 1 January. There is a considerable impetus behind this and, given the importance of the German economy, this is happening on the ground. The Norwegian Act is in force, as is the Swiss Act. The German Act is coming into force in a couple of months. Companies, including global companies, which work there are now working to align with the Act. The complaints procedure around many of the issues we have talked about must be opened to indirect suppliers and they want to put that in place. There are many things involved.

Sourcing countries such as Japan and Thailand are looking to introduce due diligence laws because as Europe leads, wants to lead and makes it explicit that it wishes to do so, other countries will have to engage on how to mirror that or there is a risk of the near-shoring of supply into countries that are within the European legislation.

Sourcing countries are also looking at what happens. That is an issue on which we need to engage and which we must recognise is happening. Across the world, jurisdictions, legislators and companies are looking at this EU development. We need to really focus on it.

Ms Sorcha Tunney:

I will speak to the timelines, but I would also recommend the Dutch Government as being one with which the committee could also engage. It has not got legislation yet; it is just beginning that process. It is ahead of us and is leading at EU level as well.

On timelines, the proposal was published in February. There have been two presidencies since it was brought forward. The first Presidency was held by France. The Czech Republic now holds the Presidency. Sweden will be next to hold the Presidency. We are hoping to see it finalised during Sweden's Presidency. It is also with the European Parliament. The committees that will have opinions have been decided, and the process of forming those opinions has started. Some of the deadlines for amendments to the opinions have already passed, but there is still this month and early next month.

As Ms de Barra mentioned, in terms of when the Council will move to the ambassador level, Politico is saying that the Czech Presidency wants that to happen in October. Once it goes to the ambassador level, it will then go to the Ministers' level and the Ministers will make decisions on it. We do not know when that meeting will take place exactly. We think it will be in early December. My point is that it is moving. To be fair to the European process, all those involved are meeting their deadlines. It is very much a live issue. It will hopefully be finalised during 2023. There will then be 18-month transposition period for each country.

Mr. Ed O'Donovan:

I will go back to the question on companies. While 100 companies have recognised the need for robust environmental and human rights due diligence - and many more have articulated the desire to see human rights defenders protected in that - coming back to Deputy Stanton's point, the reality is that many simply do not know who human rights defenders are. We have also had that issue with some Department officials we met in that there is a lack of understanding in this regard. As was mentioned previously, the ability or potential for this committee to play a key role in helping move that conversation along is there; it could be extremely useful.

Dr. Widdis mentioned Japan's new text around human rights and environmental due diligence, which also specifically includes the role of human rights defenders and the need for protection under such laws. We see the dial is shifting, but Ireland still needs to do much more.

Ms Mary Lawlor:

I would also like to mention that there is a new special rapporteur under the Aarhus Convention, which is legally binding. That is another move in the right direction. In Latin America, the Escazú Agreement is also legally binding for environmental human rights defenders. We can see that there is a move towards stronger and more robust legislation by states.

Mr. Ed O'Donovan:

One final thing to pick up on is Ms Lawlors's point about the new mechanism under the Aarhus Convention that applies to states' parties that are mostly in Europe and Central Asia. The parties to the Aarhus Convention have recognised the risks faced by environmental human rights defenders in those countries. As a result, they have put in place a rapid response mechanism to help aid protection of those people. Ireland and Austria are leading on that rapid response mechanism. The latter signifies that Ireland recognises this as an issue and that one of its priorities is supporting human rights defenders. It recognises the risks face by defenders and is showing support for this through the creation of this new mechanism of the Aarhus Convention. We would like to see this being coherently reflected in the European directive as well.

Joe Flaherty (Longford-Westmeath, Fianna Fail)
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I thank the witnesses very much for all that information. ICBHR might share with the office of the committee details of any of those companies we can bring in. Certainly, we need to perhaps have some engagement with the German and Dutch authorities and possibly contact their representatives as well.

It is important that we do not let a message go out that we feel that Irish companies are irresponsible. Some of the speakers indicated that there has been significant change and that, in the main, companies are very responsible. In the main, Irish companies are receptive to this and will engage with it. As a result, it is important that we put this message out there.

One point for Trócaire is that we must also be aware that any action has a consequence. As laudable and important as this is, it will probably not change the situation on the ground. It may not effect the change we need to see in workers' rights and welfare in many of these countries. If anything, the work that is perhaps there could possibly disappear altogether. Is there something that needs to be done? Do we need to look at this from two sides? It is okay that we can feel good about ourselves and that we are being responsible and ethical in where we source our products. As a country with a strong identity in humanitarian aid and human rights, however, do we also need to be looking at the potential consequences of this?

Ms Caoimhe de Barra:

I thank Deputy Flaherty very much. One point I would like to make is that the Department of Foreign Affairs and Irish Aid are heavily engaged in contexts where human rights violations occur. They engage diplomatically through the European Parliament and local civil society in the context of addressing the multiple causes of violations of human rights. This is not a body of work that we would see in any way in isolation from the rest of the Government's approach to the promotion, protection and defence of human rights internationally.

The point Deputy Flaherty is making is that this is certainly not a panacea. We would agree. However, from our work in Central America, for example, where there is a combination of governance, politics and criminality, effectively, what they have is an enabling environment for corporate violations of human rights. The Department of Foreign Affairs, through agencies such as Trócaire and by means of its own engagement bilaterally with, for example, counterpart ministries for foreign affairs, engages on this holistically.

What we are seeing and hearing today is that we need to see a cohesive response from the Government towards human rights violations within the corporate sector, and that the Government should equally represent the values of the Irish people in this dialogue around the corporate due diligence directive as much as it does, for example, through its work on the UN Security Council on similar issues and violations.

Ms Sorcha Tunney:

I will come in to say that unions are very heavily involved in developing and advocating for this directive. The directive includes mention of the right to a fair wage, which is recognised as a human right in the annex. It does not mention anything regarding a living wage. We would see the impact of the absence of a living wage around farmers or small farm holders. That is an area that could be improved with the directive. The unions are very much involved, however. The Irish Congress of Trade Unions is a member of the coalition and is very much involved in this. It is not a panacea but it is one other avenue by which we could improve workers' conditions and rights through this directive.

Joe Flaherty (Longford-Westmeath, Fianna Fail)
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I to thank the witnesses. I, for one, greatly appreciate their endeavours in this regard. It is a hugely important piece of legislation. As I indicated earlier, I will be following up directly over the next 48 hours with the Minister. It is important that we lead on this as a nation. I see a huge piece of work for this committee. I thank the Chair in that regard. Hopefully, we can get further engagement with today's speakers as we continue on the journey. I thank everyone very much.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank Deputy Flaherty. I apologise once again for the technical issues he experienced. Deputy Shanahan is next to speak. He will be followed by Senator Gavan. They will both have seven minutes.

Matt Shanahan (Waterford, Independent)
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I thank all the guests for coming in today and for their continued advocacy on this very important issue. As other colleagues stated, this committee will not be found wanting in terms of trying to assist them as best we can to make sure that Ireland is in the vanguard when it comes to what is being proposed at European level.

This is very difficult subject in many ways. We are largely talking about extended supply chains that go into Latin America and Africa, as has been mentioned. There is a big political difficulty in many of those countries in that the human rights we are trying to endorse are often not endorsed by those governments. That is an issue in terms of how this European directive can have teeth in trying to improve the lives of people in those countries.

The witnesses have mentioned a number of key areas they would like to see this legislation scope out. One was the provision of criminal liability and civil liability. I think the witnesses are talking about companies that either use extended supply chains or have subsidiaries. I think that it will be very difficult, from a legal perspective, to try to enforce that. It is a matter of the degree to which people who are dislocated by either governance or geography are found culpable in some way for what is going on in a far-removed country. I would like to understand how the witnesses feel the European directive will affect that.

It is very important that the witnesses have highlighted managing the risks of retaliation against, in particular, those who are in human rights and involved in those endeavours, and protecting sources. It is absolutely vital that we can, at a European level, try to offer some protection, but what would that look like? Are we going to bring people involved in mining or deforestation from South America into a witness protection programme? I can see the ethos of what we are trying to do. It appears to me that the best way to try to marshal this is through corporate reputation. One of the big phone manufacturers was highlighted. We saw what happened when cameras were brought into China to see what was happening in manufacturing. We saw in Pakistan girls of four, five and six sewing sequins onto textiles and how that had an effect. I would like to see something more in respect of what we are discussing as to how we can use the power of social media and of global communications to really help people on the ground. Ms Lawlor spoke about the killing in South America of people involved in deforestation. We have to find a way of connecting that activity with what we consume, what we buy and what we market.

The witnesses may wish to take those couple of points. How do we make this legislation reach out into the conscious mind of social media marketing? That, to me, is where it can have the greatest effect in respect of consumer buying. If consumer buying behaviour is changed, we will absolutely impact some of these activities on the ground.

Ms Mary Lawlor:

I absolutely agree that it will be difficult but all human rights work is difficult because it is never accepted by governments or companies that they should protect the most marginalised in society. That is a starting point. I absolutely agree with the Deputy about corporate reputation. From the work I have done with companies over the past two years - and I have written to many companies that have been engaged in abuses against communities and, in particular, human rights defenders because that is my mandate - it is clear to me that the only thing they care about is their reputations because that affects their share prices. It is the same with governments. Governments will go to any extent to stop you doing a negative press release about something they are doing. It is just the way of the world. Every government wants to protect its reputation and its political and strategic interests. From that point of view, I completely agree with Deputy Shanahan.

Getting back to something that occurred to me in response to, I think, Deputy Flaherty, when we in the school of business in Trinity College do the benchmarking of the 50 biggest companies in Ireland on only their published information, and half of them score under 20%, we find that a lot of it is that they just do not know. They need to be educated; not all of them. Obviously, very few of them are engaged in human rights violations of one kind or another, either directly or indirectly, but the point is that education is needed. If we look at what is coming, apart from what I have said about the Escazú Agreement and the Aarhus Convention, we find that the Inter-American Development Bank has included a section on reprisals. The International Finance Corporation, part of the World Bank Group, also has a section on retaliation and threats. The European Bank for Reconstruction and Development has also issued a statement on retaliation. Then there are the companies. Deputy Stanton mentioned the 100 companies. There are a lot of big companies and a lot of small companies engaged in this issue. Big ones like Unilever, for example, are very engaged.

What I am saying is that I absolutely agree with the Deputy but we have to take this step. Nothing will happen until we start taking the right steps in the right direction, using all the tools at our disposal, including social media.

Matt Shanahan (Waterford, Independent)
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I appreciate that. One of the things I would like to see is some kind of framework within this whereby companies would try to investigate their own supply chains, even where they are buying from a third party. If it means that companies must have a policy stating that they have put people on the ground in South America or Africa, have seen what is going on and are moderating, looking at and engaging with that, that, to me, is the only meaningful thing. Beyond that, it is a matter of advocacy around trying to get at those people on the ground and trying to get the message out, as Ms Lawlor says. Corporate reputation and money are the only two things that really matter here at the end of the day to try to effect behavioural change. They are the fastest way to get it.

Mr. Ed O'Donovan:

To come back to the Deputy's point about retaliation, there is a well-established framework around the protection of whistleblowers and human rights activists who are at risk for speaking up. There have been a number of companies with which we have been in touch and which have taken steps when we have informed them that there is a human rights defender at risk because of their opposition on human rights grounds to that company's policy. Numerous guidance documents have been published directing business and investors how to take steps to ensure that retaliation does not happen. All of that work and knowledge is already out there. It comes back to the point about education and raising awareness. The European Union has been working on the issue of the protection of human rights defenders for 20 years. All those frameworks and models are out there. It is just about raising awareness and education.

Dr. Rachel Widdis:

Personally, we go into farms, factories and fields for businesses employed by businesses to look deep into their supply chains and talk directly to women, migrants and mixed groups separately and directly to get stakeholder engagement on the ground. That does occur.

To come back to Deputy Shanahan's point about civil and criminal liability, I wrote my PhD on how to take those cases and how they could be taken. They are being taken. They have been taken primarily in common law jurisdictions and were being taken primarily in the UK. The UK Supreme Court has issued incredible judgments in this space. That said, the UK is, as we know, no longer with us. Ireland is the common law English-speaking natural jurisdiction. There are a number of issues with taking those cases in Ireland, including third party funding and class actions. The directive itself has an issue around the burden of proof, which falls to member states and could fall, as it does or did, on the people who are affected. It is an incredible lift for those people. There are issues of information, funding, lack of access to class actions, but the cases have been brought. They have taken decades but they have been brought successfully, which I think is another thing people may not be aware of. Ireland would be a natural jurisdiction, as I have written, for the criminal liability failure to prevent human rights abuses. I have also written on that. There is a movement there focusing on working off the Bribery Act.

I would like to come back to talk about environment and climate at some point, if we might.

Maurice Quinlivan (Limerick City, Sinn Fein)
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We need to wrap up. Deputy Shanahan's time is up. The next two speakers are Senators Gavan and Sherlock.

Paul Gavan (Sinn Fein)
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I thank all the speakers. It has been a really powerful set of presentations and interactions.

I went to Colombia on a trade union mission four years ago, I think, and saw at first hand the horrors there. As the witnesses will know, Colombia is the most dangerous country in the world in which to be a member of a trade union. I received a number of very serious complaints about a very prominent Irish company, which I will not name.

I found it disturbing to hear that. Thankfully, there is now a progressive government in Colombia for the first time, so the country is, I hope, on the cusp of change.

To get to the crux of the issue, it is clear that everyone, on a cross-party basis here, wants to support this directive and beef it up, which is welcome. Nevertheless, when the Tánaiste appeared before the committee last week, we got very few answers. A number of us, from several parties, not just Sinn Féin, raised questions but I did not feel as though we got answers. Why do our guests think that is? As they pointed out, we are not at an early stage. A third compromise draft is being developed, yet Ministers seem prepared to say as little as possible in regard to this. Is something preventing them from speaking about this? I have to say, I think they are dragging their feet. I want to understand from our guests' perspectives why the Government is dragging its feet in regard to these very important human rights issues.

Ms Caoimhe de Barra:

One aspect of that, to be frank, is that Ireland is a country with a lot of small and medium-sized enterprises, so there is a degree of understandable nervousness regarding whether this would affect SMEs. Within supply chains, the principle is that you look at the entire supply chain and all industries and all sectors, but you do it in a proportionate manner, and if we have time, perhaps we could discuss what exactly that would look like. The principle is one of proportionality and maintaining that overall principle for all supply chains and all companies in a proportionate manner, as is set out in the UN guiding principles. That is fundamental.

There is a degree of reassurance that needs to happen regarding what it would mean to include SMEs in this. For example, a European Commission study recently found that the additional recurrent company-level costs of carrying out due diligence, as a percentage of SMEs’ revenues, would amount to less than 0.14%. In some ways, it is to take the fear and tension around the potential impact of this out of SMEs, put it on the table and discuss it in this forum, and enable the Government to take that leadership role, which so clearly belongs to the Government in this realm. That is the key.

To return to the point on directors' responsibility in response to Deputy Shanahan's point regarding consumers, if we make consumers responsible for driving change, we are negating all the responsibilities of states and companies. Directors taking responsibility for supply chain due diligence is the key.

Ms Sorcha Tunney:

I might come in there because I watched the committee meeting last week and heard the Tánaiste talk about competitiveness. There is a misconception that this is creating structural change that will result in a standard and norms. If companies do not engage, therefore, they may be at a competitive disadvantage but by engaging, they will bring their perspectives to the negotiation. We are trying to create a standard that all companies will have to work to, and they cannot lose competitiveness if they are all working to the same standard.

Paul Gavan (Sinn Fein)
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Both Ms de Barra and Ms Tunney put their finger on something important. There is an incorrect perception that somehow a directive like this could be damaging to businesses, whereby it would somehow disadvantage Irish businesses. From what both of them said, however, that is not the case.

Ms Sorcha Tunney:

Yes. Other countries have laws and businesses are not leaving. The sky has not fallen in.

Paul Gavan (Sinn Fein)
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Other countries our guests mentioned - Germany, in particular - have made a positive start in regard to this directive. Is there anything else they think is holding back the Government? As I am sure they will agree, the Government has not to date taken a leading role on pushing this directive forward. What can they tell us to help us focus the minds of Ministers to ensure they suddenly step up and do the work we want them to do?

Ms Caoimhe de Barra:

I think what has taken the Government a little by surprise is the pace at which this is now moving. We do not necessarily always expect processes within the European Union to move this quickly, but they are moving, as Ms Tunney said earlier, according to the timelines that were set out at the beginning. There is an opportunity now, with the new Minister of State in place, to engage politically and for that to drive the technical engagement.

Dr. Rachel Widdis:

I might add there is always an opportunity to engage in dialogue and exchange, and we are all available to do that and assist. It is complex and there are a lot of factors, but dialogue and information can really assist with that. That is another aspect that might help.

Ms Sorcha Tunney:

Moreover, there is significant public support for this and perhaps that is not being heard. There has been a lot of polling throughout Europe on this and there is public support across the Continent. The European Parliament proposal is one of the proposals that have had the highest engagement from citizens of the European Union. I do not understand the lack of progress or failure to take the lead on this, but there is still time. It is not all lost and we can move it from there.

Ms Mary Lawlor:

When we strip everything away, in my view, the Irish are waiting to see what is in the final draft before they are willing to engage. The idea of a public consultation is good but it has been talked about for months. Because everyone is overworked and so on, they do not want to do something and then see something else in the directive and have to redo it-----

Paul Gavan (Sinn Fein)
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Is that not a missed opportunity in terms of what the Government should be doing?

Ms Mary Lawlor:

Yes, of course it is. The directive totally aligns with all of Ireland's foreign policy priorities. From that point of view, it seems strange the Government has not engaged with the process, and to be fair, it has not.

Marie Sherlock (Labour)
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I pay tribute to the sterling work of Ms Lawlor and her team, Front Line Defenders, and Trócaire and the Irish Coalition for Business and Human Rights. This will be a groundbreaking directive both for trade unionists throughout the world and those exposing environmental degradation if it is enacted in the spirit in which it was originally intended. As our guests detailed, there has been a significant and worrying degree of watering down the proposal, and the lack of engagement by the Government has been worrying as well, although I will take what Deputy Flaherty said about that hopefully going to change.

The focus of this meeting has been on the case for a mandatory human rights and environmental due diligence framework, but I want to ask about how that due diligence framework would complement the need to put in place an outright ban on certain practices. I am looking, in particular, at what is happening with regard to cotton products from the Xinjiang province in China. The US has moved ahead on that and the EU appears to be still thinking about it, if I am up to date on that. There is a role for outright bans. Our guests talked about the supply chain legislation that is in place. They might speak to how they see the framework that will be in the directive being complemented by outright bans. My concern is that once this directive has been enacted, a view may be taken whereby people will say we no longer need to instigate outright bans on certain practices such as forced labour because the framework will be in place.

Ms Sorcha Tunney:

Yes, the corporate sustainability due diligence directive is part of a suite of directives and regulations the EU is putting forward, and only three weeks ago, it published its proposal on banning forced labour products, particularly looking at Uyghur communities. This directive will deal with behavioural change and with companies preventing human rights abuses and fixing them where they happen, but there is also a need for a ban on the import of products from certain regions. Ms Lawlor can probably talk to this in more detail. The US has drafted quite effective laws. Again, the EU framework at the moment does not seem to be as impactful in the sense it is based on a customs duty. It is not necessarily banning all products and it does not look as good as the US one at the moment.

There is a political reason for that as well, which we have to recognise. This directive is about changing behaviour. The conflict minerals, forced labour and deforestation regulations all sit under the green new deal the EU has adopted. Basically, it is about changing behaviour and stopping the products. They are complementary and they work to each other. There is also the proposal for the corporate sustainability reporting directive, which almost a twin of this instrument, which focuses on how work and due diligence are reported. They are taken as a suite of actions and engagement, but the directive on changing behaviour is key. That is why we want it to have a bigger scope. The scope of the corporate sustainability reporting directive is wider than the scope of this instrument. We keep talking about level playing fields and making it easier for business, but at EU level we are creating directives that have different thresholds for companies. We want to simplify it for companies. We should seek to introduce a standard threshold, whether that is by looking the UN guiding principles or concentrating on the reporting directive. Currently, the scope of the corporate sustainability due diligence directive is problematic, but there is a suite of directives.

Dr. Rachel Widdis:

I would add that, of course, there is a prohibition on forced labour. The annex contains more than 11 human rights instruments, including all the ILO conventions, etc, and the German Act coming into force, which contains a prohibition on forced labour. It is all part of the same thing, but there are distinct strands, including child labour, forced labour, all forms of slavery and those on waste and environment, which we should talk about. I will refer to Ms Lawlor.

Marie Sherlock (Labour)
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Just to clarify, I used the phrase "outright ban", but I am thinking of that supply chain regulation. There is still a need for that. I did not mean to interrupt Ms Lawlor.

We have touched a little on the protections in place with regard to retaliation, reprisals and retribution. I suppose it goes to the heart of the effectiveness of the directive, whenever it is enacted. I think Mr. O'Donovan mentioned the set of protections that are in place for whistleblowers. Is that what the witnesses see as the benchmark that we should look to introduce, or is there a separate or slightly more distinct set of protections that need to be put in place for front-line defenders or those exposing practices?

Mr. Ed O'Donovan:

While I see the whistleblower protections as being effective to a certain extent, some of the risks faced by human rights defenders more broadly, and the industries that they are working in, can lead to reprisals against them that are not dealt effectively by current whistleblower protections. For instance, in terms of death threats and killings, we know that human rights defenders - and I am talking about people who are exposing human rights violations and protesting against land grabs and environmental degradation - tend to be killed at a far higher level than the traditional whistleblower in a corporate set-up. From that perspective, there needs to be a much broader stance taken on their protection. As I mentioned previously, all of these models exist. A number of agencies and organisations have been working on this issue for the past 20 or 30 years. It is about trying to get business and other actors to appreciate what these steps are, what the risks are and what kind of things they have to put in place to ensure that they are not playing a part in facilitating, or even having an awareness of, a situation which could create these circumstances.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Does Deputy Bruton wish to come in?

Richard Bruton (Dublin Bay North, Fine Gael)
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Apologies for being late. I missed the thread of the discussion, so I will have to pick up on it later.

Maurice Quinlivan (Limerick City, Sinn Fein)
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That concludes round one. We will move on to round two. Two members have indicated so far. If any other members wish to come back in, I ask them to indicate. I call Deputy O'Reilly followed by Deputy Paul Murphy.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Apologies for my absence earlier. I will catch up on anything I missed. I also apologise if my question has been asked and answered. I will not ask the witnesses to repeat themselves; they can just refer me to the transcript. It concerns a point that was made about cases being taken, and specifically, the time cases take. I think the word used was "decades". There is an article within the proposal for the directive that includes a civil liability regime, which is important. However, there are a lot of barriers now, including cases taking decades, access to cash, the lack of clear supports and all these other factors. What is it that we can do to strengthen this directive to ensure that we make it more accessible for those who may need to access the judicial remedy? If cases take decades and cost a lot of money, what can we do to ensure that by using this directive as a vehicle, we can make it simpler or easier for people to access justice?

Dr. Rachel Widdis:

As I mentioned, remedy has been non-existent. Retaining civil liability is crucial, because there will be moves to remove that. Having it as a possibility without making it practical is not of any use to the people who have been affected.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I am sorry to cut across Dr. Widdis, but that is my concern. Telling someone that they have the right to do something and then building a big wall between them and that right means that they might as well not have it. The perception that right exists without access to being able to vindicate that right makes it worse.

Dr. Rachel Widdis:

I agree 100%. These cases were so difficult and so hard won in the UK. I have mentioned the similarities between our systems. In the context of the directive, every country has a different system. In Ireland, there are specific barriers to taking these cases, including third-party funding litigation and class actions. The burden of proof, which is set out under recital 58, is a general problem. The burden of proof is to be decided by member states and could fall on those affected and most vulnerable, without the funds and the information, who are trying to look through massively opaque enormous corporates without anything like the resources required. We must ensure that we provide practical support, retain civil liability and look hard at the reversal of the burden of proof, and finally, that this country enables those cases.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Does Dr. Widdis fear that this civil liability is going to be watered down or removed?

Dr. Rachel Widdis:

Yes. Then it will be back to zero remedy.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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That is something that we, as a committee, could bring to the attention of the Tánaiste, as the relevant Minister, and try to put it up in lights. I would be surprised if he was not aware of it. However, just in case he is not, it may be useful for us, as a committee, to alert him to that serious concern. Does Ms Lawlor want to comment on the same subject?

Ms Mary Lawlor:

I do not have much else to add except that looking at the three pillars of the UN guiding principles on business and human rights, the first principle is the government's obligation to protect human rights. The second is the company's obligation to respect human rights, and the third is remedy. When we are talking about civil liability and retaliation and all of that, there should be a clear pathway for those who are opposing something for human rights reasons to be able to do so without fear of retaliation. In my work, I am constantly engaging with human rights defenders in the context of business and human rights. The youngest human rights defender to be killed was a 14-year-old child in Colombia, in the context of the environment. The oldest that I have come across and spoken about is a 65-year-old grandmother in South Africa, opposing the extension of open-pit mining beside a nature reserve, who was killed in front of her grandson. That is what it comes down to. That is what we are talking about. That is why the directive is so important.

Ms Sorcha Tunney:

I was just thinking about the football world cup. I will not mention who runs the world cup, but thinking about the number of people who have died in the process of building these stadiums -The Guardianreported that 6,500 have been killed - most of whom were from India, Nepal and countries like that, there is no remedy for these people and their families.

There has been none. There is a campaign at the moment to ask for remedy, but that is happening now. It starts in 30 days. This is where this directive must have civil liability or there is no stick. The question was asked by Deputy Shanahan about how we ensure that companies do this. The word "mandatory" is very important. It is key to couple it with civil liability. We must keep it in, and to be honest, we must strengthen it.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I think we need to focus on strengthening it.

Dr. Rachel Widdis:

In terms of litigation, I want to mention an actual case. It relates to human rights defenders in indigenous communities opposing land development. The case is now in its eighth or ninth year. Eleven women have given testimony that they were allegedly gang-raped by security guards in front of their children. One person was killed and one was paralysed. The case is proceeding in Canada.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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It has taken eight or nine years and presumably a significant amount of resources as well, and all the support.

Dr. Rachel Widdis:

The horrors are very real. That is a company that is also based in Canada. I will not mention the name.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I suppose the job for us is to marry up the carrot and the stick, if one likes. We can operate from the assumption that most companies want to have a reputation for being decent and treating their workers well. Nobody wants to wear clothes that have been made by children in sweat shops. However, that will not be enough in terms of persuading people. There will have to be some form of very serious remedy. In order for that to happen, we need to look at how we can give access to that remedy to those people who are the furthest away in terms of education, resources and access to influence and power, and how we can balance that up. We can put that on the Tánaiste's agenda.

Paul Murphy (Dublin South West, RISE)
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I will pursue the issue of civil liability. Even if civil liability stays as something that is there, which people in theory have the right to access, let us say if there is a corporation based in Ireland that is guilty of gross human rights abuses in Latin America, and we have an indigenous farmer or activist who is trying to pursue justice, at the moment we do not have any legal aid in Ireland for civil liability cases. If we do not deal with that, is this going to be a meaningful accessible remedy for people?

Dr. Rachel Widdis:

No, not unless those supports are put in place. Again, if the directive obliges that there is civil liability and access, that becomes the opener of the gate for the things that must be put in place. They have been long advocated to be put in place. These cases must be funded in different ways.

Deputy Murphy talked about the people who are affected taking the case. If there was criminal liability - many of the abuses are at the egregious level of cases such as the one I just mentioned - then it would be the state taking the case. It would not be taken by the person who is most diminished, vulnerable or marginalised - the farmer or the human rights defender - but by the state. I recognise that is not on the table. We can imagine that keeping civil liability in those circumstances is crucial, but it is still placing an enormous burden on the most vulnerable. In practice, there are also a lot of barriers to even access it.

Ms Sorcha Tunney:

I will make a quick comment. There is a new draft Spanish law that is looking at creating a fund for cases by member states or the Spanish Government that seems interesting.

Paul Murphy (Dublin South West, RISE)
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So that could be a possible model. Another major part of attempting to water it down is to exclude pension funds and alternative investment funds like hedge funds. That is very relevant for Ireland, as a centre of finance capital with the IFSC. Could the witnesses outline why it does not make any sense to exclude these companies from responsibility for what happens?

Ms Sorcha Tunney:

The financial sector is not included in the directive as a high-risk sector. That is strange. It is a pity. One of the calls is that we are advocating for the financial sector to be included because the OECD guidelines are there for the financial sector and they are a part of that process and framework. I do not understand why that is the case. If we go back to what Deputy Stanton says about the support from businesses, the support is there from investors too for this directive. I do not understand why it is excluded. The Government should seek to have the financial sector included considering our market and where we sit. I do not understand why that is not the case.

Dr. Rachel Widdis:

I might add that they are included to the extent that due diligence is done at the point of signing the contract but not over the life. This is at odds with project finance, for example. If we are looking at an infrastructural investment in Saudi Arabia, we would have to look at it across the life and market. For example, there are geographies that have inherent high human rights risks.

Paul Murphy (Dublin South West, RISE)
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To clarify that, as long as they can show they did their due diligence at the point of the investment or whatever, they are covered if everything deteriorates.

Dr. Rachel Widdis:

That is 100% out of step with the practice and nobody understands that. The issue in Ireland is we can have a very small amount of people employed in a business with very large amounts of assets that are investing in all kinds of things, so there is a chain of command and of how the impacts trickle down. Therefore, it does not make any sense to exclude them or to say there is an exception or some particular interest point for Ireland. The other point I would make in passing is that all of the foreign direct investment companies in Ireland would be coming within this directive. That is another reason to get involved.

Paul Murphy (Dublin South West, RISE)
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I have a question that is probably for Ms Lawlor. One of the interesting points that struck me in the Make it Your Business report is the reference to a study done by Trinity College in 2019. She is listed as being one of the authors of the study, which analysed 60 of the largest firms operating in Ireland. It found that 34% of the publicly listed companies scored zero against every human rights due diligence indicator and 72% failed to disclose whether they assessed salient risks and impacts. Could she speak a little bit about that and whether she knows if the statistics have improved at all?

Ms Mary Lawlor:

This is something we started some time ago. That study was the third one and there will be another one next year. The idea is to measure compliance on the companies' own published information with the UN guiding principles on business and human rights. It is only what they have said themselves, so it is quite shocking that they are so ill-informed and do not understand their obligations. That being said, we have noted over the previous two benchmarks, as we call them, that more businesses are willing to engage now. There have been some improvements in some companies as a result of being benchmarked by Trinity. We hope that this will act as a kind of motivator and create awareness and lead to behavioural change by companies here.

Paul Murphy (Dublin South West, RISE)
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I thank Ms Lawlor. I have one final point. We are speculating a bit here about the motivation for the Government being a laggard on this issue. The point was made that Ireland is home to a lot of SMEs, but is it not also partly that Ireland is home to a lot of multinational corporations that base themselves here? We have the top five global software companies, 14 of the top 15 medical technology companies and 18 of the top financial services companies. We know that Ireland Inc. markets itself globally as having low corporation tax, low data protection and low regulation. Is part of this driven by showing we are not trying to put too onerous burdens on corporations?

Ms Caoimhe de Barra:

It is very hard to say. The reality is that legislation is coming. The era of voluntary compliance with voluntary guidelines is over. It is long gone. Legislation is coming. The question is whether Ireland will be at the table to influence the legislation in a positive direction or if we will essentially adopt an inert position on it, which is not Ireland's practice or tradition. What we need to see is political engagement, and we need to see it happening with a degree of urgency.

Ms Mary Lawlor:

Referring back to the benchmark of companies, we obviously benchmark the biggest companies, many of which are multinationals. However, let us look at a company like Microsoft. I was part of its consultation on bringing in a ten-year human rights policy. It is deliberately and thoughtfully deciding that it must engage in proper due diligence and human rights impact assessment of its work. It is not beyond the realms of possibility that other companies would not be similarly willing to engage.

It is a case of such companies understanding what is involved and then changing their behaviour. As we have seen so often in the past, this is for no other reason than that they have been found guilty in awful circumstances. For example, Rana Plaza had to change its behaviour to protect its reputation.

David Stanton (Cork East, Fine Gael)
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It has been a most useful, interesting and powerful engagement. I thank the representatives for that. I heard Ms Lawlor say a few times that there is a lack of awareness and a need for more education and information. It is also useful to know that some of the larger companies have the resources to inform themselves, are moving on this and will act as an example for others to follow.

I am also struck by the timeline. Can we discuss the deadlines? It has been said more than once that this is moving very fast. We also have to move fast to catch up. As a committee, we may have been a bit of a laggard on this matter. We could have done more if we had grasped this earlier. When do the witnesses see this being enacted? Where is it going? There is a draft directive, amendments are being proposed, and deadlines for amendments and so on are coming up. This is very close; it will be in the next couple of weeks.

Ms Sorcha Tunney:

We can share the proposed calendar with the committee. That would be great. At European Parliament level, the amendments are a three-stage process. There is a parliament stage. The committees have published many of their opinions and are consulting their members. We have engaged very proactively with MEPs. I will share with the committee that as part of the process Irish MEPs are active on this file, in particular, Barry Andrews, Chris MacManus, Frances Fitzgerald and others. It is good to see that. Once they have tabled their amendments, there is a cut-off point around October-November. At the same time, the Council is moving through the Czech Presidency. It has had four meetings and we are moving to a situation where it will have five or six more quickly over the next few months.

Around December or January, we will be looking at decisions and positions being taken. That is why we feel quite strongly that we would like to know where Ireland stands on this. As regards this committee, there is a little urgency. It would be great to have other stakeholders before it to talk about this in a wider manner. In particular, we would like to facilitate human rights defenders to come in, or representatives from other affected communities or trade unions. The deadline might move but the parliament is sticking to it at present. We will share the full calendar with the committee if that is okay, but we are looking at a deadline of 2023 or 2024 to have this transposed.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank all the representatives for coming, including Ms Lawlor, Mr. O'Donovan, Dr. Widdis, Ms de Barra and Ms Tunney. They have done a good job and have assisted the committee in a significant way today. It was a very interesting discussion. The committee will consider this matter further and will decide what actions it will take from there on.