Op-ed in EJ Insight (Hong Kong Economic Journal) by U.S. Consul General Hanscom Smith
May 11, 2022
(This article was published by Hong Kong Economic Journal on May 11, 2022, and this article is not for commercial use.)
We need only look at the front-page news to see that companies are reassessing their business practices in areas ranging from preventing and addressing forced labor in their supply chains, reconsidering business ties in Russia, and addressing the climate crisis. Businesses can have direct or indirect effects on the lives of their employees, customers, suppliers, and the communities in which they operate. They also have the capacity to help positively shape society and the environment by supporting workers’ rights, improving working conditions, building trust with communities, and operating sustainably. At the same time, some global companies’ activities have had an adverse impact on people and the environment – incidents that have contributed to lost investment or profits and damaged global brand image.
To help address these challenges, the United States has long promoted internationally recognized guidelines for doing business – such as the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct (OECD Guidelines) and the UN Guiding Principles on Business and Human Rights (UNGPs) – and is committed to advancing responsible business conduct. As such, on the 10th anniversary of the UNGPs, June 16, 2021, Secretary of State Anthony Blinken announced that the United States will update and revitalize its National Action Plan (NAP) on Responsible Business Conduct. The United States’ first NAP, published on December 16, 2016, intended to focus, improve, and expand efforts to promote responsible business conduct by U.S.-based companies operating abroad. Responsible business conduct is a broad concept based on the idea businesses can perform well while doing good, and governments should create and facilitate the conditions for that to take place.
A NAP is a powerful tool for all governments to assess progress, set priorities, coordinate action, and communicate gains on business and human rights issues. The U.S. NAP focuses on responsible business conduct – an even broader term that covers additional areas, including environmental protection and labor relations. Many governments have also developed or begun developing NAPs on Business and Human Rights. We believe that active stakeholder engagement is a crucial component of effective NAP development, as is the transparency and inclusiveness of the process itself.
As such, we are seeking input and recommendations on our NAP from members of the private sector and civil society by soliciting written input through the Federal Register Notice and participating in discussions. I am pleased to announce the U.S. Consulate General in Hong Kong and Macau has posted the Federal Register Notice on our website and stands ready to host closed-door consultations with local stakeholders interested in sharing their views.
Our updated NAP will be one of many tools used by the United States to advance responsible business conduct. The Secretary of State’s Award for Corporate Excellence (ACE) is another way the U.S. government recognizes and honors U.S. companies that uphold high standards as responsible members of their communities. In 2021, U.S. companies in the Indo-Pacific region received honors in each of the three award categories: economic inclusion, health security, and climate innovation. This recognition is testament to the positive role U.S. businesses play throughout the region,, including right here in Hong Kong.
Furthering our efforts to support responsible business practices, we rely on collaboration with other governments, NGOs, and other stakeholders around the world. In Hong Kong, for example, we applaud the Hong Kong Stock Exchange for issuing an environmental, social, and governance (ESG) reporting guide, and for introducing a mandatory disclosure requirement on social key performance indicators. Under the disclosure requirement, more companies in Hong Kong are adopting the United Nations Sustainable Development Goals as part of their strategies, targets, and activities. I am proud that U.S. companies have been among those recognized by Hong Kong authorities and professional associations for sustainable growth best practices and environmental excellence. U.S. firms are also leaders in supporting inclusive and diverse workplaces globally, as well as in Hong Kong, where they have received awards for inclusive practices and high rankings on Hong Kong’s LGBT+ Inclusion Index. Effective corporate social responsibility programs reflect U.S. businesses’ commitment to the communities where they operate across the world. Whether donating anti-epidemic supplies to frontline workers and underprivileged communities, providing support for the disabled, offering training to prevent trafficking in persons, or introducing best practices on sustainability, U.S. companies in Hong Kong every day debunk the false choice between profit and purpose – proving that good businesses can also serve the public good.
While we are committed to advancing responsible business conduct, we cannot do it without your help. We invite you to visit the Federal Register webpage to submit your thoughts, comments, and concerns. Together, by creating the most effective NAP possible, we can work towards ensuring businesses producing the goods and services you buy respect the environment, workers, and the communities in which they operate.