Articles / OECD Guidelines for Multinational Enterprises

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OECD Guidelines for Multinational Enterprises

The OECD Guidelines for Multinational Enterprises is an international legal instrument adopted by all member countries, to promote responsible business conduct in the supply chain.

These guidelines cover labor rights, human rights, decent working conditions, anti-corruption and environmental protection, among other important areas.

This helpful article about the OECDs Guidelines include:

    • Implementing the OECD Guidelines for Multinational Enterprises
    • OECD Guidelines impact on human rights and decent working conditions
    • Government policies for responsible business conduct
    • Guide for businesses due diligence assessments
    • Promoting responsible supply chains
    • Management system that handles negative consequences for human rights, decent working conditions and the enviornment

Let’s dive into the OECD Guidelines for Multinational Enterprises and negative consequences for human rights and decent working enviornment!

We will also adress how a digital software for due diligence can help with responsible business conduct in accordance with the guidelines.

Feel free to navigate in or close the table of contents to find what you`re looking for.

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OECD Responsible business conduct due diligence guidance

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OECD Guidelines: Impact on Human Rights and Decent Working Conditions

The Council of OECD, meaning all the member countries, have agreed that businesses should play a key role in contributing to economic, environmental and social progress.

So how can this goal be accomplished efficiently?

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OECD’s Due Diligence Guidance for Responsible Business Conduct

The answer is OECD’s due diligence guidance for responsible business conduct. By making sure that companies minimizes the adverse impacts of their operations, supply chains and other business relationships, multinational enterprises can play a key role in contributing to the OECD Conventions main aim, sustainable growth and better living standards in the society.

OECD’s Guidelines for Multinational Enterprises recommend that enterprises conduct due diligence with focus on three key elements.

Identify, prevent or mitigate and account for how actual and potential adverse impacts are adressed. If you want to learn what “adverse impacts” are, please read this article.

You can download and read the full guidelines here.

If you`re looking for a digital software that can handle organizations due diligence for responsible business conduct, feel free to navigate to Transparency Gate to read more about how that works.

Negative Consequences for Human Rights, Labour Rights, Decent Working Conditions and environmental protection.

Responsible Business Conduct and guidelines set by the OECD-countries promotes protection of human rights as well as labour rights. The impact is far-reaching and includes all other key considerations agreed in the OECD Council.

OECDs impact on human rights include:

    • International impact
    • Government impact
    • Businesses and supply chains
    • Envioremental impact

Norway is Spearheading Compliance with the OECD Guidelines

As the OECD guidelines are for all member states, partners and organisations that pledge to preserve human rights and encourage decent work conditions, several countries has started with the policy and law making processes in order to allign themselves with OECDs aim.

Norway, well-known for it’s forward-thinking, beautiful nature, ressource rich ocean floor and the Nobel Peace Price, recently enforced a brand new Law on Transparency, which is ment to make significant impacts on the entire worlds supply chain.

Who are obliged to comply or support the OECD’s Guidelines and the Norwegian Transparency Act?

The short answer? Everyone who supports and believes in the UN World Decleration.

Furthermore, Norway recently enforced a new law, called the Transparency Act. The Act promotes OECD’s Guidelines, which are set to protect human rights and decent working conditions, as well as civil and political rights.

The Act requires companies to assess actual and potential risks for negative consequences for human rights and decent working conditions in their supply chains. Qualifying companies must report their findings and share it with the public once a year.

Before we go into the details of the guidelines for multinational companies, let’s establish some understanding of what these terms mean.

Are your organisation affected by the Norwegian Transparency Act? Find out in this article.

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OECD Guidelines supporting the UN World Decleration

Did you know that OECD Convention and all the Guidelines supports the UN World Decleration?

The OECD guidelines aim at improving sustainable growth with better conditions for workers. It shapes policies that foster prosperity, opportunity, equality, and everyone’s well-being.

Tho this article mainly will cover OECD’s Guidelines for Human Rights and Decent Working conditions, we will also get into how actual and potential negative consequences are essential in these guidelines.

Guidelines for Responsible Business

The first part of the guideline defines standards for responsible business conduct regarding child labor, the environment, combating bribery, human rights, taxation, and intellectual property rights, among others.

Furthermore, the guidelines were updated in 2021 by the OECD Council, introducing new provisions, including due diligence, human rights, and responsibility in the supply chain. The second part highlights the procedures for implementing guidelines in part one.

Consequences for Human Rights

According to the Universal Declaration of Human Rights that was adopted in 1948, human rights guarantee the freedoms of an individual regardless of race, gender, sex, language, nationality, or religion. The fundamental human rights include:

    • Right to life and liberty
    • Right to work and education
    • Right to freedom of expression and opinion
    • Freedom from slavery and torture

The OECD has guidelines for multinational organisations operating from or in adhering countries. These include guiding non-binding principles and standards that stipulate conducting responsible business in a global context. They are consistent with relevant laws and internationally recognized standards.

Consequences for Decent Working Conditions

According to the ILO (International Labour Organisation), decent work inspires people in working conditions. It allows people to access opportunities to be productive while earning a decent income. Decent conditions of work include:

    • Social protection for worker’s families
    • Job security
    • Freedom to express concerns
    • Participation in decision-making
    • Prospect for career development

Helpful Content Regarding Responsible Business

Here are some helpful facts to help you with understanding some of the terms in this article.

What is “Basic Human Rights”?

International recognized human rights that follows the UN Convention of economic, social and cultural rights from 1966, UNs Convention on civil and political rights from 1966 and ILOs core convention about basic rights and principles in the working enviorement.

What is “Decent Working Conditions”?

Decent working conditions involves work that ivaretar basic human rights and health and work-place security.

What is a “Supply Chain”?

A supply chain is every supplier and under-supplier that delivers or produces goods, services or with other innsatsfaktorer that are included in a company’s deliverance, from raw-material to finished product.

“What is a “Business Partner”? 

A business partner means everyone who deliver products or services directly to the company, but that are not a part of the supply chain.

Download-links for the full OECD Guidelines:

Norwegian – English (official)

The ILO Declaration for Multinational Enterprises and Social Policy:

Norwegian – English (official)

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A digital software in accordance with the Transparency Act and OECD Guidelines.

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Due Diligence Assessments

The Norwegian Transparency Act promotes the OECD guidelines through Acticle 4 in the Act. All qualifying companies must carry out due diligence assessments and publish a report once a year.

The Act also require Norwegian based companies to respond to requests from the public where they must share requested information within 3 weeks notice. Transparency Gate is allready helping forward-thinking organisations with the due diligence assessments and with the implementation of the OECD Guidelines.

Do you want to manage the risks for human rights, labour rights and get a head with transparency compliance in your organization?

See the Value of Due Diligence Assessments

When you work with Transparency Gate, you get a software that can help you adherce to Norway’s Transparency Act and the OECD Guidelines and international transparency legislations.

If you see the value of the OECD Convention and human rights, you can start conducting responsible due diligence assessments in our seamless portal.

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