Building a human rights framework for business education

Michael Posner

Professor Michael Posner . is Director of NYU Stern Center for Business and Human Rights. He and Sarah Labowitz co-founded the Center in 2013.

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Dorothée Baumann-Pauly

Dr. Dorothée Baumann-Pauly is research director NYU Stern Center for Business and Human Rights and oversees the Center's research activities, including development of academic publications, case studies and other teaching resources.

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Businesses face an increasing range of human rights issues that can directly impact their core business strategies. But, argue Dorothée Baumann-Pauly and Michael Posner, business education needs to catch up with this emerging field

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At last year’s EFMD annual conference in Berlin, Germany, Paolo Boccardelli, dean of LUISS Business School and the conference co-chair, outlined 10 global trends that will have an impact on management education in the future:

globalisation, immigration, income inequality and diversity, climate change, digital disruption as opposed to digital learning, the future of jobs and work, uncertainty in predictions, responsible leadership creativity, and innovation and entrepreneurship. 

While Professor Bocardelli’s list does not include human rights explicitly, many of these trends have built-in human rights dimensions. Unlike most other topics, human rights are rooted in a firm and widely accepted foundation, the Universal Declaration of Human Rights. There is also growing consensus that any corporate involvement in abuse of human rights is unacceptable and that corporations have a proactive role to play in ensuring respect for human rights, particularly in business environments in which governments are unable or unwilling to protect their own people.

The Universal Declaration of Human Rights states that “all organs of society”, including corporations, have to promote respect and adherence to these rights. The UN Guiding Principles for Business and Human Rights, adopted by the UN Human Rights Council in June 2011, reaffirms this expectation. In the last six years, the Guiding Principles have become an initial reference point for a number of companies.

Yet to date business education has been lagging behind in this emerging field, both in terms of teaching and research. As a result, tomorrow’s business leaders are not getting the preparation they need to manage the human rights issues they will face in their careers.

How should business schools prepare future managers for these human rights challenges? And how can business schools create a curriculum and teaching methods that will help corporate decision makers deal effectively and well in response to these challenges?

Adopting a human rights framework for business education can help future managers navigate societal trends in a way that is principled and coherent. By developing and committing to industry-specific human rights standards, metrics and accountability mechanisms, corporations can foster greater public trust and create a more stable business environment in which their businesses can flourish.

Human rights are business relevant

Businesses in every industry today face a range of human rights issues that are tied to their core business strategies. These issues are among the most urgent and most complicated for businesses operating in a global economy.

Whether addressing labour practices in global manufacturing or agriculture, security in mining operations, principles of non-discrimination and equal pay for equal work, or issues of privacy and political disinformation online, solutions are not easy to devise and must address the special circumstances of each industry.

Consider the challenges now facing major technology companies such as Facebook, Twitter and Google. These companies are under immense pressure from governments, media and civil society to take meaningful action to stem the flow of extremist content, hate speech and state-sponsored propaganda on the internet. In these debates, internet service companies can neither claim that they are neutral platforms that merely provide the infrastructure for global communication nor that they should be viewed as full-content editors, equivalent to those who produce daily newspapers.

The business model of these companies largely depends on online advertising. One challenge they face is how to remain highly profitable while both enabling the right of freedom of expression and at the same time preventing harmful content, including political disinformation, that undermines our democratic values. Defining the proper roles for companies and governments on these questions is essential.

Questions such as these pose difficult choices for companies. Some business leaders understand that engaging in these questions is not just a burden but an opportunity for securing long-term business profitability. Paul Polman, the CEO of Unilever, a Dutch consumer products giant, for example, argues that “next to our moral obligations to address global challenges, it’s also an enormous business opportunity”.

All too often, however, business leaders do not have the background or human rights framework to make informed decisions. Many lack the tools to enable them to engage in dialogue with governments and other critical stakeholders that are essential to help craft solutions.

They also lack familiarity with new governance models involving public and private actors that can serve as platforms for addressing these challenges. However, in recent years a set of industryspecific multi-stakeholder initiatives have helped to define common human rights standards and accountability mechanisms within a number of industries.

An example is the 18-year-old Fair Labor Association (FLA) whose participating companies include more than 60 major clothing brands and agricultural companies, NGOs and university representatives. Together they have developed a set of standards and metrics that apply to the global supply chains of the clothing industry (and now extended to agriculture).

Through industry-wide human rights initiatives such as the FLA, companies can create a levelplaying field ensuring that respect for human rights does not result in competitive disadvantage. The FLA’s transparency requirements provide evidence that corporations are following through with their commitment to uphold workers’ rights.

Critical stakeholders can see for themselves how companies have performed in unannounced third-party audits. The FLA also verifies that each brand addresses any violations that these audits reveal. Through such accountability mechanisms, brands can foster trust that their commitments are being honoured and enforced.

Human rights framework for business education

By adopting a human rights framework, business schools acknowledge that publically traded corporations have both an obligation to their shareholders to achieve stellar economic returns and at the same time a responsibility to other stakeholders in society to address the human rights challenges that stem from their core business operations.

As Peter Henry, former dean of New York University’s Stern school in the US, has emphasised: “At NYU Stern, we develop people and ideas that transform the challenges of the 21st century into opportunities to create value for business and society. Our Center for Business and Human Rights is the embodiment of that mission and demonstrates that profit and principle can co-exist”. Professor Henry’s leadership on these issues has enabled the Stern Center for Business and Human Rights to develop a human rights programme at the school that includes several stand-alone courses and increasingly integrates human rights issues into the school’s core courses and executive programmes.

It is this full integration into mainstream business school teaching and research that creates an overarching human rights frame. It offers future managers a compass that will guide them in their careers as they navigate evolving trends and central business challenges related to human rights.

Business schools’ response

Last November the NYU Stern Center, the Alliance Manchester Business School in the UK and the Geneva School of Economics and Management at the University of Geneva in Switzerland co-hosted an inaugural group of over 20 business schools to discuss current efforts to promote human rights in business schools and explore future opportunities.

The group agreed to share teaching material and research and explore how their institutions could collaborate to advance human rights issues on the business education agenda. Accreditation organisations such as the AACSB and EFMD can play an important role in supporting this objective.

The inaugural group will reconvene this year in Geneva in November. We aim to grow the number of schools participating and create an active network of schools that promotes human rights as an overarching frame for business education.

The way forward 

As the field of human rights in business is taking shape, teaching and research in leading business schools is an important element of this process. Developing teaching material and tackling research questions that examine the business models of corporations in different industry settings will help to understand how business can be a positive force for human rights.

This year marks the 70th anniversary of the Universal Declaration of Human Rights. The involvement of business in defending these fundamental rights and freedoms is essential for the future of our economies and our society. As Zeid Ra’ad al Hussein, the UN High Commissioner for Human Rights, put it recently: “it is the accumulating human rights violations… and not a lack of GDP growth, which will spark conflicts that can break the world”. Business educators need to adapt and be responsive to this changing global environment.

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