LOTF2011 | Marieke Klompe


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Law of the Future 2011
23 & 24 June 2011, Peace Palace, The Hague, The Netherlands

Title: Privatization and the law of the future
By: Marieke Klompe

Workshop: The Youth, the Law and the Future


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  • Goodafternoon everyone, I am also going to talk to you about the trend of privatization First I am going to tell you something about the trend of privatisation. Second I am going to talk to you about what I think the trend of privatisation on the Law of the Future. Last I would like to make my conclusion.
  • As Mira already stated, these presentations are about giving an overal view on what privatization of law is and what it means for certain area’s. I would like to narrow this down to privatisation of the law, which means that the hard law will have a lot of concurrence of other forms of law. I would especially like to extend that to corporate social responsibility. I am going to look specifically into Codes of Conduct and Soft law
  • The trend of the law of the future will be that there will become more privatization in the business playing field. The question is what the role of private actors will be in the future. In this presentation I would specifically like to look state that multinationals are getting more depended on the public but they are also getting more independed in making law themselves.
  • Why is this a trend? There is an increase in social media which means that the public is more involved and informed (on daily basis) with the issues in the world. Imagine that Nike (for example) uses Sweatshops to produce their cloth... it is immediately in the news, especially with the increasing development in social media. The public will must faster be informed about this, by the social media. The public will then put pressure on Nike to abandon those sweatshops or to let employees work in better working conditions. What should Nike do then, while the word spreads all over the world?
  • As just stated, there is more pressure of the public because of the increasing social media. The society relies on businesses and individuals being able to see beyond their own wishes and need and acting fairly towards others most of the time. If an illegal act of a multinational is immediately spread over the world the multinational can expect more pressure. Examples of this kind of pressure are: Boycotting of buying products Campaigns against the multinational Stikes to achieve more attention for the issue at stake
  • If an international company does something illegal or not responsible, the company can be sued for this. However there is no good judicial system to sue international companies for (for example) making use of sweatshops. It is not sure for the public: Who can sue? At which court? On what ground - on what law? How much costs will it bring? For example with sweatshops in developing countries, these countries do not what to sue the multinationals as they increase the economy in their country. Another example: if I buy something from a store which made use of child labour, can I then sue the store? Therefore it is important to see that this is not a clear solution, in this case there are too many fora and places to sue. There is so too many uncertainty under: the consumers the company itself the country where the business is seated
  • The trend is; that there will be more privatisation of law, in this case Corporate Social Responsibility. The two situations that can develop here are that there will become more Codes of conduct or more soft law. I will first discuss the Codes of Conduct and second the soft law.
  • Companies feel the urge to already make a regulation themselves to adhere, especially for looking good to the public.   So companies make themselves Codes of Conduct to follow => companies' policy statements that define ethical standards for their conduct. Often create compliance systems as a public demonstration of effort to the public to clean up their own ranks before the court did it for them or before they get a bad name in public. Now these corporate codes are still voluntary and can have different formats and different issues There are three kind of formats: Compliance codes : directive statements giving guidance and prohibiting certain kinds of conduct. Corporate credos : broad general statements of corporate commitments to constituencies, values and objectives. Management philosophy statements : formal enunciations of the company or CEO's way of doing business. A code of conduct depends on credibility of the society. It is important in this case to inform the public about it, so that there comes more social and moral pressure by the public This can really affect their profits made if the public boycotts (fe)
  • It is really important when having more and more Codes of Conducts in the future that these are also followed. AND HARMONIZED . This means that it is not only important to have credibility on the following of the codes, but it is also important that companies feel the pressure to make their code transparent/ to monitor the behaviour of the employees/ and to enforce the code if there is infringed a code. There are made several general Code of Conduct in sectors , fe. by the International Labour organization/ The OECD (guidelines) / The UN Transnational Corporations Codes / UNNCTAD Restrictions -> this code is adopted by many companies. I think that the trend should develop in a way that each sector has his own general code of conduct with its own institution to monitor (such as with the ILO)  
  • So my solution is to increase the effect of codes of conduct . In this way there is a total different way of ‘suing’ the company for immoral conducts . The company is affected by the social media and has to respond to this by making codes of conduct, to let the public see how they conduct. I think there should be more institutions and general codes of conduct for each company sector or division. In this way there is a more harmonized general code which needs to be adopted by the company Then there is an overall control mechanism If a company then does not follow the code, this will become public -> which will put the pressure on companies
  • If companies do not adhere the codes of conduct or hide their actions another solution would be Soft law This is to have an overall law for a certain issue which is needs to be followed. If it is not binding , one cannot do anything about it. However in general, it is followed -> It is performs important functions , it is very important for international lawyers to have them and set their case in court. Soft law can overcome deadlocks in the relations of states that result from economic or political differences among them, when efforts at firmer solutions have been unavailing. There is so first a soft law that needs to be followed, once the public is used to this, there can be made a hard law of it (with adjustments -> seem necessary after the soft law period) If the companies are used to follow this soft law – it is easier to develop and set up the right institutions to sue the multinationals if they do not follow this law (then it will not be soft law anymore) So to conclude: soft law is just a fase towards possible hard law. However as there is for now not really a good judicial mechanism to sue multinationals, this soft law will force the multinationals to act in a responsible way – after that – it is possible to set up institutions so that multinationals can be sued if they infringe the ‘soft law that became hard law’.
  • Thank you for your attention and I am looking forward to hear your view on this
  • LOTF2011 | Marieke Klompe

    1. 1. Privatization and the law of the future By Marieke Klompe, 24 June 2011
    2. 2. Outline <ul><li>Defining the trend of privatization </li></ul><ul><li>Forms of Corporate Social Responsibility </li></ul><ul><li>Conclusion </li></ul>
    3. 3. Definition <ul><li>Privatization of law </li></ul><ul><li>Corporate Social Responsibility </li></ul><ul><li>Codes of conduct and soft law </li></ul>
    4. 4. Trend: privatization <ul><li>Business </li></ul><ul><li>Development of role of private actors? </li></ul>
    5. 5. Why is this a trend? <ul><li>Increase social media </li></ul><ul><li>More involvement of the public </li></ul><ul><li>More pressure of the public </li></ul>
    6. 6. Why is this a trend? More Pressure! <ul><li>Moral character </li></ul><ul><li>See beyond own wishes </li></ul><ul><li>If not; social media; more pressure </li></ul>
    7. 7. What happens judicial? <ul><li>No good judicial system </li></ul><ul><li>uncertainty: </li></ul><ul><ul><li>Who can sue? </li></ul></ul><ul><ul><li>At which court? </li></ul></ul><ul><ul><li>On what ground – law? </li></ul></ul><ul><ul><li>Costs? </li></ul></ul>
    8. 8. Solutions CSR <ul><li>Codes of Conduct </li></ul><ul><li>Soft law </li></ul>
    9. 9. Codes of Conduct <ul><li>Made by multinationals </li></ul><ul><li>Companies’ policy statements </li></ul><ul><li>Voluntary </li></ul><ul><li>Credibility – inform the public </li></ul><ul><li>Who is going to monitor? </li></ul>
    10. 10. Codes of Conduct <ul><li>More harmonized </li></ul><ul><li>Credibility -> feel pressure </li></ul><ul><li>General Codes of Conduct (ILO – OECD – UN – UNNCTAD) </li></ul>
    11. 11. Codes of Conduct – future <ul><li>Increase codes of conduct </li></ul><ul><li>More institutions and general codes of conduct (for each sector) </li></ul><ul><ul><li>Control mechanism </li></ul></ul><ul><ul><li>Infringe code? Pressure! </li></ul></ul><ul><li>So: harmonization </li></ul>
    12. 12. Soft Law <ul><li>Not binding </li></ul><ul><li>Performs important functions </li></ul><ul><li>Overcome deadlocks </li></ul><ul><li>Can be made into hard law </li></ul><ul><li>Set up institutions for infringements </li></ul><ul><li>So: just a phase </li></ul>