Human Rights in the Oil and Gas Industry: When Are Policies and Practices Enough to Prevent Abuse?

Abstract

Multinational enterprises are aware of their responsibility to protect human rights now more than ever, but severe human rights violations, including physical integrity abuses (e.g., death, torture, disappearances), continue unabated. To explore this puzzle, we engage theoretically with the means-ends decoupling literature to examine if and when oil and gas firms’ policies and practices prevent severe human rights abuse. Using an original dataset, we identify two pathways to mitigate means-ends decoupling: (a) while human rights policies alone do not reduce human rights abuses, firms with a high-quality human rights policy over the long-term reduce severe human rights abuses; (b) firms that combine preparedness—which we define as a firm’s capabilities, practices, and engagement—with a long-term human rights policy also reduce the likelihood of human rights abuses. Preparedness, we argue, can lead to reinforcement dynamics between long-term policy efforts and additional capabilities that provide a more holistic understanding of firm behavior.

Human Rights: A Promising Perspective for Business & Society

“…BHR scholarship has been processing the accelerating developments described above from an academic stance, providing conceptual foundations (Fasterling, 2017; Fasterling & Demuijnck, 2013) and clarity to the developments previously noted in practice, such as the role of domestic human rights due diligence legislation (Cassell, 2016), human rights litigation (Palombo, 2019; Schrempf-Stirling & Wettstein, 2017), or policy instruments with extraterritorial effects such as BHR clauses in procurement contracts or export guarantees (Martin-Ortega, 2018). BHR scholarship has also been developing new constructs to make sense of what protecting and respecting human rights obligations for business looks like with regard to specific issues such as modern slavery (LeBaron, 2021; Van Buren III, Schrempf-Stirling, & Westermann-Behaylo, 2021) and for specific industries such as extractives, finance, or private security (Davitti, 2019; Kinley, 2018; Meyersfeld, 2017; Olsen et al, 2021; Park, 2018), as well as what company-level operational grievance mechanisms would look like (Knuckey & Jenkin, 2015; Thompson, 2017).…”

“…However, the BHR perspective has evolved largely outside the business and society field. Of course, business and society scholarship has addressed certain human rights issues and associated behaviors by firms, such as labor rights (Dawkins, 2016; Soundararajan et al, 2018), child labor (Ballet et al, 2014), modern slavery (Caruana et al, 2019; Monciardini, Bernaz, & Andhov, 2021), physical integrity abuses (Olsen et al, 2021), or businesses operating in or collaborating with oppressive regimes (Brenkert, 2009; Schrempf, 2011). However, it has done so predominantly from an issue-centered perspective, that is, with a specific interest in clarifying the narrow problem or challenge at hand.…”

Oil, Transitions, and the Blue Economy in Canada

“…Even small spills or chronic discharges around platforms can lead to significant impacts on wildlife, particularly seabirds, whose feathers can suffer loss of waterproofing and insulating properties from oily water [26]. Oil development has been associated with negative health [27] and human rights issues [28,29], including the rights of future people to a healthy environment [30]. It has also led to environmental justice struggles, for instance, over the distribution of health impacts from flaring [31] and opportunities to participate in regional developments [32,33].…”

Big Profits, Big Harm? Exploring the Link between Firm-Performance and Human Rights Abuses

“…Such commitment might be genuine or merely symbolic. For instance, in the context of the oil and gas industry, Olsen et al (2021) show that symbolic commitment to human rights principles does not reduce human rights abuses and the reduction or prevention of the most severe abuses requires strong human rights policies and demonstration of commitment to them. Yet, it is unclear how companies' declared commitment to human rights changes their human rights conduct at different levels of performance.…”

“…It is perhaps not surprising that both international and domestic developing country firms have been found to violate human rights in the conduct of their business 2 (Ciravegna & Nieri, 2021;Fiaschi et al, 2017;Gomero Osorio et al, 2019;Jiang, 2016;Lebaron, 2021;Olsen et al, 2021;Whiteman & Cooper, 2016, among others). Also, while most studies agree that institutional weaknesses and regulatory gaps in these companies' operating environments play a significant role in explaining the emergence and persistence of such violations, they call for a better understanding of how firm-level heterogeneity shapes abusive behaviours over time and across space (Olsen et al, 2021;Wettstein et al, 2019).…”