OECD Updates Guidelines for Multinational Enterprises on Responsible Business Conduct

The Organisation for Economic Co-operation and Development (OECD) has released an updated version of its Guidelines for Multinational Enterprises on Responsible Business Conduct. The new guidelines, which were adopted by the OECD’s 50 member countries on June 9, 2023, reflect the latest thinking on responsible business conduct and include a number of new provisions on issues such as climate change, biodiversity, technology, business integrity, and supply chain due diligence.

The OECD Guidelines are a set of voluntary principles and standards for responsible business conduct that are addressed by governments to multinational enterprises operating in or from their territories. The guidelines cover a wide range of issues, including human rights, labour rights, environment, bribery, consumer interests, disclosure, science and technology, competition, and taxation.

The updated guidelines reflect the growing importance of responsible business conduct in the global economy. They also reflect the increasing expectations of governments, businesses, and civil society that companies will take steps to manage their social, environmental, and economic impacts.

The new provisions in the guidelines include:

• A new chapter on climate change, which encourages companies to take steps to mitigate and adapt to climate change, and to promote the use of clean energy.
• A new chapter on biodiversity, which encourages companies to respect biodiversity and ecosystems, and to avoid causing significant harm to them.
• A new chapter on technology, which encourages companies to use technology responsibly, and to respect human rights and fundamental freedoms in their use of technology.
• A new chapter on business integrity, which encourages companies to have strong anti-corruption and bribery policies in place, and to conduct due diligence to identify and mitigate corruption risks.
• A new chapter on supply chain due diligence, which encourages companies to identify and manage the risks of human rights abuses and environmental damage in their supply chains.

The updated guidelines are a significant step forward in the fight for responsible business conduct. They provide companies with clear guidance on how to operate in a way that is socially, environmentally, and economically responsible. The guidelines also provide a framework for governments, businesses, and civil society to work together to promote responsible business conduct.

The OECD Guidelines are an important tool for promoting responsible business conduct. They are voluntary, but they are backed by the power of government endorsement. The updated guidelines send a strong signal to companies that responsible business conduct is expected and that there will be consequences for those who fail to meet the standards.