Modern capitalism has its enthusiasts, its opponents and its reformers. Anna Aseeva, who presumably belongs to the latter category, has authored a thought-provoking book that challenges what she labels as the ‘normalization’ of social irresponsibility and legal impunity of corporations operating transnationally. With a focus on Global Value Chain (GVC) capitalism, she provides an in-depth analysis of the root causes of this normalization and draws the contours of a proposed legal framework to address it. By tackling the governance gaps associated with the development of GVCs worldwide, the book resonates with the current zeitgeist that seeks to resurrect the human component forsaken by the established global trend of free-market-led approaches to economic development and policy-making.
The discussion revolves around the main statement that corporations operating across national borders through GVCs generally remain immune from liability because of the ‘economically dependent – legally independent’ relationships between the main corporations and their suppliers and subcontractors. The author highlights our responsibility, as a society, to address abuses of economic dependence, notably ‘by ensuring a level playing field both economically and socially’. More specifically, she emphasises the key role played by lawmakers and the legal profession in establishing legally effective relationships between head corporations and their economically dependent entities. The book ambitiously approaches this task, starting in Part I with an interdisciplinary account of the ideological, social, economic and political contexts of GVCs and of Corporate Social Responsibility (CSR). In Part II, the author surveys relevant CSR legal instruments and initiatives and underlines how they may have paradoxically contributed to creating obstacles to controlling corporate behaviours at both national and international levels. Part III of the book turns to Corporate Social Liability (CSL). It offers a comparative analysis of national legislation and case law aiming at imposing corporate responsibility for outsourced production and other operations and looks at the general requirements for founding corporate liability in practice. Part IV gives an overview of whether and how a systemic approach to CSL should be adopted. The final chapter and conclusions address the pitfalls of CSL and advance the means through which CSL should be implemented.
The author provides a lucid study of the context which has led to permissive approaches towards the diverse abuses perpetrated through GVCs and to legal impunity when faced with human disasters such as the collapse of the Rana Plaza Garment Factory in Bangladesh in 2013. Her interdisciplinary analysis places emphasis on the complex web of relationships between law, on the one hand, and economics, politics and society on the other. Adopting an outspoken, direct and perspicuous style, she reasons that the economic deregulation that has accompanied the development of neoliberalism since the late 1970s has led to a general tendency of divesting labour of its social meaning, reducing it to a quantitative value. Having set this background, the essence of her thesis is that sensible re-regulation is inevitable to restore a quality-based approach to work, with respect for human values and the environment. Thus, she advocates for the development of a strong corporate social liability framework for GVCs and outlines ideas for law reforms which are daring and far-reaching.
Among the reforms proposed is a ban on outsourcing production in hazardous sectors such as mining or waste management. In sectors where outsourcing and subcontracting would be allowed, the author makes recommendations for national legislative reforms introducing due diligence obligations for corporations operating in the framework of GVCs. These include: (1) the imposition of liability on head corporations for negative impacts throughout the supply chain of subcontracting, by making the head corporations’ national legislation applicable to outsourced activities and imposing an obligation to prevent such negative impacts; (2) the adoption of a broad standard for the recognition of the existence of a sub-contractual relationship, justifying the liability of the head corporation; (3) the establishment of a presumption of liability of GVCs’ head corporations when violations of labour law or environmental law do occur.
The author further promotes transparency obligations, through public reporting of the measures taken to prevent potential or imminent risks affecting human rights or the environment. Drawing on her comparative law analysis of existing due diligence and liability instruments, she proposes that relevant entities should publicly guarantee the absence of child labour and forced labour in their production, services and operations. She further stresses that consultation with potentially impacted indigenous people and local communities should be undertaken in accordance with the internationally agreed standards of free, prior and informed consultation (FPICON) and consent (FPIC), as applicable, and argues that their opinions and requirements should be taken into consideration before proceeding with any due diligence plan and related measures.
The book's publication coincides with the ongoing elaboration by the European Commission of a new mandatory corporate due diligence framework for GVCs, which is due to be adopted by the end of 2021. Although the author seems to go further than the propositions currently discussed in Brussels, she promotes a kindred obligation for companies to undertake due diligence to prevent and account for actual or potential adverse impacts on human rights or the environment throughout their supply chains. Beyond its legal reach, the book, written in the midst of an unprecedented public health and socio-economic crisis, provides a perceptive account of our society's dominant values and contributes to paving the way towards a mindful and sustainable recovery from the pandemic.
