Human Rights and Political Economy: Addressing the Legal Construction of Poverty and Rights Deprivation

Birchall, David

doi:10.5070/lp63259636

Cited by 1 publication

(2 citation statements)

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“…A debate could be had on whether redundancies could constitute an adverse impact, linking joblessness to poverty, inadequate welfare, child hunger, and so on, citing the UNGPs on ‘reducing access to rights’, and state obligations to avoid the ‘retrogression’ of access. We will not undertake this project here (but see: Birchall 2022a ; Courtis et al 2014 ). Instead, we argue that the business model and the incentive structure therein is more important than specific human rights outcomes for three reasons.…”

Section: Private Equity: Defining the Problem In Human Rights Termsmentioning

confidence: 99%

“…In analysing the application of BHR principles to the PE model, the paper also questions the scope and limits of human rights principles in managing, or at least reducing, harm, within the contemporary economy. This focus on business strategy develops nascent work on how underlying business strategy and incentives can increase risks to rights-holders (OHCHR 2021 , 13; Shift 2021 ; Birchall 2021a , b ; Birchall 2022a , b , 406–408), by focusing on a model in which business success is determined by a particularly narrow focus on investor returns.…”

Section: Introductionmentioning

confidence: 99%

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Business Strategy as Human Rights Risk: the Case of Private Equity

Birchall

Bernaz

2023

Hum Rights Rev

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In this article, we apply the UN Guiding Principles on Business and Human Rights to the private equity (PE) business model. PE firms often adopt a controversial, ‘value extractive’, business model based on high debt and extreme cost-cutting to generate investor returns. PE firms own large numbers of companies, including in many rights-related sectors. The model is linked to increased human rights risks to workers, housing tenants, and in privatized health and social care. We map these risks and analyse the human rights responsibilities of PE firms. Our analysis has major implications for understandings of human rights responsibility. We argue that value extractive methods are the root cause of eventual harm to human rights, even though they may not harm rights directly. To respect human rights, PE firms must mitigate the risks of these value extractive methods. We define how human rights due diligence (HRDD) could achieve this and argue that given the extent of harm and the lack of a business case for adopting such a view of human rights responsibility, business strategy level HRDD should be a core component of forthcoming HRDD laws.

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Section: Private Equity: Defining the Problem In Human Rights Termsmentioning

confidence: 99%