SOMO report "Fragile! Handle with care: Multinationals and Conflict"

Publication date: 7 Jul 2017 Organization: SOMO

Recently, SOMO published the report “Fragile: Handle with care: Multinationals and Conflict”, including 14 lessons learned on the role of multinational corporations in Conflict-Affected Areas. This work was funded under the Dutch Ministry of Foreign Affairs' Reconstruction Fund.

This report by SOMO reveals that multinational companies operating in conflict-affected areas often lack proper policies on how to deal with conflict situations – thereby running the risk of contributing to human rights violations and sparking renewed conflict. To meaningfully contribute to peace, multinationals must act with much greater care in situations of fragility and conflict. As emphasized by the UN Guiding Principles for Business and Human Rights, adopted in 2011:

“Gross human rights abuses can take place anywhere, but the risks are particularly great in areas of poor governance, and especially in conflict-affected areas.”

The research challenges the widespread belief that private sector development has a mostly positive influence on peace building and economic reconstruction, and argues that the relationship between the private sector and conflict requires further scrutiny. Many companies – especially so-called “hit and run” companies – operate in conflict-affected areas without making long-term investments, while benefiting from the fragility and the governance gap.

Vicious circle

Fragility enables companies to operate without accountability, and to profit from the government’s weak bargaining position. The resulting vicious circle contributes to already fragile situations and can lead to renewed conflict because of grievances among local (often traumatised) populations expecting to benefit from private development. This is compounded by an almost complete lack of access to remedy for victims when human rights abuses take place in conflict-affected areas.

Report: ‘Fragile! Handle with care’

The new report, ‘Fragile! Handle with care: Multinationals and Conflict’, draws lessons from SOMO’s research over the past four years on multinational corporations in conflict-affected areas. It considers research on extractives and agro-industries and their impact on human rights in five countries: Colombia, Democratic Republic of the Congo, Liberia, Sierra Leone and South Sudan. These case studies provide many illustrations of business-related human rights abuses in contexts of conflict and fragility, and valuable lessons on how companies operate in conflict-affected areas.

Strengthening host states and civil society

The report asserts that fragile states’ governments can improve their bargaining position with multinational corporations by building capacity to better negotiate contracts and to assess the long-term implications of companies’ investments, including social cost-benefit analyses. It is also crucial to allow sufficient space for civil society to operate in fragile and conflict-affected areas.

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