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OECD Guidelines and the law

The OECD Guidelines are voluntary and not legally binding, but they are increasingly serving as a guide for strong, legally binding corporate accountability and due diligence rules.

Irresponsible conduct is in no one’s interest

Businesses, consumers, and governments are simultaneously realising what impacted people have always known – that irresponsible business conduct can no longer be tolerated.

  • Companies are learning that climate-blind, polluting, human rights-abusive, and corrupt practices in their value chains cause them real operational, clean-up, reputational, and consumer confidence costs.
  • Consumers increasingly don’t want products they know are made through environmental degradation and worker abuse.
  • Governments recognise that to save the planet and preserve functioning societies in future, they must ensure corporations do their part to prevent climate change and support sustainable and inclusive development.
  • Impacted people and civil society know that planetary and social wellbeing depend on businesses respecting their rights and environments.

We all know that a new and responsible way of doing business is essential. So how do we get there?

How the OECD Guidelines help

The OECD Guidelines establish valuable recommendations on responsible business conduct. They’re not perfect, and OECD Watch is always pushing for improvement. But they set a strong baseline.

And though the Guidelines are voluntary, companies increasingly follow them – because they work. They are comprehensive in scope, flexible to each circumstance and, if genuinely followed, effective in supporting prevention, mitigation, and remedy of harm. They are also widely known globally, backed by governments, and endorsed by business, unions, and civil society.

As governments pursue corporate accountability law, they are increasingly using the OECD Guidelines as a blueprint or model. In fact, in their 2022 Recommendation on the Role of Government in Promoting Responsible Conduct, OECD governments encouraged each other to adopt legal and regulatory frameworks for responsible business conduct aligning with the OECD Guidelines and due diligence guidance.

Aligning laws with the Guidelines

In recent years, governments have been using varying legal approaches to require corporate accountability – from banning products made irresponsibly such as with forced labour, deforestation, or corruption; to seeking disclosure of harms and response measures; to requiring human rights and environmental due diligence.

These approaches can sometimes seem in conflict. In fact, they can align well when implemented through the lens of the normative framework for responsible business conduct – namely through the lens of OECD Guidelines, UN Guiding Principles on Business and Human Rights, and ILO MNE Convention.

That’s why governments and the OECD are promoting coherence between the Guidelines and national, regional, and multilateral approaches to corporate accountability. Through an Inclusive Platform on Due Diligence Policy Cooperation, 70 governments are discussing best practice to ensure responsible business conduct through policy and law. They see the Guidelines as a key tool companies and governments can use to achieve impact, efficiency, and legal coherence globally.

What OECD Watch is doing

OECD Watch supports the deepening of the Guidelines’ voluntary standards into binding rules for companies. We support policy discussion on this topic at the OECD, and enable civil society to use the Guidelines’ standards as a reference point and the due diligence model as a framework to support parallel development of policy, law, and standards on corporate conduct.

Get involved

Want to learn more about OECD Watch’s work on this issue? Get in touch with us to find out more about our advocacy and resources, or to discuss how the OECD Guidelines can support your work.

You can also join our civil society working group on due diligence legislative developments to connect with organisations working on this issue, exchange knowledge, and contribute to collective advocacy. Reach out to us directly.

Related resources

Our work on supporting accountability rules

We support civil society and policymakers to strengthen corporate accountability rules and responsible business conduct frameworks in line with the OECD Guidelines.

Policy coherence factsheet

Get a practical overview of what the OECD Guidelines say about advancing coherence across global RBC policy. Available in:

English

Arabic

French

Spanish

Portuguese

Using the OECD Recommendation on the Role of Government in Promoting RBC

Read OECD Watch’s blog on using the Recommendation to encourage governmental progress in advancing RBC through law as well as policy on related topics like procurement, export credits, or development finance.

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