Home OECD & NCPs The OECD Guidelines What’s in the Guidelines? The OECD Guidelines and just transition

The OECD Guidelines and just transition

Is your community or environment experiencing harm from a company’s past or current development of either fossil fuels or renewable energy, or from a business activity (like overuse of water resources) that makes it harder for you to adapt to climate change? The OECD Guidelines may help you fight for a more resilient future.

What the OECD Guidelines say about just transition

Just transition is about moving toward renewable, green industry in a just and fair way, looking after workers and preventing harm to communities from the transition process. The Guidelines refer to the Paris Agreement’s call for just transition. The Guidelines expect companies to address social harm both in their transition away from fossil fuels as well as their adoption of greener models. You can use the OECD Guidelines to demand that companies:

  • Transition away from fossil fuel development or use, or away from other practices that harm the environment, to minimise their greenhouse gas (GHG) emissions.
  • Identify and address harms – including past harms – to workers and communities while transitioning away from fossil fuels or other environmentally harmful practices. This involves practising responsible disengagement by looking after workers who may lose jobs and communities harmed by pollution or environmental damage.
  • Identify and avoid potential human rights and environmental harms to workers and communities when transiting toward greener models. This means developing renewable energy and other products in a way that respects human rights and the environment.
  • Engage meaningfully with workers, communities, and other stakeholders throughout the transition process.
  • Ensure worker training and upskilling to adapt to future environmental and technological changes.
  • Avoid activities that undermine climate adaptation and resilience of communities, workers, and ecosystems.

Tip

As the OECD Guidelines do not define “just transition” and reference it in the context of the Paris Agreement, which focuses narrowly on workers rights, civil society should cite language from other sections of the Guidelines on minimising GHG emissions, respecting human rights, and remediating harms to demonstrate the Guidelines’ implicit broader expectations on just transition. To encourage equitable access to renewable energy by companies, which is epecially important for impacted communities, civil society should cite evolving international expectations in this area and note that the Guidelines urge companies to align with best practice.  

Read the text

  • Chapter VI (Environment): paragraph 5(a) and (b); commentaries 70 and 79
  • Chapter V (Employment and Industrial Relations): commentary 64
  • Chapter II (General Policies): paragraph 12, commentaries 25 and 28
  • Chapter II (Human Rights): paragraphs 1 and 6

Additional important information

What are the OECD Guidelines?

The OECD Guidelines for Multinational Enterprises on Responsible Business Conduct (OECD Guidelines) are recommendations from governments to companies on how to act responsibly. The OECD Guidelines set non-binding standards for responsible business conduct across a range of issues important to communities, such as human rights, workers rights, and the environment, and also cover issues such as corruption and taxation.

Governments that follow the OECD Guidelines must establish a non-judicial complaints body called a National Contact Point for Responsible Business Conduct to promote the Guidelines and handle complaints about harmful business activity. The Guidelines set good standards for all companies, but complaints can only be filed against two types of companies operating across borders:

  1. multinational enterprises headquartered in a country that follows the OECD Guidelines, or
  2. multinational enterprises operating in a country that follows the OECD Guidelines.

How can you use the OECD Guidelines?

Civil society can use the Guidelines to:

  • Raise community awareness about company standards.
  • Talk to companies to demand better conduct.
  • File complaints when companies fall below the standards.
  • Advocate for strong laws and policies on corporate responsibility.

 Further resources