extractive industry

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“HUMANIZING” INVESTMENTS IN THE EXTRACTIVE INDUSTRIES IN AFRICA THROUGH THE IFC’S SUSTAINABILITY POLICIES

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Chairman Okoloise

INTRODUCTION

International financial institutions face enormous challenges in Emerging Markets and Developing Economies (EMDEs). They finance infrastructure projects, manage vast investment portfolios, offer advisory services, and contribute to economic development in EMDEs. In the process, they are exposed to huge risks and face reputational damage if they act recklessly or have little or no regard for their projects’ adverse impacts on third parties. In the context of natural resource exploitation in Africa, the weak governance of environmental and social risks often results in devastating consequences for communities proximate to investment projects. Promises of infrastructure and social services, job opportunities and economic boom have only often delivered land grabs, forced displacement, cultural infringements, environmental pollution, conflicts, health disasters, misery and sometimes deaths. As calls for greater corporate scrutiny increase, investment project facilitators in the extractive industries like the International Finance Corporation (IFC) must respond appropriately. To preserve its reputation and long-term market access, the IFC needs to apply a higher degree of due diligence and sustainable business conduct that proactively treat risks and limit its exposure. With the rising number of complaints against IFC policy compliance, including projects tainted by scandals and the debarment of companies from accessing international finance, this article demonstrates that merely promoting sustainable investment policies on paper is inadequate. Using a human rights-centred approach to development project financing, the article critically assesses the extent to which the implementation of the IFC’s sustainability framework can practicably protect resource-rich communities, safeguard human rights and ensure sustainable development outcomes in Africa.

Keywords: Extractive Industries, Human rights, Project Financing, IFC, Compliance, Sustainable Development.

DOI: https://dx.doi.org/10.4314/jsdlp.v11i2.6

DAAD (German Academic Exchange) Doctor of Laws Candidate, Centre for Human Rights, University of Pretoria, South Africa. LLB (Ambrose Alli), BL (Nigeria), LLM (Pretoria), Dip (Åbo Akademi); Dip (Copenhagen). Email: chairmanokoloise@yahoo.com

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THE CIVIL SOCIETY AND THE REGULATION OF THE EXTRACTIVE INDUSTRY IN NIGERIA

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Rhuks Ako* and Eghosa O. Ekhator**

ABSTRACT

This article focuses on the role of civil society organisations (CSOs) in impacting on trends and developments in the extractive industry in Nigeria. For example, CSOs take on the government to promote accountability and probity in the management of the sector that is beset by ineffectual regulation; alleged collusion with multinational corporations having as consequences environmental degradation and human rights abuses; and, ineffective judicial processes, among other things. On the other hand, CSOs are increasingly beginning to play prominent roles in collaborations with extractive corporations in the initiation and management of development programmes. In a nutshell, this paper aims to engage with both theoretical (based on the Hood et al conceptualisation of a regulatory regime, which encompasses information gathering, standard setting and behaviour modification activities) and practical frameworks (such as litigation, collaboration and pressure by CSOs) that explain the evolution of CSOs and their “regulatory” roles in Nigeria’s extractive industry. Civil society and civil society organisation are used interchangeably.

Keywords: Nigeria, CSOs, extractive industry, regulatory framework.

Doi: http://dx.doi.org/10.4314/jsdlp.v6i2.9

* Senior Fellow, Institute for Oil, Gas, Energy, Environment and Sustainable Development, Afe Babalola University, Nigeria. Email: rako@ogeesinstitute.edu.ng

** University of Hull Law School, UK. Corresponding author: Email: eghosaekhator@gmail.com

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THE FEASIBILITY OF IMPLEMENTING THE UNITED NATIONS GUIDING PRINCIPLES ON BUSINESS AND HUMAN RIGHTS IN THE EXTRACTIVE INDUSTRY IN NIGERIA

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Oyeniyi Abe*

ABSTRACT

Extractive resource governance has been a challenging task for resource-rich countries in Africa. It has fuelled civil wars, ethnic clashes and underdevelopment in this region. This has turned the so-called resource wealth into resource curse. To address this particularly nauseating challenge, the international community came together to adopt the UN Guiding Principles on Business and Human Rights (GPs). Polarised debate on whether the GPs should be binding or voluntary has slowed down the effective implementation of the Principles. This article argues that while the GPs have been the latest attempt at regulating multinational companies (MNCs), greater emphasis should be placed on the readiness of states to domesticate the Principles. To achieve this, the paper explores various approaches through which the GPs can be crafted into national legislation. It also investigates the different methods through which states can ensure that corporations systemically respect human rights obligations in their areas of operation. In order to restore faith in the whole process, it is necessary to examine how human rights principles can be mainstreamed into corporate practice locally. No doubt, rights-based frameworks, such as the GPs, are needed to ensure that human rights are streamlined in business’ projects, policies, and agreements throughout the various stages, including preparation, funding, implementation and monitoring. The issue of corporate liability under international law has had its troubled history, thus, this article argues that MNCs have a heightened responsibility to respect the human rights of the local communities in resourcerich, war-torn zones, particularly in sub-Saharan African, using Nigeria as focal point.

Keywords: Guiding principles, business, human rights, multinational companies (MNCs).

Doi: http://dx.doi.org/10.4314/jsdlp.v6i2.7

* Doctoral Candidate, Centre for Comparative Law, Faculty of Law, University of Cape Town, South Africa, currently Fulbright Visiting Scholar at Loyola University, Chicago School of Law. oabe@luc.edu.