Swiss Voters to Decide Whether Idea is Full of Holes
The supply chain for the gold refining industry is in the crosshairs of a new initiative. (iStock/alfexe)
Switzerland will vote Nov. 29 on whether to become the first country to hold multinational corporations responsible for abuses in their supply chains. The development is cheered by human rights groups calling for businesses to take more responsibility for policing sustainable and ethical practices among their suppliers. But others, including some members of the country’s gold industry, argue that the Swiss idea is full of holes.
The Responsible Business Initiative (RBI) would apply to companies headquartered in Switzerland. It is backed by Swiss human rights and environmental organizations, religious groups and trade unions. The result of the referendum will be watched by groups and governments elsewhere because supply chain sustainability appears to be a growing concern among consumers, and not only those who purchase gold watches.
“For too long, multinational corporations have been able to hide their abuses behind a veneer of respectability, using plausible deniability whenever bad behavior is highlighted,” said a representative of a pro-RBI group. “The Responsible Business Initiative is part of a global movement by unions and civil society organizations to hold companies responsible for their behavior. Our message is this: We are coming for you. There is nowhere to hide. We will hold you accountable.”
Not so fast, respond representatives of Switzerland’s gold refining industry, which would be particularly impacted by RBI. “Zero risk does not exist and the initiative will bring some legal uncertainties that we consider are not in favor of promoting Swiss companies to do business in those countries,” a Metalor executive was quoted on a Swiss news site.
That particular article noted that some have warned that RBI could have unintended consequences: “Some fear that Swiss businesses may decide to divest or pull out of doing business in countries where they view the risk as too high, if the referendum allows foreign plaintiffs to sue in Swiss courts. This, they say, would leave a vacuum in the gold business for players who are less equipped or less ready to try to guarantee sustainable supply chains.”