Using Non-Judicial Grievance Mechanisms

As explained in the sections on using courts and human rights mechanisms, it can be very difficult for aggrieved communities to seek justice and hold companies accountable in court or by using human rights bodies. In response to campaigns highlighting these significant accountability gaps, some companies, industries, governments and development banks have developed their own, non-judicial grievance mechanisms. These mechanisms are generally established to receive complaints from communities or workers who have suffered or anticipate harms.

Given that many of these mechanisms are established by corporations, banks and industries, they are, unsurprisingly, flawed in their ability to provide remedy for communities and hold companies accountable. However, because they are relatively accessible and cheap to use, and because their processes, if used effectively, can result in flexible remedial action beyond just monetary compensation, these mechanisms are sometimes the best option for communities.

These mechanisms can be most effective when used as one part of a broader, multi-pronged advocacy strategy that targets other pressure points along investment and supply chains. While these mechanisms often lack the power to compel action, companies do care about formal complaints filed against them when they come with reputational damage and financial costs. Therefore, filing a complaint is an important moment for media advocacy and alerting key actors along the investment and supply chain to the complaint.

While most non-judicial grievance mechanisms typically have two main functions that communities can use — a dispute resolution function (usually mediation) and an investigation function to assess compliance with relevant policies and standards — there are differences in the way each type of mechanism, and each individual complaints office, handles those functions. In general, the complaint mechanisms of development banks tend to run more robust dispute resolution processes and deeper investigations than other types of non-judicial grievance mechanisms. However, each mechanism has different procedural rules, budgets and approaches so if you have the option of using more than one, it is worth finding out from civil society organizations with experience using the mechanisms which ones are most worth pursuing in the context of your case.

This section describes several types of non-judicial grievance mechanisms and provides some commentary on their effectiveness.

Tip

If you are representing communities through any of these grievance mechanisms, you should obtain evidence of your authority to represent them and submit this along with the complaint. If the community members submitting the complaint wish to keep their identities confidential from the government and company because they fear reprisals, make sure they clearly request confidentiality in the complaint.

OECD NATIONAL CONTACT POINTS

One type of non-judicial grievance mechanism that is most frequently available to communities seeking remedy for harmful investment projects is National Contact Points (NCPs). These are mechanisms established by governments in countries that are members of the Organization for Economic Cooperation and Development (OECD) to receive and handle complaints about breaches of the OECD Guidelines for Multinational Enterprises. These guidelines define standards for, among other things, socially and environmentally responsible business conduct, including respect for human rights.

NCPs generally offer a dispute resolution service, and if that fails to resolve the issues, they conduct an examination of the company’s conduct against the human rights and environmental standards in the guidelines and publish a statement with their findings, sometimes with recommendations for the company to improve their policies and practices. NCPs vary in their effectiveness and none can make enforceable rulings against companies. But, when used alongside a broader multi-pronged advocacy strategy, they can be an effective tool for seeking remedy and holding companies accountable.

If the company that operates the project or its parent company is based in an OECD member country, you may be able to file a complaint to the relevant NCP. If one of the other actors along the investment or supply chain is directly linked or contributed to the harms and is based in an OECD country, you may also be able to file a complaint against that actor. If the project itself is in an OECD country, you can file a complaint to the NCP in that country.

DEVELOPMENT FINANCE ACCOUNTABILITY MECHANISMS

If you have identified an international development bank in your investment chain, there is a good chance that it has its own complaints office, usually known as an “accountability mechanism.” An increasing number of bilateral development banks, export credit agencies and aid agencies also have their own accountability mechanisms. In this section, we will refer to development banks but the information also applies to other multilateral and bilateral financial institutions that have accountability mechanisms. Most accountability mechanisms have a degree of independence from the financial institution’s day-to-day management.

If the community you are supporting has been harmed, or fears harm, caused by a project that is directly or indirectly financially supported by a development bank, they may be able to file a complaint with the bank’s accountability mechanism.

Like NCPs, accountability mechanisms of development banks all generally offer dispute resolution between representatives of the complainant community and the company (the bank’s client), and sometimes other relevant actors, such as the bank itself. Typically, accountability mechanisms offer a more robust dispute resolution process than NCPs, involving multiple face-to-face meetings and support to enable community representatives to join the meetings. These processes can last many months or years depending on the issues raised in the complaint and other factors. Accountability mechanisms also all have a “compliance review” function, but typically they assess the bank’s compliance with its own policies, rather than directly assessing whether the bank’s client respected the bank’s standards, though the better mechanisms do both.

Accountability mechanisms vary in their effectiveness and none can make enforceable rulings against companies or order them to provide compensation or other remedies. But when used alongside a broader multi-pronged advocacy strategy, they can be an effective tool for seeking remedy and holding companies and their development bank backers accountable.

MULTI-STAKEHOLDER INITIATIVE GRIEVANCE MECHANISMS

Multi-Stakeholder sustainability initiatives are associations that bring together companies and civil society, with the stated goal of making business activities more socially and environmentally responsible. Companies typically engage in these initiatives though membership, which usually requires them to agree to follow the initiative’s code of conduct and other policies, or through a more rigorous system of certification that verifies that their business practices meet a particular set of standards, including social and environmental standards.

Some of these initiatives have established grievance processes for receiving and addressing complaints that emerge from the operations of their members or of companies they have certified. In theory, grievances should be resolved through the complaints process, and if the company fails to address them in a manner consistent with the applicable standards, it can be expelled from the multi-stakeholder group and/or lose certification. This can have a serious effect on the business’s reputation and can therefore be a powerful part of your advocacy strategy.

However, by their nature, multi-stakeholder initiatives may be easily influenced by companies and often fail to function fairly and effectively to address the grievances of affected communities. They may instead shield those companies from negative publicity.

If the company operating the project causing harms, or one of the companies along its investment or supply chain are members of a relevant multi-stakeholder initiative, you may be able to file a complaint with its grievance mechanism. However, before you decide to file a complaint with a multi-stakeholder initiative, it is worth asking the advice of other organizations that have recently had experience engaging with it to decide whether it is worthwhile and how to make the best use of it.

COMPANY & OPERATIONAL-LEVEL GRIEVANCE MECHANISMS

The Guiding Principles for Business and Human Rights, which the U.N. Human Rights Council endorsed in 2011, tell companies to “establish or participate in effective operational-level grievance mechanisms for individuals and communities who may be adversely impacted” by their operations. While operational-level grievance mechanisms have become increasingly common, many have been criticized for not being fair or effective.

If there is a company or operational-level grievance mechanism available, it is a good idea to ask other organizations or communities with experience using the mechanism if they found the process worthwhile. Take this information into account when advising communities whether or not to try to use the mechanism to resolve their problems. As a general rule, company grievance mechanisms are usually ineffective for addressing serious harms and human rights violations, especially those that affect entire communities. Depending on the company, they may be more effective at addressing single instances of problems, such as where a household received an incorrect compensation amount because of a mistake made in an inventory list or calculation.

However, it may be worth using the grievance mechanisms of other companies along investment and supply chains, such as a bank that has financed a project, a shareholder, or a company that buys the commodity. Using their grievance mechanisms can be a good way to alert them to the problems on the ground and get them to use their leverage to bring about remedy, or if they themselves contributed to the harms, to push them to contribute to remedy.

USEFUL RESOURCES

In addition to organizations in your own country, the following may be able to provide advice and assistance in using accountability mechanisms:

Accountability Counsel

Center For International Environmental Law (Ciel)

Recourse

Inclusive Development International

Centre For Research On Multinational Corporations (Somo)

Fundación Para El Desarrollo De Políticas Sustentables (Fundeps)

Forest Peoples Programme

Cee Bankwatch Network

Bank Information Center

Coalition For Human Rights In Development

Arab Watch Coalition

Lumiere Synergie Pour Le Developpement (Lsd)

Aida

Ngo Forum On Asian Development Bank (Adb)

GUIDES & OTHER RESOURCES

Accountability in Africa: Harm from International Financial Flows and Strategies for Supporting Community-Led Access to Remedy by Accountability Counsel and the African Coalition for Corporate Accountability (ACCA) (2020).

Community Guide to the Asian Infrastructure Investment Bank: An Action Resource for People Affected by AIIB-Funded Projects by Inclusive Development International (2020).

Avoiding Forced Evictions: A Community Guide to Negotiation and Advocacy (with lesson plans you can use to train community leaders and representatives to prepare for negotiations with the company in cases of forced displacement) by Inclusive Development International and Equitable Cambodia (2017).

Community Guide to the International Finance Corporation: An Action Resource for People Affected by IFC-Funded Projects by Inclusive Development International (2017).

Corporate Accountability for Human Rights Abuses: A Guide for Victims and NGOs on Recourse Mechanisms by the International Federation for Human Rights (FIDH) (2016).

Glass Half Full? The State of Accountability in Development Finance by SOMO et al. (2016).

Accountability Resource Guide by Accountability Counsel (2015).

Seeking Justice at the International Level: A Short Guide to Regional and International Grievance and Advocacy Mechanisms for Indigenous Peoples and Local Communities by Natural Justice (2015).

SOMO has also produced a step-by-step guide to filing a complaint, as well as a range of grievance mechanism brochures.