Human rights and private sector development: a discussion paper

There is a growing consensus that development cooperation activities should promote human rights, and that human rights can promote development. A growing number of donor agencies have adopted human rights policies that guide their cooperation activities.

The links between the international development agencies with private sector development (PSD) as a tool for poverty reduction remain relatively undeveloped. Similarly human rights approaches to poverty reduction in the form of rights based approaches to PSD are required. Some agencies have begun to take steps to address this gap through the development of policy frameworks, programming tools and processes for accountability.

Many of the initiatives have been taken within both bilateral and multilateral agencies, and in some NGOs. The Norwegian agency for development cooperation (NORAD) has developed a handbook on human rights assessment. The Swedish international development cooperation agency’s policy guidelines for support to PSD include property rights, decent work conditions and environmental sustainability. The UK Department for International Development (DFID) identified three strategic aims: participation, inclusion, and fulfilling obligations. The international labour organisation’s business development programs include targeting women in very small and medium businesses. The World Bank could play a “facilitative role in helping its members realise their human rights obligations.

A frank exchange of good practice and lessons learned on integrating human rights in PSD in the organisation for economic co-operation and development (OECD) development assistance committee (DAC) or donor committee for enterprise development (DCED) would be useful. There is need to encourage further discussion on tensions in addressing both social and economic implications of growth strategies and PSD programming.

The following are issues related to rights based approaches to PSD that need further research and discussion:

• monitoring 
• enforceability/justiciablity 
• indivisibility 
• the role of the state and other actors 
• most agencies are investing in tools to support internal capacity-building