Norges Bank Investment Management V United Steelworkers (Canada) and Birlesik Metal Iscileri Sendikasi (Birlesik Metal IS) (Turkey)

Overview

NCP Decision Rejected
Current Status Closed
Date Submitted 10/11/2014
Date Closed 02/07/2015
Case Duration 33 weeks and 3 days
Host Countries Canada  (OECD member)
Turkey  (OECD member)

Issue(s) Failure to undertake human rights due diligence; Failure to use leverage to prevent and mitigate adverse human rights impacts
Provisions Cited II.A.12  IV.1  IV.3  IV.4  IV.5  IV.6   
Related Cases Crown Holdings V United Steelworkers (Canada) and Birlesik Metal Iscileri Sendikasi (Birlesik Metal IS) (Turkey)
Case Description On 10 November 2014, the United Steelworkers (USW) submitted a complaint to the Norwegian National Contact Point concerning the failure of Norges Bank Investment Management (NBIM) to undertake due diligence and use its leverage to address adverse human rights impacts when it was informed of breaches of the Guidelines by Crown Holdings, Inc., an enterprise in which NBIM invests. The USW informed NBIM on the 4 July 2014 that Crown workers in Canada and Turkey were being subjected to violations of labour and human rights and specifically the refusal to negotiate to resolve a strike. On August 27, 2014, the Global Head of Business Risk at NBIM, wrote to the USW that NBIM did not see themselves as a party to the alleged situation.
Outcome On 2 July 2015, the Norwegian NCP rejected the case on the grounds that "‘[T]he NCP’s task is to promote the OECD Guidelines. A new consideration of the same questions of principles concerning the financial sector’s compliance with the Guidelines, so shortly after the last consideration and at the same time as the ongoing clarification process in the OECD, will not further the effectiveness of the Guidelines".
The ‘last consideration’ to which the NCP refers, pertains to the POSCO/NBIM case of 2013, On that occasion, the Norwegian NCP concluded that NBIM, by refusing to cooperate with the OECD NCP, and by not having any strategy on how to react if it becomes aware of human rights risks related to companies in which NBIM is invested, violated the OECD Guidelines. This case raised questions of principle concerning the application of the OECD Guidelines in relation to financial institutions - what type of due diligence can be expected of a minority shareholder? These issues, as of September 2015, are currently being examined by a multi-stakeholder Advisory Group at the OECD.

Organisations

Lead NCP Norway NCP : Independent Expert Body 

Companies

Multinational Company NBIM (Home country: Norway)

Complainants

Lead Complainant USW United Steelworkers of America : National Sectoral Union 

TUAC Analysis

Did the NCP publish its initial assessment? status-icon
Did the case involve parallel proceedings? status-icon
Was the existence of parallel proceedings an obstacle to the NCP accepting the case? status-icon
Was the businsess relationship other than that of a subsidiary? status-icon
Was the nature of the business relationship an obstacle to the NCP accepting the case? status-icon
Did the NCP inform other relevant government departments about its acceptance of this case? status-icon
Did the NCP offer mediation or conciliation? status-icon
Did the company accept the offer of mediation or conciliation? status-icon
Did the complainant(s) accept the offer of mediation or conciliation? status-icon
Was mediation or conciliation held? status-icon
Was mediation or conciliation conducted by a professional mediator? status-icon
Did the parties reach agreement? status-icon
If yes, did the NCP publish this agreement following the consent of the parties? status-icon
If mediation was refused or failed did the NCP make an assessment of whether the company had breached the Guidelines? status-icon
Did the NCP conduct in-host country fact finding? status-icon
Did the NCP make recommendations to the company on the future implementation of the Guidelines? status-icon
Did the NCP publish its final statement or report? status-icon
Did the NCP provide for follow-up of the agreement/recommendations? status-icon
Did the NCP inform other relevant government departments about its final statement or report? status-icon
Did the NCP inform public pension funds about its final statement or report? status-icon
Did the NCP apply any consequences in this case? status-icon
Did the NCP follow the indicative timescales set out in the procedural guidance? status-icon
Was there a positive outcome for the workers involved in this case? status-icon
Did the filing of the case under the Guidelines have a positive impact for the workers involved? status-icon
Did the lead NCP play a positive role? status-icon
If different, did the home NCP play a positive role? status-icon

TUAC Assessment

This is an extremely disappointing outcome that represents a significant step backwards not only for the Norwegian NCP, but also for the OECD Guidelines. There is no question that the Guidelines apply to NBIM. The OECD has already issued a clarification confirming that this is the case. The issue that will be discussed at the OECD in the upcoming months is "how" not "whether" the Guidelines apply.