ON recent days, I held discussions on the responsible investment together with those from Channel K. I considered not only business people but also officials of relevant government departments and citizens need to have knowledge about the responsible business conducts at a time when the government opens the door to invite businesses. It can be seen that many global countries encourage the responsible investment and the responsible business conducts in economic sector in the 21st century.
Responsible Investment
Although each country initiated the responsible investment in various forms in early 20th century, use of such word the responsible investment officially started in 2006 when the United Nations adopted the Principles for Responsible Investment. Later, all global organizations including the United Nations have been using the word of responsible investment on a wider scale.
Basically, the responsible investment is a way of approach to inserting the facts relating to environmental, social and management sectors into the management functions for respective investments. In so doing, it is an attempt to obtain greater profits by systematically managing the risks, particularly to increase the rights of investors through investment tactics.
With regard to the main points for taking basic facts on environs of the responsible investment into consideration, the business of investment has to make efforts for avoiding the acts of causing impacts on climate change and declining of natural resources, for practising the proper waste system and preventing environmental pollution and deforestation. To undertake the basic social facts, business people adopted the plans to prevent human rights violation, neo-enslavement and child labour and to focus on welfare at workplaces and good relations with employees. Basic management procedures comprise acts of avoiding bribery and corruption, pay scale of managers, formation of board of directors without discrimination of gender, racism and religion, without complication between political canvassing for votes and donations, and procedures for payment of tax system.
Today’s global countries recognize the aforesaid basic factors as basic requirements for following the points of assessing the businesses to be put with investment and the point of adopting the decisions. Based on changing the world situations, it is propulsion for those who can get benefits from the investments and customers in demanding transparency related to their businesses. Some countries enact and practise rules and regulations as well as laws on issues of responsible investments. Actually, the responsible investment in operating a business is a basic factor beneficial to investors, citizens and States.
Responsible Business Conduct
In respect of the responsible business conduct, the majority of countries follow the OECD-Guidelines for Multinational Enterprises approved by the Organization for Economic Cooperation and Development-OECD on 25 May 2011. Not only OECD member countries but also non-member countries practise the OECD guidelines as their work guidelines. Such guidelines set aims for businesses to spread economic, natural environmental and social improvements across the world. The OECD guidelines mentioned its fundamental perception that businesses must obey the laws of the investments accepted countries as their first obligation. In observing the guidelines, a restriction was adopted that these businesses shall not offend the laws and rules of the countries they operate their businesses. The multinational enterprises of the guidelines were defined as inclusiveness of any businesses in more than one country. Likewise, the governments were urged not to abuse the guidelines of OECD for protecting the interest of those countries. The guidelines of the OECD were mentioned in brief as follows:- (1) The declaration is the first guideline. The OECD guidelines mentioned that enterprises should ensure that timely and accurate information is disclosed on all material matters regarding their activities, structure, financial situation, performance, ownership and governance. In so doing, the disclosure policies of enterprises should include the financial and operating results of the enterprise, enterprise objectives, major share ownership and voting rights, remuneration policy for members of the board and key executives, related party transactions and issues regarding workers.
(2) Enterprises should respect human rights, avoid infringing on the human rights of others and immediately address adverse human rights impacts. Within the context of their own activities, they should avoid causing or contributing to adverse human rights impacts and address such impacts. They should have a policy commitment to respect human rights and practise assessment over human rights.
(3) With regard to labour relations and employment practices, they should respect the right of workers employed by the multinational enterprises to have trade unions and representative organisations of their own choosing recognized for the purpose of collective bargaining. They should engage in constructive negotiations, elimination of child labour and various forms of forced labour and no discrimination among labour, render necessary assistance for such representatives with a view to reaching agreements on terms and conditions of employment, provide information to workers’ representatives and hold discussions with labour.
(4) Enterprises should, within the framework of laws, regulations and administrative practices in the countries in which they operate, set up work procedures for environmental management, take into account concerns about cost, business confidentiality and the protection of intellectual property rights, provide the public and workers with adequate, measureable and verifiable and timely information on the potential environment, avoid health and safety impacts of the activities of the enterprise and seriously harmful acts for environment and strive for greater improvement of environmental development of the companies.
(5) Regarding the combating bribery, bride solicitation and extortion, enterprises should not offer, promise, give, or demand a bribe or other undue advantage to obtain or retain business or other improper advantage. They should offer, promise or give undue pecuniary or other advantage to public officials or the employees of business partners. They should prohibit or discourage in internal company controls, ethics and compliance programmes or measures. They should to enhance the transparency of their activities in the fight against bribery, bribe solicitation and extortion and promote employee awareness of compliance programmes or measures against bribery, bribe solicitation and extortion.
(6) Consumer interest was inserted into the guidelines. When dealing with consumers, enterprises should act in accordance with fair business, marketing and advertising practices and should take all reasonable steps to ensure the quality and reliability of the goods and services and provide accurate, verifiable and clear information. They should provide consumers with access to fair, easy to use, timely and effective non-judicial dispute resolution, not make representations or omissions, nor engage in any other practices, that are deceptive, misleading, fraudulent or unfair, respect consumer privacy and co-operate fully with public authorities to prevent and combat deceptive marketing practices.
(7) Concerning science and technology, enterprises should endeavour to ensure that their activities are compatible with the science and technology policies and plans of the countries, practices that permit the transfer and rapid diffusion of technologies and know-how. They should perform science and technology development work in host countries to address local market needs and grant licences for the use of intellectual property rights. The enterprises should contribute to the long term sustainable development prospects of the host country. They should develop ties with local universities, public research institutions, and participate in co-operative research projects.
(8) For competition, enterprises should carry out their activities in a manner consistent with all applicable competition laws and regulations, refrain from entering into or carrying out anti-competitive agreements among competitors, co-operate with investigating competition authorities and regularly promote employee awareness of the importance of compliance with all applicable competition laws and regulations.
(9) It is important that enterprises contribute to the public finances of host countries by making timely payment of their tax liabilities. Enterprises should comply with both the letter and the spirit of the tax laws and regulations in all countries in which they operate. The guidelines urged enterprises to insert tax management and tax payment to the tax governing system.
Myanmar and Responsible Investments
Myanmar mentioned provisions for development of responsible investments in the Investment Law enacted in 2016. Section 3 (a) states “to develop responsible investment businesses which do not cause harmful to the natural environment and the social environment for the interest of the Union and its citizens.” Moreover, Section 25 mentions powers of the commission with necessary provisions. And, sections 36, 41, 46, 51, from 65 to 67 and 71 and rules carry provisions related to the responsible business conducts.
Likewise, as the Myanmar Companies Law enacted in 2017 comprises guidelines for responsible business conducts necessarily, the government has firmly adopted legal frameworks concerning the responsible investment and the responsible business conducts. As such, businesspersons, departmental staff and all citizens need to join hands for achieving greater development of responsible businesses in the Myanmar’s economic arena.
Translated by Than Tun Aung
