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But when U.S. companies operate beyond our borders, they do not have to disclose basic environmental, labor and human rights information - to anyone. This lack of disclosure has allowed some U.S. companies to conceal dangerous or disgraceful behavior. The Unknown Can Kill: The Need for IRTK Disclosure Works: America's Right to Know Laws IRTK Wouldn't Be the First Time America Raised the Bar A Cost-effective, Practical Solution Affect the Competitiveness of American Companies? Nonsense!
What is International Right to Know International Right to Know would extend our domestic "right to know" requirements to large multinational companies that are either listed on our stock exchanges or incorporated in the United States. Companies will disclose environmental, labor, and human rights information about their operations abroad that the public has a right to know, such as:
The Unknown Can Kill: The Need for IRTK Shortly after midnight on December 3, 1984, one of the world’s worst industrial disasters unfolded in Bhopal, India. Over 40 tons of lethal gases - including methyl isocyanate, which contains cyanide - leaked from a pesticide plant in the northern part of the city. The streets of Bhopal filled with the bodies of thousands of victims, many suffering violent deaths. Today, hundreds of thousands of others still suffer debilitating health effects. By some estimates, the death toll has risen to 16,000 or more. The Bhopal tragedy is shocking for two reasons. First, the pesticide factory was owned and operated by an American company, the Union Carbide Corporation, now owned by the Dow Corporation. Second, it was entirely preventable. Union Carbide ignored numerous public warnings and avoided safety precautions that the company would have had to follow in the United States. The single biggest factor in the Bhopal disaster was the failure of Union Carbide to adequately inform the Indian government, its workers, and the surrounding community of the risks. Union Carbide hid information about the toxicity of the chemicals used at the plant to avoid safety regulations. The Bhopal accident led to the creation of U.S. law requiring disclosure in some key areas, but even these laws do not apply to the Bhopal case, or any U.S. company’s operations abroad. While Bhopal is an extreme example, there are numerous other cases of U.S. companies and their subsidiaries and contractors behaving badly, endangering communities, and collaborating with oppressive governments to increase profits. Too often, American companies have been implicated in environmental abuses, human rights violations, and poor labor practices. These abuses by American companies doing business abroad have compromised America’s reputation around the world. Disclosure Works: America's Domestic Right to Know Laws When toxic pollutants like methylmercury and dioxins are released into the environment through industrial activities - such as burning coal for electric power generation, mining, and waste incineration - these hazardous pollutants roam the globe and find their way into the food we eat, the water we drink and the air we breathe. We know how much pollution companies are releasing into the environment here at home thanks to the groundbreaking Emergency Planning and Community Right to Know Act passed by Congress in 1986. This law requires companies to report important environmental, health and safety information to the Environmental Protection Agency, which is then made available to the public in a user-friendly database called the "Toxic Release Inventory" (TRI). TRI information has provided citizens, communities and investors with critical information, which has led to significant voluntary reductions of toxic pollution and other environmental hazards. For example, information disclosed under TRI was used by citizens to convince IBM to phase-out its use of chlorofluorocarbons - the main culprit in depleting the ozone layer. It allowed a group of citizens in Akron, Ohio to obtain a commitment from BF Goodrich to reduce its toxic airborne emissions by an impressive 70 percent. TRI also gave communities in Oregon and Louisiana the information they needed to successfully enact toxics reduction statutes in their states. However, we simply do not know how much pollution U.S. companies are releasing into the environment worldwide. American companies operating abroad are not required to disclose information that they must disclose when they operate in the U.S. This lack of disclosure has allowed some U.S. companies to conceal irresponsible or disgraceful behavior, such as treating workers poorly, destroying the environment, and collaborating with oppressive governments that violate human rights. In the modern world of integrated markets and political interdependence, we cannot afford to have U.S. companies acting as poor ambassadors of America’s ideals. Whether at here at home or abroad, American business should represent the very best of our country and operate with integrity, honesty, and transparency. This starts with establishing International Right to Know disclosure standards based on the principles of existing domestic disclosure standards that protect communities in here at home. IRTK Wouldn't Be the First Time America Raised the Bar In 1977, Congress passed the Foreign Corrupt Practices Act (FCPA) in order to stop U.S. companies from bribing foreign government officials. By all accounts, the FCPA has been huge success. In the 1970s, over 400 American companies admitted to making corrupt payments to foreign officials. But since the FCPA was passed, this practice as come to a virtual standstill. In fact, in the first 18 years of FCPA, there were only 16 prosecutions for bribery. American companies are now widely regarded as the most ethical players in the world. A Cost-effective, Practical Solution Some companies may claim that IRTK will be prohibitively expensive, both to business and to government. While IRTK will certainly cost money - nothing is free - the costs are not great. Studies indicate that the amount the government will need to spend will be relatively small. While it will cost money for companies to gather this information, the process of information-gathering may generally benefit corporations in the long run. Following the motto "what gets measured gets managed," when companies are required to collect data, research has shown that they discover ways to improve the efficiency and performance of their operations. In fact, the Environmental Protection Agency found that industries reduced their toxic releases by an astounding 45.6% in the first decade of the Toxic Release Inventory. It is important to consider the potentially enormous costs of not having an International Right to Know. The lack of information disclosure harms consumers, shareholders, workers, and the environment every day, and contributes to a dangerous resentment of America and American multinational companies. Affect the Competitiveness of American Companies? Nonsense! Some companies may claim that IRTK will harm their competitiveness if they have to report basic environmental, human rights, and labor rights information for their operations abroad. At first, this may seem like a valid argument, but it's not. Because IRTK applies to all companies traded on U.S. stock exchanges - U.S. and foreign - American companies will not be placed at a disadvantage. Also, it is important to remember that IRTK is merely a set of reporting requirements - not a set of operating standards that will dictate how companies are supposed to act. Information disclosure will only be harmful to a company's competitiveness if it has been acting irresponsibly to get a leg up on its competitors. IRTK will also have the same protections for trade secrets as our domestic right to know laws. The fact that only one percent of companies reporting information to the Toxics Release Inventory, a domestic right to know database, have ever requested trade secret protections shows that disclosure does not compromise trade secrets. American corporations would still be able to conduct their operations like any other company. The difference would be that the American people - and the local communities in which the corporations operate - would have a right to know basic facts about the impact of company operations. |
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