Corporate Disclosure

'Hardening Soft Law: Are the emerging corporate social disclosure laws capable of generating substantive compliance with human rights' by Justine Nolan in (2018) Brazilian Journal of International Law comments 

The aim of this paper is to examine the potential effectiveness and limitations of the emerging corporate social disclosure laws that aim to increase transparency about human rights risks in global supply chains. Globalization has led to the emergence of low cost, efficient (but risky) supply chains that span multiple sourcing countries which exhibit a wide range of economic, political, social, labor and environmental standards. The five laws examined seek to provide mechanisms that aim to reduce the negative human rights impact of business in supply chains. They introduce varying demands on business to map, track and disclose how and where their products are being made. This paper first briefly highlights the preponderance of soft law that defines the business and human rights regulatory framework and guides corporate behavior. It then examines three mandated disclosure laws, the Dodd-Frank Act, the California Transparency in Supply Chains Act and the UK Modern Slavery Act and two due diligence focused laws, the Australian Illegal Logging Prohibition Act and the French Duty of Corporate Vigilance Law. After which, it proposes criteria to strengthen the development and implementation of these laws. It concludes by noting that while these laws are hardening the human rights expectations of business, for them to generate substantive (and not just procedural) human rights compliance they must include: detailed requirements on reporting and due diligence; collaboration with external stakeholders; and compliance mechanisms. Through analysis of these regulatory developments this paper seeks to provide greater understanding of how to shape regulatory responses to governance gaps in transnational supply chains.