Friday, January 26, 2024

Are Lawyers, Lawmakers, and Law Professors Really Ready for AI in 2024?

We just finished our second week of the semester and I’m already exhausted, partly because I just submitted the first draft of a law review article that’s 123 pages with over 600 footnotes on a future-proof framework for AI regulation to the University of Tennessee Journal of Business Law. I should have stuck with my original topic of legal ethics and AI.

But alas, who knew so much would happen in 2023? I certainly didn’t even though I spent the entire year speaking on AI to lawyers, businesspeople, and government officials. So, I decided to change my topic in late November as it became clearer that the EU would finally take action on the EU AI Act and that the Brussels effect would likely take hold requiring other governments and all the big players in the tech space to take notice and sharpen their own agendas.

But I’m one of the lucky ones because although I’m not a techie, I’m a former chief privacy officer, and spend a lot of time thinking about things like data protection and cybersecurity, especially as it relates to AI. And I recently assumed the role of GC of an AI startup. So, because I’m tech-adjacent, I’ve spent hours every day immersed in the legal and tech issues related to large and small language models, generative AI (GAI), artificial general intelligence (AGI), APIs, singularity, the Turing test, and the minutiae of potential regulation around the world. I’ve become so immersed that I actually toggled between listening to the outstanding Institute for Well-Being In Law virtual conference and the FTC’s 4-hour tech summit yesterday with founders, journalists, economists, and academics. Adding more fuel to the fire, just before the summit kicked off, the FTC announced an inquiry into the partnerships and investments of  Alphabet, Inc., Amazon.com, Inc., Anthropic PBC, Microsoft Corp., and OpenAI, Inc. Between that and the NY Times lawsuit against OpenAI and Microsoft alleging billions in damages for purported IP violations, we are living in interesting times.

If you’ve paid attention to the speeches at Davos, you know that it was all AI all the time. I follow statements from the tech leaders like other people follow their fantasy football stats or NCAA brackets. Many professors, CEOs, and general consumers, on the other hand, have been caught by surprise by the very rapid acceleration of the developments, particularly related to generative AI.

However, now more members of the general public are paying attention to the concept of deepfakes and demanding legislation in part because the supernova that is Taylor Swift has been victimized by someone creating fake pornographic images of her. We should be even more worried about the real and significant threat to the integrity of the fifty global elections and occurring in 2024 where members of the public may be duped into believing that political candidates have said things that they did not, such as President Biden telling people not to vote in the New Hampshire primary and to save their votes for November.

For those of us who teach in law schools in the US and who were either grading or recovering from grading in December, we learned a few days before Christmas that Lexis was rolling out its AI solution for 2Ls and 3Ls. Although I had planned to allow and even teach my students the basics of prompt engineering and using AI as a tool (and not a substitute for lawyering) in my business associations, contract drafting, and business and human rights class, now I have to also learn Lexis’ solution too. I feel for those professors who still ban the use of generative AI or aren’t equipped to teach students how to use it ethically and effectively.

Even so, I’m excited and my students are too. The legal profession is going to change dramatically over the next two years, and it’s our job as professors to prepare our students. Thompson Reuters, the ABA, and state courts have made it clear that we can’t sit by on the sidelines hoping that this fad will pass.

Professionally, I have used AI to redraft an employee handbook in my client’s voice (using my employment law knowledge, of course), prepare FAQs for another client’s code of conduct in a very specialized industry, prepare interview questions for my podcast, and draft fact patterns for simulations for conferences and in class. I’ve also tested its ability to draft NDAs and other simple agreements using only ChatGPT. It didn’t do so well there, but that’s because I know what I was looking for. And when I gave additional instructions, for example, about drafting a mutual indemnification clause and then a separate supercap, it did surprisingly well. But I know what should be in these agreements. The average layperson does not, something that concerns Chief Justice Roberts and should concern us all.

How have you changed your teaching with the advent of generative AI? If you’re already writing or teaching about AI or just want more resources, join the 159 law professors in a group founded by Professors April Dawson and Dan Linna. As for my law review article, I’m sure a lot of it will be obsolete by the time it’s published, but it should still be an interesting, if not terrifying, read for some.

January 26, 2024 in Business Associations, Compliance, Consulting, Contracts, Corporate Governance, Corporate Personality, Corporations, CSR, Current Affairs, Ethics, Human Rights, Intellectual Property, International Law, Jobs, Law Firms, Law School, Lawyering, Legislation, Marcia Narine Weldon, Research/Scholarhip, Science, Teaching, Technology, Web/Tech | Permalink | Comments (0)

Saturday, January 14, 2023

Can The Next Generation of Lawyers Save the World?

An ambitious question, yes, but it was the title of the presentation I gave at the Society for Socio-Economists Annual Meeting, which closed yesterday. Thanks to Stefan Padfield for inviting me.

In addition to teaching Business Associations to 1Ls this semester and running our Transactional Skills program, I'm also teaching Business and Human Rights. I had originally planned the class for 25 students, but now have 60 students enrolled, which is a testament to the interest in the topic. My pre-course surveys show that the students fall into two distinct camps. Most are interested in corporate law but didn't know even know there was a connection to human rights. The minority are human rights die hards who haven't even taken business associations (and may only learn about it for bar prep), but are curious about the combination of the two topics. I fell in love with this relatively new legal  field twelve years ago and it's my mission to ensure that future transactional lawyers have some exposure to it.

It's not just a feel-good way of looking at the world. Whether you love or hate ESG, business and human rights shows up in every factor and many firms have built practice areas around it. Just last week, the EU Corporate Sustainability Reporting Directive came into force. Like it or not, business lawyers must know something about human rights if they deal with any company that has or is part of a supply or value chain or has disclosure requirements. 

At the beginning of the semester, we discuss the role of the corporation in society. In many classes, we conduct simulations where students serve as board members, government officials, institutional investors, NGO leaders, consumers, and others who may or may not believe that the role of business is business. Every year, I also require the class to examine the top 10 business and human rights topics as determined by the Institute of Human Rights and Business (IHRB). In 2022, the top issues focused on climate change:

  1. State Leadership-Placing people at the center of government strategies in confronting the climate crisis
  2. Accountable Finance- Scaling up efforts to hold financial actors to their human rights and environmental responsibilities
  3. Dissenting Voices- Ensuring developmental and environmental priorities do not silence land rights defenders and other critical voices
  4. Critical Commodities- Addressing human rights risks in mining to meet clean energy needs
  5. Purchasing Power- Using the leverage of renewable energy buyers to accelerate a just transition
  6. Responsible Exits- Constructing rights-based approaches to buildings and infrastructure mitigation and resilience
  7. Green Building- Building and construction industries must mitigate impacts while avoiding corruption, reducing inequality, preventing harm to communities, and providing economic opportunities
  8. Agricultural Transitions- Decarbonising the agriculture sector is critical to maintaining a path toward limiting global warming to 1.5 degrees
  9. Transforming Transport- The transport sector, including passenger and freight activity, remains largely carbon-based and currently accounts for approximately 23% total energy-related CO2 global greenhouse gas emissions
  10. Circular Economy- Ensure “green economy” is creating sustainable jobs and protecting workers

The 2023 list departs from the traditional type of list and looks at the people who influence the decisionmakers in business. That's the basis of the title of this post and yesterday's presentation. The 2023 Top Ten are:

  1. Strategic Enablers- Scrutinizing the role of management consultants in business decisions that harm communities and wider society. Many of our students work outside of the law as consultants or will work alongside consultants. With economic headwinds and recessionary fears dominating the headlines, companies and law firms are in full layoff season. What factors should advisors consider beyond financial ones, especially if the work force consists of primarily lower-paid, low-skilled labor, who may not be able to find new employment quickly? Or should financial considerations prevail?
  2. Capital Providers- Holding investors to account for adverse impacts on people- More than 220 investors collectively representing US$30 trillion in assets under management  have signed a public statement acknowledging the importance of human rights impacts in investment and global prosperity. Many financial firms also abide by the Equator Principles, a benchmark that helps those involved in project finance to determine environmental and social impacts from financing. Our students will serve as counsel to banks,  financial firms, private equity, and venture capitalists. Many financial institutions traditionally focus on shareholder maximization but this could be an important step in changing that narrative. 
  3. Legal Advisors- Establishing norms and responsible performance standards for lawyers and others who advise companies. ABA Model Rule 2.1 guides lawyers to have candid conversations that "may refer not only to law but to other considerations such as moral, economic, social and political factors, that may be relevant to the client's situation." Business and human rights falls squarely in that category. Additionally, the ABA endorsed the United Nations Guiding Principles on Business and Human Rights ten years ago and released model supply chain contractual clauses related to human rights in 2021. Last Fall, the International Bar Association's Annual Meeting had a whole track directed to business and human rights issues. Our students advise on sanctions, bribery, money laundering, labor relations, and a host of other issues that directly impact human rights. I'm glad to see this item on the Top 10 list. 
  4. Risk Evaluators- Reforming the role of credit rating agencies and those who determine investment worthiness of states and companies. Our students may have heard of S&P, Moody's, & Fitch but may not know of the role those entities played in the 2008 financial crisis and the role they play now when looking at sovereign debt.  If the analysis from those entities  are flawed or laden with conflicts of interest or lack of accountability, those ratings can indirectly impact the government's ability to provide goods and services for the most vulnerable citizens.
  5. Systems Builders- Embedding human rights considerations in all stages of computer technology. If our students work in house or for governments, how can they advise tech companies working with AI, surveillance, social media, search engines and the spread of (mis)nformation? What ethical responsibilities do tech companies have and how can lawyers help them wrestle with these difficult issues?
  6. City Shapers-  Strengthening accountability and transformation in real estate finance and construction. Real estate constitutes 60% of global assets. Our students need to learn about green finance, infrastructure spending, and affordable housing and to speak up when there could be human rights impacts in the projects they are advising on. 
  7. Public Persuaders- Upholding standards so that advertising and PR companies do not undermine human rights. There are several legal issues related to advertising and marketing. Our students can also play a role in advising companies, in accordance with ethical rule 2.1, about persuaders presenting human rights issues and portraying controversial topics related to gender, race, indigenous peoples, climate change in a respectful and honest manner. 
  8. Corporate Givers- Aligning philanthropic priorities with international standards and the realities of the most vulnerable. Many large philanthropists look at charitable giving as investments (which they are) and as a way to tackle intractable social problems. Our students can add a human rights perspective as advisors, counsel, and board members to ensure that organizations give to lesser known organizations that help some of the forgotten members of society. Additionally, Michael Porter and Mark Kramer note that a shared-value approach, "generat[es] economic value in a way that also produces value for society by addressing its challenges. A shared value approach reconnects company success with social progress. Firms can do this in three distinct ways: by reconceiving products and markets, redefining productivity in the value chain, and building supportive industry clusters at the company's locations." Lawyers can and should play a role in this. 
  9. Business Educators- Mainstreaming human rights due diligence into management, legal, and other areas of academic training. Our readers teaching in business and law schools and focusing on ESG can discuss business and human rights under any of the ESG factors. If you don't know where to start, the ILO has begun signing MOUs with business schools around the world to increase the inclusion of labor rights in business school curricula. If you're worried that it's too touchy feely to discuss or that these topics put you in the middle of the ESG/anti-woke debate, remember that many of these issues relate directly to enterprise risk management- a more palatable topic for most business and legal leaders. 
  10. Information Disseminators- Ensuring that journalists, media, and social media uphold truth and public interest. A couple of years ago, "fake news" was on the Top 10 and with all that's going on in the world with lack of trust in the media and political institutions, lawyers can play a role in representing reporters and media outlets. Similarly, lawyers can explain the news objectively and help serve as fact checkers when appearing in news outlets.

If you've made it to the end of this post, you're either nodding in agreement or shaking your head violently in disagreement. I expect many of my students will feel the same, and I encourage that disagreement. But it's my job to expose students to these issues. As they learn about ESG from me and the press, it's critical that they disagree armed with information from all sides.

So can the next generation of lawyers save the world? Absolutely yes, if they choose to. 

January 14, 2023 in Business Associations, Business School, Compliance, Conferences, Consulting, Contracts, Corporate Finance, Corporate Governance, Corporate Personality, Corporations, CSR, Current Affairs, Ethics, Financial Markets, Human Rights, International Business, International Law, Law Firms, Law School, Lawyering, Management, Marcia Narine Weldon, Private Equity, Shareholders, Stefan J. Padfield, Teaching, Technology, Venture Capital | Permalink | Comments (0)

Friday, November 4, 2022

How Generation, Nationality, and Expertise Influence Stakeholder Prioritization of Tech Social Issues- Pt. 2

Last month, I posted about an experiment I conducted with students and international lawyers. I’ve asked my law student, Kaitlyn Jauregui to draft this post summarizing the groups’ reasoning and provide her insights. Next week, I’ll provide mine in light of what I’m hearing at various conferences, including this week’s International Bar Association meeting. This post is in her words.

After watching The Social Dilemma, participants completed a group exercise by deciding which social issues were a priority in the eyes of different tech industry stakeholders. The Social Dilemma is a 2020 docudrama that exposes how social media controls that influences the behavior, mental health, and political views of users by subjecting them to various algorithms. Director Jeff Orlowski interviewed founding and past tech employees of some of the biggest companies in Silicon Valley to bring awareness to viewers.  

Groups of primarily American college students, primarily American law students, one group of Latin American lawyers, and one group of international lawyers completed the exercise. Each of the groups deliberated from the perspective of a CEO, investor, consumer, or NGO.  Acting as that stakeholder, the team then ranked the following issues in order of importance: Incitements to violence, Labor Issues, Suppression of Speech, Mental Health, Surveillance, and Fake News. 

How The Groups Performed

The college students attend an American law school, but they are not necessarily all American. The groups’ logic behind their rankings could not be provided. I provided the rankings in the last post.

Law Students

The law students attend and American law school, but they are not necessarily all American. They considered six social issues.

Team CEO: Law Students

1.    Labor Issues in the Supply Chain

2.    Surveillance

3.    Mental Health

4.    Fake News

5.    Suppression of Speech

6.    Incitements to Violence

The law students assigned to view the issues as a CEO based their rankings on an internal to external approach. They believed the CEO is responsible for the operations of the company so would first try to solve internal issues such as labor issues because that would directly affect the bottom line. Surveillance and mental health ranked #2 because the team assumed that these issues directly related to customer satisfaction and retention. Because this group took on the role as a tech CEO and not a social media CEO, they did not view 4-6 as important. Fake news was only relevant if it was about the company. Suppression of speech was not problematic to them because it would not directly impact their business. Finally, they did not view incitement to violence as relevant to the business operations so ranked it last.

Team Investor: Law Students

1.    Labor Issues in the Supply Chain

2.    Incitements to Violence

3.    Surveillance

4.    Suppression of Speech

5.    Fake News

6.    Mental Health

The law students who prioritized social issues as if they were an Investor approached the task considering market forces. They chose labor issues first because it poses challenges to business operations. Whatever looks bad for revenue generation such as incitement to violence and surveillance means their investment would look bad as well. It is important to note they viewed this assignment as an institutional investor. The remaining factors were not imperative to the success of the tech company so were ranked lower.

Team NGO: Law Students

1.    Fake News

2.    Incitement to Violence

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    Surveillance

6.    Suppression of Speech

The law students who took on a role as an NGO based their sense of urgency on the danger and risks the involved in each issue. At the top was fake news because they thought misinformation when taken as fact was unhealthy for making decisions and forming opinions. Incitement to violence closely followed because political polarization can lead to hateful actions outside of social media. They found mental health to be important because of statistics showing teens committing self-harm or worse as a result of social media use. Although labor Issues are abroad, the NGO team could not ignore it. Surveillance was not key to them because they believed platforms are already taking measures against it. And lastly, suppression of speech was not as important to them as deleting hate speech and fake news.

Team Consumer: Law Students

1.    Surveillance

2.    Mental Health

3.    Incitement to Violence

4.    Suppression of Speech

5.    Fake News

6.    Labor Issues in Supply Chain

The law students who took on their natural roles as consumers found social issues more important than financial forces. They referred to the many advertisements that tech companies like Apple and Google are posting against surveillance. The effects of social media on mental health and even physical health also stood out to them. As a group of law students, they are informed individuals who can spot fake news so did not see that as a priority. Lastly, labor issues are not in the consumers’ sight so are out of mind and therefore not a priority.

Latin American Lawyers

*The Latin American Lawyers did not consider Fake News or Incitements to Violence.

Team CEO: Latin American Lawyers

1.    Labor Issues in the Supply Chain

2.    Surveillance

3.    Suppression of Speech

4.    Mental Health

5.    -

6.    -

The Latin American lawyers ranked the social issues regarding business success and long-term goals. Labor issues were their top concern because it influences the legal challenges faced by the company and the costs of production. “Information is power” so surveillance restrictions would greatly decrease money earned from selling data gathered. They did not see suppression of speech as an issue because the company itself is not limited. Mental health was ultimately last because it does not impair business operations.

Team Investor: Latin American Lawyers

1.    Mental Health

2.    Surveillance

3.    Labor Issues in the Supply Chain

4.    Suppression of Speech

5.    -

6.    -

The Latin American lawyers listed their priorities as a socially responsible Investor. Mental health triggered the most urgency for them because the negative influence of social media on users is growing and is not slowing down. Heavy surveillance conflicts with the rights of persons like themselves so it is a great risk for them. Although labor issues were important, they did not think of it as a widespread issue affecting large populations of people. Lastly, suppression of speech was not a concern at all for them.

Team NGO: Latin American Lawyers

1.    Surveillance

2.    Suppression of Speech / Fake News

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    -

6.    -

The Latin American lawyers who participated as an NGO focused their efforts on user experience and rights. They found surveillance to be a growing concern and a human right violation for users. Suppression of speech was also very important to them, especially in the scope of the team’s nationality because of political distress in their home countries. For countries with political instability, their citizens are more conscious of infringed rights through social media. Fake news and censorship on virtual platforms can ultimately destroy the democracy of countries in their point of view. The team preferred life over work so chose to rank mental health higher than labor issues.

Team Consumer: Latin American Lawyers

1.    Surveillance

2.    Suppression of Speech / Fake News

3.    Mental Health

4.    Labor Issues in Supply Chain

5.    -

6.    -

The Latin American lawyers used their personal perspective as consumers to rank in accordance with social concerns. Surveillance was seen as a major problem because it makes users uncomfortable knowing that their activity is tracked and sold as data. Suppression of speech was grouped with fake news as an important issue regarding the rights and freedom of the consumers. The gatekeeping of information from mainstream media in general was a concern for these consumers because they feel as if they are being controlled and concealed from the truth. Although the negative mental health results on teens from social media is important, the consumers thought this was the responsibility of parents and not of other consumers. Labor issues were of no concern because the consumers felt as if they have no control over the matter. 

International Lawyers

The International Group comprised of participants from Bolivia, Brazil, Bulgaria, Canada, Colombia, Ecuador, Egypt, Ethiopia, India, Iran, Jamaica, Mexico, Nepal, Sweden, Switzerland, and Ukraine. The group was not assigned to rank Mental Health as a social issue. The groups’ logic behind their rankings could not be provided.

Team CEO: International Lawyers

1.    Fake News

2.    Labor Issues in the Supply Chain

3.    Surveillance

4.    Incitement to Violence

5.    Suppression of Speech

6.    -

Team Investor: International Lawyers (Socially Responsible)

1.    Incitement to Violence

2.    Fake News

3.    Labor Issues in the Supply Chain

4.    Surveillance

5.    Suppression of Speech

6.    -

Team Investor: International Lawyers (Institutional)

1.    Labor Issues in the Supply Chain

2.    Incitements to Violence

3.    Suppression of Speech

4.    Fake News

5.    Surveillance

6.    -

Team NGO: International Lawyers

1.    Fake News

2.    Labor Issues in Supply Chain

3.    Suppression of Speech

4.    Incitements to Violence

5.    Surveillance

6.    -

 

Team Consumer: International Lawyers

1.    Incitements to Violence

2.    Suppression of Speech

3.    Fake News

4.    Labor Issues in Supply Chain

5.    Surveillance

6.    -

 Insights

When given a business or financial oriented role, the teams ranked the social issues by focusing on whether it impacts company performance. Teams with community or advocate roles tended to rank the social issues according to impact on society. Team CEO prioritized labor issues and surveillance the most. Labor issues along with incitements to violence were of top concern for Team Investor. Fake news was the number one issue for Team NGO. Team Consumer, which reflects the average personal view of the participants, believed incitements to violence and surveillance were the most pressing social issues in the tech industry. Labor issues were the least important to the consumer participants, which is interesting in scope of consumer purchase decisions overall and not just in tech.

The Team Consumer data is reflective of each of the groups’ personal beliefs because all participants are also consumers. The College Students prioritized mental health. Both the law students and the Latin American lawyers found surveillance the most important tech issue. International lawyers instead thought incitement to violence more pressing. A possible explanation is that people in the U.S. and Latin America are trying to protect their privacy from intrusive technology. Because the international lawyers had participants from countries where incitement to violence are occurring, that may be why it was important to them.

Suppression of speech closely followed for Latin American Lawyers and International Lawyers whereas Mental Health was the second priority for the primarily American law Students. Many citizens of countries around the globe face oppressive governments that censor speech which may be influential in why Suppression of Speech was ranked highly. In the United States, citizens are guaranteed freedom of speech and press which is why this issue may not be as concerning for them. American teens also suffer from more mental illness as a result of social media use, possibly why it is second place.

Practices in corporate culture and opinions on social issues are influenced by the ethnic makeup of the employees. Although the stakeholder roles the groups took are the most determinative factor, their nationality is naturally a bias in their decision-making.

The Lewis Model is a triangular spectrum that identifies the prominent features of different cultures. Richard Lewis spoke 10 languages, visited 135 countries, and work in over 20 of them to find observable variability in social behavior. He recognized that stereotypes are unfair, but also emphasized that social norms are standards in each country. There are three defined points of culture: Linear Active, Multi-active, and Reactive.

  • Linear actives — those who plan, arrange, organize, do one thing at a time, follow action chains. They are truthful rather than diplomatic and do not fear confrontation. Their work and as well as personal life is based on logic rather than emotions. Linear actives like facts, fixed agenda and they are very job oriented. They are able to separate social-private and professional life.
  • Multi-actives — people belonging to this cultural category are able to do many things at once, planning their priorities not according to a time schedule, but according to the relative thrill or importance that each appointment brings with it. These cultures are very talkative and impulsive. These characteristics predict their orientation on people. They feel uncomfortable in silence. Multi-active people prefer face to face sessions.
  • Reactives — member of this group has in the priority list courtesy and respect on the top. This group is best listening culture. Listening quietly, reacting calmly and carefully to the other side's proposals are their traits as well. Reactive cultures are the world’s best listeners in as much as they concentrate on what the speaker is saying, do not interrupt a speaker while the discourse or presentation is on-going. Reactive people have large reserves of energy. Reactives tend to use names less frequently than other cultural categories.

How does the Lewis Model explain the results?

The primarily American college and law students fall under linear-active with their priorities aligned with individual rights and performance.

The Latin American lawyers are multi-active, think about the social issues in terms of impact on the community and on building relationships.

The International lawyers are comprised of participants all over the world, bringing in aspects from all over the spectrum.

The Lewis Model most likely plays a part in how each participant individually arrived at their own rankings and how they then communicated to agree on a reflective ranking together. The conversations guiding to the final result would have probably shown more insight as to how and why these social issues are important.

Age

The age of the participants is another influential factors because of the generational variation in trust in surveilling technologies. Generation Z, Millennials, and Generation X+ were asked in a survey how comfortable they felt with programs like Alexa or Siri on a scale from 1 to 10, 1 being very and 10 being not.

Generation Z: 7.73

Millennials: 8.28

Generation X+: 8.90

Older generations are more uneasy about virtual assistant technology.

With age comes more experience and better foresight. Researchers in Texas found that “older adults use the experience in decision-making accumulated over their lifetime to determine the long-term utility and not just the immediate benefit before making a choice. However, younger adults tend to focus their decision-making on instant gratification.”

How does age explain the results?

The majority of the college and law students were Generation Z or Millennials whereas the practicing attorneys were mostly Millennials or more senior.

As generations progress, younger people are more comfortable with surveillance technology than older people.

Expertise

Expertise of the participants surely impacted how they ranked social issues. The knowledge of experts in comparison to novices gives them a wider and practical approach to business and social issues. Here are some key aspects:

  1. Experts notice features and meaningful patterns of information that are not noticed by novices.
  2. Experts have acquired a great deal of content knowledge that is organized in ways that reflect a deep understanding of their subject matter.
  3. Experts’ knowledge cannot be reduced to sets of isolated facts or propositions but, instead, reflects contexts of applicability: that is, the knowledge is “conditionalized” on a set of circumstances.
  4. Experts are able to flexibly retrieve important aspects of their knowledge with little attentional effort.
  5. Though experts know their disciplines thoroughly, this does not guarantee that they are able to teach others.
  6. Experts have varying levels of flexibility in their approach to new situations.

Perhaps the practicing attorneys foresaw further down the line as to why one social issue was more pressing than another.

Thank you, Kaitlyn for providing your analysis of the results. Next week, I’ll provide mine.

November 4, 2022 in Business Associations, Comparative Law, Compliance, Corporate Personality, Corporations, CSR, Current Affairs, Human Rights, International Law, Law School, Lawyering, Marcia Narine Weldon, Social Enterprise, Teaching | Permalink | Comments (0)

Friday, May 20, 2022

What Do FIFA, Nike, and PornHub Have In Common?

It's a lovely Friday night for grading papers for my Business and Human Rights course where we focused on ESG, the Sustainable Development Goals (SDGs), and the UN Guiding Principles on Business and Human Rights. My students met with in-house counsel, academics, and a consultant to institutional investors; held mock board meetings; heard directly from people who influenced the official drafts of EU's mandatory human rights and environmental due diligence directive  and the ABA's Model Contract Clauses for Human Rights; and conducted simulations (including acting as former Congolese rebels and staffers for Mitch McConnell during a conflict minerals exercise). Although I don't expect them all to specialize in this area of the law, I'm thrilled that they took the course so seriously, especially now with the Biden Administration rewriting its National Action Plan on Responsible Business Conduct with public comments due at the end of this month.

The papers at the top of my stack right now:

  1. Apple: The Latest Iphone's Camera Fails to Zoom Into the Company's Labor Exploitation
  2. TikTok Knows More About Your Child Than You Do: TikTok’s Violations of Children’s Human Right to Privacy in their Data and Personal Information
  3. Redraft of the Nestle v. Doe Supreme Court opinion
  4. Pornhub or Torthub? When “Commitment to Trust and Safety” Equals Safeguarding of Human Rights: A Case Study of Pornhub Through The Lens of Felites v. MindGeek 
  5. Principle Violations and Normative Breaches: the Dakota Access Pipeline - Human rights implications beyond the land and beyond the State
  6. FIFA’s Human Rights Commitments and Controversies: The Ugly Side of the Beautiful Game
  7. The Duty to Respect: An Analysis of Business, Climate Change, and Human Rights
  8. Just Wash It: How Nike uses woke-washing to cover up its workplace abuses
  9. Colombia’s armed conflict, business, and human rights
  10. Artificial Intelligence & Human Rights Implications: The Project Maven in the ‘Business of war.’
  11. A Human Rights Approach to “With Great Power Comes Great Responsibility”: Corporate Accountability and Regulation
  12. Don’t Talk to Strangers” and Other Antiquated Childhood Rules Because The Proverbial Stranger Now Lives in Your Phone
  13. Case studies on SnapChat, Nestle Bottling Company, Lush Cosmetics, YouTube Kidfluencers, and others 

Business and human rights touches more areas than most people expect including fast fashion, megasporting events, due diligence disclosures,  climate change and just transitions, AI and surveillance, infrastructure and project finance, the use of slave labor in supply chains, and socially responsible investing. If you're interested in learning more, check out the Business and Human Rights Resources Center, which tracks 10,000 companies around the world. 

May 20, 2022 in Compliance, Corporate Governance, Corporate Personality, Corporations, CSR, Current Affairs, Ethics, Financial Markets, Human Rights, International Business, International Law, Marcia Narine Weldon, Securities Regulation, Teaching | Permalink | Comments (0)

Friday, December 4, 2020

Introducing Our December Guest Blogger - Lécia Vicente

I am delighted to announce that Professor Lécia Vicente from LSU Law is joining us as a guest blogger at the BLPB this month. Her posts will be on Sundays through the end of the month.  You can find her work on SSRN here.

Professor Vicente teaches Business Associations, a Comparative Corporate Law Seminar, the Louisiana Law of Obligations, and Western Legal Traditions (a comparative and legal methodology course). Her recent scholarship focuses on the several dimensions of property rights within the firm’s contractual framework. She is also expanding her research to include law and development as a result of her consultancy work with developing countries and various other professional engagements, including her roles as:

  • a delegate to the 74th Session of the United Nations General Assembly in 2019;
  • the Head of Delegation of the African Union at the United Nations’ High-Level Political Forum on Sustainable Development under the auspices of the United Nations Economic and Social Council in 2016; and
  • an advisor of the African Union at the United Nations Sustainable Development Summit for the adoption of the Post-2015 development agenda.

Professor Vicente holds an LL.M. in Comparative, European and International Laws and a Ph.D. from the European University Institute, Florence, Italy.  Her undergraduate degree was earned at the Faculty of Law, Catholic University of Portugal.  She beings unique interdisciplinary perspectives to her scholarship and teaching--and now to our blog!  Please join me in welcoming her to our pandemic "virtual pod" as she posts over the next few weeks.

December 4, 2020 in Comparative Law, International Business, International Law, Joan Heminway | Permalink | Comments (0)

Wednesday, August 26, 2020

New Article: Professor Fandl on "Trump, Xi and the Threat to the World Trade Organization"

Professor Kevin Fandl, the President of the ALSB International Section, has posted a really timely article to SSRN: Trump, Xi and the Threat to the World Trade Organization (here).  I’m looking forward to giving it a thorough review just as soon as the new semester settles in!  Here’s the abstract:

Is the WTO big enough for two economic superpowers? China’s explosion onto the world economic stage has allowed new and unexpected challenges to emerge, most significantly, which path globalization should be guided down. For 70 years, the western world has approached globalization from a liberalist perspective, seeing it as a corollary to democracy and rules-based economic growth. Yet China, which benefited enormously from globalization, has exceled in the absence of democracy, challenging the idea that the liberal world order is necessary or even desirable.


With the WTO teetering on irrelevance, this is a moment to lift the hood and examine the engine of economic growth we have relied upon for decades. Though both China and the United States have the economic power to unilaterally pursue trade advantages (think NAFTA or the Belt and Road Initiative), it is not in the interest of either party to abandon the constraints imposed by the rules-based WTO system. The WTO provides an avenue to resolve disputes peacefully without the need for unilateral actions, which tend to escalate rather than resolve trade disputes. The WTO also enshrines the ideals of liberal trade by denouncing trade barriers of all kinds and pursuing open exchange. And the WTO establishes, by consensus, the rules of the road that allow countries large and small to compete in a mostly fair and equitable environment. These are public international rules that neither China nor the United States could establish and enforce on their own.

 

August 26, 2020 in Colleen Baker, International Law | Permalink | Comments (0)

Wednesday, August 5, 2020

ALSB International Section Meeting and Ralph Bunche Award for Best International Paper

The Academy of Legal Studies in Business is in the midst of its annual conference.  And, not surprisingly, it’s completely online.  Although we aren’t able to meet in person this year, the event has been a really great, remarkably smooth experience.  Pre-pandemic, the Program Chair, Professor Robert Bird, at the University of Connecticut School of Business, presciently selected the theme of “Managing Disruption.”

For me, one highlight of the conference thus far has been the opportunity to hear guest speaker Lee Buchheit’s remarks to the ALSB’s International Section on the “State of the Art of Sovereign Debt Restructuring.”  Buchheit is arguably the world’s leading expert on sovereign debt restructuring.  As an FT Alphaville piece put it: Buchheit “has represented nearly every country that has gone bankrupt since the 1980s, sparring with aggrieved creditors and cajoling stricken governments back to fiscal health — and in the process almost single-handedly building up an entire field of international law.”  He didn’t disappoint, giving us a fascinating overview of the major disruption the pandemic is causing in the sovereign debt arena, and the likely challenges that lie ahead, including the risk of a systemic sovereign debt crisis such as happened in the 1980s.  For readers interested in learning more about Buchheit’s perspectives on the impending issues in sovereign debt markets, a few places to start are here and here.

Afterwards, the International Section elected a new officer, Professor Justin Evans, to serve the Section, along with Professor Kevin Fandl (President) and myself (Vice-President).  A total, but quick, fun digression: Fandl has led several faculty development trips in international business to Chile to study innovation in Chile focused on wine.  Watch out for the next iteration! 

Our Section meeting was followed by presentations for the ALSB Ralph Bunche Award for Best International Paper.  This Award aims to recognize excellent, unpublished research in the area of international business law.  There were many exceptional submissions, and it was difficult to select the finalists.  Professor Abbey Stemler presented Regulation of Sharing Economy Platforms: A Multi-Country Comparative StudyProfessors Brian Feinstein and Kevin Werbach discussed The Impact of Regulation on Global Cryptocurrency Trading (here).  Professor Tim Samples, the winner of the Award for 2020, spoke about Investment Disputes and Federal Power in Foreign Relations (here).

Finally, I want to send a big THANK YOU to outgoing President Professor Stephen Park!  With his tireless work for, and commitment to, the Section, he did a great job of modeling for future officers excellence in this role.         

August 5, 2020 in Colleen Baker, Conferences, International Business, International Law | Permalink | Comments (0)

Friday, August 23, 2019

UN Forum on Business and Human Rights- Nov. 25-27. Registration Open

I had planned to write about the Statement on the Purpose of a Corporation signed by 200 top CEOs. If you read this blog, you've likely read the coverage and the varying opinions. I'm still reading the various blog posts, statements by NGOs, and 10-Ks of some of the largest companies so that I can gather my thoughts. In the meantime, many of these same companies  will be at the UN Forum on Business and Human Rights touting their records. I've been to the Forum several times, and it's worth the trip. If you're interested in joining over 2,000 people, including representatives from many of the signatories of the Statement, see below. You can register here:

The UN annual Forum on Business and Human Rights is the global platform for stock-taking and lesson-sharing on efforts to move the UN Guiding Principles on Business and Human Rights from paper to practice. As the world’s foremost gathering in this area, it provides a unique space for dialogue between governments, business, civil society, affected groups and international organizations on trends, challenges and good practices in preventing and addressing business-related human rights impacts. The first Forum was held in 2012. It attracts more than 2,000 experts, practitioners and leaders for three days of an action- and solution-oriented dialogue.The Forum was established by the UN Human Rights Council in 2011  “to discuss trends and challenges in the implementation of the Guiding Principles and promote dialogue and cooperation on issues linked to business and human rights, including challenges faced in particular sectors, operational environments or in relation to specific rights or groups, as well as identifying good practices” (resolution 17/4, paragraph 12).

The Forum addresses all three pillars of the Guiding Principles:

    • The State duty to protect against human rights abuses by third parties, including business, through appropriate policies, regulation and adjudication;
    • The corporate responsibility to respect human rights, which means to avoid infringing on the rights of others and to address adverse impacts with which a business is involved; and
    • The need for access to effective remedy for rights-holders when abuse has occurred, through both judicial and non-judicial grievance mechanisms

The Forum is guided and chaired by the UN Working Group on Business and Human Rights and organized by its Secretariat at the Office of the UN High Commissioner for Human Rights (OHCHR).

If you have any questions about the value of attending the Forum, feel free to reach out to me at [email protected]

August 23, 2019 in Conferences, Corporate Personality, Corporations, CSR, Current Affairs, Human Rights, International Business, International Law, Marcia Narine Weldon, Shareholders, Social Enterprise | Permalink | Comments (0)

Monday, February 4, 2019

Summer Opportunity for Business Law Students - Hofstra Law

This from our friend Heather Johnson at Hofstra Law:

This May and June, Hofstra Law will offer a three-credit or five-credit study abroad program on International Financial Crimes and Global Data Regulation. Both programs will begin Sunday, May 19; the three-credit program will conclude on June 1, 2019 and the five-credit program will conclude on June 13, 2019. The courses will be taught by Hofstra University School of Law Professor Scott Colesanti and Professor Giovanni Comande from the Scuola Superiore Sant’Anna.

It will be held in Pisa, Italy, and is co-sponsored by the Scuola Superiore Sant’Anna. This year, we have added a dinner with the Dean of our Law School, Gail Prudenti and an excursion to Milan to visit the Borsa headquarters!

The deadline is Friday, March 29, 2019 — those interested should apply as soon as possible!

The course is open to law students around the country; students must have completed their full-time 1L course work by the start of this program. Attached to this e-mail you’ll find the up-to-date application, a poster about the program as well as the tentative schedule. Interested students should apply by AS SOON AS POSSIBLE.

Students joining us from other universities should have these credits verified to transfer to your home institution, submit a letter of good standing to our office and work with financial services to complete a consortium agreement. Feel free to reach out to me with any questions regarding the above information.

Warmly,

Heather Johnson

Heather N. Johnson, M.A. International Education
Assistant Director of International Programs and Student Affairs Coordinator
Maurice A. Deane School of Law at Hofstra University
121 Hofstra University, Suite 203 | Hempstead, NY 11549
[email protected] | Phone: (516) 463-0417 |Fax: (516) 463-4710

HofstraLaw

Sounds like a great opportunity for the right student.  Contact Heather for more information.

February 4, 2019 in International Business, International Law, Joan Heminway, White Collar Crime | Permalink | Comments (0)

Friday, December 7, 2018

Do Investors Really Care About Environmental, Social, and Governance Factors?

In January 2018, Larry Fink of Blackrock, the world’s largest asset manager, shocked skeptics like me when he told CEOs:

In the current environment, these stakeholders are demanding that companies exercise leadership on a broader range of issues. And they are right to: a company’s ability to manage environmental, social, and governance matters demonstrates the leadership and good governance that is so essential to sustainable growth, which is why we are increasingly integrating these issues into our investment process. Companies must ask themselves: What role do we play in the community? How are we managing our impact on the environment? Are we working to create a diverse workforce? Are we adapting to technological change? Are we providing the retraining and opportunities that our employees and our business will need to adjust to an increasingly automated world? Are we using behavioral finance and other tools to prepare workers for retirement, so that they invest in a way that will help them achieve their goals?

In October 2018, Blackrock declared, “sustainable investing is becoming mainstream investing.” The firm bundled six existing ESG EFT funds and launched six similar funds in Europe and looked like the model corporate citisen.

So does Blackrock actually divest from companies with human rights violations or that do not provide meaningful disclosures on human trafficking, child slavery, forced labor, or conflict minerals? The company did not publicly divest from gun manufacturers although it did “speak with” them in February after the Parkland school shooting; the company has stated that due to fiduciary concerns, it cannot divest from single companies in a portfolio. 

In theory, a behemoth like Blackrock could have a significant impact on a firm’s ESG practices, if it so chose. It could set an example for companies and for other institutional investors by seeking (1) additional information after reviewing disclosures and/or (2) demanding changes in management if companies did not in fact, show a true commitment to ESG.

But I shouldn’t pick on Blackrock. Based on what I heard last week in Geneva at the UN Forum on Business and Human Rights, other investors outside of the SRI arena aren’t pressuring companies either.  I attended the Forum for the fourth time with over 2,000 members from the business, NGO, civil society, academic, and governmental communities. There was a heavy focus this year on supply chain issues because 80% of the world’s goods travel through large, international companies.The Responsible Business Alliance and others stressed the importance of eradiating forced labor. Apple, Google, Microsoft, Intel, and Amnesty International focused on tech companies, artificial intelligence, and human rights implications. Rio Tinto and Nestle allowed an NGO to publicly criticize their disclosure reports in painstaking detail. An activist told the entire plenary that states needed to stop killing human rights defenders. In other words, business as usual at the Forum. Here are some of the takeaways from some of the sessions:

  1. NGO PODER warned that investors should not divest when companies are not living up to their responsibilities  but instead should engage companies on ESG factors and demand board seats.
  2. The UN Working Group on Business and Human Rights observed that rating agencies can and should be a fast track to the board on ESG issues. 
  3. A representative from the Sustainable Stock Exchanges Initiative, a joint initiative of UNCTAD, PRI, the UN Global Compact, and UNEP-FI, indicated that investors want to know if ESG information is material. It may be salient, but not material to some. 79 stock exchanges around the world have partnered with the SSEI. 39 have voluntary ESG disclosures and 16 have mandatory disclosures.
  4. The Business and Human Rights Resources Center noted that of 7,200 corporate statements mandated by the UK Modern Slavery Act, only 25% met the minimum requirements required by law. As they shocked the audience with this statistic, news alerts went out the Australia had finally passed its own anti slavery law.
  5. 40% of companies in apparel, agricultural, and extractive industries have a 0 (zero) score for human rights due diligence, indicating weak implementation of the UN Guiding Principles on Business and Human Rights. The average score in the benchmark was only 27%.
  6. French companies must respond to the French Duty of Vigilance Law and the EU Nonfinancial Disclosure regulations, which have different approached to identifying risks. It could take six months to do an audit to do the disclosure, but investors rarely question the companies directly or the data. 
  7. SAP Ariba found that 66% of consumers believe they have a duty to buy goods that are good for society and the environment and that sustainability is mostly driven by millennials and generation Z consumers. 
  8. Nestle, the biggest food and beverage company in the world, requires its 165,000 suppliers to follow responsible sourcing standard especially for child and forced labor. The conglomerate partners with NGOs to conduct human rights impact assessments for their upstream suppliers. 
  9. Apple has returned 30 million USD in recruitment fees to workers since 2008 to address forced labor and illegal practices. HP has also returned fees. The hotel industry has banded together to fight forced labor. Most responsible businesses have banned the use of recruitment fees but many workers still pay them to personnel agencies in the hopes of getting jobs with large companies. 
  10. Many companies are now looking at human rights and ESG issues throughout their own supply chains but also with their joint venture, merger, and other key business partners.
  11. Rae Lindsay of Clifford Chance noted that avoiding legal risk is not the main role of human rights due diligence but lawyers working across disciplines can make sure that clients don’t inadvertently add to legal risk in deals. She encourages deal lawyers to become familiar with the risks and law and business students to learn about these issues. 

So do investors care about ESG? Are these disclosure rules working? You wouldn’t think so by hearing the speakers at the Forum. On the other hand, proxy advisory firm ISS recently launched an Environmental and Social Quality Score to better evaluate the ESG risks in its portfolio companies. I’ll keep an eye out for any divestments or shareholder proposals. 

I’m not holding my breath for too much progress next year at the Forum. While I was encouraged by the good work of many of the companies that attended, I remain convinced that the disclosure regime is ineffective in effectuating meaningful change in the world’s most vulnerable communities. Unless governments, rating agencies, investors, or consumers act, too many companies will continue to pay lip service to their human rights commitments.  

 

 

 

December 7, 2018 in Compliance, Conferences, Corporate Governance, Corporations, CSR, Current Affairs, Human Rights, International Business, International Law, Marcia Narine Weldon, Shareholders | Permalink | Comments (1)

Sunday, October 21, 2018

5th Conference of the French Academy of Legal Studies in Business - June 20-21 - Paris

5th Conference of the French Academy of Legal Studies in Business (Association Française Droit et Management)

June 20 and 21, 2019 – emlyon - Paris Campus

CALL FOR PAPERS 2019 Social Issues in Firms

Social issues and fundamental rights occupy an increasingly important space in the governance of today’s companies. Private enterprises assume an increasingly active role not only in a given economy but also in society as a whole. Firms become themselves citizens. They recognize and support civic engagement by the men and women who work for them. Historically, the role of the modern firm that resulted from the Industrial Revolution has been torn between two opposing viewpoints.

[More information under the break.]

Continue reading

October 21, 2018 in Business Associations, Business School, Call for Papers, Conferences, Corporate Governance, Corporations, Ethics, Haskell Murray, International Business, International Law, Management, Research/Scholarhip | Permalink | Comments (0)

Saturday, October 13, 2018

Has the Dodd-Frank Conflict Minerals Rule Really Made a Difference and is Blockchain The Answer?

Last week Dr. Denis Mukwege won the Nobel Peace Prize for his work on gender-based violence in the Democratic Republic of Congo (DRC). This short video interview describes what I saw when I went to DRC in 2011 to research the newly-enacted Dodd-Frank disclosure rule and to do the legwork for a non-profit that teaches midwives ways to deliver babies safely. For those unfamiliar with the legislation, U.S. issuers must disclose the efforts they have made to track and trace tin, tungsten, tantalum, and gold from the DRC and nine surrounding countries. Rebels and warlords control many of the mines by controlling the villages. DRC is one of the poorest nations in the world per capita but has an estimated $25 trillion in mineral reserves (including 65% of the world's cobalt). Armed militia use rape and violence as a weapon of war in part so that they control the mineral wealth. 

The stated purpose of the Dodd-Frank rule was to help end the violence in DRC and to name and shame companies that do not disclose or that cannot certify that their goods are DRC-conflict free (although that labeling portion of the law was struck down on First Amendment grounds). I  wrote a law review article in 2013 and co-filed an amicus brief during the litigation arguing that the law would not help people on the ground. I have also blogged here about legislation to end the rulehere about the EU's version of the rulehere about the differences between the EU and US rule, and half a dozen times since 2013.

I had the honor of meeting Dr. Mukwege in 2011, who at the time did not support the conflict minerals legislation. He has since endorsed such legislation for the EU. During our trip, we met dozens of women who had been raped, often by gangs. On our way to meet midwives and survivors of a massacre, I saw five corpses of villagers lying in the street. They were slain by rebels the night before. I saw children mining gold from a river with armed soldiers only a few feet away.  That trip is the reason that I study, write, and teach about business and human rights. I had only been in academia for three weeks when I went to DRC, and I decided that my understanding of supply chains and corporate governance from my past in-house life could help others develop more practical solutions to intractable problems. I believed then and I believe now that using a corporate governance disclosure to solve a human rights crisis is a flawed and incomplete solution. It depends on the belief that large numbers of consumers will boycott companies that do not do enough for human rights. 

What does the data say about compliance with the rule? The General Accounting Office puts out a mandatory report annually on the legislation and the state of disclosures. According to the 2018 report:

Similar to the prior 2 years, almost all companies required to conduct due diligence, as a result of their country-of-origin inquiries, reported doing so. After conducting due diligence to determine the source and chain of custody of any conflict minerals used, an estimated 37 percent of these companies reported in 2017 that they were able to determine that their conflict minerals came from covered countries or from scrap or recycled sources, compared with 39 and 23 percent in 2016 and 2015, respectively. Four companies in GAO’s sample declared their products “DRC conflict-free,” and of those, three included the required Independent Private Sector Audit report (IPSA), and one did not. In 2017, 16 companies filed an IPSA; 19 did so in 2016. (emphasis added).

But what about the effect on forced labor and rape? The 2017 GAO Report indicated that in 2016, a study in DRC estimated that 32 percent of women and 33 percent of men in these areas had been exposed to some form of sexual and gender-based violence in their lifetime. Notably, just last month, a coalition of Congolese civil society organizations wrote the following to the United Nations seeking a country-wide monitoring system:

... Armed groups and security forces have attacked civilians in many parts of the country...Today, some 4.5 million Congolese are displaced from their homes. More than 100,000 Congolese have fled abroad since January 2018, raising the risk of increased regional instability... Since early this year, violence intensified in various parts of northeastern Congo’s Ituri province, with terrifying incidents of massacres, rapes, and decapitation. Armed groups launched deadly attacks on villages, killing scores of civilians, torching hundreds of homes, and displacing an estimated 350,000 people. Armed groups and security forces in the Kivu provinces also continue to attack civilians. According to the Kivu Security Tracker, assailants, including state security forces, killed more than 580 civilians and abducted at least 940 others in North and South Kivu since January 2018. (emphasis added)

The U.S. government provides $500 million in aid to the DRC and runs an app called Sweat and Toil for people who are interested in avoiding goods produced by exploited labor. As of today, DRC has seven goods produced with exploitative labor: cobalt (used in electric cars and cell phones), copper, diamonds, and, not surprisingly, tin, tungsten, tantalum, and gold- the four minerals regulated by Dodd-Frank. The app notes that "for the second year in a row, labor inspectors have failed to conduct any worksite inspections... and [the] government also separated as many as 2,360 children from armed groups...[t]here were numerous reports of ongoing collaboration between members of the [DRC] Armed Forces and non-state armed groups known for recruiting children... The Armed Forces carried out extrajudicial killings of civilians including children, due to their perceived support or affiliation with non-state armed groups. .."

For these reasons, I continue to ask whether the conflict minerals legislation has made a difference in the lives of the people on the ground. The EU, learning from Dodd-Frank's flaws, has passed its own legislation, which goes into effect in 2021.  The EU law applies beyond the Democratic Republic of Congo and defines conflict areas as those in a state of armed conflict, or fragile post-conflict area, areas with weak or nonexistent governance and security such as failed states, and any state with a widespread or systematic violation of international law including human rights abuses. Certain European Union importers will have to identify and address the actual potential risks linked to conflict-affected areas or high-risk areas during the due diligence of their supply chains. 

Notwithstanding the statistics above, many investors, NGOs, and other advocates believe the Dodd-Frank rule makes sense. A coalition of investors with 50 trillion worth of assets under management has pushed to keep the law in place. It's no surprise then that many issuers have said that they would continue the due diligence even if the law were repealed. I doubt that will help people in these countries, but the due diligence does help drive out inefficiencies and optimize supply chains.

Stay tuned for my upcoming article in UT's business law journal, Transactions, where I will discuss how companies and state actors are using blockchain technology for due diligence related to human rights. Blockchain will minimize expenses and time for these disclosure requirements, but it probably won't stop the forced labor, exploitation, rapes, and massacres that continue in the Democratic Republic of Congo. (See here for a Fortune magazine article with a great video discussing how and why companies are exploring blockchain's uses in DRC). The blockchain technology won't be the problem-- it's already being used for tracing conflict diamonds. The problem is using the technology in a state with such lawlessness. This means that blockchain will probably help companies, but not the people the laws are meant to protect. 

 

 

 

 

 

 

 

 

 

October 13, 2018 in Compliance, Corporate Governance, Corporations, CSR, Current Affairs, Human Rights, International Business, International Law, Legislation, Marcia Narine Weldon, Securities Regulation | Permalink | Comments (1)

Monday, July 30, 2018

日本からのご挨拶 - My Japanese Adventure

Hello to all from Tokyo, Japan (Honshu).  I have been in Japan for almost a week to present at and attend the 20th General Congress of the International Academy of Comparative Law (IACL), which was held last week in Fukuoka, Japan (Kyushu).  By the time you read this, I will be on my way home.

Fukuoka(Me+Sign)

As it turns out, I was at the Congress with old business law friends Hannah Buxbaum (Indiana Maurer Law), Felix Chang (Cincinnati Law), and Frank Gevurtz (McGeorge Law), as well as erstwhile SEALS buddy Eugene Mazo (Rutgers Law).  I also met super new academic friends from all over the world, including several from the United States.  I attended all of the business law programs after my arrival (I missed the first day due to my travel schedule) and a number of sessions on general comparative and cross-border legal matters.  All of that is too much to write about here, but I will give you a slice.

I spoke on the legal regulation of crowdfunding as the National Rapporteur for the United States.  My written contribution to the project, which I am told will be part of a published volume, is on SSRN here.  The entire project consists of eighteen papers from around the world, each of which responded to the same series of prompts conveyed to us by the General Rapporteur for the project (in our case, Caroline Kleiner from the University of Strasbourg).  The General Rapporteur is charged with consolidating the information and observations from the national reports and synthesizing key take-aways.  I do not envy her job!  The importance of the U.S. law and market to the global phenomenon is well illustrated by this slide from Caroline's summary.

Fukuoka(GlobalCrowdfundingSlide)

The Congress was different from other international crowdfunding events at which I have presented my work.  The diversity of the audience--in terms of the number of countries and legal specialties represented--was significantly greater than in any other international academic forum at which I have presented.  Our panel of National Rapporteurs also was a bit more diverse and different than what I have experienced elsewhere, including panelists hailing from from Argentina, Brazil, Canada, France, Germany, Poland, and Singapore (in addition to me).  At international conferences focusing on the microfinance aspects of crowdfunding, participants from India and Africa are more prominent.  I expect to say more about the individual national reports on crowdfunding in later posts, as the need or desire arises.

A few outtakes on other sessions follow.

Continue reading

July 30, 2018 in Conferences, Contracts, Corporate Finance, Corporate Governance, Crowdfunding, Current Affairs, International Business, International Law, Joan Heminway, Research/Scholarhip, Securities Regulation, Social Enterprise | Permalink | Comments (0)

Friday, May 4, 2018

Does CSR Really Exist in Latin America? Should Corporations be Treated as Persecutors Under Asylum Law? Is Labor an Extractive Industry? Buy This Book and Find Out

In 2015, I and several academics and other experts traveled to Guatemala as part of the Lat-Crit study space. The main goal of the program was to examine the effect of the extractive industries on indigenous peoples and the environment. During our visit, we met with indigenous peoples, government ministers, the chamber of commerce, labor leaders, activists (some who had received multiple death threats), and village elders.

Our labor of love, From Extraction to Emancipation Development Reimagined, edited by Raquel Aldana and Steve Bender, was released this week. My chapter "Corporate Social Responsibility in Latin America: Fact or Fiction" introduces the book. I first blogged about CSR in the region in 2015 in the context of a number of companies that had touted their records but in fact, had been implicated in environmental degradation and even murder. Over the past few years, one of the companies I blogged about, Tahoe Resources, has been sued in Canada for human rights violations, the Norwegian pension fund has divested, and shareholders have filed a class action based on allegations re: the rights of indigenous people.

Although the whole book should be of interest to business law professors and practitioners, chapters of particular interest include a discussion of the environment and financial institutionsthe Central American experience with investor protections under CAFTA, whether corporations should be treated as persecutors under asylum law, climate adaptation and climate justice, the impact of mining on self-determination, environmental impact assessments, and labor as an extractive industry.

Other chapters that don't tie directly to business also deserve mention including my mentor Lauren Gilbert's closing chapter on gender violence, state actions, and power and control in the Northern Triangle, and other chapters on the right to water and sanitation in Central America, community-based biomonitoring, and managing deforestation.

We encourage you to buy the book and to invite the chapter authors to your institutions to present (shameless plug for panels, but we would love to share what we have learned). 

 

May 4, 2018 in Conferences, CSR, Current Affairs, Human Rights, International Law, Marcia Narine Weldon, Research/Scholarhip, Writing | Permalink | Comments (0)

Tuesday, March 27, 2018

Larry Catá Backer: Theorizing Regulatory Governance Within Its Ecology

International law is usually not my thing (only in a few instances), but it's definitely Larry Catá Backer's thing.  He has a new article out that may be of interest. If it's your thing, I recommend checking it out. He knows his stuff. 

"Theorizing regulatory governance within its ecology: the structure of management in an age of globalization,"  
Larry Catá Backer
Contemporary Politics 24(3):-- (2018)

Abstract: This article examines regulatory governance (‘RG’) within its own ecology. It considers RG as an ideology of governance, as its own set of techniques to that end, and as a methodology andpsychology of the relations of regulatory organisms to one another and to their context. The object is first to chart the structures and modalities of this ecology, and second to understand the properties that makes RG both coherent (singularly as the method of regulating a field, as the framework for the use of RG techniques, and as an ideology of governance), and structural (as a means of structuring regulation as an exercise of ordering power. After a brief introduction, the article introduces the regulatory context through a close reading of the operation of global garment supply chains in  Bangladesh, examining RG in action within the ecology of global production. It then theorizes the meta structures of RG within this ecology as a mechanics for governance within institutions, and as an ideology for ordering systems of governance among institutions.
For more on his piece, check out the introduction here.  

March 27, 2018 in International Law, Joshua P. Fershee | Permalink | Comments (0)

Monday, March 26, 2018

Teaching Corporate Law Globally - Recommended Text

I am committed to introducing my business law students to business law doctrine and policy both domestically and internationally.  The Business Associations text that I coauthored has comparative legal observations in most chapters.  I have taught Cross-Border Mergers & Acquisitions with a group of colleagues and will soon be publishing a book we have coauthored.  And I taught comparative business law courses for four years in study abroad programs in Brazil and the UK.  

In the study abroad programs, I struggled in finding suitable texts, cobbling together several relatively small paperbacks and adding some web-available materials.  The result was suboptimal.  I yearned for a single suitable text.  In my view, texts for study abroad courses should be paperback and cover all of the basics in the field in a succinct fashion, allowing for easy portability and both healthy discussion to fill gaps and customization, as needed, to suit the instructor's teaching and learning objectives.

And so it was with some excitement--but also some healthy natural skepticism--that I requested a review copy of Corporations: A Comparative Perspective (International Edition), coauthored by my long-time friend Marco Ventoruzzo (Bocconi and Penn State) and five others (all scholars from outside the United States), and published by West Academic Publishing.  I am pleased to say that if/when I teach international and comparative corporate governance and finance (especially in Europe) in the future, I will/would assign this book.  It is a paperback text that, despite its 530 pages, is both reasonably comprehensive and manageable.

The book is divided into ten chapters, starting with basic "building blocks" of comparative corporate law and ending (before some brief final thoughts) with unsolicited business combinations.  U.S. law is, for the most part, the centerpiece of the chapters, which consist principally of original text, cases, statutes, law journal article excerpts, and (in certain circumstances) helpful diagrams.  The methodological introduction, which I found quite helpful and user-friendly, notes that the coauthors "often (not always) start our analysis with the U.S. perspective."  (xxvi)  Yet, despite the anchoring use of U.S. law throughout the book, it somehow has a very European feel.  The coauthors note the emphasis on "U.S., U.K., major European continental civil law systems (France, Germany, Italy) and European Union law, and Japan," (id.) but my observation is that the words and phrasing also have a European flair.  Of course, this is unsurprising, given that all but one of the coauthors hail from European universities.  I note this without praise or criticism, but I mention it so others can assess its impact in their own teaching environments.

I recommend that those teaching in study abroad (or other courses focusing on comparative corporate law) review a copy of this book.  I will look forward to teaching from it the next time I need an international or comparative law teaching text for use in or outside the United States.

March 26, 2018 in Business Associations, Comparative Law, Corporate Finance, Corporate Governance, Corporations, International Business, International Law, Joan Heminway, Teaching | Permalink | Comments (0)

Thursday, December 21, 2017

Trump, Trade, and Human Rights

Earlier this week, President Trump gave his annual speech on national security. As in the past, he failed to stress human rights (unlike his predecessors) but did allude to cooperation, even with China and Russia, when warranted by geopolitical interests. Over the last several months, he has touted bilateral trade agreements. Coincidentally, my latest law review article on a potential bilateral investment treaty with Cuba came out the same day. As you may recall, Trump recently reversed some Obama-era policies on Cuba over human rights. My article may help his administration reconcile some of the apparent contradictions in his policies. The abstract is below. 

You Say Embargo, I Say Bloqueo—A Policy Recommendation for Promoting Foreign Direct Investment and Safeguarding Human Rights In Cuba

The United States is the only major industrialized nation that restricts
trade with Cuba. Although President Obama issued several executive orders
that have facilitated limited trade (and President Trump has scaled some
back), an embargo remains in place, and by law, Congress cannot lift it until,
among other things, the Cuban government commits to democratization and
human rights reform. Unfortunately, the Cuban and U.S. governments
fundamentally disagree on the definition of “human rights,” and neither side
has shown a willingness to compromise. Meanwhile, although some U.S.
investors clamor to join their European and Canadian counterparts in
expanding operations in Cuba, many have an understandable concern
regarding the rule of law and expropriation in a communist country. Bilateral
investment treaties aim to address those concerns.

After discussing the legal and political barriers to lifting the embargo, I
propose a partial solution to the stalemate on human rights, which will: (1)
facilitate foreign direct investment in Cuba; (2) protect investor interests
through a bilateral investment treaty; and (3) require an examination of
human rights impacts on the lives of Cuban citizens before investors can 
receive the protection of the treaty. 

Specifically, I recommend the inclusion of human rights clauses in bilateral 
investment treaties (BITs) and investor-state dispute mechanisms as a condition precedent 
to lifting the embargo. My solution also requires “clean hands” so that investors seeking relief must
provide proof that their business interests have not exacerbated or been
complicit in human rights abuses, rebut claims from stakeholders that their
business interests have not exacerbated or been complicit in human rights
abuses, or both. Finally, I propose revisions to the 2016 U.S. National Action
Plan on Responsible Business Conduct to incorporate human rights
requirements in future BITs and other investment vehicles going forward.

Anyone with connections to Rex Tillerson is free to pass it on. Happy Holidays to all.

 

December 21, 2017 in Current Affairs, Human Rights, International Business, International Law, Law Reviews, Marcia Narine Weldon | Permalink | Comments (0)

Wednesday, November 8, 2017

Martin: Hiding in the Light: The Misuse of Disclosure to Advance a Business and Human Rights Agenda

My friend and colleague at West Virginia University, Jena Martin, has posted her new paper, Hiding in the Light: The Misuse of Disclosure to Advance a Business and Human Rights Agenda. The paper is forthcoming in the Columbia Journal of Transnational Law and can be accessed at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3028826 

It's worth a read. Here's the abstract:

In June 2017, Waitrose, a top UK supermarket, pulled its cans of corned beef off the shelves after an investigation revealed that the meat might have been produced with slave labor. At the time of the recall, Waitrose was in compliance with the UK Modern Slavery Act (MSA), a 2015 law enacted to prevent human trafficking and modern-day slavery. Under the MSA, corporations are required to file annual reports disclosing what action they had taken to eradicate slavery and human trafficking in their supply chains. The Modern Slavery Act, in turn, was a much-lauded law that is part of the growing trend of States to move the international business and human rights agenda forward. A key component of that agenda involves disseminating the UN’s Protect, Respect and Remedy Framework and implementing the UN Guiding Principles, which have been praised by States around the world as a framing mechanism for issues of corporate accountability for negative human rights impacts in a corporation’s operations and relationships with its suppliers.

The aim of this article is to analyze whether the business and human rights agenda (as embodied by the Three Pillar Framework and UN Guiding Principles) is well served with national laws that focus on disclosure. The article will focus primarily on rules being implemented in the United States at both the subnational and national level, however, it will also discuss approaches being used in European jurisdictions such as the United Kingdom and France and the overall trend towards a transparency model for human rights protection from business activities. The increased use of disclosure-based regulation (and the resulting compliance efforts by corporations) seems to come, at least in part, as a result of the efforts by States to address the duties laid out for them in the UN Guiding Principles. As such, it seems appropriate to undertake an analysis regarding whether these laws are in fact effective at implementing the Guiding Principles.

For decades now, disclosure has been held out as the ultimate curative for every corporate woe. The expansion of disclosure initiatives from mere investment-related issues to increasingly social policy issues would indicate that this trend will continue. Yet as this article demonstrates, disclosure to right now is at best a temporary stop gap measure that can lead to limited corporate change on the issue of business and human rights. At worst, disclosure is being used by corporations as a way to obtain a reputational advantage without actually making substantive changes – by simply hiding in the light.

November 8, 2017 in Corporations, Ethics, International Business, International Law, Joshua P. Fershee | Permalink | Comments (2)

Thursday, October 19, 2017

Faculty Development Opportunity -- Business Innovation in Chile: A Case Study of the Wine Export Sector

If you're a fan of wine (I am) and international business if of interest (it is), this Faculty Development might be for you.  It overlaps with the AALS Annual Meeting, so it won't work for me this year, but it looks like a good program.  Have a look: 

Temple University’s Center for International Business Education and Research (CIBER) presents

Faculty Development in International Business: Santiago, Chile (January 5-11, 2018)

Business Innovation in Chile: A Case Study of the Wine Export Sector

Leave winter behind this January and join us for a summer experience in Chilean wine country. As an innovation-driven economy, the United States prides itself on developing and delivering innovative goods and services domestically and globally through high-tech exports, creative branding, and in-demand services. Among those exports is our growing wine sector, led by Napa Valley but recently expanding into other parts of California, Oregon, Virginia, and other lesser-known wine producing regions of the United States. Despite this expansion, the United States remains behind old world wine producers in Europe. Chile and Australia also outpace the United States in terms of wine exports and have been leading the way in innovative production and marketing techniques.

On this faculty/professional-oriented immersion experience, participants will visit a number of innovative businesses in the wine export sector and related industries in Chile to better understand how innovation in a highly-regulated sector can disrupt the traditional approaches taken by Old World producers in Europe and provide a comparative advantage for modern producers.

Some of the key learning outcomes on this immersion include:

  • An understanding of how innovation is utilized to drive growth in emerging markets;
  • A comparative perspective of an innovative sector active in the home and target market;
  • A better sense of the supply chain for a commodity such as wine and how innovation can accelerate movement along that supply chain and;
  • Tools that can be used to leverage enhancements in innovation for U.S. exporters.

The immersion experience is being led by Fox School of Business Assistant Professor, Dr. Kevin Fandl, a Latin America specialist with deep knowledge of the region. Dr. Fandl’s research emphasizes the relationship between law, policy, and business in global markets. He takes his extensive experience at senior levels of federal government policymaking to the marketplace by examining how laws and regulations drive or inhibit innovation and business opportunity. His knowledge of Chile, as well as the wine industry, add significant academic value to this immersion experience.

Program Fee: $2,700 per person (fee includes: hotel accommodations, corporate visits, cultural activities, some meals, visits to Chilean Vineyards, and in-country transportation)

Deposit:  A $500 non-refundable deposit is due at initial time of registration. Final payment will be due on October 27, 2017. To register: https://noncredit.temple.edu/templeciberfdib

Space is limited. A guest package is also available.

For questions or additional information, please contact Lauren Letko at [email protected]

October 19, 2017 in Conferences, Food and Drink, International Business, International Law, Joshua P. Fershee, Travel | Permalink | Comments (0)

Thursday, August 10, 2017

University of Nebraska College of Law - Tenured/Chaired Position in International Trade and Finance

From an e-mail I received this week:

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The UNIVERSITY OF NEBRASKA COLLEGE OF LAW invites applications for lateral candidates for a tenured faculty position to hold the Clayton K. Yeutter Chair at the College of Law. This chaired faculty position will be one of four faculty members to form the core of the newly-formed, interdisciplinary Clayton K. Yeutter Institute for International Trade and Finance. The Institute also will include the Duane Acklie Chair at the College of Business, the Michael Yanney Chair at the College of Agriculture and Natural Resources, and the Haggart/Works Professorship for International Trade at the College of Law. The Yeutter Chair, along with the other three professors, will be expected to support the work and objectives and ensure the success of the Yeutter Institute. The Yeutter Chair will teach courses at the College of Law, including International Finance. Other courses may include Corporate Finance and/or other classes related to business and finance. More on the Yeutter Institute can be found at http://news.unl.edu/free-tags/clayton-k-yeutter-institute-of-international-trade-and-finance/.

Minimum Required Qualifications: J.D Degree or Equivalent; Superior Academic Record; Outstanding Record of Scholarship in International Finance and/or other areas related to international business; and Receipt of Tenure at an Accredited Law School. General information about the Law College is available at http://law.unl.edu/. Please fill out the University application, which can be found at https://employment.unl.edu/postings/51633, and upload a CV, a cover letter, and a list of references. The University of Nebraska-Lincoln is committed to a pluralistic campus community through affirmative action, equal opportunity, work-life balance, and dual careers. See http://www.unl.edu/equity/notice-nondiscrimination. Review of applications will begin on September 15, 2017 and continue until the position is filled. If you have questions, please contact Associate Dean Eric Berger or Professor Matt Schaefer at [email protected].

August 10, 2017 in Financial Markets, Haskell Murray, International Business, International Law, Jobs, Law School | Permalink | Comments (0)