As Myanmar opens for business, how can companies ensure they hear from potentially affected people?
May 2013 | Anna Triponel
In 2011, the government of Myanmar, led by President Thein Sein, initiated a number of political and economic reforms to open the country up to the outside world. Last month, the European Union lifted all sanctions (except for an arms embargo) against Myanmar. Yet the very same day – April 22 – Human Rights Watch issued a report alleging that crimes against humanity have been committed by the Myanmar authorities against Rohingya Muslims in the west of the country.
This illustrates the challenges companies are faced with as they seek to expand operations into Myanmar: while a wealth of business opportunities have become available, the country has a lingering history of severe human rights abuse.
Myanmar has vast natural resources, from oil and gas, coal, minerals and gemstones to arable land, forest products and freshwater and marine resources. It is strategically placed in the region of the Association of South East Asian Nations (ASEAN), with neighboring countries such as China, India and Thailand that are on a rapid path of development. It has untapped market potential, with a population of an estimated 60 million individuals, most of whom lack access to reliable electricity, financial services, and cell phone and internet connection. And it has a young labor force that is eager to work and compete with Myanmar’s neighboring countries.
Recent economic and political reforms in Myanmar have enabled a large number of companies to begin, or consider, operating in Myanmar. Monopolies – for instance, in vehicles and telecommunications – have been dismantled; new laws on labor, land, peaceful assembly, foreign direct investment, and special economic zones have been passed; restrictions on the media have been relaxed; and opposition political parties have been allowed to run in the 2012 parliamentary by-elections. In parallel, a number of countries, including the United States, those in the European Union, Australia, Norway and Switzerland, have eased their restrictions on doing business in Myanmar.
Yet Myanmar has been governed by successive authoritarian military regimes since 1962, each characterized by extensive human rights violations, weak rule of law and corruption. Decades of warfare in Myanmar’s ethnic states – where most of the country’s abundant natural resources are located – have brought with them numerous human rights abuses, including forced labor, rape, torture, extrajudicial killings, the use of child soldiers and the laying of mines; and have uprooted a large number of families from their homes. The border areas have been the scene of illicit drug production, widespread prostitution, and an alarming spread of HIV/AIDS. Although a number of ceasefire agreements have been signed, active fighting and violence continues in some areas of the country.
In this context, companies entering Myanmar face significant risks of causing, contributing to, or being linked to negative human rights impacts in Myanmar. They will need to identify and address these risks before they begin operations in Myanmar, and on an on-going basis thereafter. The UN Guiding Principles on Business and Human Rights (the “Guiding Principles”), developed by Professor John Ruggie – Shift’s Chair and former UN Special Representative on Business and Human Rights – provide guidance to companies on how to proceed. They underline the essential role of meaningful consultation with potentially affected groups, particularly in high-risk contexts.
Just as meaningful consultation gains increased importance in high-risk contexts, so too does the complexity involved in structuring such consultations. So what does meaningful stakeholder consultation look like in Myanmar?
To help answer that question, I traveled to Myanmar and the Myanmar/Thai border in January 2013. I conducted community consultations and interviews with representatives of non-governmental organizations and networks, think tanks, and other civil society organizations, as well as entrepreneurs, Embassies and development agencies. In all, I met with over 100 individuals, ranging from the top leadership of the National League for Democracy and the longest-serving political prisoner in Myanmar, to men and women working in sugarcane plantations, bee farms, livestock, basket weaving, steel production, textile production, as well as trading in jade and industry zones. The questions I asked them had two aims: first, to survey stakeholder views on the entry of companies into Myanmar; and second, to identify key considerations for companies when structuring a stakeholder engagement strategy.
Despite the wide disparity in the backgrounds of the people I spoke with, as well as distinctive regional differences within Myanmar, the results of the consultations were surprisingly consistent. A number of recurring themes emerged.
Interviewees have high expectations of the benefits that companies could bring to Myanmar, from building workers’ skills in labor-intensive sectors, to improving working conditions and reducing poverty. They hoped that companies could help ensure that Myanmar’s recent reforms pave the way for a peaceful future, founded on respect for human rights and set higher benchmarks for corporate conduct than those imposed under current laws.
They also feared being taken advantage of as the country opens up. Most had yet to see benefits resulting from the presence of companies spread beyond the companies themselves and a select few Burmese individuals. They expressed a range of specific concerns:
a) That the government would use ceasefires as a short-term measure to enable investment into the ethnic states from which they and the military would profit, only to drop negotiations on regional autonomy once they had secured their commercial objectives. Non-Burman ethnic nationals were opposed to business activities in the ethnic states until ceasefire agreements were stable and political dialogue had been achieved;
b) That companies would structure their operations in Myanmar without an accurate understanding of the situation on the ground. Interviewees emphasized how fragile and complex the recent reforms were, and that change had yet to trickle through outside of the larger cities;
c) That corporate activities would spur additional land grabbing, perpetuate low labor standards and contribute to environmental degradation. Other concerns were that new business operations would lead to violent crackdowns against protestors, wipe out small farming businesses, and favor one group of Burmese over others.
Interviewees emphasized that stakeholder consultation in a country emerging from decades of military rule is necessarily complex. In particular:
a) Although a range of civil society organizations exist, and a number of new organizations and networks are emerging, the long history of opposition to the military regime makes the situation especially polarizing. In addition, the civil society scene is shifting considerably: from operating outside to inside of Myanmar; from a service delivery function to a watchdog role; and from engaging with government officials to engaging with company representatives;
b) Interviewees identified a range of stakeholders companies can engage with to assist companies in understanding the specific context in their area of operation, identifying who to speak with, and providing guidance on how to tailor stakeholder engagement so that it is meaningful in that area.
c) Interviewees expected companies to proceed with genuine, meaningful consultation at the grassroots level, and provided suggestions for how companies can do so. These included:
The responses interviewees provided to Shift’s questions are intrinsically linked to Myanmar’s history of human rights abuse and prior experience of corporate engagement. The Burmese are asking companies to lead by example in investing responsibly in their country, and are looking to companies to assist them in ensuring that Myanmar becomes a democratic country which provides economic opportunities to all, regardless of their ethnicity, gender, politics and location. Careful background research, coupled with patience and perseverance, can set the right foundation for meaningful stakeholder consultations in Myanmar. This can in turn help companies meet their commercial objectives while ensuring that they respect the human rights of the Burmese people who are looking forward to a better future.
Shift will be presenting the findings of its report Conducting Meaningful Stakeholder Consultation in Myanmar at a workshop on business and human rights organized by the World Economic Forum in Naypyidaw on June 5, 2013.
As a Senior Associate with Shift, Anna works directly advising companies, lawyers, investors and business associations on how to put the Guiding Principles into practice.