Why an understanding of conflict dynamics still matters for businesses

Over the past 20 years, conventional forms of armed conflict have been in decline. The absence of inter-state or intra-state conflict has, in many places, given way to relative stability. Emerging middle-income economies, keen to capitalise on abundant natural resources, have courted investment from major international companies, and subsequently experienced growth. But in many of these contexts, the absence of armed conflict masks what in fact represents only the illusion of peace. Under the surface, less visible social, political and economic tensions can become manifest in social unrest or cycles of violence that can destabilise development and bring major economic projects to a standstill.

Take South Africa, for example. For the past few years, the country has seen cycles of widespread labour unrest, as workers in the valuable mining sector express their dissatisfaction with stagnant wages and the rising cost of living. The situation is complicated by conflict between different unions, a dynamic that seeps back into the communities in which union members live and generates further hostility. With the police and other government institutions reluctant to get involved, protests frequently descend into violence. Where security forces have responded, it has often been with excessive force and resulted in clashes, injuries and fatalities.

In Peru, social unrest around mining projects manifests in community resistance. In many places, companies are facing violent opposition to mining projects from local, largely indigenous communities. The roots of this opposition are complex, and the dynamics at play are never clear-cut. Often, conflict stems from a lack of consultation by companies, which have failed to recognise the close connection to land held by many indigenous people. Community leaders often approach companies directly as an ‘easy target’, bypassing the government altogether and allowing them to overlook their responsibility for the impact of projects for which they have granted licences. In a legislative environment that is in some instances contradictory to international standards, there are limited official ways for communities to channel their grievances. In these circumstances, resorting to violent confrontation is common.

These are two very different examples. But both highlight the ways in which ‘peaceful’ countries can be sites of less visible conflict that is both destabilising and has the potential to lead to violence. These situations present different challenges to those of more conventional armed conflicts, such as in Colombia, the Philippines and DRC, where organised armed groups are engaged in violent confrontations with the state. Again, however, the boundaries are not so clear. In Colombia and the Philippines, armed actors co-exist and cooperate with paramilitaries and criminal organisations through complex networks that infiltrate political structures and co-opt legitimate economic activities.

Other contexts present more overtly political challenges. In Uganda, where substantial progress has been made towards stability in the war-affected northern region, a widespread lack of transparency permeates a political environment in which power remains entrenched, whilst the discovery of commercially viable quantities of oil has set in motion the race for resource wealth.

In these complex and volatile environments, how should companies behave to ensure that their operations maintain respect for human rights and don’t exacerbate existing conflicts or generate new ones? In the 10 years since the publication of its guidance on conflict-sensitive business practice (CSBP), International Alert has worked with companies in all of the countries cited above and more, from small, local businesses to major multinational firms. In the course of our work, we have gained a good understanding of the complexity of different conflict environments, and the different requirements for companies engaging in business in these varied circumstances.

Although a decade has passed since the publication of the guidance, the core principles of CSBP have not changed or diminished with time. Companies operating in conflict areas are never neutral players; there is always a two-way dynamic between the company and its operating environment. The focus should not only be on what risks are ‘out there’ for the company, but also how the company has an impact on its context, positive or negative.

Yet we also recognise that in the course of the last decade, certain things have changed. In particular, the field of business and human rights has emerged as a highly influential area of theory and practice. Companies have become increasingly interested in, and have begun integrating the recommendations of, such new international frameworks as the UN Guiding Principles on Business and Human Rights. This is certainly to be encouraged. But it also needs to be recognised that the field of business and human rights is relatively new, and the effective implementation of human rights practice by companies is nascent and remains largely limited. This is even more evident in areas of conflict, such as those described above, where companies must confront unique challenges when attempting to mitigate their human rights impacts.

As an established body of practice, conflict-sensitivity has a lot to offer to the business and human rights field, and can draw on a wealth of experience and lessons learned to complement the human rights perspective and highlight areas of additional consideration for companies operating in areas of conflict. In recognition of this, International Alert will this year publish its first set of supplementary guidance, examining what the endorsement of the UN Guiding Principles on Business and Human Rights mean for companies operating in conflict areas.

The guidance will take into account lessons learned over 10 years of working across a diverse range of conflict environments, from intra-state civil conflicts to areas of latent conflict, cycles of violence and social unrest. Companies need to understand how a conflict environment affects their impact on human rights, recognise the different forms that conflict can take, and understand the ways in which the type of conflict informs how they manage their human rights impacts. As experts in the field of conflict-sensitivity, International Alert is well placed to guide companies towards meeting this need.