Globalization and growth of the role of transnational corporations in the global economy has raised serious concerns about their adverse human rights impacts. Risks exist with transnational corporations, especially in those developing countries with low human rights and environmental standards. As a consequence, there have been great efforts to regulate activities of transnational corporations. While there seems to be a general agreement about the importance and necessity of corporate respect for human rights, the way of achieving this goal has been the subject of heated debates among all stakeholders. After a series of failed attempts to codify some human rights obligations for businesses, a non-binding guidance laying out three pillars (state duty to protect human rights, corporate responsibility to respect human rights and access to remedy) underpinning the relationship between business and human rights, was developed under UN auspices. The 2011 United Nations Guiding Principles on Business and Human Rights introduced the notion of human rights due diligence as a means for companies to ensure that impacts of their activities do not infringe on peoples’ rights. Based on that, companies are supposed to set up and employ mechanisms to assess and mitigate the risks of human rights violations connected to their business activities and make remedies for actual violations. Mandatory due diligence focusing on human rights has been increasingly taken up by legislators at the national, regional and global level.

The fact that human rights standards need to apply to business operations is clear, but the question is how far a company should go to discover and then prevent or mitigate and account for adverse impacts of its activities on human rights. The material scope of the human rights due diligence (HRDD) obligation defines the range of human rights that are subject to protection. It provides an answer to which human rights a diligent business enterprise should take care of.

This paper has applied a descriptive-analytical method and scrutinized the status of mandatory human rights due diligence instruments in national, regional and global levels with regard to the scope of human rights obligations of corporations. Furthermore, it delves into the different approaches of doctrine about the subject.

The paper argues that material scope of corporations varies in different jurisdictions. The UN Guiding Principles refer to the internationally recognized human rights expressed in the International Bill of Human Rights and the principles concerning fundamental rights in the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work, as a minimum standard of the corporate responsibility to respect human rights. The German Supply Chain Act extends the material scope of due diligence obligations to cover human rights enshrined in eleven internationally recognized conventions. Besides what is referred to in the UNGPs - the International Bill of Human Rights and the ILO’s eight core conventions, this legislation also covers three international environmental conventions, namely, Minamata Convention on Mercury, Stockholm Convention on Persistent Organic Pollutants, and Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal. The French Law on the Corporate Duty of Vigilance does not specifically mention some international instruments, but it requires corporations to undertake reasonable vigilance measures to identify and prevent serious violations of human rights and fundamental freedoms, the health and safety of the people, and the environment.

In literature also we witness different arguments. One argument is that development of the role of transnational corporations and their undeniable and inevitable influence on nearly all aspects of life and at the same time their scientific, technological, financial and logistical capacities has made some to argue, beyond obligation to respect, corporations have positive obligations to protect and promote human rights. On the other hand, some scholars argue that obligations of corporations as private entities should not be the same as states who are the main duty bearers in international law. States enjoy full sovereignty, pass law and control public authorities. Although influential on process of law making, corporations don’t have sovereignty and must obey law. Therefore, their status is not the same and the expectation of them should not be the same. Based on this argument, the human rights obligation of corporations should be limited to respect human rights – namely their obligations are solely negative ones. HRDD instruments follow this approach. But the challenge is that they are very general and do not define a specific range of human rights which corporations are capable of and more likely to violate.

In recent decades, we have witnessed a momentum in mandatory human rights due diligence laws and regulations; this has been inspired by adoption of UN Guiding Principles, change of paradigms in the realm of business and human rights and a shift from soft law to hard law. These instruments rely on due diligence policies to ensure that businesses respect human rights. Focusing on negative obligations by these instruments is more realistic and based on more compelling legal arguments. Nevertheless, future instruments—particularly the UN binding instrument on business and human rights—should exercise greater prudence in clarifying the precise framework of corporate human rights obligations and in illustrating how these obligations interact with the specific circumstances of corporate activities.