1

Report from the Nordic-Baltic Internal Peer-Learning Seminar for

National Contact Points

20-21 May 2019, Oslo, Norway

Photo: Per Kristian Lie Løwe/Konsis

About the Nordic-Baltic cooperation

The annual report of the OECD Guidelines for Multinational Enterprises encourages peer–learning activities between NCPs, and highlights as an example the collaboration between the NCPs i the Nordic Baltic region.

The Nordic and Baltic National Contact Points (NCPs) started its cooperation in 2018 with the purpose of creating a platform for sharing knowledge and experiences between the NCPs. The participants have included representatives from the NCPs in Sweden, Finland, Iceland, Latvia, Norway, Lithuania and Denmark, as well as the OECD Secretariat in Paris.

Following the successful and well-attended NCP seminar in Lithuania in September 2018, the Norwegian NCP hosted this year’s seminar in Oslo. Continuing from last year’s focus on how NCPs best can fulfil the core criteria of the OECD Guidelines, the objective of this year’s seminar

2

was sharing experiences between NCPs in handling specific instances and tools for promoting due diligence for responsible business conduct. Experts from business in the field of finance and the garment sector participated, and shared best practices from business’ work on responsible business conduct (RBC).

The Danish NCP has offered to host the next seminar.

Key focus areas

DAY 1: Key issues was peer learning for NCPs: promoting due diligence for RBC, handling specific instances and labour rights in Nordic Baltic countries

The Norwegian State Secretary for Foreign Affairs, Mrs. Marianne Hagen, gave an opening speech1, where she encouraged collaboration between Nordic Baltic NCPs to promote responsible business conduct. She referred to the recent progress report on NCPs 2from the OECD Council meeting stating that there is an uneven level of functioning among NCPs. She stressed the need for member countries to ensure functioning and adequately resourced NCPs. New chair for Norway’s NCP, Mr. Frode Elgesem, thereafter thanked the State Secretary for the Government’s strong support and welcomed the participants to Norway. He highlighted the seminar as a tool for NCPs to learn and draw on each other’s experiences while discussing best practice in promoting RBC. This contributes to coordinated efforts as well as a more even playing field for business in the Nordic-Baltic region.

DAY 2: On the second day, business experts from the finance and textile sectors shared their

experiences with RBC by giving concrete examples on how risk-based due diligence can look

like in practice. Moreover, Linda Nielsen from the Danish NCP and the Danish Task Force on

money laundering introduced the money-laundering scandal that has shaken the financial

sector in the Baltics. Nielsen highlighted i.a. the similarities between anti-money laundering

and RBC while emphasizing that there are opportunities for the two fields to learn from each

other's framework of regulation, tools and methods of enforcement. Lastly, Barbara Bijelic from

the OECD Secretariat presented initiatives for a continuous improvement of the financial sector

while also stressing the need for continuous funding.

1 State Secretary Hagens speech: https://www.regjeringen.no/no/aktuelt/nordisk-baltisk-seminar/id2645824/ 2 http://www.oecd.org/mcm/documents/NCPs%20-%20CMIN(2019)7%20-%20EN.pdf

3

NCPs work to promote the OECD Due Diligence Guidance for RBC

Kathryn Dovey from the OECD Secretariat presented the OECD due diligence guidance, which was followed by a workshop on promotion of due diligence for RBC led by Barbara Bijelic. One of the key takeaways from the session was the importance of communicating how risk-based due diligence from an RBC perspective differs from the traditional understanding of risks in the business community. Risk is to be understood as risk for adverse impacts towards people and planet – an outward-looking approach - rather than assessing the risks for the company itself. This is still, for many companies, a new way of understanding risks and will continue to be an important factor to communicate when NCPs are promoting RBC.

Since RBC is a new way of thinking business, communicating the business case can sometimes

be a good way to spark motivation for implementing due diligence processes. Katherine Dovey

highlighted how a proactive approach to RBC will help sustain the business in the long run,

which is one of the pull-factors for businesses in adjusting to RBC. Most specific instances from

NCPs concludes with either an agreement between the parties in the complaint or a final

statement from the NCP, that gives recommendations to the company on how to comply with

the OECD Guidelines. Very often the NCP gives recommendation to the company to conduct or

improve their risk-based due diligence for RBC. Some specific instances, although they are rare,

companies have been under scrutiny for negative impacts that might happen as a consequence

of planned activities. However, most specific instances show that the reactive approach is still

dominant among the responding companies, which only underlines the imperative of NCPs

work on promoting due diligence for RBC.

The OECD Secretariat’s workshop on promoting due diligence for RBC. Photo: Per Kristian Lie Løwe/Konsis

4

Another aspect of promoting RBC is training of NCPs to better give advice and answer questions

from businesses on e.g. due diligence or the international guidelines. The workshop presented

typical questions from stakeholders and provided answers to how NCPs best can make sure

that the same information is communicated regardless of which NCP receives the question.

RBC in Nordic-Baltic employment and labour relations

RBC in the labour market is highly relevant in the Nordic-Baltic cooperation as a result of the

large flow of Baltic workers in the Nordic countries. The Confederation of Trade Unions (LO)

works for securing labour rights in Norway and have treated several cases of social dumping in

relation to temporarily employees from the Baltic countries. LO’s examples of grave breaches

of labour rights is a manifestation of how adverse impacts also occur in “low-risk countries.”

Overview over Nordic Baltic NCPs

Cathrine Halsaa from Norway’s NCP presented a paper with an overview of the status of

functioning of the Nordic Baltic NPCs, with numbers taken from the Annual report of the OECD

Guidelines. She also gave and overview of cases handled by Nordic and Baltic NCPs from 2000-

2017, and how the Nordic Baltic NCPs deal with issues on specific instance coordination,

recommendations and determinations, and whether it is included in their Rules of Procedures.

Group exercise discussing best practices in handling specific instances

5

Handling Specific Instances

The afternoon session of day 1 was a closed session where the NCPs were given the opportunity

to speak freely about experiences with handling former or ongoing cases (specific instances).

Kathryn Dovey introduced the objective of this session by presenting how rules of procedure

(RoP) for handling specific instances can work as a proxy for trust, and a way to ensure

compliance with the key principle of predictability as well as the core criteria of visibility and

transparency. A trustful environment can be crucial for a successful case, which was

exemplified by the Danish NCP with the presentation of a specific instance where i.a. the lack

of trust between the two parties resulted in unsuccessful mediation.

Fruitful discussions and experience sharing between the Norwegian and the Lithuanian NCP. Photo: Per Kristian

Lie Løwe/Konsis

The Norwegian NCP facilitated a workshop that went through the process of handling specific

instances step by step. The NCPs received a matrix with questions sent out in advance of the

seminar concerning their procedures for deadlines and communication with the parties,

coordination between NCPs, and the steps NCPs take to inform parties in a complaint about

the OECD Guidelines and the complaint handling procedure.

Most of the seminar’s NCPs have an RoP for handling specific instances however, not all have

had the chance to test their feasibility in practice. Thus, the level of practical experience differs.

Nonetheless, everyone agreed that regardless of experience, being able to share challenges or

dilemmas is beneficial for all NCPs, as it creates a basis for future handling of specific instances.

From some of the NCPs that have operationalised their RoP, an experience is that the RoP is a

dynamic document that should be revised based on new discoveries after handling a specific

6

instance. Also, the RoP’s level of detail can ease the process by assuring the right steps are

taken at the right time, which in turn will help with keeping momentum during the process.

The question of balancing impartiality and providing guidance was also discussed during the

workshop. Impartiality is an important principle for a successful procedure and for the

legitimacy of the NCP. However, it was concluded that this should not be a barrier for providing

general support to the complainant e.g. by assisting them in identifying which chapters in the

guidelines the specific instance could be related to.

RBC in the financial sector

The OECD Secretariat opened the second day by presenting the increasing expectations for RBC

in the financial sector. The growing focus has also been evident on specific instances filed in the

past years where 20%+ of all cases involved the financial sector.

The OECD paper on RBC for institutional investors and the upcoming paper on RBC for General

Corporate Lending and Securities Underwriting feeds into this agenda. These OECD guidance

documents were actively used by the invited experts from the financial sector, and proved to

be an important tool in their everyday work on ensuring RBC. The Norwegian bank DNB

presented the steps they have taken to ensure RBC in their client relationships in the shipping

sector, while the Danish pension fund MP Pension emphasized how transparency is an

important tool when the financial responsibility to their beneficiaries influences the possibility

to comply with their own RBC policies. Furthermore, Norsif (the Norwegian initiative for

responsible finance) presented how they promote responsible investments to their members

and the big potential to develop the field.

The focus on RBC in the Nordic-Baltic financial sector was especially heightened after the

money-laundering scandals and the topic was also present on the seminar’s agenda. The

Lithuanian NCP gave an insight into expectations, regulation and realization of RBC in the

banking sector in Lithuania, while Linda Nielsen presented measures taken in Denmark on anti-

money laundering. The scandal uncovered how there is still a need for turning principles into

practice, which the promotional activities for RBC that the NCP’s undertakes can play an

important role to achieve.

7

From the left: Troels Børrild (MP Pension), Linda Nielsen (Denmark NCP/Task Force on anti-money laundering),

Øistein Akselberg (DNB), Barbara Bijelic (OECD Secretariat), Monica Mee (Norsif), Andrius Bambalas (Lithuania

NCP).

The session on RBC in the financial sector was finalized with a panel debate between the

presenters moderated by former chair of the Norwegian NCP, Ola Mestad. The debate

concluded that there is still a need for more knowledge and training for the financial sector in

risk-based due diligence to mitigate the risk for adverse impact on people and planet.

NCP’s cooperation with NGO’s The OECD Guidelines stresses how stakeholder engagement is an important part of the due

diligence process, but it is also a significant part of the NCPs work. The Norwegian NGO Forum

for Development and Environment (ForUM) was invited to the seminar to share their

experience with cooperating with the NCPs. ForUM expressed how they appreciate the

opportunity to be invited to events hosted by the NCPs and called for establishment of more

NCPs around the world.

ForUM also touched upon some of the challenges they face with the NCP’s complaint

mechanism. The complaint procedure’s social and financial cost, and the potential

complainant’s lack of competences and resources can become barriers to submit a complaint.

There is a constant evaluation of where the NGO will experience the best outcome, which

sometimes boils down to weighing whether to gain media attention or choosing to involve an

NCP.

This is an important message that the NCPs should reflect upon – easing the process to ensure

specific instances are submitted. A place to start might be by producing or revising its RoP, and

8

having an open dialogue and contact with stakeholders, both from the business sector, trade

unions and NGOs.

RBC in the textile sector

The textile sector continues to be a focus area for many NCPs as a result of the challenges that

are present in the industry. The Danish NCP exemplified this with a specific instance handled

by the contact point in relation to the collapse of the Rana Plaza building in Bangladesh. The

NCP’s final statement with recommendations was taken into account by the company that now

works actively with implementing processes of risk-based due diligence in accordance with the

OECD Guidelines.

The Norwegian underwear company Pierre Robert Group ended the session with a

presentation of their RBC efforts. The company has a long tradition for working with RBC and

gave a detailed introduction to the different steps in their due diligence processes, showing

that this is a continuous process that should be repeated over time.

A continuous relationship based on trust and cooperation

The NCPs agreed that the seminar provided useful tools and methods to the work of promoting

RBC and handling specific instances. The workshops were particularly appreciated as it created

a space for sharing experiences and facilitated interesting discussions between the NCPs.

The Nordic-Baltic cooperation has developed into a trustful group where the participants

engage in professional and social conversations. The Norwegian NCP had arranged a dinner at

a restaurant in the Norwegian skerries where these conversations continued over delicious

food and wine. The seminar’s social aspect is an important activity as the group gets to know

each other better and therefore lowers the threshold for reaching out with questions or other

requests in our daily work.

We are looking forward to the next seminar in Copenhagen, Denmark.

9

Programme Nordic-Baltic Internal Peer-Learning seminar 20-21 May, Oslo, Norway

Venue: Hotel Opera, Dronning Eufemias gate 4 DAY 1 – Internal peer learning for NCPs Focus issues: promoting due diligence for RBC, handling specific instances, labour rights in Nordic Baltic countries

08.30 – 09.00 Coffee, tea

09.00-09.10 Welcoming speech

State Secretary Marianne Hagen

09.10 - 9.20 Overview of workshop, aims, agenda and format

Frode Elgesem , Norway NCP

09.20-9.40 Introduction of the OECD due diligence guidance for RBC and tools for NCPs’ work to promote the guidance

Kathryn Dovey, OECD

09.40-11.30 Workshop: NCPs’ work to promote due diligence for responsible business conduct RBC

Barbara Bijelic, Kathryn Dovey, OECD

11.30-12.30 Lunch

12.30-13.10 Ensuring RBC in employment and labor relations in the Nordic - Baltic region.

Examples of breaches of labor rights for temporary employees from Baltic countries in Norway

The role of contracting companies and efforts from trade unions

Jonas Bals, Norwegian Confederation of Trade Unions – LO

13.10 – 15:00 Afternoon: Handling specific instances

Norway and Denmark NCP

13:10 – 13:20 How to increase the chance for a successful case – predictability and creating trust with the parties - experiences

Kathryn Dovey

13:20 – 13:30 Overview of Nordic Baltic NCPs on handling specific instances – see paper

Norway NCP

13:30 – 13:55

Introduction to the Danish NCP’s handling of specific instances – case: PWT

Denmark NCP

13:55 – 15:00

Workshop: Step by step – handling specific instances – see questionnaire

Norway NCP

15.00 - 15.15 Sum up – key takeaways. Norway NCP

18:00

Dinner at Lille Herbern, Bygdøy (Approximate time for departure hotel: 17:00)

10

DAY 2 – Internal seminar with invited experts from business. Focus issues: RBC in the finance sector and textile sector.

09:00 – 09:10 Wrap up from day 1 + today’s agenda Cathrine Halsaa and Ola Mestad Norway NCP

09:10 – 09:30 OECD finance sector project

OECD due diligence guidance on responsible business conduct for institutional investors

OECD due diligence guidance on responsible business conduct for corporate lending and securities underwriting

Barbara Bijelic

09:30 – 09:50 Due diligence on RBC for corporate - in practice Øistein Akselberg, DnB

09:50 – 10:10 Due diligence guidance on RBC for institutional investors – in practice

Monica Mee, Nordea

10:10 – 10:30 Responsible investment in practice

Troels Børrild, Danish pension fund

10:30 – 10:50 Money laundering scandals in Nordic-Baltic banking system

Finance Denmark’s Task Force on Money laundering

Linda Nielsen, Denmark NCP

10:50 – 11:00 Responsible business conduct in the banking sector of Lithuania: expectation, regulation and realization

Andrius Bambalas, Lithuania NCP

11:00 – 11:30

Responsibility in the finance sector - Q&A Panel discussion

Linda Nielsen, Barbara Bijelic, Monica Mee, Øistein Akselberg, Troels Børrild, Andrius Bambalas Moderator: Ola Mestad

11:30 – 12:30 Lunch

12:30 – 12:50 Civil society – how does civil society work with the NCPs

Ingrid Rostad, The Norwegian Forum for Development and Environment (ForUM)

12:50 - 13:20

Responsible business conduct in the textile sector

Brief presentation to the Danish guidance on due diligence in the textile sector

o The actual process o Reflections during the process

Example of an NCP statement, recommendations and follow up on complaint in the textile industry

o Case: Complaint against PWT Group

Denmark NCP

13.20 – 14.00

Responsible Business Conduct in Pierre Robert Group

Margrethe Vikanes, CSR Manager Pierre Robert Group

14.00 – 14.30 Wrap up and next steps Norway NCP