State Owned Companies and Risks of Human Rights Violations.
Risks of Human Rights Violations in IT and Telecom Industry in Azerbaijan, Georgia, Kazakhstan, Moldova and Russia.
Amnesty Business Group Sweden
July 2006 1
The Swedish State has ratified a number of international conventions on human rights. The State is therefore under legal obligation not to violate human rights. The Swedish State owns a number of companies, and it is the obligation of the State to actively ensure that it is not involved in human rights violations through the core business of its companies. This requires a systematic risk-analysis and follow up of these companies.
TeliaSonera is a partly owned by the Swedish State, the Swedish state is the largest sharedholder with 45,3% of the shares.i TeliaSonera is an IT and Telecom company.
Through their core business TeliaSonera risks being involved in human rights violations, or even to become the vechicle of repressive overnments in Eurasia that violates human rights.
TeliaSonera has extensive business in a number of countries where Amnesty International has reported on human rights violations such as Russia, Georgia, Ukraine, Kazakhstan, Moldova and Azerbadjan. The risk for ITC companies is specifically that they assist a government in curtailing or censoring information or monitoring its population.
TeliaSonera has initiatied an ambitions programme to manage these human rights risk, but to date, only a small part of the organisation has been reviewed. In effect this means that TeliaSonera risks being complicit in human rights violations.
Thereby, the Swedish State, does not know, and does not monitor, if it violates human rights in repressive countries through the operations of TeliaSonera. This lack of knowledge and action is contrary to international legal obligations (human rights).
The Swedish State should immediately ensure that TeliaSonera, and thereby the Swedish Government, does not violate human rights through TeliaSoneras actions.
Part 1 TeliaSonera and the Swedish Government
The Swedish Government as an Owner to TeliaSonera ii
The Swedish State has ratified a number of international conventions on human rights. The State is therefore under legal obligation not to violate human rights.
It is the responsibility of the government to assure and control that no human rights violations or risks of human rights violations exist in the State owned companies’ business activities. TeliaSonera is a partly owned by the Swedish State, the Swedish state is the largest sharedholder with 45,3% of the shares.
In “Verksamhetsberättelse för de Statliga bolagen 2004” the Government recommends that the boards of the State owned companies actively follow and report on the company’s activities in this area. They also recommend the board to adopt a policy on ethics as well as programme for putting the ethics policy into place. It recommends that the State owned companies should actively work on ethics issues. The Swedish Government also encouraged all Swedish companies to adhere to international human rights and to join its own initiative “Globalt Ansvar”, that has as an objective “to uphold human rights and the principles of sustainable development”.iii
Globalt Ansvar does not follow up the behaviour of the State owned companies, nor are the companies required to report on human rights violations to Globalt Ansvar.
Despite this the Government does not systematically follow up the individual companies human rights record. During 2005 the Government has on an ad hoc basis raised the issue with companies more often than before, but there is no follow up system. The board and chairperson is responsible for reporting to its owner, the Swedish Government on human rights violations. So far the Government has never received a report on human rights violations from its companies.
TeliaSonera states in its CSR report for 2005 that the Swedish Government controls annually that TeliaSonera are in conformity with the OECD guidelines on multinational corporations. This has not yet been put in to place (July 2006).
Näringsdepartementet has earlier in 2006 out of interest requested information about how TeliaSoneras subsidiary Fintur manages CSR issues. A meeting was held with Fintur management. Following that Näringsdepartementet did not issue any recommendations to TeliaSonera on human rights. As of today no other follow up has been planned by Näringsdepartementet.
The Government does not provide assistance to individual companies when they are entering markets where human rights violations are systematic. The Government does not explicitly ensure that board-members have competence in the area of human rights, when selecting board-members.
The Government states that it cannot control individual companies as they are jointstock companies, and the board is responsible for these issues. Considering the Swedish Governments international legal obligations this creates a situation where the Government does not know and cannot control or prevent human rights violations they may participate in through their companies.
TeliaSoneras Risks of Violating Human Rights
Telecommunication companies are exposed to a wide range of human rights challenges. TeliaSonera as an actor within the IT and telecom industry has an opportunity to contribute to a more open society in the region with the technology it produces. Even so, TeliaSonera and the IT and telecom industry faces extensive challenges. Like other industries that source raw materials and components from developing or transitional economies, IT and telecom companies may become associated with child labour, poor working conditions and other human rights abuses through their supply chain.iv
TeliaSoneras greatest challenge is however the risk of being complicit in human rights violations through business with governments where human rights violations are systematic. TeliaSoneras operations in Eurasia in countries such as Russia, Georgia, Ukraine, Kazakhstan, Moldova and Azerbadjan requires TeliaSonera to take active steps to prevent its own involvement in human rights violations. In other countries, such as China, companies in the ITC sector have practically assisted governments in censoring its population. Yahoo for example have disclosed the addresses of two of its customers who had written e-mails with regime critical content. Those two individuals where then arrested and received prison sentences for approximately 10 years. Both Google and Yahoo censor their Chinese search engines so that it is not possible to search for the term “human rights for example”.v This kind of curtailing, censoring and surveillance of local populations are also human rights risk for telecom companies.
TeliaSonera offers services for the transmission and packaging of sound, images, data, information, transactions and entertainment. TeliaSonera is one of the leading telecommunications company in the Nordic and Baltic region and also holds strong positions in mobile communications in Eurasia, Turkey and Russia. All areas where Amnesty International reports on systematic human rights violations.vi
TeliaSonera states in its policy on Social Responsibility (approved by the board in 2004) that the foundation of the policy is the Universal Declaration of Human Rights and the ILO Core Conventions. They also state that they shall always follow national legislation and where appropriate surpass it. The policy states that TeliaSonera will take human rights (“social criteria”) into account both in sourcing and procurement as well as in partnerships. The policy also states that TeliaSonera will review all “CSR” related risks in their operations. vii
Telia Sonera supports the Sustainability Charter of the Euorpean Telecommunications Network Operators’ Association (the ETNO Charter) where it is stated that the companies aspires to build in CSR into training programmes, observe Human Rights in procurement, appoint a management board member with CSR responcibilities and a manager w coordination resp as well as developing management systems that support development of social accountability. viii
TeliaSonera also states that it takes a “clear stance” for human rights in countries where protection for human rights is weak.ix
TeliaSonera launched its first CSR report in 2005 aspiring to fulfil GRI. A CSR director has been appointed in 2003, Mr Kari Vaihia and a executive management team member was appointed in 2004, Mr Terje Christofferson, group vice president and head of marketing, products and serviced.
Telia Sonera has initiated a CSR risk-analysis of its operations in Eurasia, that includes human rights elements. TeliaSonera has operations in a number of countries in Eurasia, where the risk to be complicit in human rights violations is high for an ITC company.
Human rights are included as one element in the risk analysis, for example discrimination, workers’ rights, freedom of opinion and expression. The risk analysis encompasses also subsidiaries where TeliaSonera owns 50% or more of the total shareholder value. TeliaSonera has identified a total risk-analysis of their operations as a goal to be fulfilled in 2005/2006. So far TeliaSonera has initiated only one study, in Azerbadjan including TeliaSoneras operations through Azercell.
Amnesty Business Group does not know what types of human rights risk that TeliaSonera has identified in Azerbadjan, but TeliaSonera will review legislation and review the gaps with human rights, and follow up with development proposals for the management of Azercell. This has not been done yet. To date TeliaSonera has not seen the need for any changes of practices in Azerbadjan or other countries in Eurasia because of human rights violations.
Fintur Holdings B.V., TeliaSoneras subsidiary through which all Eurasian subsidiaries are being held, has described its management practices regarding CSR issues, but has not performed a risk-analysis from a human rights perspective in the relevant countries.xi
TeliaSonera also aspires to give all staff a one hour training on CSR issues. The training has not been completed as of yet. TeliaSonera has adopted guidelines on ethical sourcing in 2005. We do not know how the guidelines are being implement into procurement, or how large a part of TeliaSoneras total purchase that today are being screened.
What Should TeliaSonera Do?
Amnesty Business Group is pleased to see this development of management tools to limit the risk of human rights violations, including the human rights due diligence that is planned for countries Eurasia and the ethical procurement guidelines. Amnesty is also very pleased to see that TeliaSonera supports human rights as a foundation for its work on “CSR”.
However, the CSR management tools, as well as human rights training for staff, has not yet been put into place in the countries where human rights risks are most pertinent. The due diligence performed should also focus more on the risk that TeliaSonera itself becomes the vehicle of a repressive government.
This means that TeliaSonera today does not have complete knowledge of, and therefore cannot manage risks it does not have knowledge of, for example the risk of being complicit in human rights violations in some countries in Eurasia and Russia, where the CSR due diligence has not been performed. Amnesty Business Group encourages TeliaSonera to as soon as possible, implement the ambitious management actions that it has defined.
All companies, private and others, must take active and systematic precautions when choosing to enter a country where human rights violations are systematic. In the case of TeliaSonera, where largest owner is the Swedish State, the obligation to goes even further.
What Should the Swedish Government Do?
The Swedish Government must be able to guarantee that it does not violate human rights, through its companies operations. To date, neither the Swedish Government, nor TeliaSonera itself can guarantee this.
The Swedish Government should immediately ensure that TeliaSonera, and thereby the Swedish Government, does not violate human rights through TeliaSoneras business.
The Swedish Government should proactively and systematically seek information on TeliaSoneras
1) exposure to human rights violations
2) risk-management, the prevention of human rights violations
Not doing so places the Government in a position where the Government does not know and cannot control if it is involved in human rights violations through their holdings. The Swedish Government is bound by international legal obligations not to violate human rights.
Part 2 Human Rights Risks
This report outlines a summary of information from Amnesty International, other NGOs and governmental sources on Azerbaijan, Georgia, Kazakhstan, Moldova and Russia. A selection of information has been made to reflect Amnesty’s main criticism towards Azerbaijan, Georgia, Kazakhstan, Moldova and Russia.
Reported risks and violations in Azerbaijan, Georgia, Kazakhstan and Moldova
The human rights situation in the four former Soviet states Moldova, Kazakhstan, Azerbaijan and Georgia, is poor. The government’s human rights record is however worst in Kazakhstan and Azerbaijan where the government committed numerous abuses and severely limited the right of citizens to peacefully change their government.
The following violations of human rights have been a problem in the four countries during 2005:
· Restricted freedom of press and expression
· Ill Treatment and Torture
· Harsh prison conditions
· Discrimination of women
· Discrimination of children
Restricted freedom of press and expression
Violations has been reported from all countries during 2005.
In Moldova the threat of heavy fines for “moral damage” or “insulting the honour and dignity” of an individual (Article 16, Civil Code) was used in defamation cases brought against journalists and the media for publishing criticisms of politicians and officials.xiii
Ill Treatment and Torture and Harsh prison conditions
During 2005 torture and ill treatment in police custody continued to be a major problem in these countries. For example, in Georgia there has been reports of torture and illtreatment. The methods allegedly included putting plastic bags over the detainee’s head; placing a gun in the detainee’s mouth and threatening to shoot; beatings, including with gun butts; kicking; and threats against the detainee’s family.xiv
Amnesty International’s report from Moldova 2005 stated Moldova to be an important source for trafficking of women and girls. However, trafficked women and girls were not necessarily treated as victims of crimes by the state; instead they were only exempted from criminal liability if cooperating with law enforcement agencies.xv
In this judicial climate it is difficult for TeliaSonera to guarantee no indirect involvement with human rights violations.
Reported risks and violations in Russia
The Russian Federation emerged from the collapsing Soviet Union (USSR) in 1991. Since then many changes, both economical and political, have taken place. A new form of government elected by popular vote has emerged and a new Constitution and several legal reforms have been introduced. The Russian economy has been opened up to the free market and is in transition. The economic liberalization however has not been accompanied by the creation of effective regulatory mechanisms and thus some people have made great gains while many have faced increased hardship and insecurity. Russia faces numerous economic and social problems since the rapid restructuring of the economy has led to widening inequality and a situation where more than half the population lives in poverty. The gap between rich and poor regions has also widened. In the political sphere there has been a marked growth in nationalist and separatist movements.
Despite the Russian Federation’s economic potential and political reforms it remains a difficult place to do business. Companies have routinely complained about for example failures of central and local government to respect the rule of law, lack of transparency in decision-making and policy formulation and the influence of organized crime.xvi
Serious violations of Human Rights
During 2004 serious abuses of human rights were reported in Russia. Violations such as “disappearances”, killings, torture and ill-treatment of civilians and violence against women were frequently reported in the context of the Chechen conflict. Human rights concerns in Russia are, however, not confined to the Chechen Republic. Many civilians were killed or injured following the attacks by armed groups on civil society such as bomb explosions in the Moscow metro or the hostage taking in a school in Beslan, North Ossetia. Ethnic and national minority groups and foreign citizens were targeted in racist attacks which in some cases led to killings. Human rights defenders and people seeking justice through the European Court of Human Rights were harassed and some were tortured and killed. Police routinely used torture and ill-treatment to extract confessions.
Investigations into allegations of torture or ill-treatment were rare and often inadequate, contributing to a climate of impunity.
Thousands of women were killed as a result of gender-based violence in the home or community. Those responsible for violence against women were rarely brought to justice.xvii
The judicial climate that exist in Russia makes it is difficult for TeliaSonera to guarantee no indirect involvement with human rights violations.xviii
Additional Sources of Information
In Transparency Internationals Corruption Perception Index, released on 18th October 2005, it is shown that Azerbaijan (137), Georgia (130), Kazakhstan (107) Moldova (88) and Russia is ranked (126) are some of the most corrupt countries in the world. 158 countries listed, number one being the least corrupted state. Azerbaijan is one the countries where the corruption is perceived to be most acute.xix
Amnesty Business Group Sweden: www.amnestybusinessgroup.se
Amnesty International: www.amnesty.org
Business and Human Rights Resource Centre: www.business-humanrights.org
The Swedish Government: www.regeringen.se
ii Interviews with ”Enheten för statligt ägande”, end of February 2005, 21 March 2006, and 22 March 2006 and 30 June.
iv For further details please read more in A Geography of Risks:
ix TeliaSonera CSR report 2005 p 9
x Interviews with Thomas Westlind, Corporate Communications, TeliaSonera
Swedish government’s official human rights report (in Swedish)
Länder i Fickformat Azerbajdzjan, Georgien, Kazakstan and Moldavien, Utrikespolitiska Institutet, 2005.
U.S. Department of State Bureau of Democracy, Human Rights, and Labour
And Swedish government’s official human rights report (in Swedish):
xvii For further information on human rights violations in Russia please read Amnesty International report
xviii For more information about the situation for companies in Russia please read the Amnesty report Doing business
in the Russian Federation: The human rights approach: