Transparency International estimates that corruption is a bigger problem in construction than mining, real estate, energy or the arms market. The Bank of Thailand in collaboration with the Thai Bankers Association has established the Sustainable Banking Guidelines on Responsible Lending in August 2019. Explicitly promote broad dissemination and implementation of due diligence in accordance with the OECD Due Diligence Guidance for RBC. tobacco). For example, working out contingency plans with workers and suppliers may make more commercial sense than paying the price of disbanding large segments of a workforce that took years to build and train. A 2016 report by the UN Working Group on Business and Human Rights examined the practices with respect to current RBC and business and human rights practices of SOEs and found that there is a general lack of attention to RBC issues and that policies, guidelines and good practices are lacking at both the international and national levels (UN, 2016). PRI (2018), Financial Performance of ESG Integration in US Investing, www.unpri.org/download?ac=4218. Ensuring that ratings agencies and reporting frameworks be explicit about whether they are focused on (only) ESG issues which create a financial risk for the company or actual ESG performance (and whether they report information related to these issues separately) will be critical for brining clarity to the market. Thailand is a regional leader on RBC. The conference focused specifically on RBC due diligence and featured high-level business representatives and government officials. The NHRCT has reported that a number of complaints have been received over the course of the last few years related to SOEs and state projects, particularly on labour rights and large-scale impacts on environment and communities. A variety of approaches exist with respect to responsible investment. Labour measures used in the fisheries sector could be applied to other industrial sectors, such as agriculture and construction, which have a large number of migrant workers. Provisions related to RBC are also included in the chapter on state-owned enterprises (SOEs) (art. If workers, trade unions, civil society or whistle blowers cannot meaningfully engage, that has a chilling effect on such processes and solutions. OECD Guidelines for Multinational Enterprises - Responsible Business As businesses aim to 'do good while doing no harm, implementing Responsible Business Conduct standards, such as the OECD Guidelines for Multinational Enterprises, across business operations and supply chains can help gain and retain a social license to operate. For example, the garment and footwear sector has struggled with addressing persistent issues with wages and labour issues. China and India have also recognised importance of RBC. This may especially be exacerbated in contexts where awareness of RBC is low. WE CALL on the OECD to provide further clarity and good practice on application of RBC standards in support of: better outcomes for at-risk groups and communities; Indigenous Peoples; gender equality; just transition towards a net-zero economy; and small and medium-sized enterprises, taking into account their specificities and circumstances; as . Increasingly strong political ties with China and concrete infrastructure development plans could help Thailand become a regional logistics hub and lower related costs. As discussed in Chapter 11, Thailands presence in ASEAN as an outward investor has been steadily rising in recent years, accounting for a third of outward FDI and increasingly concentrated in Cambodia, Lao PDR, Myanmar and Viet Nam (CLMV). It is important to note that the acceptance of the case at this stage means that the UK NCP will offer mediation/conciliation and does not indicate any determination of the case. roads, rail, aviation, maritime, freight/logistics) could increase 60% by 2050, despite the significant technological progress already assumed in baseline modelling scenarios (OECD/ITF, 2017). The buying power of governments is a lever for promoting RBC. SEC is planning capacity-building activities under the Thai NAP for listed companies. Nevertheless, the picture is not so clear-cut when it comes to other trading partners. The role of SETs Social Responsibility Centre is relevant in this regard. For example, Australian investors are subject to the Australian Modern Slavery Act. The report helps banks and other financial institutions implement the due diligence recommendations of the OECD Guidelines for Multinational Enterprises in the context of their corporate lending and underwriting activities. The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at http://www.oecd.org/termsandconditions. This document, as well as any data and map included herein, are without prejudice tothe status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. RBC factors appear to have, at best a positive relationship with corporate financial performance and at worst a neutral relationship (OECD, 2017). Implementing RBC principles and standards can help companies operationalise the SDGs and ensure their most significant impacts are prioritised (for more information, see OECD, 2019c). The OECD Guidelines for Multinational Enterprises on Responsible Business Conduct are recommendations addressed by governments to multinational enterprises. Thailand is also the first country in Southeast Asia to sign a country programme with the OECD, where promoting/enabling RBC on the basis of the OECD RBC standards is included as a priority area of cooperation. Businesses and business associations, including the Joint Steering Committee on Commerce, Industry, and Banking (JSCCIB), Federation of Thai Industry, Thai Bankers' Association and Stock Exchange of Thailand organised awareness raising events and workshops to familiarise businesses with international standards on RBC and to engage in the process of developing the Thai NAP. For example, the various OECD RBC due diligence guidances recognise and recommend that businesses align their internal incentives and purchasing practices to avoid facilitating or incentivising their suppliers to cause adverse impacts on people, planet and society. Enterprises involved in agricultural supply chains can create employment, raise labour standards and bring the technology to increase agricultural production or reduce pollution. It is also important to highlight that labour issues also concern other sectors of the economy. Additionally, the policy guidance for SOEs should be aligned with the 2015 OECD Guidelines on Corporate Governance of State-Owned Enterprises and the specific expectation that SOEs establish and implement due diligence according to international standards should be made clear. See Claire Ballentine (31 March 2020), ESG Stock Resilience Is Paving the Way for a Surge in Popularity Bloomberg https://www.bloomberg.com/news/articles/2020-03-31/esg-stock-resilance-is-paving-the-way-for-a-surge-in-popularity. This pioneering annual event convened leading actors across the green finance community to help catalyze and support the transition to a green, low-emissions and climate-resilient global economy. Additionally, the National Human Rights Commission of Thailand (NHRCT) has played a critical role by raising visibility about the complaints received in the business and human rights field and by organising awareness raising events and workshops. Thailands significant efforts to prevent human trafficking have resulted in an increase in its rank in 2018 to Tier 2 from Tier 2 Watchlist in the US State Department Trafficking in Persons Report (see US State Department, 2019). The Paris Agreement on climate change also underlines the critical role of business in tackling climate change, including through reducing greenhouse gas emissions and improving environmental performance. The above considerations should be reflected in freight on board (FOB) prices together with traditional pricing considerations such as quantities being purchased, cost of materials, skill requirements, etc. It recognises that an enterprises price negotiations may contribute to cost-cutting and therefore labour, human rights or environmental impacts and recommends the enterprise to strengthen its management systems to prevent contributing to harm through its purchasing practices (see OECD, 2018). UN experts have recommended that Thailand decriminalise defamation and revise its civil and criminal laws as well as prosecution processes to prevent misuse of defamation legislation by companies (UN OHCHR, 2018b). RBC expectations can also be a legal requirement for investors. Strong cooperation with China is also strengthening Thailands role in the implementation of the Master Plan on ASEAN Connectivity 2025. OECD/FAO (2019), OECD-FAO Pilot project on the implementation of the OECD-FAO Guidance for Responsible Agricultural Supply Chains: Final Report, http://mneguidelines.oecd.org/Pilot-project-on-the-implementation-of-the-OECD-FAO-Guidance-for-Responsible-Agricultural-Supply-Chains-FINAL-REPORT.pdf. It recognises the importance of responsible business and business leadership explicitly and delineates the board roles and responsibilities for the companys long-term sustainable value creation (SEC, 2017a). While the RCEP text was not available as of November 2019, the Joint Leaders Statement recognises the intention for RCEP to benefit businesses, as well as workers, producers, and consumers (RCEP, 2019). In its report to the UN General Assembly in 2018, the Working Group underlined that [t]he recently issued OECD Due Diligence Guidance [] provides a comprehensive practical tool for supporting implementation of human rights due diligence in line with the Guiding Principles, which is based on comprehensive multi-stakeholder inputs and dialogue. (UN, 2018). Overall, in Asia, the importance of the financial sector is significant and increasing. In September 2019, the UK National Contact Point for Responsible Business Conduct, a government agency in charge of implementing the OECD Guidelines for Multinational Enterprises, decided that a complaint submitted against a multi-stakeholder membership organisation working as a global sugarcane platform merited further examination. Globally, current strategies for responsible investment vary widely in terms of objectives, scope of application, and prevalence of use amongst institutional investors.3 Box 8.1 provides an overview of approaches with respect to responsible investment. A recent report by the World Wildlife Fund on sustainable banking in ASEAN showed that, while Thai banks in general have developed sustainability strategies and have engaged with stakeholder, implementation could still be improved. Thailands ambitions to be a regional leader could be particularly impactful in the context of integrating RBC considerations in the various regional trade and investment agreements and initiatives. Nevertheless, for example, a few high-profile cases have been examined by the NHRCT concerning Thai investments in Cambodia and Myanmar and the significant impacts on the local population. ShareAction (2018), Pensions in a Changing Climate, https://aodproject.net/wp-content/uploads/2019/01/AODP-PensionsChangingClimate.pdf.