Balancing Buyer and Supplier Responsibilites in International Supply Chains

Tuesday, March 16 2021 20:52 Written by  Susan Maslow

Model Contract Clauses to Protect Workers in International Supply Chains, Version 2.0

A working group formed under the American Bar Association (ABA) Business Law Section has announced a revised set of model contract clauses for international supply chains. The 2021 Report and Model Contract Clauses, Version 2.0 (MCCs 2.0) from the Working Group to Draft Human Rights Protections in International Supply Contracts are now finalized and can be found on the ABA Center for Human Rights site.  The MCCs 2.0 are one of several initiatives within the Business Law Section’s implementation of the ABA Model Principles on Labor Trafficking and Child Labor. The MCCs 2.0 are offered as a practical, contractual tool to assist inside and outside corporate counsel in efforts to reflect their clients’ commitment to stated human rights policies and desire to abide by international human rights soft and evolving hard law. Given the likely European Union and United Kingdom implementation of mandatory human rights due diligence, the mounting number of Withhold Release Orders in US ports, and growing investor concern with respect to environmental, social and governance (ESG) liability, the Model Contract Clauses should be of interest to all companies with complex supply chains and those that provide such companies legal services. Designed as a modular, practical tool for corporate counsel, the 2021 MCCs 2.0 are the first model contract clauses to implement “human rights due diligence” obligations in supply contracts. They attempt to integrate the principles contained in the UN Guiding Principles on Business and Human Rights (the “UNGPs”) and the OECD Due Diligence Guidance for Responsible Business Conduct into international contracts. The MCCs translate these principles into contractual obligations that require buyer and supplier to cooperate in protecting human rights and make both parties responsible for the human rights impact of their business relationship.

Please access the following links for an abstract, Executive Summary, full 2021 Report and MCCs 2.0, Schedule P Building Blocks and Schedule Q:

A brief introduction to the MCC initiative, including its objectives, target audience and an outline of some of the key human rights due diligence-aligned clauses. Click here

Executive summary: An attempt to address some FAQs on why and how to use the “MCC toolkit” and a summary of how human rights due diligence-aligned contracts compare with traditional supply contracts.Click here

The Report on Balancing Buyer and Supplier Responsibilities in International Supply Chains with a complete introduction to the MCCs 2.0 and the text of MCCs 2.0 (starting at page 17) consisting of 33 model contract clauses designed to integrate human rights due diligence principles into every stage of the supply contract and operationalize the shared responsibility between buyers and suppliers for the human rights performance of their contract. Click here

Building Blocks for Schedule P (Code of Conduct, stating human rights standards and responsibilities): Offering guidance on developing robust human rights performance standards contractually. Click here

Schedule Q : The Buyer Code, stating the buyer’s obligations to follow principled purchasing practices to better protect human rights in their supply chains. Click here

Susan Maslow, Partner and Co-Founder of AMM, Vice Chair of the Working Group, will moderate a panel CLE discussion explaining the significant changes in the MCCs 2.0 to better reflect feedback and international mandatory disclosure and human rights due diligence scheduled for Tuesday, April 20, 2021 at 10:45 AM to 12:15 PM during the Business Law Section’s Virtual Spring Meeting.

Please feel free to contact one or more of the principals of the Working Group to Draft Human Rights Protections in Supply Contracts:

David Snyder, chair (dsnyder@wcl.american.edu)
Susan Maslow, vice chair (smaslow@ammlaw.com)

Principled Purchasing Project led by Sarah Dadush (s.dadush@law.rutgers.edu)
Principled Purchasing Project contributor Olivia Windham Stewart (Olivia@oliviawindhamstewart.org)

 

Last modified on Tuesday, March 23 2021 20:34
Susan Maslow

Susan Maslow

Sue concentrates her practice primarily in general corporate transactional work and finance documentation in the areas of Business Transactions, Business Law, Private Finance, Real Estate, Contracts, and Non-Profit Law. She represents entrepreneurial individuals and privately-held companies in a great variety of business transactions, including stock and asset acquisitions, banking negotiations, mergers, secured and unsecured financing, real estate and business acquisitions and leases, capital arrangements for hospitals and other health care providers, distributorships, license arrangements and business separations and dissolutions.

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