The Human Rights Obligations of State Owned Enterprises (SOEs): Emerging Conceptual Structures and Principles in National and International Law and Policy

43 Pages Posted: 6 Jun 2017 Last revised: 18 Sep 2017

See all articles by Larry Catá Backer

Larry Catá Backer

The Pennsylvania State University (University Park) – Penn State Law

Date Written: June 4, 2017


The distinction between the obligations of public and private entities, and their relation to law, is well known in classical political and legal theory. States have a duty which is undertaken through law; enterprises have a responsibility which is embedded in their governance. These fundamental divisions form part of the current international efforts to institutionalize human rights related norms on and through states and enterprises, and most notably through the U.N. Guiding Principles for Business and Human Rights (UNGP). The problems of conforming to evolving norms becomes more difficult where states project their authority through commercial enterprises. These state owned enterprises (SOEs) operate where state duty and enterprise responsibility meet. This essay takes a close look at the issue of the human rights duties of states as owners of SOEs, and of the responsibilities of SOEs for their own human rights related conduct. The form and substance of these duties and responsibilities are considered in light of two recent developments. The first is the substantial change in the direction of U.S. policy in trade and globalization. The other is the maturation of Chinese outbound economic and investment policy, where its construction of an outbound nationalist globalization - the One Belt One Road policy - relies to some extent on the projection of commercial power through Chinese SOEs. After After an Introduction, Part II, “Challenging Engagement and Engagement Challenges,” closely examines the emerging structures and principles of the debate through a deep analysis of the 2016 Report of the U.N. Working Group on the Issue of Human Rights and Transnational Corporations and other Business Enterprises, interrogating its conceptual framework and its implementation programs. Part III then briefly considers the consequences of these approaches and work left to be done: from conceptual lacunae to implementation. It offers a set of ten (10) challenges and recommendations for further development. These recommendations and challenges suggest that issues of corporate personality, of sovereign immunity, of asset partition, and of the mania for compartmentalization that marks certain approaches to global economic and financial regulation may well hobble the work of embedding human rights within the operation of states as owners and SOEs as public enterprises. To embed human rights more effectively in accordance with evolving international standards, it may be necessary to substantially change contemporary and backwards looking legal frameworks within which SOEs now operate. More importantly it suggests the difficulty of the current strongly held consensus that the focus of regulatory governance must be a formally constituted enterprise, the SOE, rather than economic activity irrespective of the form in which it is undertaken. Until these conceptual issues are considered the regulation of economic activates - SOEs, supply chains, multinational corporations, will remain elusive.

Keywords: state owned enterprises, business and human rights, Guiding Principles Business Human Rights, multinaitonal corporations, sovereign immunity, asset partitioning, internaitonal trade,

JEL Classification: F68, H77, K22, K33, L20, M14, P45, Z28

Suggested Citation

Backer, Larry Catá, The Human Rights Obligations of State Owned Enterprises (SOEs): Emerging Conceptual Structures and Principles in National and International Law and Policy (June 4, 2017). Vanderbilt Journal of Transnational Law, Vol. 51, 2017, Penn State Law Research Paper No. 18-2017, Available at SSRN:

Larry Catá Backer (Contact Author)

The Pennsylvania State University (University Park) – Penn State Law ( email )

Lewis Katz Building
University Park, PA 16802
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
PlumX Metrics