ABSTRACT

The OECD Guidelines for Multinational Enterprises state non-binding principles and standards for responsible business conduct (OECD, 2011). The Guidelines have a suggestive nature, and unless they coincide with national regulations, they are not legally enforceable. They were adopted in 1976 and updated in 2011 for the fifth time (OECD, 2022). The Guidelines cover all areas of business responsibility (OECD, 2016). Aiming to promote positive contributions by multinational enterprises to economic, environmental, and social progress worldwide, the Guidelines point out the shared values of the governments of countries from which a large share of international direct investment originates; therefore, the governments adhering to the Guidelines are expected to implement them and encourage their use (OECD, 2011). In this way, participating governments establish National Contact Points to promote the Guidelines. The Guidelines draw the perimeter of responsible business conduct with the following domains under the stated general principles (OECD, 2011):

Disclosure

Human Rights

Employment and Industrial Relations

Environment

Combating Bribery, Bribe Solicitation, and Extortion

Consumer Interests

Science and Technology

Competition

Taxation

The Guidelines also set forth implementation procedures. Since 2011, the Guidelines have included a chapter on Human Rights aligning with the UN Guiding Principles for Business and Human Rights (UNGPs) (OECD, 2016). Additionally, the Guidelines contain references to relevant provisions of the ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy and the Rio Declaration (OECD, 2016). In this regard, the Guidelines set the fundamentals of sustainability and sustainability features expressed with environmental, social, and governance (ESG) factors for multinational enterprises. Similarly, the Guidelines are instrumental for sustainable finance by guiding business organizations with sustainability features. The Guidelines are used as the cornerstone sustainability rule set in various sustainability and sustainable finance regulations. For example, as part of the EU’s sustainable finance policies, the EU Taxonomy for sustainability addresses the OECD Guidelines for Multinational Enterprises within one of the technical screening criteria in classifying economic activities as taxonomy aligned (EU Technical Expert Group on Sustainable Finance, 2020). Even though the Guidelines focus on multinational enterprises, they also apply to nationally operating business organizations.