On 24 April 2013, the eight-storey Rana Plaza building in Dhaka collapsed, killing 1,129 people, most of them female textile factory workers producing garments for international fashion brands.

The building had been designed for shops and offices, not to hold the five factories that operated there. Its improper use caused the building to deteriorate rapidly, and the risk of collapse was clear before the disaster. Despite the workers’ protests, however, the factory managers refused to halt production, with the connivance of the municipal government.

As in many other cases, the factories’ main clients were transnational corporations (TNCs). The factories in Bangladesh form part of their supply chains, and those operating in the Rana Plaza building were producing clothes for well-known brands such as Benetton, El Corte Inglés, Loblaw, Primark, and Walmart.

Their parent companies publicly proclaimed a commitment to ensure that their suppliers respect workers’ health and safety standards. But that did nothing to prevent the building from collapsing, nor did it guarantee any sanctions or punishments for the individuals or companies that benefited from the profits derived from lowering labour and safety standards.

The case of the Rana Plaza is one of many that reveals the reality of TNCs and human rights: first, TNCs frequently violate human rights through the business activities that take place all along their global production chains; and second the vast majority of these violations have ended either in impunity or, in the best-case scenario, with compensation negotiated out of court, which lets the guilty parties off the hook.

This reality has been affirmed by the Office of the United Nations High Commissioner for Human Rights (UNHCHR) in a 2016 report:

"Human rights impacts caused by business activities give rise to causes of action in many jurisdictions, yet private claims often fail to proceed to judgment and, where a legal remedy is obtained, it frequently does not meet the international standard of ‘adequate, effective and prompt reparation for harm suffered’."

The report summarises the difficulties facing the victims of human rights violations: ‘fragmented, poorly designed or incomplete legal regimes; lack of legal development; lack of awareness of the scope and operation of regimes; structural complexities within business enterprises; problems in gaining access to sufficient funding for private law claims; and a lack of enforcement’.

It states that: ‘Those problems have all contributed to a system of domestic law remedies that is “patchy, unpredictable, often ineffective and fragile”’. Along similar lines, in her 2015 report on contemporary forms of slavery, the Special Rapporteur expressed concern that these are occurring in global supply chains.

Another report prepared for the Office of the UNHCHR by Dr Jennifer Zerk, details 22 cases of gross human rights abuses committed by corporations. These include, for example, the case of Blackwater, which was accused under the Alien Tort Statute of acting negligently and failing to apply due diligence in the screening and training of its employees, some of whom committed murder and war crimes in Iraq in 2007.

None of the cases that are now closed ended with a judgment finding any corporation guilty of having committed a violation of human rights. A high percentage ended with the victims accepting an out-of-court settlement.

Rana Plaza is a case in point. The Rana Plaza Coordination Committee set up in October 2013, chaired by the International Labour Organization (ILO) and including representatives of the government, unions, the clothing companies involved, and non-government organizations (NGOs) undertook to determine the losses that should be covered, and ensure that adequate assistance was provided to victims and their families to present claims for compensation.

In January 2014, the ILO established the Rana Plaza Donor Trust Fund and a year later announced that it had raised $30 million required to pay compensation to the more than 2,800 victims who had made claims. Financial compensation was the sole remedy offered. The guilty parties remain unpunished, and the victims have not even received full and adequate compensation.

We are therefore facing an angulo muerto (‘legal dead end’), whereby national and international law not only fails victims and allows the TNCs to go scot free, but even encourages human rights violations within certain large transnational businesses.

This impunity derives both from the nature and strategies of these businesses and from their increasingly close – or, as de Sousa Santos puts it, ‘promiscuous’ – relationship with the state.

Appalling in itself, this impunity is simply the most striking facet of the many different components of the complex and problematic relationship between TNCs, human rights and democracy.

It is important, however, not to approach the issue solely from the angle of analysing what their production strategies imply for human rights, but also to examine the role of international law forged by TNCS to protect their investments, the phenomenon of state capture, and the way corporations have established and maintained the ‘market authoritarianism’ that enables such corporate violations to occur.