(L-R) Christian Schuller, LuxNPC President; Franz Fayot, Luxembourg's Minister of the Economy; Basak Baglayan, LuxNPC Secretary-General; Tom Theves, first advisor at Luxembourg's Ministry of the Economy; Credit: MECO

On Wednesday 6 September 2023, Luxembourg's Minister of the Economy, Franz Fayot, presented the team, missions and activities of the OECD National Contact Point for Responsible Business Conduct for Luxembourg (LuxNCP), as well as the main recommendations resulting from a recent peer review.

According to the OECD, NCPs for RBC are agencies set up by governments with the mission of promoting the OECD Guidelines for Multinational Enterprises (and related due diligence guidance) and of handling cases as a non-judicial grievance mechanism.

As Luxembourg's Ministry of the Economy explained, the aforementioned guidelines are recommendations issued by governments to businesses to promote responsible business conduct. They are the only internationally recognised standard on responsible business conduct on which 51 governments have agreed at multilateral level. Since their introduction in 1976, the guidelines have been revised and updated several times - most recently in June 2023.

These guidelines cover various issues such as disclosure of information on business activities, respect for human rights, management of labour relations and employment practices, environmental protection and anti-corruption, among others.

The guidelines provide for a single implementation mechanism through the NCPs. Created in 2000, the LuxNCP has three main tasks:

  • to raise awareness of the introduction of the OECD Guidelines for Responsible Business Conduct;
  • to handle requests for information and complaints lodged;
  • to contribute to the consistency of the implementation of the guidelines by assisting in the resolution of issues raised in the context of complaints lodged.

The LuxNCP is based, managed and coordinated within Luxembourg's Ministry of the Economy.

Peer review: main recommendations

OECD NCP peer reviews are the main mechanism for evaluating the performance of individual NCPs. Their objective is to assess the functioning and activities of the NCPs, to identify strengths and achievements as well as shortcomings and opportunities for improvement, to make recommendations for improvement in line with the guidelines and to serve as a learning tool for both the NCP under review and the NCPs that participated in the review.

As part of the peer review process, in September 2022, the LuxNCP hosted a delegation made up of NCP representatives from Iceland, Latvia and Switzerland, accompanied by representatives from the OECD Secretariat.

Some of the main recommendations included putting in place more regular, formalised stakeholder engagements - a recommendation which the LuxNCP has already taken into account by organising regular stakeholder consultation meetings. In light of the LuxNCP's "mono-agency" structure, i.e. it operates within a single ministry, the peer review addressed concerns about independence and an approach that was deemed overly pro-business. The peers found that the LuxNPC's proximity to the Economy Ministry actually facilitated interactions with companies, especially when handling complaints, and helped in raising awareness.

As part of these recommendations, the LuxNPC will also study the possibility of strengthening its legal basis and has already set up a programme of activities to promote the guidelines for the years 2023-2024. To improve the visibility of the LuxNPC, both among companies and the general public, it is drawing up a list of partners and organizations of interest to contact. The LuxNCP has set also up a new website (available in two languages) and strengthened its presence on social media.

Following the presentation on Wednesday, Minister Fayot said: "To ensure a sustainable economy, compliance with the OECD Guidelines is essential. The LuxPCN is a great tool for promoting responsible business conduct, particularly in terms of duty of vigilance, human rights and governance. I would like to salute its remarkable evolution in recent years and I congratulate the whole team for their tireless work, which has made it possible to obtain these positive results during the peer review."