Russia's invasion of Ukraine has spotlighted the issue of ethical business relationships. Construction has some big questions to address on its client lists
Are you comfortable doing commercial deals with a nation that ranks badly on human rights? That’s a vexed question that has come sharply to the fore recently.
It poses tough questions for architects and other construction-related businesses. The nature of the services they offer is inevitably much needed in less-developed nations, which tend, almost by definition, to be limited in technical knowhow and talent. Unfortunately, many of those able to afford these services have very poor human rights records.
The Russian invasion of Ukraine has heated an already bubbling cauldron of concerns. The attempt to shun Russia has led to envoys of energy-hungry European nations to approach countries that boast an uncomfortable record on human rights.
The heat of that cauldron has been fired up by a string of recent news stories. The release of Nazanin Zaghari-Ratcliffe swung the spotlight again to the darker side of Iran. England footballers, readying for World Cup duty, have expressed horror over Qatar’s attitudes on LGBTQ+. Formula 1’s Lewis Hamilton reiterated his concerns over human rights in Saudi Arabia ahead of the Grand Prix. Meanwhile, stories of China violating human rights is now a hamster wheel of news covering the treatment of the Uyghur and those in Hong Kong, China’s activities in Latin America, and growing disillusionment over the environmental and social implications of the belt and road initiative.
The direction of travel points to businesses, ever mindful of a public relations backlash, looking hard at reweighting the reputational and potential financial risks posed by trading with nations that score badly on human rights. Furthermore, the rapid rise of metric-based ESG (Environmental, Social, Governance) reporting as a driving force within investment circles is likely to hasten these debates in the boardrooms of many major firms active in the international construction scene.
Where does construction fit in?
This all teases us to wonder where then do UK architectural and engineering firms conduct business abroad, and how weighted is it to nations with questionable human rights records?
Late last month the ONS released data on where and how much UK architects and engineers sold services overseas in 2020, along with many services the UK exports. The data collection covers three years – 2018, 2019, and 2020. Some data are suppressed (about 20%) but, overall, the set provides a good guide to where business has been done over recent years.
Finding a composite measure to gauge a good or bad nation to do business with from a human rights perspective is less straightforward. There are many facets to this complex issue.
For example, the United States scores well on civil liberties. But in 2019 it scored below average internationally on human rights protection, having from the mid-1970s to early in the 2000s been among the higher ranked. It should be noted that the US is not a member of the UN’s Global Alliance of National Human Rights Institutions.
Meanwhile, Qatar, which for many is a country of concern, has a respectable score on human rights protection, defined as protection from government killings, torture, political imprisonments, extrajudicial executions, mass killings, and disappearances. But it scores low on civil liberties and exceptionally low on freedom of expression.
The website Our World in Data, provides a range of measures against which nations can be compared on human rights and other related issues. What does that tell us?
Multiple human rights criteria
Chart 1 shows the top 20 export nations for UK architecture over the years 2018 to 2020. The numbers show three human rights variables: human rights protection, freedom of expression, and civil liberties. As we see many of the big buyers of UK architecture have poor records across all the measured areas of human rights. China and Saudi Arabia stand out.
And, if we look just at the spread of work across nations bracketed simply on their human rights protection, a large amount of work is won by architects, engineering firms, and indeed UK services firms in general in nations with very poor human rights records.
Chart 2 shows the level of revenue won by UK architects, engineers, and all firms exporting services over the past three years in countries separated into bands based on their scores for human rights protection.
The scores are based on standard deviations from the average, which provides the zero point each year. So, countries in band 4+, such as Norway or Luxemburg, have very good human rights records. Meanwhile in band -2 to -1 are countries with very poor records such as China or Egypt.
The chart shows how more than a third of overseas revenue won by UK-based architectural practices comes from nations with poor or very poor human rights records.
The level of activity in every nation will vary over time, and there is some suppression in the numbers which may mean the picture is slightly better or worse than that depicted. Also, it is not just where work is won and who pays that matters. The purpose is paramount. There’s a big difference between providing a vanity project for a despot and delivering a much-needed school or hospital to a beleaguered population.
But taken as a whole, the numbers suggest there may be some awkward debates ahead for architectural practices, along with many other UK businesses, that export their services. Ever-growing scrutiny and increasing pressure to trade more ethically will no doubt intensify questions over who we should and who we shouldn’t be trading with, why, and on what terms.