A/HRC/32/45 operating in high-risk contexts. For China, fulfilling corporate social responsibility is important so as “to spread an image as a responsible nation”.36 B. Mechanisms to set and manage expectations: ownership arrangements 55. The OECD Guidelines on Corporate Governance of State-Owned Enterprises emphasize that expectations established by the Government with regard to responsible business conduct should be publicly disclosed and mechanisms for their implementation be clearly established (p. 25). Practices in this regard vary. States can set human rights expectations for State-owned enterprises in different documents, such as national action plans on business and human rights or on responsible business conduct, or a State ownership policy. When it comes to ensuring that expectations set are implemented, models for exercising ownership offer a particularly useful avenue as they include functions and tools for implementing the State’s requirements of State-owned enterprises. 56. According to international guidelines and good practices, shareholders should not interfere with the management and daily operations of enterprises in which they have holdings. The same applies to States in the exercise of ownership of State-owned enterprises. The OECD Guidelines on Corporate Governance of State-Owned Enterprises provide that “the Government should allow SOEs full operational autonomy to achieve their defined objectives and refrain from intervening in SOE management” (p. 34). Norway’s Ownership Policy states that “companies in which the State has a holding are … subject to regulatory and supervisory authorities in the same way as companies in which the State has no holdings”. The same practice can be found in the Swedish Ownership Policy. These safeguards are in place to prevent the instrumentalization of State-owned enterprises for political or private gain and ensure a level playing field with private companies. 57. There are various models for managing ownership.37 Ownership arrangements have evolved towards greater centralization, which is seen as a guarantee for effectiveness and ensuring clear distinctions between the roles of the State. Centralized arrangements delegate ownership functions to one designated entity — the ownership entity —, as is the case in Finland, France, Mozambique or South Africa. Some countries, such as Chile, Norway and Sweden, share ownership functions between one main ownership entity and other ministries, which are often in charge of specific sectors, while other countries, such as Bhutan and Malaysia, centralize ownership through a company-type structure. 58. Regardless of the model chosen, all government entities and departments in charge of exercising ownership rights for either all or some State-owned enterprises should take the steps necessary to ensure that they respect human rights. 59. While this is not yet the case in most countries, there are, nonetheless, practices to learn from. As examples in this section show, several States, such as Chile, Finland, Norway and Sweden, unequivocally use their ownership model to ensure that State-owned enterprises respect human rights, by explicitly stating their expectations in ownership policies or principles and the tasks that the ownership entity will commit to in order to ensure respect for human rights. 36 37 14 See SASAC Guidelines, guideline 1(4) (see para. 47 above). All examples are from The World Bank Toolkit and answers to the questionnaire.

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