Consider the following scenario. Your company and a local business partner just entered into a joint venture in a dynamic new market: it is a match made in heaven between the two groups, but once you mention your global diversity and inclusion policy, your new partner argues it goes against local culture and traditions.

Here's another: you have established a profitable healthcare business in a new country, but parliamentarians there are now tabling a law that would require you to turn over information about gay clients to the police.

Some of the most prominent multinationals, from Ikea to Coca-Cola, have found trouble trying to follow local law in parts of the Middle East, the former Soviet Union, Africa and East Asia, where anti-gay sentiment tends to be deeply embedded against a backdrop of populism and anti-western sentiments. Today, denouncing the “arrogant imposition of Western values” delivers a clear political premium in some parts of the world.

In July, Starbucks made headlines when prominent religious groups in Indonesia and Malaysia called for a boycott of the brand to protest against its support of gay rights. A #boikotstarbucks hashtag briefly spread on Twitter but stores have since remained open, as busy as ever. The coffee company kept away from the controversy but did not retract either from its position that “being open, inclusive and forward-thinking is at the core of what Starbucks is about.”

The dividends of inclusion
On the other hand, companies are also aware of the potential dividends of lesbian, gay, bisexual, transgender and intersex (LGBTI) inclusion, a business and economic case that the World Bank Group has highlighted in numerous studies. This is particularly true for purpose-driven brands: global advertising giant Ogilvy published a study in June which found that seeing a brand's LGBTI-inclusive advertising would make 46% of Americans more likely to consider purchasing its products/services – a figure that rises further still among younger demographics.

Companies find themselves stuck between a rock and a hard place as pressure arises from, on the one hand, any perceived betrayal of the values of the company’s shareholders, customers or watchdogs when they do not stand for human rights, and the fear of getting excluded from promising new markets that have not yet fully embraced the human rights of LGBTI people on the other.

Business objectives vs. human rights

There are many other challenges that companies face when trying to reconcile achieving
their business objectives and respecting their human rights responsibilities as outlined in the 2011 UN Guiding Principles on Business and Human Rights. Concretely, it means that companies have to be increasingly prepared to respond to human rights challenges linked to LGBTI issues, and to understand what they are responsible for.

But beyond discharging their responsibility to respect human rights, companies also have
unprecedented opportunities to support human rights — including the rights of LGBTI people — in the countries where they do business. This leverage was best illustrated by the coalition of US companies campaigning against the infamous “bathroom bills” designed to prevent trans individuals from using the bathroom corresponding to the gender they identify with. It was also showcased when Singapore’s LGBT pride rally, “Pink Dot”, attracted sponsorship from a record number of local companies this year despite tighter regulations aimed at stopping foreigners from supporting it.

What’s a business to do?

At the World Economic Forum in Davos in January 2016, United Nations High Commissioner for Human Rights Zeid Ra’ad Al Hussein announced that his Office (OCHCR), together with the Institute for Business and Human Rights and UN and corporate partners, would develop guidance for businesses on the steps that companies can and should take to tackle discrimination and other human rights violations against LGBTI people globally.

Over the next few months, the UN Human Rights Office is launching that guidance in the form of a set of Standards of Conduct for Business, with events planned in New York (26 September), Mumbai (12 October), Paris (16 October), London (30 October), Honk Kong (14 November), Geneva (29 November) and Melbourne (5 December).

These new standards call for companies to have anti-discrimination policies in place,
exercise due diligence and establish effective grievance mechanisms. They also urge
companies to equalise staff benefits and sensitise managers, and to take steps to eliminate discrimination against LGBTI customers, suppliers and distributors – and to require the same of their business partners.

Perhaps most ambitiously, the standards challenge companies to stand up for the rights of LGBTI people in the countries where they do business – including through dialogue and advocacy, support for local community organisations, and, in some cases, civil disobedience. These standards hold companies to a meaningful standard, but without being so prescriptive as to make them impossible to implement from industry to industry and from state to state. Early adopters include major firms from a wide array of industries such as Accenture, Baker McKenzie, BNP Paribas, The Coca-Cola Company, EDF, EY, Gap, Godrej, IKEA, Microsoft and SAP.

Obviously, the development of the standards themselves solves only a small part of the
problem; it is in the widespread application of their underlying principles that a long-term solution lies. For its next step, OHCHR is encouraging civil society to develop a mechanism to monitor and ideally support, through best practices, adherence to the standards and to point out shortcomings.

The benefits of such an approach could well have a transformative impact. By working together around these common standards, and harnessing the support of civil society, LGBTI organisations, investors, trade unions, lawmakers and governments, the business world has an opportunity to change the lives of millions of LGBTI people around the world for the better. The most efficient and thorough way for companies to address the LGBTI conundrum is for themselves to take the lead in accelerating social change.