STRATEGIC FRAMEWORK ON A NATIONAL ACTION PLAN ON BUSINESS AND HUMAN RIGHTS FOR MALAYSIA VI. POLICY OBJECTIVES FOR AN NAP ON BUSINESS AND HUMAN RIGHTS A. Pillar I – State Duty to Protect Foundational Principles Guiding Principle 1 States must protect against human rights abuse within their territory and/or jurisdiction by third parties, including business enterprises. This requires taking appropriate steps to prevent, investigate, punish and redress such abuse through effective policies, legislation, regulations and adjudication. Guiding Principle 2 States should set out clearly the expectation that all business enterprises domiciled in their territory and/or jurisdiction respect human rights throughout their operations. (1) Prioritise actions to address specific domestic and overseas business and human rights challenges affecting Malaysia and ASEAN 34. Malaysia’s NAP on business and human rights should include effective action to prevent and remedy adverse business-related human rights impacts that arise in relation to specific thematic issues and sectors. Examples of thematic issues that have been in the spotlight in Malaysia include the abuse and exploitation of migrant workers, human trafficking, child labour, forced labour, infringements of indigenous peoples’ rights and environmental rights. Examples of sectors with known human rights challenges include the electronics, hydropower and the plantations (e.g. palm oil and timber) sectors. A notable issue cutting across these themes and sectors is that of managing human rights risks and impacts along supply chains. These examples are not exhaustive and there may be other key business and human rights challenges. It is important to note that the intention here is not to single out sectors or industries to name and shame, but to identify areas that require the efforts of these industries and other relevant stakeholders to problem-solve. 35. Effective action should be based on an adequate understanding of the nature and causes of these specific business and human rights challenges. For example, the Commission has found that in the hydropower and plantation sectors, adverse human rights impacts have arisen due to poor community engagement and inadequate environmental and social impact assessments.36 Adequate monitoring and effective enforcement is required to ensure that environmental and social impact assessments (ESIAs) are conducted and are adequate. Better training of company officers is likely required to ensure adequate community engagement. Importantly, to adequately understand the nature and causes of the problems, affected stakeholders should be consulted for their input. 36. The overseas human rights impacts of Malaysian companies, especially in countries known for weak governance, also deserves attention. Malaysia’s FDI outflows were in 2011 the fifth largest in Asia at US$15 billion.37 (This increased to US$17 billion in 2012 and were at US$13.6 billion in 2013.)38 Malaysia was the source country with the second highest FDI inflows into Cambodia in 13