Can businesses operate responsibly in conflict-affected areas?
Business Ethics Debates | read time: 6 min
Published: 15 October 2026
The number of armed conflicts globally has risen significantly in recent years, and the geographical spread of conflicts has evolved too. Organisations that may previously have considered conflict a distant business risk are increasingly confronted with the impacts of conflict on their people, operations, supply chains, sourcing activities, business partners and long-term resilience.
Against this backdrop, GoodCorporation’s latest House of Lords debate posed what has become an urgent question for many organisations: can businesses operate responsibly in conflict-affected areas?
The discussion explored the complex risks that businesses face when operating and sourcing in conflict-affected and high-risk areas (CAHRAs), and the measures businesses must take to protect people, manage risk and maintain responsible operations in these environments.
Opening remarks
The debate was opened by Peter Nestor, Head of Human Rights at Novartis.
Peter explained that, as a provider of innovative and often life-saving medicines, Novartis would like to operate in every market in the world to preserve patient access to critical treatments. In CAHRAs, this requires Novartis to anticipate and navigate the complex risks these environments present. Deciding whether to begin or continue operating in a CAHRA, for Novartis, depends on a thorough assessment of the risks and the company’s ability to implement effective mitigation measures.
Peter shared two learnings from Novartis’ experience of building out its approach to Enhanced Human Rights Due Diligence (eHRDD) that can be useful for other companies:
- Develop a company-specific risk register to identify and prioritise the risks most relevant to your operations, ensuring that time and resources are directed towards the corresponding mitigations, rather than spread across risks that may not be relevant to your business.
- Integrate mitigating measures into existing processes rather than creating new, standalone activities
For Novartis, the starting point is a detailed local conflict analysis to understand the underlying dynamics of the conflict and the local actors involved.
This analysis can then be used to identify potential risks to the company, including risks related to the health and safety of employees, conflict financing, extortion, supply chain security (including dual-use products), the co-option of company facilities by conflict actors and severe labour rights abuses such as discrimination and child or forced labour.
The debate
Following Peter’s opening remarks, the debate chair, Leo Martin, invited guests to share if their organisation had a specific framework for deciding when and how to operate in CAHRAs, or whether these decisions are made on a case-by-case basis. The room was fairly evenly split.
Organisations adopting a framework-based approach
Some organisations have adopted a framework that guides their operations in CAHRAs. Examples included formal policies to prohibit sourcing in countries associated with serious human-rights abuses and clear governance procedures to guide responses to government requests such as network shutdowns. These organisations reported the value of a consistent and objective strategy for operating in CAHRAs, covering at least some parts of their business, while emphasising the importance of tailoring the framework to the local context.
Another guest noted that for organisations whose investment strategy focuses on CAHRAs, a framework that includes heightened due diligence is a baseline expectation given the elevated risk profile of the environments in which they operate.
Organisations adopting a case-by-case approach
Other organisations take a case-by-case approach, noting there are some aspects of conflict that a standardised framework may be unable to account for. These include questions of what is realistic to ask of actors on the ground during a conflict and the difficulties of conducting deep due diligence on the variety of actors that need to be considered.
One guest remarked that the absence of a framework to guide decision-making had led to internal disagreements when highly sensitive conflict-affected environments were under scrutiny.
Many of these organisations noted the shifting geopolitical landscape necessitated a more standardised approach to CAHRAs that can be adapted to local contexts.
Managing interconnected risks
While human rights is often the primary focus of discussions about conflict-affected areas, the discussion highlighted other risks often interconnected with human rights. Corruption, fraud, health and safety, security threats and sanctions exposure rarely arise in isolation and can compound one another, reinforcing the need to integrate conflict-related considerations into broader enterprise risk management systems.
Organisations need to understand how their operations may influence broader conflict dynamics or affect the interests of local actors, and make difficult decisions about how to handle the possibility that tax payments or other financing activities may support conflict actors or that products or infrastructure might be diverted for conflict-related purposes.
Practical challenges of conducting hHRDD
The UN Guiding Principles on Business and Human Rights and the OECD Due Diligence Guidance provide important foundations for businesses seeking to identify, prevent and address adverse human rights impacts. However, the discussion highlighted the practical challenges of applying these principles in conflict-affected areas (CAHRAs), where circumstances can change rapidly and reliable information may be difficult to obtain.
Guests described the difficulties of understanding local conflict dynamics, particularly where organisations have limited presence on the ground and information from different sources may conflict with each other or be influenced by the interests of those involved. These challenges can make it difficult to assess risks and determine whether mitigation measures are effective, especially when decisions must be made quickly as circumstances change.
Participants also raised the issue of overlapping and potentially competing legislative requirements across jurisdictions. One example is the new supply chain security legislation China introduced in April 2026, which restricts certain investigations, information requests and audits by foreign organisations where they are viewed as threatening supply chain security or contrary to Chinese law. This legislation may create tensions with the EU’s Corporate Sustainability Due Diligence Directive (CS3D), which imposes requirements for organisations to conduct risk-based due diligence throughout their supply chain. Such differences in legal requirements can create uncertainty for organisations seeking to meet their due diligence obligations while operating across multiple jurisdictions.
These challenges also raised broader questions about the feasibility of operating responsibly in CAHRAs. One guest questioned whether the commercial benefits of operating in these environments justified the significant time and resources required to manage the risks, while the discussion also considered whether some risks may remain impossible to mitigate fully, even with robust due diligence and oversight.
The question of responsible disengagement
Responses varied on the question of disengagement. Whilst most organisations advocated for implementing safeguards to continue operations in conflict-affected areas, many endorsed the establishment of clear red lines for deciding when operations must be suspended. Several guests cited examples where their organisations had elected to suspend operations, including in Myanmar and Sudan.
Organisations providing what may be considered essential goods or critical services, such as telecommunications and construction, emphasised the potentially detrimental impacts of withdrawing operations. They noted their organisations provide livelihoods, critical infrastructure and/or goods and services essential to the realisation of certain human rights. From this perspective, disengagement can be harmful for workers and local communities.
When considering whether to suspend operations, most organisations agreed that the risk of operating in the CAHRA must be weighed against the potentially detrimental impacts of exiting. One approach suggested during the debate was to incorporate a regional perspective into conflict risk analysis. Rather than treating an entire country as a single risk environment, organisations should assess conditions on a regional basis and consider whether operations could continue responsibly in areas where risks were more manageable. This could help avoid situations in which the heightened risks in one region lead to the unnecessary withdrawal of essential goods or services from other parts of the country.
Ultimately, guests agreed that the decision of whether to stay or exit a conflict-affected area is not binary. Businesses must be prepared to reassess their approach as conflict dynamics evolve, considering both the potential impacts of their continued presence and the consequences of withdrawal. Responsible decision-making requires organisations to understand these trade-offs rather than assume staying or leaving is inherently the more responsible option.
GoodCorporation’s perspective
Operating responsibly in conflict-affected and high-risk areas requires businesses to make difficult decisions in complex and rapidly changing environments. Our experience shows that effective heightened due diligence must go beyond generic risk and due diligence frameworks, combining a detailed understanding of local conflict dynamics with an assessment of how a company’s activities may affect the conflict and people. Human rights, corruption and sanctions risks must be considered together and integrated into business decision-making.
Businesses also need clear criteria for deciding when risks can no longer be managed responsibly. These should be established from the outset and reviewed as circumstances evolve. However, withdrawal is not always the most responsible option. Decisions to stay or leave must therefore account for the potential consequences of both and be underpinned by a responsible exit framework.
GoodCorporation has supported organisations in 38 countries classified as conflict-affected and high-risk areas. Our work in heightened human rights due diligence, security-related human rights risks, responsible exit and anti-corruption helps businesses strengthen their approach to responsible operations and exit and make informed decisions in challenging environments.
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