The UN Global Compact – A Corporate PR Vehicle
If there is any doubt about where the interest of those in control of the UN lies, the so-called Global Compact is a clear illustration of the postures that appear to change so that everything remains the same. The Global Compact, proposed by the UN Secretary General in 2000, originally had nine principles, to which the principle to fight corruption was later added. Beside this matter, the Compact covers the areas of human rights, labour rights and the environment. Having a moral nature, the principles are offered to be observed by companies exclusively on a voluntary basis. In most sectors of organised civil society they are regarded as a rhetorical instrument of public relations, given its nature deprived of a balance since they are extremely business friendly.
It is important to assess the Global Compact, for it reveals the prevailing line of thought in the UN and because of its influence in the postures of the UN Human Rights Commission in one of its last reports, since it frequently uses it as a reference and as a positive example to be followed: Internationally, many companies participate in the UN Global Compact, which stipulates that those companies should support and respect internationally proclaimed human rights (paragraph 23).1
Scarce business interest. The truth is that the Compact enjoys scarce participation despite its excessive consideration for the interests of the owners of the market. According to the Compact’s own portal (December 2007), there are only 4.326 corporations out of 70.000 global businesses and almost 700.000 subsidiaries, according to the UN.2 Moreover, currently it has 782 inactive companies, since they have failed to have ever reported –or at least have not done so in the last two years– about their compliance with the ten principles of the Compact.
It also has 441 businesses that have not reported after they missed their deadline.3 This is despite, as even the Commission’s Report explains, the principles of the Compact reliance on public accountability, transparency and the enlightened self-interest (paragraph 16 of same UN Human Rights Commission report E/CN.4/2005/91 ) and that the Compact does not specify what HR should be respected by business (paragraph 17). Such business interests are further discredited by the report of The Economist –a magazine so emblematic of the business vision– that many U.S. companies decided to join the Compact only after a three-year effort by the UN and the U.S. Bar Association, that produced a letter, full of legal boilerplate, which shields them from lawsuits based on claims that they have failed to live up to the compact. According to the magazine, this is how companies such as Gap, Starbucks and Newmont Mining had rushed to sign up.4 Coincidentally, it is quite interesting that at the end of 2007 –three years later– the Compact only had 95 active U.S. companies, 17 that had not reported on time and 32 inactive for not reporting. Considering that the U.S. is the largest economy in the world, it is surprising that less than three percent of all active companies in the Compact were from this country.
The market is king. The very low popularity of the Compact among companies, considering its extreme affinity with the business vision, which is reflected in the predominance of business members on its Board, is indeed surprising. What is not surprising is that Mr. Klaus Leisinger, who was Special Advisor (to then Secretary General Kofi Annan) for the Global Compact and who is Director of the Novartis Foundation (from pharmaceutical transnational Novartis) as well as a professor at the University of Basel, mirrors with crisp clarity the backdrop of the business thinking conveyed by the Compact. In his assessment of corporate responsibility for human rights,5 Leisinger is consistent in all his appraisals. To him the context is unambiguously the market.
In this way, business should determine its own values and not society. Accordingly, business should independently determine and design what Leisinger qualifies as “values management.” He asks: Where do we draw the limits of our responsibility...how do we define our sphere of influence? How should a company competing with integrity define “complicity”?6 By the same token, in regards to the “decision-making process” relative to the commitments of business with HR, Leisinger declares that part of this homework is to identify the stakeholders essential to the company and to address their concerns and demands.7 That is, it is the company that decides who are its stakeholders and not society. This vision also implicitly carries the context that everything should be voluntary, for if business defines its values and the stakeholders affected by its activity then there is no place for a legal universal framework, resulting from a broad and democratic social consensus, making such decisions.
Guide to the Global Compact
A practical understanding of the vision and ten principles.
The purpose of this Guide is to explain the Global Compact initiative and the ten principles that underpin it in a way that will be useful within the context of training or teaching.
Through the power of collective action, the Global Compact seeks to advance responsible corporate citizenship so that business can be part of the solution to the challenges of globalisation. In this way, the private sector - in partnership with other social actors - can help realize the Secretary-General's vision: a more sustainable and inclusive global economy.
The Compact is a voluntary initiative promoting responsible global corporate citizenship. It operates on a leadership model in that it aims to bring a critical mass of business leaders on board to build a sustainable movement.
Click here to download a pdf of the guide
1. HUMAN RIGHTS COMMISSION. REPORT OF THE SUB-COMMISSION ON THE PROMOTION AND PROTECTION OF HUMAN RIGHTS. Report of the United Nations High Commissioner on Human Rights on the responsibilities of transnational corporations and related business enterprises with regard to human rights E/CN.4/2005/91. 15 February 2005.
2. United Nations Conference on Trade and Development. World Investment Report 2005. New York y Geneva, 2005
3. See: https://www.unglobalcompact.org/ParticipantsAndStakeholders/index.html
4. The Economist. Bluewashed and boilerplated. June 17th 2004
5. Klaus M. Leisinger. On Corporate Responsibility for Human Rights. Basel, Switzerland, April 2006
6. ibid, pages 6, 9 y 13.
7. ibid, page 8.