THE GLOBAL COMPACT

Global Compact on the web: http://www.globalcompact.org

United Nations Secretary-General Kofi Annan introduced the Global Compact in an address to the World Economic Forum in 1999. He challenged world business leaders to help build the social and environmental pillars required to sustain the new global economy and make globalisation work for all the world's people. He argued that because markets have gone global, so, too, must the principle and practice of corporate citizenship. In the new global economy, it makes good business sense for firms to internalize these principles as integral elements of corporate strategies and practices.

The Global Compact is a value-based platform designed to promote sustainable development through partnerships between the UN and business. Corporations that join the Global Compact agree to follow nine human rights, labor rights and environmental principles.

NGOs are very skeptical about these partnerships. They argue, partnerships should be entered between parties that share the same goals, which is not the case with profit oriented corporations and the United Nations. In some cases, the UN is forming partnerships with known human rights violators, or despoilers of the environment. NGOs particularly criticise partnerships with companies like Nike and Shell, companies that violate human rights norms and exploit the worst dynamics of corporate globalisation.

In the case of the Global Compact, NGOs complain that there is no monitoring of corporate adherence to these principles and no enforcement. As there are no monitoring and enforcement mechanisms, NGOs fear that the Global Compact serves as an ideal corporate greenwash instrument in the run-up to the WSSD, thus heavily questioning the credibility of the UN. At the same time the initiative distracts international attention to the needs of regulatory frameworks for global corporate behaviour such as the recently proposed Convention on Corporate Accountability.