Press Conference by Executive Director of Global Compact Office

 

The Executive Director of the United Nations Global Compact Office said today that, while corporate responsibility continues to be high on the business agenda despite the worldwide economic downturn, many companies had nevertheless failed to implement key policies on human rights and anti-corruption.

Georg Kell, who briefed correspondents on the upcoming 2010 Global Compact Leaders Summit — to be held in New York next week — also introduced the tenth anniversary addition of the United Nations-led initiative’s Annual Review, saying the worldwide survey revealed much progress, but also serious gaps in corporate efforts to advance corporate responsibility.

According to the survey, the financial crisis and subsequent economic downturn appeared not to have slowed down efforts to advance responsible business conduct, yet global challenges like corruption or human rights remained neglected, said Mr. Kell.  “This is something we have long known, but the survey, the review puts the spotlight on it and shows where the bottlenecks are,” he declared.

A total of 1,044 businesses in 97 countries, representing nearly 20 per cent of all of the Global Compact’s participants last year, took part in the survey and the key findings included that, while a majority of companies reported implementation of key labour and environment policies, only 31 per cent had done the same for human rights and 32 per cent for corruption.

He said that the Survey was the world’s most comprehensive implementation stocktaking of how that agenda had evolved and how business was embracing non-financial issues.  The survey formed the basis for the 2009 Global Compact Annual Review, released today at United Nations Headquarters.

The mission of implementing those non-financial issues in corporate strategies and operations had been what had been driving the Global Compact and, as the Secretary-General had often stressed, was a critical way of disseminating United Nations values while at the same time enabling the Organization to build a new platform for advancing its goals.  “This time, the Millennium Development Goals are very high on the agenda,” he added.

Highlighting some of the other main findings, Mr. Kell said, to begin with, the good news was that from the initiative’s perspective, the economic downturn had not diminished engagement.  On the contrary, there were many indications that many participants had deepened their dedication to the issues which the Compact was advancing; largely because ethics were “back” and long-term forecasts had proved to be more important than an obsession with short-term profit maximization.  Also, the entire notion of risk assessment integrating non-financial issues was increasing understood as being important.  Additional to all that, there was recognition of important gaps, especially those concerning subsidiaries supply chain, he explained.

Another important finding was that about half of the Compact’s corporate participants were engaged in partnerships for development - something his office intended to stress scaling up significantly at the upcoming summit – ranging from environmental projects to women’s empowerment, community investment and the like.  Continuing, he said that the Global Compact, while voluntary, had a mandatory disclosure policy, meaning that participants that failed to present an annual progress report were de-listed and already more than 1,300 such non-compliant participants had been de-listed.  But despite that de-listing, the “appetite” for disclosure continued to rise, he noted.

Turning to the Leaders Summit 2010, which would mark the tenth anniversary of the Global Compact, he said that event would be a historic gathering of more than 1,000 leaders from more than 100 countries representing business executives, civil society, labour, the investment community and academia, as well as Government and the United Nations.

Mr. Kell said the summit aimed to take stock of the Global Compact initiative, which at this point, remained the world’s largest voluntary corporate-citizenship scheme with over 8,000 participants from more than 130 countries, 6,000 corporate participants and over 2,000 other stakeholders.  The Leaders Summit also hoped to chart the Compact’s future course.  Major “new deliverables” would be unveiled, including a blue-print for sustainability; to include the latest tools on supply chain management, environmental stewardship, anti-corruption and a host of activities to build partnerships for development between business and non-State actors, including Governments.

Overall, he believed the last 10 years of the Compact’s existence had resulted in some significant trends which were important for policymakers and for international organizations, which meant that non-financial issues, United Nations values and principles had actually become material for investment decisions, analysis and corporate strategy.  Another important trend that made him hopeful was that it appeared possible to build a new era of sustainability was the emergence of investors and educators who were largely absent 10 years ago, but today were very active.

“So, with these positive trends, we hope to have a good chance next week to actually give a big boost to long-term thinking and to change mind-sets and signals; and to also make the United Nations more effective by bringing together better what works in terms of partnerships — public and private,” he said.

In response to correspondents’ questions on his Office’s policy regarding corporate use of child labour, Mr. Kell said the Global Compact was “a learning platform”, and supported “engagement and dialogue” wherever it could but would not back or approve of any child labour practices.  His office currently had over 90 country networks more than half of which dealt with issues that stakeholders raised and many solutions were found that way.

Additionally, use was made of the Compact’s good office by forwarding issues to companies which often also led to positive resolutions.  Some of those issues were pending and always ongoing, he explained.  He cited the anti-tobacco movement, saying the Global Compact had embraced the World Health Organization’s framework agreement and, therefore, discouraged tobacco companies from joining, but the Compact had no legal basis to keep them out because they were legally tax-paying corporations established by Member States.  The Global Compact had a policy not to accept, primarily the contributions from tobacco companies, and similar companies whose policies or practices were at variance with the Compact’s aims.

* *** *

For information media • not an official record