Press Conference to Present United Nations Global Compact’s 2010 Review,

 

Findings of Annual Implementation Survey

 

With the corporate world increasingly aligning itself with the goals of the United Nations, the Organization enjoyed growing private-sector support as well as more partnership activities on the ground to address key initiatives relating to health, poverty reduction and the environment, Georg Kell, Executive Director of the United Nations Global Compact, said today at Headquarters.

“The Global Compact has become the UN’s premiere business/corporate engagement platform,” he told a press conference to present the Global Compact Annual Review 2010, which includes an update on the initiative’s growth, priorities and governance, as well as the findings of the Global Compact’s 2010 Annual Implementation Survey.  (See also Press Release ECO/192)

Since its 2000 launch with only 40 corporations and civil society organizations, the Global Compact had grown rapidly to more than 6,000 participants from over 130 countries, he said.  Nearly 100 country networks were also up and running, allowing participants to undertake dialogue, learning and partnership projects on such issues as the Millennium Development Goals and community investments.  While more than 2,000 corporate participants had been expelled in the two years since the Global Compact had started implementing strict integrity measures — with roughly 100 corporations de-listed monthly — more than 100 were joining every month, he noted.

Spotlighting some of the Global Compact’s recent work, he said it had organized a private sector tract to support the Fourth United Nations Conference on the Least Developed Countries, held last month in Istanbul, Turkey.  Among other things, that effort had engaged 600 executives in finding ways to bring business to least developed countries, he said, adding that the Global Compact was gearing up for the 2012 United Nations Conference on Sustainable Development (Rio+20), to be held in Rio de Janeiro, Brazil.

Turning to Implementation Survey — the world’s most comprehensive study on the implementation of corporate sustainability issues — he said the third such study in as many years provided good “progress indicators” that allowed the identification of benchmarks on implementation trends.  Among the Survey’s main findings was that increasing numbers of corporate participants had found that their engagement with the Global Compact had resulted in concrete operational changes.

That meant that the Global Compact’s working groups on anti-corruption, environment, supply-chain, business and peace were making a difference, he continued.  However, the “not so good” news was that only a small fraction of the corporate world was engaged on those issues.  Indeed, the Global Compact was working with just 6,000 out of 80,000 multinational companies.  Moreover, by their own assessment — confirmed by an independent Wharton School review from — only a quarter of those firms were on the front end of those issues.  The other 75 per cent found themselves to be “beginners” with a long way to go.

He went on to say that this year’s findings confirmed last year’s revelation that human rights and anti-corruption efforts posed the most difficulties to companies.  Nonetheless, anti-corruption activities had rebounded in 2010, while there was also a “significant surge” in environmental issues in all regions and among corporations of all sizes.

Other important findings were that large corporations had clearly outperformed smaller companies on all scores, he said.  Publicly owned companies had the highest performance record, with State-owned companies second and privately held companies exhibiting the lowest performance records.  The report also showed the huge gaps between stated corporate policy and actual implementation.  He underscored the significance of such gaps, particularly in the complex areas of corruption and human rights, noting that they cut across all aspects of implementation.  For example, less than 20 per cent of the corporations participating in the study — and arguably among the leaders of the global movement on those issues — currently recorded gifts and facilitation payments.

He further noted that the implementation gaps extended to subsidiaries, saying that only 28 per cent of those were actually implementing the directives and policies developed at their headquarters.  The story was even grimmer with respect of the supply chain, which from a corporate angle, was critical to changing the world.  While 65 per cent of the survey’s 1,300 participants said they had made sincere efforts on supply chain, concrete efforts were actually much smaller, demonstrating the depth of the implementation gaps.

Mr. Kell went on to stress that growing numbers of the Global Compact’s 6,000 participants were actually taking action in support of United Nations goals, whether through the Global Issues Working Groups or in partnerships with non-governmental organizations.  Indeed, 76 per cent of them were engaged in concrete actions, a significant improvement over previous years.

Looking to the future, he said that while the Global Compact was going strong, it would face major challenges.  For that reason, it had introduced a “Blueprint for Corporate Sustainability Leadership” a few months ago, to demonstrate that it was possible to be a sustainability leader and also succeed in the commercial domain.  However, the Global Compact had a real scale issue: while 6,000 might sound like a big number, it was a small fraction of the global corporate world, he noted, adding that to change the world and have an impact on global markets, the Global Compact’s stated goal was to go from 6,000 to 20,000 as the world moved towards Rio+20.

Announcing that the Annual Local Network Report was being launched on the Global Compact website today, he said it provided information on what in-country networks were doing and provided a “fairly good picture” of how the corporate world was increasingly aligning itself with United Nations goals by internalizing their own principles and taking action in support of the world body’s goals.

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For information media • not an official record