Tuesday, August 7, 2007

Global Compact

One of the bigger items in the last two weeks was the triennial meeting of the UN Global Compact. Actual before the conference I had never heard of the compact. In fact, as I found out it had been founded in 2000 by Kofi Annan. The Global Compact is a volunteer grouping of companies who wish to follow a set of ten principles covering human rights, labor standards, and the environment. Companies which join must submit a "Code of Practice"(COP) stating what they will do to follow the 10 principles.

You can find the resolutions from the meeting and related information at the global compact's website.

The Global Compact is a good example of a good idea in theory, but not in practice. It is good for companies to get involve, but is very possible that companies use their COP as a public relations exercise to say "see how 'responsible' we are" -- without doing anything concrete.

I did have a laugh (albeit a sarchastic laugh) at a statement before the conference, which stated that US companies are reluctant to sign up to the compact because it was "not binding". Are these not the same people who say that environmental regulations should be voluntary? It shows how hollow their agrument opposed to environmental regulations really is.

Of the about two thousand companies worldwide that signed the compact only about 30 are in the Fortune 500. That shows the big problem.

One of the companies signed up to the compact is Nestle. That was the same company whose CEO said at the World Economic Forum a few years ago that businesses should forget about social responsibility and instead should be making profit because that what it shareholders want.

In conclusion, it appears that the global compact is being joined by few big businesses, and many of those that have signed are using it as "green propaganda".

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