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UN Re-launches Global Compact with 7 Chemical Producers among 54 Lead Companies

Written By krishna on Saturday, April 09, 2011 | 7:58 PM

Note:Contrary to positive provisions in the UN Norms on Transnational Business, from the very beginning the credibility of UN's Global Compact, "an innovative public-private partnership" and its voluntary and demand driven nature "for businesses that are committed to aligning their operations and strategies with ten universally accepted principles in the areas of human rights, labour, environment and anti-corruption" has been questionable.

From UN Secretary General's initiating speech delivered at World Economic Forum, Davos in 1999, its launch in 2000, upgradation of the role of the “Global Compact Donor Group” in 2008, informal and self-organized “Friendhttp://www.blogger.com/img/blank.gifs of the Global Compact Group” for political guidance, 96 established and emerging local Networks, setting up of working groups on human rights,labor rights, anti-corruption, responsible business in conflict areas, and supply chain management, General Assembly resolutions entitled “Towards Global Partnerships” (latest 2010: A/RES/64/223) for strategically developing the capacity of the UN to collaborate with the private sector to UNGC Governance Note OF April, 2011, there has been formal efforts that attempt to establish credibility of GC and to undermine salutary and progressive efforts like mandatory UN Norms on Transnational Business.

GC has incubated the Principles for Responsible Investment (PRI), set up in partnership with the UNEP Finance Initiative, emerged as the leading platform for investors to incorporate environmental, social and corporate governance (ESG) issues
into their decisions. Likewise, the Principles for Responsible Management Education (PRME) represent the first globally recognized framework to integrate corporate sustainability into university curricula.

Global Compact's voluntary and business-led character is reflected by its two related global issue platforms: Caring for Climate and the CEO Water Mandate as well. It has been reported that till now, more than 2,000 firms have
been expelled for failure to report on implementation progress. Global Compact Office created integrity measures such as the mandatory Communication on Progress (COP) reporting framework as well as a logo and branding policy. The
COP requirement makes clear that those business participants who have been non-communicating for more than one year are expelled from the initiative.

It is claimed that among the members of GC there are Public sector organizations as well. Notably, from India there is only one such organisation, Grace Peter Charitable Trust.

Among the business association from India that are its members are Foreign Investment Promotion Organisation (FIPO), Management Development Systems Consultants (MDSC), The Associated Chambers of Commerce and Industry of India (ASSOCHAM), Focus India Group, AIMA - All India Management Association, Confederation of India Industry (CII), Construction Industry Development Council (CIDC), Federation of Indian Chambers of Commerce and Industry (FICCI), Standing Conference of Public Enterprises (SCPE) and Madhyanchal Organic Farmers Association (MOFA).

The UN Global Compact website claims that it "is the world's largest corporate citizenship and sustainability initiative. Since its official launch on 26 July 2000, the initiative has grown to more than 8,000 participants, including over 5300 businesses in 130 countries around the world. It is a network-based initiative with the Global Compact Office and six UN agencies at its core. The website claims that UN is "the world's only truly global political forum, as an authoritative convener and facilitator."

Gopal Krishna

UN Re-launches Global Compact with 7 Chemical Producers among 54 Lead Companies

The United Nations has re-launched its corporate sustainability initiative with 54 companies committing to higher levels of performance, impact and collective action relating to the objectives of the United Nations Global Compact.

In its first decade the Global Compact adopted thousands of company's corporate sustainability principles. It was criticised, however, by civil society organisations for lacking effective assessment and enforcement, and was ultimately perceived as being used as a public relations instrument rather than constituting a genuine commitment to progress.

The relaunch positions 54 "LEAD" companies as standard-bearers of the Compact. The LEAD companies have endorsed a Blueprint for Corporate Sustainability Leadership, promising "a new level of performance" in commitment and achievements from companies in the sustainability agenda.

Two elements are of particular relevance to the chemical sector. Firstly, the Core Business Contribution to UN Goals and Issues, which implies a challenge to manufacturers to contribute to the UN SAICM (Strategic Approach to International Chemicals Management) goal of achieving "the sound management of chemicals throughout their life cycle so that, by 2020, chemicals are used and produced in ways that lead to the minimization of significant adverse effects on human health and the environment."

Secondly are the issues around Transparency and Disclosure, where an emphasis on sharing sustainability information with all interested parties conflicts with an established tendency towards keeping secret the chemical ingredients of products. It will be a challenge for chemical producers to report on the chemical hazards in their product portfolio and work transparently towards developing and using safer alternatives.

The UN expects Global Compact LEAD companies to share their knowledge through the initiative's local networks in more than 90 countries and report on their activities at an advanced level. The LEAD participants have promised to work more actively with United Nations agencies, funds and programmes, many of which have built significant business partnership capacities in recent years in order to involve business in addressing global challenges.

Chemical producing companies that are members of the LEAD group
Bayer AG (DE)
Novartis International AG (Pharma) (CH)
Novo Nordisk (Pharma) (DK)
Novozymes (DK)
Sumitomo Chemical Company Ltd (JP)
Takeda Pharmaceutical Company Ltd (JP)

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