UN Global Compact: Is big business saving the world?

More than 9,000 companies from all over the world have joined the UN Global Compact. It's an initiative to drive forward the UN’s sustainable development goals — a set of 17 development targets world leaders agreed in 2015 — through the private sector. The Global Compact's latest report on whether these efforts actually yield results says its "findings are encouraging:" 75 percent of the businesses that have signed up now take some form of action; more and more companies are joining.

But not everybody sees that as great news. The UNGC also has many outspoken critics, who are skeptical of the UN cozying up to private corporations. As top business leaders are meeting in New York for the UNGC Leaders Summit, DW spoke to Cloe Franko, a senior organizer at Corporate Accountability International, a non-profit organization fighting to stop corporate abuse.

DW: What the UNGC report basically says is that businesses are on the right track to make this world a better place. Do you agree?

Cloe Franko: The report showed a number of corporate commitments in the UNGC, but did not demonstrate that those corporations are having a positive impact through their stated commitments. The UNGC provides a platform for corporations to advance their brands and promote their association with the UN - with little or no action. It's a voluntary initiative, which corporate actors use to advance their own agendas and bottom lines. But they don't significantly change the playing field around, for instance, health, the environment and labor - which the UNGC claims to advance. It is primarily a PR scheme.

But the report says that 75 percent of businesses in the Global Compact are taking real action on the sustainable development goals. What do you think about that?

As I reviewed it, I saw there's a figure that reports on which action companies have taken to embed sustainability throughout their strategy and operations. It stood out to me that the highest tier of compliance in that graphic is the corporations that publicly communicate their commitment to corporate responsibility. What I'm seeing is that the promotion of the corporations' own corporate responsibility is being taken more seriously than the actual monitoring, evaluation or policy implementation.

But nothing's ever perfect, right? Isn't some commitment from the private sector to save the planet better than no commitment at all?

Unfortunately, what we've seen time and time again is that corporations use these sorts of voluntary initiatives as a means of actually heading off more binding regulation. They use initiatives such as the Global Compact to try to convince the public and regulators that they don't in fact need to be regulated. In that sense I would say that their existence actually has a net negative impact on the advancement of corporate accountability and human rights through the UN system.

Does that mean that the UN shouldn't ever work with the private sector?

I won't say there is never an opportunity for the UN to be interacting with corporations. But if governments and the UN intend to make corporations more accountable to people and the environment, there's an entire movement right now to create the global treaty on transnational corporations and human rights, which will be a binding mechanism to reign in corporate abuse. It would give governments and the UN a platform under which to actually advance corporate accountability and human rights within the UN system.

If you could make one change to the UNGC as it's set up at the moment, what would it be?

It would have to be a shift towards making the currently voluntary commitments under the UNGC binding for each of the corporate members in it.

So basically making sure that companies actually follow through on what they sign up for?

Exactly.