Successful examples of international agreements which have then been translated into national regulation or legislation include:
The Convention on International Trade in Endangered Species of Wild Fauna and Flora has been in place since July 1975. As of June 2007, there are 171 Parties.49
The World Trade Organization is the only international organisation dealing with the global rules of trade between nations. Virtually all decisions are taken by consensus among all member countries and ratified by members' parliaments. It also has a legally binding way of settling disputes amongst members.50
In emerging countries, enormous needs still exist for potable water delivery - more than one billion people still don’t have access to it - and for the provision of wastewater treatment and services. But the lack of enforceable legal frameworks, weak governance and the failure of national governments to respect contracts are major obstacles to achieving significant progress. As a result, SUEZ, for example, who is a major actor in Europe, North Africa, the Middle East, North America and China, has been forced to terminate several large water contracts in Latin America, despite undisputed achievements and huge increases in the amount of water and wastewater connections. On a global scale, there is no risk of water shortage, because, thanks to the water cycle, water never completely disappears. The problem is in its uneven allocation amongst various countries or regions around the globe. However this can be avoided and remedied in a sustainable way by sound management of the water resource, based upon technological solutions such as leak detection, desalination or water reuse, which is SUEZ's expertise. Such technologies are already available and used for example in Australia and the Middle East. However, what is mostly required is political will and good local governance to allow for viable and sustainable partnerships.
Infosys believes that progress comes from aspiration and imagination, which only comes from people. The development of human capital is vital to lifting people out of poverty, and business can accelerate this development, particularly where governments and communities are unable to keep pace. Infosys contributes in a phased way:
- Primary education - the Infosys linked Akshayapatra foundation feeds 82,000 kids daily in various parts of India, and brings more children into education.
- Secondary education - provides school children with better infrastructure - Infosys contributes to libraries and facilities in schools including donating books to 15,000 libraries, constructing hostels for underprivileged children, renovating schools, donating to computing facilities and providing scholarships to 1,700 meritorious students.
- Tertiary education - where students are equipped and skilled to join industry - Infosys partners with universities- programs such as Campus connect which spans over 100 universities, and InStep – which focuses on 50+ top universities across the world.
- lifelong career coaching - as the world globalises, all societies will need to constantly coach their communities to continue to remain competitive, and Infosys has an evolved 15,000 person, fully residential facility to enable this.
BP’s values include a commitment to producing energy in a way that respects human rights. Yet like many companies working in emerging economies, it faces challenges when national frameworks of human rights are not fully developed and it needs to draw up agreements with host governments that create appropriate safeguards for its projects. In 2003, Amnesty International published a report, Human Rights on the Line, alleging that BP and its partners had effectively created a ‘human rights-free corridor’ for the Baku-Tbilisi-Ceyhan pipeline as a result of the agreements signed with governments. BP’s joint venture company, BTC Co., responded by engaging in dialogue with Amnesty International, confirming its commitment to the Universal Declaration of Human Rights and International Labour Organization conventions and making a specific commitment not to seek compensation from the Turkish, Georgian or Azeri governments for any action taken on the basis of obligations under international human rights, environmental or other treaties.
“There are medium to long-term problems that cannot be solved unless companies openly participate in public policy issues. But many companies don't feel it is appropriate to take positions ... and so stay at a distance. The world has moved on and companies have to engage now.”
Karina Litvack, Director, Head of Governance & Sustainable Investment. F&C Management.51
In October 2006, the UN Global Compact office removed 335 companies from its global list of participants as part of a drive to elevate the integrity and accountability of the initiative.52
The Equator Principles were drawn up in 2003 by a group of banks working with the World Bank’s International Finance Corporation (IFC). The principles are designed to ensure that financed projects are developed in a manner that is socially responsible and reflect sound environmental management practices. By the end of April 2007, they had been adopted by 51 financial institutions from 19 countries.53
Extractive industry companies worked with NGOs, such as Amnesty International, and governments to draw up ‘The Voluntary Principles on Security and Human Rights’. These principles; “guide companies in maintaining the safety and security of their operations within an operating framework that ensures respect for human rights and fundamental freedoms.” 54
The Business Leaders Initiative on Human Rights (BLIHR) was founded in May 2003 and at the time of writing there are 13 member companies including ABB and Alcan. Its principal purpose is to find “practical ways of applying the aspirations of the Universal Declaration of Human Rights within a business context and to inspire other businesses to do likewise.” 55
The exposure of the sale of rough diamonds to finance violence was widely publicised by a group of NGOs following the Angolan Civil War. This led multinational companies to re-assess their practice of buying diamonds on the open market. A dialogue was opened, culminating in the negotiation of an international certification system for the diamond trade. In June 2007, The Kimberley Process Certification Scheme covered 46 participant states and regional organisations, which accounted for an estimated 99.8% of the world’s rough diamond trade.56
The Extractive Industries Transparency Initiative (EITI) launched in June 2003, aims to increase transparency in transactions between governments and companies within extractive industries. Participants include government, industry, and civil society representatives.57
ISO standards are voluntary, but some – mainly concerned with health, safety or the environment - have been adopted or used as reference points in national legislation or international market requirements. The ISO 14064 standards for greenhouse gas accounting and verification published on 1 March 2006 resulted from the work of some 175 international experts from 45 countries and 11 international business, development or environmental
organisations.58
The Energy Efficiency in Buildings project includes leading companies in the building, equipment and energy industries. Participating companies are developing a roadmap to focus on designing, financing, building and operating commercial and residential structures that are energy self-sufficient. Meanwhile, local initiatives are being explored, such as collaboration to work towards zero net energy buildings between China's Ministry of Construction, the China Business Council for Sustainable Development (CBCSD) and local businesses.59
Ford contrast their differing experiences based on the approaches they have adopted:
- Unilateral Initiative - in the late 1990s Ford Motor Company gave a public signal on its readiness to react to global warming by issuing a unilateral commitment to reduce fuel consumption from its US Sports Utility Vehicles by 25% over five years. The commitment was started, but not carried through, as competition did not follow, and the incremental Ford investment into low-CO2 technologies could not be recovered in the market. This would have made Ford uncompetitive, and hence the initiative had to be abandoned.
- Concerted Initiative - in the same period of time, Ford of Europe equally wanted to make a signal on climate change and proposed to reduce CO2 emissions from passenger cars by 25% over 10 years. Before going public, Ford of Europe talked to all European competitors and convinced them to sign a Voluntary Agreement where everybody committed to contribute to CO2 reduction. This was done, it ensured a level playing field, and the commitment was successfully carried out.
Nike developed a comparatively high-cost supply chain in response to brand damage in its key youth markets in Europe and North America over poor labour standards. It therefore had no choice but to work to establish industry-level standards through its support of the Fair Labour Association. Realising that a voluntary initiative, whilst a significant improvement, could still not overcome free-riders and laggards, Nike went even further by advocating formal regulation among national, regional and global policy-maker groups.60