Global Policy Forum

UN 'Global Compact' Principles Appearing

UN News Service
March 23, 2001

Sixteen thousand oil workers in 23 countries -- including Vietnam, Venezuela, Angola and Azerbaijan -- are now covered by a pact which not only guarantees respect for their labour rights and for their health and safety on the job, but also holds their employer to a commitment to promote human rights, environmental and labour standards in their respective communities.

The agreement, signed last week by Statoil, a Norwegian-based state multinational scheduled for partial privatisation later this year, and the 20 million-member International Federation of Chemical, Energy, Mine and General Workers' Unions (ICEM), is specifically patterned on the guiding principles of the Global Compact initiative launched by UN Secretary-General Kofi Annan, according to company and union representatives. The Compact brings together multinational businesses and global labour and civil society organizations to seek ways to ameliorate the harsh effects of globalization and to expand its benefits.

"The Global Compact engages the private sector directly in promoting a set of universal principles in the areas of human and labour rights, and the environment", commented UN Assistant Secretary-General John Ruggie, Special Advisor to the Secretary-General. "This agreement between Statoil and ICEM is a very exciting development, which shows how the Compact can be used constructively to advance social dialogue and social partnership -- ultimately the only viable response to the many challenges of globalization."

The ICEM-Statoil deal is only the most recent example of a snowballing trend towards international social dialoguing, including "framework" labour agreements, according to Jim Baker, director of the Department of Multinational Enterprises Organising and Recruitment at the International Confederation of Trade Unions (ICFTU). Such agreements allow unions to deal with multinational corporations at a global level on the basis of common principles, including fundamental workers' rights that are incorporated in core conventions of the International Labour Organization. The rise to prominence of the Global Compact over the last year has been both a reflection and a spur to this trend, Mr. Baker said.

A new aspect of globalization

"In a little over a year, we have gone from two framework agreements between international trade secretariats and multinational companies to nine", Mr. Baker said. "It's an important and so-far overlooked aspect of globalization. Just a few years ago, only a few corporations would have been willing to seriously discuss anything with unions at the international level."

Among the international union organizations that have reached framework agreements with major global enterprises are the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers' Associations (IUF), Union Network International (UNI), representing service workers and others, and the International Federation of Building and Wood Workers (IFBWW), Mr. Baker said.

ICEM General Secretary Fred Higgs indicated that his union is talking to at least seven more companies about framework agreements, including Rio Tinto and Shell, and that he is hopeful of several signings within the next few months. "We will insist that any other agreement we sign with anybody is in compliance with Global Compact principles", Mr. Higgs said.

Mr. Higgs met with 14 company representatives from the Nordic countries to discuss Global Compact principles the day before he signed the agreement with Statoil. He said that not only in Europe but in countries such as South Africa, where mining firms have been under public pressure for questionable practices, interest in agreements on Global Compact principles is running high. "It's like pushing at an open door", he said.

The pact with the ICEM "makes good business sense", said Geir Westgaard, a Statoil vice president. Complying with and furthering the Global Compact is "part of securing our 'license' to operate internationally", he said. "If you are in business in challenging areas of the world, you absolutely want and need to act ethically, sustainably and socially responsibly. It changes the terms of the debate from whether or not you should be in a country to how you should act in that country."

The stakeholder dialogue aspects of the Global Compact -- which encourages civil society, labour and business to not just set standards but meet face-to-face to work out solutions to common problems -- is particularly valuable to business, Mr. Westgaard said. "The unions as well as the NGOs are globe spanning knowledge-based organizations", he said. "They give us early warning of problems we should be aware of, and allow us to take early action to mitigate risks." He added that companies that take a cooperative rather than adversarial stance toward civil society and labour "have history on their side".


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