DEVELOPMENT: Report Faults UNDP Partnership with Corporations

By Farhan Haq Reprint | | Print |

UNITED NATIONS, Mar 12 1999 (IPS) - The UN Development Programme (UNDP) had endangered its traditional mission by seeking funds from controversial corporations for a proposed development body, according to a local watchdog group.

The Transnational Resource and Action Centre (TRAC) said in a report Friday that the UNDP’s planned partnership with private- sector groups for a proposed Global Sustainable Development Facility (GSDF) would link it to some corporations with “tarnished records”.

The report, ‘A Perilous Partnership’, said that many of the corporations – which paid 50,000 dollars each to sign on as sponsors for the project – “are well known for the negative impacts their activities have had on human rights, the environment and development”.

UNDP, meanwhile, announced that 16 corporations had joined the discussions to set up the GSDF, and each had contributed 50,000 dollars to cover the costs of the design and dialogue process for the project.

There was no connection between the money and any outcome of the project, Henry Jackelen, director of UNDP’s Private Sector Development Programme, said Friday.

UNDP officials asserted that the partnership could be useful in upholding the agency’s development goals.

“To get corporations to work with the United Nations to create projects and investments that uphold universal labour, environmental and human rights standards, including the right to be free of poverty, would be a minimum standard for engagement,” said UNDP Assistant Administrator Eimi Watanabe.

Watanabe contended that “it is possible for corporations to meet these standards, improve the lives of poor people and be profitable”.

TRAC, among other groups, were worried that the record of the groups who had signed on indicated otherwise.

Such firms as Citibank and Dow Chemical corporations, Britain’s Rio Tinto Plc, and Norway’s StatOil were “all corporations with spotty records in dealing with the environment and the poor,” said Joshua Karliner, executive director of TRAC.

Karliner said that Dow’s chlorine production made it a leading producer of dangerous dioxins and it also exported pesticides to developing countries while Citibank had a record of what he called “wasteful” loans for lavish projects in the South.

Worried about the precedent of the private-sector partnership being proposed by UNDP, nine development experts – including Karliner, Walden Bello of Thailand’s Focus on the Global South and Mohamed Idris of the Malaysia-based Third World Network – recently wrote UNDP Administrator James Gustave Speth to “call off (the) GSDF project”.

The partnership, the authors warned, “may be more of an opportunity for these corporations to practise ‘greenwash’ – a public-relations exercise aimed at improving their troubled images… So far, we have seen no substantial indication that these corporations or most others are changing their priorities.”

“The United Nations is at a crossroads,” said Upendra Baxi, former vice chancellor of the University of Delhi and one of the letter’s co-signers.

“It can take the low road and favour trade- based, market-friendly corporate rights or take the high road carved out by its founders, which would allow it to continue to stand up for universal labour, environmental and human rights.”

Watanabe said that, in a globalised world, corporations can have both a positive and negative impact on the world, but added, “We are trying to find the positive way.”

“Any kind of engagement by UNDP with the corporations would obviously mean that they have to meet the norms and standards that the United Nations represents,” added Jackelen.

In recent months, the UNDP-corporate partnership has been moving full steam ahead.

In a Jun 15, 1998 letter to UNDP regional bureaus, Speth confirmed that the GSDF already had 11 corporations signed on as sponsors, and was seeking a minimum of 20 in order to launch the project this spring. (Watanabe said Friday that UNDP has “travelled less than half way” toward realising its project, but added that the Facility could be set up later this year.)

“This global initiative is central to our effort to engage in the corporate sector,” Speth wrote. “Corporate lenders recognise the critical nature of UNDP’s operations … The Secretary-General (Kofi Annan) has made clear that he welcomes efforts of the UN system to work with corporations.”

The GSDF project is intended to provide corporate money for sustainable development initiatives worldwide, and is headed by a steering committee that includes Speth; former UN special adviser Maurice Strong; David Buzzelli, head of Dow Chemical; and Goran Lindahl of the Swiss-Swedish company Asea Brown Boveri.

(Asea Brown Boveri has been targeted by environmentalist groups for its involvement in the controversial Three Gorges Dam in China and Bakun Dam in Malaysia.)

The GSDF venture is just the latest example of the United Nations’ effort to forge ties with the corporate sector. Facing billions of dollars in unpaid dues – including some 1.5 billion dollars in US arrears – the United Nations has tried to attract private groups to back its goals.

Recently, the world body and its agencies won billion-dollar grants from media mogul Ted Turner and Microsoft founder Bill Gates.

“Our expanding relationship is part of a trend that holds great promise for global peace and prosperity: the growing awareness that the goals of the United Nations and the goals of business can and should be mutually supportive,” Annan said last year.

“In today’s interdependent world, the United Nations and the private sector need each other.”

But activists remained concerned that the growing UN relationship with big business would harm its other work.

“Increasing collaboration will lead to a reluctance to criticise corporations, which are central players in the human rights, environmental and development dramas unfolding every day across the globe,” warned Ward Morehouse, president of the Council on International and Public Affairs, a New York-based non- governmental organisation.