By Martin Khor
Third World NetworkOctober 2, 2002
One of the few bright spots in an otherwise disappointing World Summit on Sustainable Development was the successful campaign by many NGOs to get WSSD to make a commitment to make corporations accountable for their actions and the effects of these.
Many NGOs had made the need to regulate corporations and make them accountable as their main priority for WSSD. They saw the failure of Rio 1992 as stemming from the Earth Summit's rejection of the need to regulate companies. In the decade after Rio, the TNCs became much stronger and were now disciplining governments for their own interests, instead of governments disciplining them in the public interest.
WSSD eventually did adopt a significant paragraph (para 45.ter in the Draft Plan of Implementation) on corporate responsibility. But there was a last minute dramatic fight to keep this para intact.
Para 45.ter of the draft Plan of Implementation, reads: "Actively promote corporate responsibility and accountability, based on the Rio Principles, including through the full development and effective implementation of inter-governmental agreements and measures, international initiatives and public-private partnerships, and appropriate national regulations, and support continuous improvement in corporate practices in all countries."
This para was approved together with the rest of the draft Plan on the night of 3 September after a last-minute attempt by some countries to water down the paragraph was turned back by forceful interventions by Ethiopia and Norway.
As a result, one of the few achievements of the Summit will be a commitment to promote corporate responsibility and accountability through the full development and effective implementation of inter-governmental agreements and measures.
The meeting of the main committee to adopt the draft Plan, chaired by Emil Salim of Indonesia, was delayed for three hours when delegates held last-minute negotiations to amend three paragraphs regarding women's rights; human rights and fundamental freedoms relating to health, and access to health care services.
The draft Plan was adopted at almost 1.00 a.m. Immediately following this, a member of the UN secretariat sitting on the dais, read out a prepared statement, that it is the "collective understanding of the contact group on Means of implementation" that the paragraph regarding corporate responsibility and accountability refers to "existing" intergovernmental agreements and international initiatives, and that this understanding should be reflected in the final report of the Conference.
The reading of this statement, according to several delegates, was an untransparent action as there was no explanation at the session as to how the statement had come about, whether the contact group had met in full membership, and who had taken the decision to enable it to be termed a "collective understanding."
It was also unusual that a UN official instead of a government representative, such as the chairman of the contact group, read out the statement and without an introductory explanation.
According to a document issued by NGOs, the statement was the result of an attempt by the United States delegation to neutralise the text on corporate accountability that had already been agreed to last week by the contact group on globalization and the means of implementation.
The contact group had been faced with three proposed versions (from the EU, G77 and the US) of the paragraph on corporate accountability. Part of the EU proposed text read: "Actively promote corporate responsibility and accountability.... including through full and effective implementation of existing inter-governmental agreements and measures...."
On Saturday (31 August) evening, Ambassador John Ashe, the contact group chairman, produced a new text, in which the word "existing" had been removed and the words "full development" added.
The text, which was the one that was eventually adopted by the Main Committee today as para 45.ter of the draft Plan of Implementation, reads: "Actively promote corporate responsibility and accountability, based on the Rio Principles, including through the full development and effective implementation of inter-governmental agreements and measures, international initiatives and public-private partnerships, and appropriate national regulations, and support continuous improvement in corporate practices in all countries."
After the intervention by the UN official reading out the "collective understanding of the contact group", the Ethiopian delegate, Dr. Tewolde Berhan Egziabher took the floor and asked for clarification on who in the contact group had made the decision to issue the statement, as his delegation for one had not been informed of such a consensus reached.
Tewolde also said the statement about "existing" agreements was not logical when read in conjunction with the paragraph. He said that in the text, "full development" obviously refers to new agreements. "How then do we develop agreements in the future if the statement refers only to existing agreements and thus prevents us from what is to be done in the future? The whole thrust of the paragraph is what is to be done in the future. But what is read out in the statement implies there is no future agreement."
Tewolde asked where then was the logic of the statement and asked for clarification.
The contact group chairman John Ashe explained that although not all delegations were not present at the contact group meeting that decided on the statement, representatives of delegations were present and thus it was assumed that it was the intention of the group.
Tewolde then reiterated that the term "full development" seems to refer to new agreements, and therefore the statement that only existing agreements were meant must be wrong. "Let us assume our representatives made a mistake. Do we as countries repeat that mistake? My proposal is that the contact group's statement is incompatible with our decision here (i.e the text in the draft Implementation Plan), and one or the other has to be discarded, and I propose that the statement has to be discarded."
After a brief exchange for clarification between the Main Committee Chairman, Emil Salim and Tewolde, the chairman ruled that para 45ter of the text is agreed to and would be kept and that the statement of the contact group would be discarded.
The Norway Minister for International Development, Ms Hilde Johnson, then stated that she also had concerns on the contact group statement. She said that according to UN procedure, informal contact groups do not formally exist, and thus should not be referred to in an official UN document. "We question that statement on behalf of the contact group and we have the same understanding of the situation as Ethiopia," she said.
But even after the passing of the para by the Main Committee, it was not the end of the story.
The next day (4 September) was the last day of WSSD. At the final plenary, chaired bythe South African President Thabo Mbeki, the US delegation stated it wanted to make interpretative statements on four points relating to the WSSD documents. One of the points was in relation to the Implementation Plan's para on corporate responsibility and accountability. According to the US delegate, the chairperson of the main committee meeting (held on 3 September night) had said that it was the collective understanding that the para refers to existing international agreements, and that this should be reflected in the report of WSSD.
In fact the US delegate made a factual error in announcing the US interpretative statement. The chairman of the 3 September night meeting, Emil Salim of Indonesia, expressly rejected a proposal read out by a UN official that it was the common understanding of the contact group on globalisation and means of implementation that only existing intergovernmental agreements were being referred to. The chairman's clear decision to reject the proposal came after strong objections by Ethiopia and Norway.
That the chairman had rejected the proposal that there was "collective understanding" which should be reflected in the WSSD report, was confirmed personally by Emil Salim to the author of this article during the final plenary session of 4 September itself.
It is unclear whether the final report of WSSD will endorse the US position that there was a collective understanding that the para on corporate responsibility refers only to existing agreements. If it does, then this would be to cater to a total untruth, for the decision of the chairperson on the night of 3 September was to reject the proposal for diluting the text, and to adopt the para as it was, without any accompanying "understanding".
The next step forward is for the NGOs, the governments and the UN to follow up on the para, and to begin as soon as possible to take steps to internationally regulate the corporations so as to make them accountable.
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