By Laura Miller
PR WatchAugust 2002
"Did I tie this right?" an Asian businessman asked me, pointing at a red bandana around his neck. I had just been watching the milling international crowd. It was an amusing scene the world's business elite tying red and blue bandanas around their necks, posing for pictures atop mechanical bulls and with costumed 'Old West' show girls, queuing up for barbecued ribs and chicken, all leading up to a rodeo exhibition sponsored by Coors Brewing, 3M, and Wells Fargo.
The site for the evening's festivities was a rodeo arena in Denver, Colorado, surrounded by train yards, grain elevators, and stockyards. It was a bit of a contrast from the air-conditioned, conference-centre environs where actual meetings were held and plans were discussed during the 34th World Congress of the International Chamber of Commerce (ICC). The ICC's May meeting brought together nearly 700 participants from 72 countries to remind themselves, or perhaps convince themselves, that liberalised markets and free trade will save the world.
Like the pictures taken alongside the mechanical bull, however, the conference itself was largely a staged event. Nobody actually wanted to ride the bull, and nothing of substance seemed to happen at the conference. The documents that came out of the conference had all been written beforehand. Decisions were made in advance by small committees.
The Hong Kong businessman in the red bandana told me that this was his first ICC conference. He was impressed by the attention which China, and Asia in general, were receiving. Until now, US and European corporations have controlled the business lobby group, whose main office is in Paris. But with China's entry into the World Trade Organisation (WTO), eyes have shifted to the East. Still, Asia did not dominate the main discussions of the meeting. Instead, central honors were reserved for rhetorical commitments to the world's poor (none of whom were actually present, of course). The needs of the poor, we were told, can best be served by promoting 'corporate responsibility'.
During the three-day conference, I heard much from businessmen about corporate social responsibility, the World Summit on Sustainable Development in Johannesburg, and private sector partnerships with civil society. I also heard from the demonstrators outside the high-security meeting about how corporate globalisation isn't benefiting all people.
Whose Responsibility Is It?
"A growing number of companies approach corporate responsibility as a comprehensive set of values and principles," says a glossy ICC pamphlet, "which are integrated in business operations through management policies and practices and decision-making processes. ICC proposes the following definition of corporate responsibility from a business perspective: 'The voluntary commitment by business to manage its activities in a responsible way.'" The pamphlet containing these vague but fine-sounding phrases was distributed prior to a large panel discussion entitled, "Responsible business conduct to whom should business be answerable?" The panel chairperson opened the discussion by saying that the definition of "responsible" business is wide open to different interpretations from CEOs, nongovernmental organisations (NGOs), business competitors, and the governments of developed and developing nations. The ICC pamphlet agrees: "There is no single, commonly accepted definition of the concept of corporate responsibility, also referred to as corporate social responsibility, responsible business conduct, corporate citizenship, voluntary corporate initiatives, etc. ICC prefers the terms responsible business conduct and voluntary corporate initiatives."
This lack of definition and emphasis on 'voluntary' initiatives clearly suits the public relations objectives of corporations, which want to create a feel-good aura for themselves while simultaneously avoiding any specific, verifiable commitments that might constrain their behaviour. The ICC's preferred terminology "responsible business conduct" omits the "social" from "social responsibility," a subtle but telling indicator of the limitations to its vision. The more I listened to their speakers, the more it seemed that businesses' primary responsibility was simply to stay in business.
The panel discussion on responsible business conduct featured scant self-reflection about bad business conduct. Instead, the spotlight was on companies that already claimed to be practicing corporate responsibility. Panelists offered different interpretations of the concept, but all agreed that it must be undertaken on a voluntary basis.
Leading by Example
During the question-and-answer period at the end of the panel, participants again rejected the idea of international regulations on business conduct. Shell's Watts admitted that business isn't perfect, but argued that it can lead the way to a better world with its best practice examples.
ICC's own rationale for good behaviour avoids any statements on ethics or universal human rights. Its pamphlet states, "ICC applauds the primacy accorded to human rights by the United Nations; however, the making and enforcement of laws for protecting human rights are tasks for governments." Instead of morality, ICC argues that profits are the driving consideration that will motivate companies to behave well. "Responsible business conduct may place companies in a more favourable legal and political environment, improve their public image, give them a strategic advantage over competitors in the long-term and help them to make their management systems more effective," it says. ICC lists "pre-empting government legislation" as a further incentive for companies to take up corporate responsibility, which it says is "a far-sighted and profitable business policy."
Conference participants seemed genuine in their concern about environmental degradation, hunger, poor sanitation and lack of drinking water for the world's poor. Many sincerely believed that business can improve these conditions and find ICC's promotion of corporate responsibility reassuring, especially in the face of critical NGOs and the protests that have become commonplace at large globalisation meetings.
Those Crazy Protesters
"I often tell people we've got the wrong target when we target multinationals as the problem. We have to make them vectors of solutions," said ICC Secretary General Maria Livanos Cattaui during a press conference meant as a pre-emptive strike against a demonstration planned by organised labor. If there are problems for workers, she said, the International Labour Organisation is where they should be addressed and not the ICC. "[If] that forum isn't working, fix the forum. Don't keep adding new international organisations when there's one out there. Fix the forum," Cattaui said.
ICC spokesman Bryce Corbett repeated the common "we're misunderstood" theme. "These kinds of protests go in with the best intentions, but they're maybe a little ill informed," he told Business News. "I don't think they have any clue what's going on inside the meeting there."
The protesters, of course, hadn't been invited, and in fact considerable resources were devoted to keeping them out. According to the Rocky Mountain News, Denver spent nearly US $1 million on security for the conference, which was held in a downtown hotel behind steel crowd-control fences and surrounded by police. I was able to get in as an accredited journalist, but I had to show a photo ID, have my bags searched and step through a metal detector to get into the hotel lobby.
About 500 union members, community activists, and anarchists demonstrated against the ICC meeting. The protest featured speakers from El Salvador and Mexico who have not seen the 'wealth' promised by free-market boosters. They described wages too low to live on, uncertain and abusive working conditions, jobs lost to privatisation, and retaliation for unionising. Far from misunderstanding the work of ICC, demonstration organisers link these problems to the trade policies supported by ICC.
ICC worked hard to be accessible to media before, during and after the demonstration. Public relations techniques, such as labeling critics "irrational" and using "independent" third party advocates, were also evident. "Convincing public opinion is really a challenge," said Franí§ois Perigot, president of the International Organisation of Employers and former chair of the European business lobby UNICE. With very few panelists offering advice on corporate counter-strategies to high profile, anti-globalisations protests like those that took place during the WTO meeting in Seattle, Perigot's remarks seemed frank and relevant.
"The total organisation of the economy and our business' future is at stake," he said. "Convincing opponents is a formidable task. First of all, because they don't care what we are saying. The more you talk, the more you say, the more evidence you give, they don't believe. They have other evidence. So I say the direction is very, very limited. Secondly, because their attitude is not only irrational, but is totally emotional, there is very little you can do against emotion. How can you discuss with emotional people? These movements are purely emotional."
Perigot suggested changing the strategy, looking at the problem from a different angle, and referring to "universal values that everyone will understand: freedom, democracy, and respect for the press."
The Sceptical Environmentalist
A critique of NGOs came from Bjorn Lomborg, the associate professor of statistics at the University of Aarhus (Denmark) whose book, 'The Skeptical Environmentalist', has made him the current darling of the anti-environmental right wing. Lomborg, whose attempt to debunk environmental groups like Greenpeace has been panned in leading scientific publications including Science, Nature and Scientific American, has nevertheless been knighted as a "global leader for tomorrow" by the World Economic Forum.
Like the labour protesters outside, NGOs were also not invited to the ICC congress but were often mentioned as a source of concern regarding public opinion. "It's important to say that sometimes NGOs overinterpret or falsely represent data, but mostly they actually use data fairly reasonably," Lomborg admitted. "The thing that I'm trying to point out is that NGOs are like business organisations. They are interest groups. They are basically trying to promote an interest."
The problem, Lomborg said, is that NGOs have more credibility than corporations in public debates, because the public perceives business claims as self-serving. "The problem is that most people actually believe them [NGOs] above government scientists and university researchers. And there is a clear failure to understand that these are also interest groups, and we should certainly hear them, but we shouldn't necessarily take them as purveyors of the proverbial truth."
The WTO Needs You
The success of the World Trade Organisation's new round of talks, launched at their November 2001 meeting in Doha, was of much concern to many conference panelists. ICC members were urged to do everything they could to shore up the credibility of the WTO. "The WTO needs the champions in the private sector to defend and promote the very mission statement that is the WTO," said WTO General Counsel chairman Sergio Marchi. "This is where ICC members can help. Political leaders cannot make tough choices required if the public only hears the critics and support for trade is low. Citizens, businesses and governments must build support for WTO's work."
What Is Changing? And What Isn't? "The world's expectations of us are changing," said Lord Holme of Cheltenham, an advisor to the Rio Tinto mining company, chairman of the ICC Environment Commission, vice-chair of Business Action for Sustainable Development, and a member of the World Business Council for Sustainable Development. With more information instantly available from all corners of the world, he said, business leaders are experiencing "less deference and trust" and "more cynicism and suspicion of actions of powerful entities."
Citizens of developed countries are actively and effectively challenging business in the court of public opinion. In this context, ICC's embrace of "corporate responsibility" is a strategic, defensive move aimed at co-opting the language of NGOs.
But do words like "transparency," "accountability," "principles," "responsibility" and "inclusivity" signify a real change in business practices? While these broad ideas were floated by panelists, meaningful definitions of the words and how they should be practiced were lacking. Speakers at the ICC Congress claimed that trade liberalisation will decrease poverty but never provided any evidence to support this contention and were quick to assign blame elsewhere when alluding to failures of current and past liberalisation policies.
The main change that was evident at the ICC Congress was that transnational corporations, in particular the industry giants, are feeling increased pressure to defend their enormous control over wealth and resources. They need to convince the world that increasing disparity and environmental degradation aren't that bad and that what are beginning to look like corporate fiefdoms are somehow beneficial to all, and not just to the few who rule them.
The Road to Johannesburg
The ICC's preoccupation with "responsibility" is part of a corporate PR buildup to the United Nations' World Summit on Sustainable Development (WSSD), also known as Rio+10 (see also the other articles on Rio+10 in this Corporate Europe Observer). The WSSD is scheduled for August 26 September 4 and has been billed as a 10th anniversary follow-up to the UN's Earth Summit held in Rio de Janeiro in 1992. Organisers had planned for 60,000 attendees. (However, a South African businessman told me that they are now expecting only 45,000 people to attend.)
The WSSD is seen by some activists as an opportunity to "re-dedicate ourselves to the goals of Rio and to avoid the mistakes made since the first Earth Summit." (CorpWatch, "Greenwash +10").The business community, however, sees the event as an opportunity to advance its own power in controlling the affairs of the world and undermine any attempt to place binding controls on international business activities.
According to Shell's Philip Watts, WSSD "is a vital opportunity for the international community to demonstrate it can take practical steps to ensure all benefit from sustainable development. Business needs to show it can be a partner in that journey." Watts told ICC members that the themes of their conference - trade, technology and partnership - are "an excellent basis" for conceptualising that partnership.
As the key to sustainable development, the business lobby is heavily promoting 'partnerships' between business and NGOs, the UN, local governments, trade unions, and communities. The 'voluntary action' agenda is represented by the Business Action on Sustainable Development (BASD), a joint project of the ICC and the World Business Council for Sustainable Development.
BASD is already working with the UN Development Program (UNDP) to prepare a "Virtual Exhibition" (www.virtualexhibit.net) that "will bring the world to Johannesburg and take Johannesburg to the world." The website will showcase hand-picked examples of "best practice" partnership initiatives, broadcast summit proceedings via the internet, and have an online discussion forum. The "Virtual Exhibition" will also have large screens set up at the summit to "keep conference delegates informed of real initiatives being pursued in the real world and serve as a reminder that the world is watching."
British Telecommunications, Shell, and Rio Tinto are sponsoring the "Virtual Exhibition" web site, which calls itself a "multi-media showcase of sustainable development initiatives." Curiously, however, none of these companies appear to be actually sponsoring any sustainable development initiatives themselves at least, none that have shown up yet on the web site. When I visited the "Virtual Exhibition" on June 3, BP Solar was the only major corporation participating in any of the partnerships listed and BP's involvement consisted primarily of selling solar panels for an energy project in the Philippines funded by the government of Australia. The other 15 "best practice" partnerships listed in the exhibition were mostly sponsored by governments and NGOs, with no involvement from major corporations.
This paucity of actual achievement did not discourage Louise Fréchette, UN Deputy Secretary-General, who told the ICC that the "doors to the United Nations are open as never before to the vast and dynamic constellation of non-state actors. The Secretary General has made it one of his main priorities to see that this trend continues. So let there be no mistake, the UN needs the world's business men and business women as creators of wealth, as promoters of trade, investment and stable markets, as innovators in the development of new technologies, in short, as full partners in our global mission of peace and development." Fréchette added that the new partnership marks "a new recognition by the UN and the private sector alike, not only that business can do a great deal for the United Nations, but that a strong United Nations is good for business."
A stronger embrace of business by the UN can scarcely be imagined. "It is quite natural for the United Nations and the private sector to join forces," Fréchette said. "I'm pleased to say that the partnership with the ICC has already yielded some very positive results. Together the ICC and the United Nations conference on trade and development have created guides designed to steer foreign investment to some of the world's poorest countries."
Sir Mark Moody-Stuart, former chair of Royal Dutch/Shell group and current chair of BASD, spoke at an ICC panel discussion titled "Sustainable solutions for business and the environment." He told ICC members that business participation was welcomed at preparatory meetings leading up to the Johannesburg summit. Meeting the goals set out at Rio is a "huge task and we're only just starting," he said. He was concerned, however, by the number of demands coming out of the "multi-stakeholder dialogues" leading up to the summit, which he characterised as "much less dialogues than a series of position statements or wish lists. This structure is not easy to handle." He also expressed concern that the agenda for the Johannesburg meeting lacked focus, "every good idea plus a great deal more." Such wide-open discussion "doesn't encourage good business participation. Real progress will be made not through high level agreements but through very specific projects with clear targets," Moody-Stuart said.
Moody-Stuart was joined by Rio Tinto's Lord Holme of Cheltenham, who is also co-chair of BASD. Holme agreed that partnership initiatives are the best way to promote sustainability and took another dig at environmentalist demands for enforceable standards on international business conduct. Holme was the only panelist to mention Friends of the Earth by name and alluded to a proposal that FoE is spearheading for international negotiations to create enforceable standards. Holme characterised FoE's position as naí¯ve, arguing that global standards would fail to make distinctions across sectors or between global regions, imposing a "one size fits all" straitjacket on corporate behavior.
Don't worry, be happy Skeptical Environmentalist author Bjorn Lomborg also participated in the panel with Moody-Stuart and Holme and was a clear audience favorite. He elicited giggles and applause during his presentation on the state of the environment. Lomborg's basic argument is that things are not so bad with the environment, and if anything, they are getting better. By recognising this 'fact', he argues, 'better' decisions can be made about 'sustainable' development.
"You should make sure we focus on the important issues," Lomborg said. "Those are poverty and starvation and, not in the first place, environment. That will come when people get sufficiently rich. Basically, what matters is that we make sure the poor countries get allowed to trade."
Lomborg admitted, however, that his recommendations were likely to elicit scepticism from the public. "Everyone is going to say, 'yeah, of course, business.' And so there really is a selling problem, a PR problem," Lomborg said. "But I do also honestly believe that just because people can possibly level a suspicion at you, it shouldn't prevent you from advocating the right thing."
As public scrutiny of corporate activities continues to increase, international business will want more than ever to be perceived as doing the right thing. ICC and other business lobbies will do all they can to ensure their members and constituents are seen as not needing regulation and as capable of being good corporate citizens.
Laura Miller works with PR Watch, a US-based group offering unique investigate reporting on the public relations industry.
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