Richard Moore

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Date: Thu, 14 May 1998
From: el viento <•••@••.•••>
To: •••@••.•••

Date: Mon, 27 Apr 1998
From: Corporate Europe Observatory <•••@••.•••>




   In the last issue of Corporate Europe Observer, we reported on a
   June 1997 luncheon in UN headquarters with corporate executives
   and global political leaders, including UN Secretary General Kofi
   Annan. Discussion topics included business participation in the
   UN decision-making process and a UN-business partnership in
   development policies. That this event was not an isolated case
   becomes clear in the following two articles: one describing the
   increasingly successful attempts of the International Chamber of
   Commerce (ICC) to gain privileged access to the UN; and the other
   detailing a particularly inappropriate case of corporate
   sponsorship -- Nestli's recent hosting and sponsoring of a UN
   workshop on women and sustainable development.


                    UNITED NATIONS UNDER SIEGE

   The International Chamber of Commerce (ICC) -- the self-
   proclaimed "world business organization" -- wants privileged
   access to the United Nations and other international
   organizations. During last year's presidency of Nestli's Helmut
   Maucher, the ICC's ambitions seemed to materialize and take

   UN-Business Partnership

   The International Chamber of Commerce (ICC), contrary to what its
   name might suggest, is primarily an organization representing the
   largest transnational corporations on earth, including corporate
   giants like General Motors, Novartis, Bayer and Nestli. The ICC,
   which for many years has pushed for global economic deregulation
   within the World Trade Organization, the G-7 and the OECD, now
   has its sights set on the United Nations. "The way the United
   Nations regards international business has changed fundamentally.
   This shift towards a stance more favourable to business is being
   nurtured from the very top", ICC Secretary General Maria Livanos
   Cattaui concluded with satisfaction in a column in the
   International Herald Tribune in February. Cattaui quotes UN
   Secretary General Kofi Annan in saying that the time is ripe for
   consultation between the UN and business.[1]

   Cattaui's optimism was confirmed the same week in a February 9th
   meeting of 25 ICC business leaders with a heavyweight UN
   delegation headed by Kofi Annan, heralded as the first step in "a
   systematic dialogue". The ICC delegation included captains of
   industry from Coca Cola, Unilever, McDonalds, Goldman Sachs and
   Rio Tinto Zinc. In a joint statement, the ICC and the UN
   Secretary General stated that "broad political and economic
   changes have opened up new opportunities for dialogue and
   cooperation between the United Nations and the private sector".
   The two sides committed themselves to "forge a close global
   partnership to secure greater business input into the world's
   economic decision-making and boost the private sector in the
   least developed countries". The industry representatives used the
   occasion to argue for "establishing an effective regulatory
   framework for globalization, including investment, capital
   markets, competition, intellectual property rights and trade
   facilitation".[2] The ICC has worked with UN institutions before,
   but not on the highest level and not on the potentially very wide
   range of political matters around which 'partnership' now seems
   to have emerged.[3]

   ICC and UNCTAD Hand-in-Hand

   One of the concrete projects agreed upon at the February
   consultation between the UN and ICC is a joint series of business
   investment guides to the least developed countries, to be
   produced by the UN Centre for Trade and Development (UNCTAD) and
   the ICC. The aim of these guides is to increase foreign direct
   investment flows into the 48 countries which the UN considers
   'least developed', 38 of which are African. The guides "are to
   contain accurate, objective, investor-oriented and comparative
   information on investment opportunities and conditions in the
   countries covered".

   Another example of the new fruitful cooperation arose in March,
   when the ICC and UNCTAD presented the results of a joint
   "worldwide survey of leading multinational companies" which
   showed that corporations had not lost interest in investing in
   East and Southeast Asia. ICC Secretary-General Cattaui concluded
   from the survey of 198 TNCs that "business still sees enormous
   investment opportunities to be derived from the projected growth
   of Asian markets in the 21st century".[4] The survey shows that
   34% of European firms, and 19% of US and Japan-based TNCs plan to
   increase their activities in Asia. A senior UNCTAD investment
   expert explained that: "In the short and medium term, the lower
   costs for multinationals in the most affected countries create
   immediate incentives for additional direct investment."[5] UNCTAD
   Secretary-General Rubens Ricupero said that the interest
   expressed by TNCs "augurs well for recovery in the region".[6]

   Geneva Business Dialogue

   The most ambitious event this year in the ICC's strategy for
   forging closer links with UN and other international institutions
   is the Geneva Business Dialogue, a conference slated to take
   place on September 23-24 1998. "The Geneva Business Dialogue", a
   press release explains, "is the ICC's initiative to create a
   successful mechanism to deal with the effects, promises and
   progress of globalization". Participants at this conference,
   which organizers plan to hold annually, will be from "the ICC and
   the many important international organizations based in Geneva".
   7] ICC president Maucher amplifies: "During two days of intensive
   meetings in September, we shall bring together the heads of
   international companies and the leaders of international
   organizations so that business experiences and expertise is
   channelled into the decision-making process for the global
   economy."[8] The programme -- details are yet to be released will
   deal with "some of the significant and contentious issues raised
   by an increasingly integrated international economy". 9]

   The ICC boasts that the initiative "is welcomed at the highest
   level of the World Trade Organization, the United Nations system
   and other international bodies", and the preliminary participants
   list confirms that the Geneva Business Dialogue will bring
   together influential players including EU Commissioner
   Yves-Thibault de Silguy, WTO Director-General Renato de Ruggiero,
   high-level officials from the World Bank and the Industrial
   Standards Organization (ISO), as well as presidents, prime
   ministers and other top ministers from the US, Finland, Hungary,
   Thailand and Switzerland. Among the many high-level UN
   representatives are UNCTAD Secretary-General Rubens Ricupero and
   UN Under-Secretary General Vladimir Petrovsky. Secretary-General
   Kofi Annan will address the dialogue through a satellite
   connection. In addition to Helmut Maucher himself, business will
   be represented by CEOs from Unilever, ICI, Mitsubishi, Goldman
   Sachs, Lyonnaise des Eaux, Norsk Hydro, Siemens, BASF, Shell and
   many other global corporations.

   Maucher's Ambitions

   The new "partnership" between the ICC and the UN is the result of
   the former's ambitious strategy pursued since Helmut Maucher took
   the helm in early 1997. Maucher, who recently left his job as CEO
   of Nestli but remains on the board of directors, felt that the
   ICC had hitherto been neither sufficiently influential nor
   visible in the media.[10] Maucher has observed the efficient work
   of environmental and human rights NGOs within the UN system with
   great concern. In one of his first interviews as ICC president,
   Maucher warned: "We have to be careful that they do not get too
   much influence".[11]

   Within both the WTO and the UN, the ICC is pushing for the
   implementation of "a framework of global rules" which it plans to
   help draft, "as the only organization qualified to speak for
   every business sector in all parts of the world". "Governments
   have to understand", Maucher argues, "that business is not just
   another pressure group but a resource that will help them set the
   right rules".[12] The joint statement between the UN Secretary-
   General and the ICC clarifies the ICC's reasons for wanting to be
   involved in global decision making: "Business has a strong
   interest in multilateral cooperation, including standard-setting
   through the United Nations and other intergovernmental
   institutions and international conventions on the environment and
   other global and transborder issues."

   When Maucher became vice president of the ICC in 1995, he
   immediately dove into a reorganization process. He brought in a
   new Secretary-General, Maria Livanos Cattaui, who for many years
   had organized the World Economic Forum in Davos and like Maucher
   has a wide ranging network of international contacts. Maucher
   himself divides his time as ICC president with his leadership of
   the European Roundtable of Industrialists. (ERT; for background
   information see "Europe, Inc.", CEO, 1997) Maucher's ambitions
   for the ICC also include formal status within the World Trade
   Organization (WTO): "We want neither to be the secret girlfriend
   of the WTO", Maucher said in an interview, "nor should the ICC
   have to enter the World Trade Organization through the servants
   entrance."[13] To pursue this more intimate relationship with the
   WTO, Maucher has made former GATT general director Arthur Dunkel
   chairman of the ICC's commission on trade. Dunkel is also a board
   member of Nestli.

   Shared Vision?

   The ICC, with its strategic cooptation of the message spread by
   NGOs and people's movements, is attempting to use the growing
   consensus that global deregulation is creating serious social and
   environmental problems to its advantage. As Maria Livanos Cattaui
   described the ICC's new cooperation with the UN, "the dialogue is
   coming not a moment too soon. Globalization has the potential to
   bring immense benefits to the human race. But as recent events in
   East Asia have demonstrated, it can swiftly magnify local crises
   into problems affecting the entire world economy. Hence the need
   for a framework of rules on investment, capital markets,
   competition policy and a host of other areas."

   The ICC's agenda of deregulated markets -- in the interest of
   hardly anyone besides the large transnational corporations united
   in the ICC -- is presented an idealistic strategy to benefit all
   people. Cattaui disturbingly claims to have UN support for the
   ICC's vision: "What makes the dialogue possible is the perception
   by both sides that open markets are a precondition for spreading
   more widely the benefits of globalization, for integrating
   developing countries into the world economy, and for improving
   living standards of all the world's peoples, and in particular
   the poor."

   The joint UN-ICC statement seems to confirm a wide-ranging
   consensus, as it emphasizes the importance of "the effective
   functioning of the global market place and on the existence of
   open, equitable, inclusive economic systems, based on the free
   flow of trade, investment for economic growth and development and
   the avoidance of protectionist pressures".

   The UN seems to have largely given up worrying about the growing
   economic dominance of transnational corporations worldwide. Until
   1993, the UN still had its Centre on Transnational Corporations
   (UNCTC) which carried out research and served the Commission on
   Transnational Corporations, an intergovernmental body with the
   mandate of developing a Code of Conduct for TNCs. Corporations
   were extremely hostile to the UNCTC, which also developed
   environmental guidelines for TNCs and promoted restricting
   foreign investment in the South Africa under the apartheid
   regime. In 1993 the UNCTC was dismantled as part of a
   'reorganization', and UNCTAD became the new UN focal point for
   work on TNCs. UNCTAD, however, does not address the regulation of
   TNC activities, but rather works closely with them in order to
   stimulate foreign investment flows to the Third World. Work on
   the Code of Conduct on TNCs has stopped entirely.

   With this "systematic dialogue" with the UN, the ICC has made a
   disturbing leap forward in its desire to become the legitimate
   global representative of "business". However, the ICC does by no
   means represent all businesses, but principally only the largest
   transnational corporations. The interests of these footloose
   global players differ significantly from those businesses which
   are grounded in and oriented towards a local market. But there
   are other fundamental questions besides whether or not the ICC is
   really "the world business organization". Is it appropriate for
   corporations -- which are supposed to compete, adapt and
   diversify -- to organize themselves in what effectively equals a
   global political monopoly? And concerning the ICC's ambitions for
   "global regulation": should corporations not simply be following
   the rules -- local, national or global - shaped by democratically
   elected governments assisted by citizens organisations?


    1. Maria Livanos Cattaui: "UN-Business Partnership Forged on
       Global Economy", February 6 in International Herald Tribune.

    2. "UN-Business Partnership to Boost Economic Development",
       ICC statement 9 February 1998.

    3. For instance the ICC signed an agreement with the United
       Nations Development Programme in September 1992 "under
       which UNDP provides financial and practical support for
       ICC efforts to strengthen the private sector and chambers
       of commerce in developing countries and in eastern Europe
       and the former Soviet Union", ICC website. The Inter-
       national Bureau of Chambers of Commerce (IBCC), which
       is a part of the ICC, is playing a leading role in
       implementing the agreement.

    4. ICC and UNCTAD Press Release: "Leading Multinationals Vote
       their Confidence in Asia", 18 March 1998.

    5. Idem

    6. Idem

    7. Helmut Maucher: "Ruling by Consent", guest column in the
       Financial Times, 6 December 1997, FT Exporter, p. 2.

    8. "Die Globalisierung Verlangt eine Kraftigere Stimme der
       Wirtschaft", Frankfurter Algemeine 12 February 1997, p. 13.

    9. Idem

   10. Helmut Maucher: "Ruling by Consent", guest column in the
       Financial Times, 6 December 1997, FT Exporter, p. 2.

   11. Idem

   12. Idem

   13. "Die Globalisierung Verlangt eine Kraftigere Stimme der
       Wirtschaft", Frankfurter Algemeine 12 February 1997, p.13.

Date: Mon, 27 Apr 1998
From: Corporate Europe Observatory <•••@••.•••>



   Nestli -- one of the world's largest transnational corporations
   -- is the long-time target of an international boycott campaign
   resulting from its unethical marketing of infant foods.
   Consequently, the member groups of IBFAN (International Baby Food
   Action Network) which are active participants in the Nestli
   Boycott are disturbed about Nestli's co-sponsorship and hosting
   of a United Nations workshop on women and sustainable development
   in November last year.

   The UN workshop, entitled "Mechanisms of Support to Women's
   Participation in Sustainable Development", took place from 5-7
   November 1997 at Nestli's International Research Centre in
   Lausanne, Switzerland. Nestli fully dominated the workshop --
   paying for all meals and lodging plus air fares for some
   participants; providing name tags with the Nestli logo;
   presenting the company's research and development activities;
   organizing a visit to the Nestli Research Centre; and hosting a

   Overall, the workshop had the feel of an internal Nestli meeting
   with token UN sponsorship. Although the mining corporation
   Glencort was an official co-sponsor, this company was far less
   prominent than Nestli. The eight Nestli observers present,
   fortified by several others with close ties to the company,
   outnumbered the six UN officials. The workshop -- with 40
   participants, half of which were NGOs from developing countries
   -- was closed to the public, and one UN-accredited journalist was
   denied access to the proceedings.

   NGO Protests

   Since United Nations activities carried out within the framework
   of its mandate must be paid from the organization's own funds,
   and possible conflicts of interest must be avoided at all times,
   one wonders why the UN workshop was not held at Geneva's Palais
   des Nations, one of the most prestigious and best-equipped
   conference centres in the world. When NGOs heard that the event
   would be both hosted and sponsored by Nestli, they began to ask

   The workshop's stated objective was "to provide a forum to
   identify and promote viable mechanisms for private sector support
   of women's participation in sustainable development". The
   aide-memoire from the UN Department of Social and Economic
   Affairs was subtitled "Exploring Strategies for Cooperative
   Partnerships in Environmentally Sustainable Development", and
   requested that NGOs fund participants from the South -- "women
   involved in promoting small-scale entrepreneurial activities at
   the grassroots level in developing countries".

   Upon hearing about the workshop, the NGO Working Group on Women
   for the ECE Region expressed its doubts about the role of baby
   food and mining companies in building environmentally sustainable
   development, warning against the probable commercial agenda of
   the co-sponsors. Additionally, the International Baby Food Action
   Network (IBFAN) identified a host of problems attached to
   Nestli's co-sponsorship. IBFAN has many years of experience in
   monitoring the compliance of the baby food industry with the 1981
   International Code of Marketing of Breastmilk Substitutes. The
   International Code is the UN's code for the protection and
   promotion of breastfeeding in the face of inappropriate marketing
   practices. The promotion of baby milks and infant foods is not
   only damaging to women's health, but also causes untold misery
   due to artificial feeding related sicknesses and death -- also
   known as the bottle-baby syndrome.

   IBFAN has been investigating the marketing practices of the baby
   food industry over the past 17 years, and has continuously
   documented its sustained and wilful violations of the
   International Code. Nestli has emerged as the most systematic
   corporate offender in terms of non-compliance with the Code and
   subsequent World Health Assembly resolutions. Since Nestli holds
   the lion's share of the market, its irresponsible marketing
   practices harm more babies and mothers worldwide than those of
   any other company.

   Yet despite protest letters to the UN, it proved impossible to
   prevent Nestli's involvement in the workshop. IBFAN later
   expressed its concern in writing to Dr. Nitin Desai, UN
   Under-Secretary for Social and Economic Affairs, and UN Secretary
   General Kofi Annan. In response, Dr. Desai requested "practical
   inputs and insights on guidelines and criteria" as the UN
   proceeds "along this largely uncharted path". At present, IBFAN
   is working to provide just these insights.

   Opposing the Infant Formula Industry

   Relations between the infant formula industry and UN institutions
   are not uniformly rosy. UNICEF, for example, implements a de
   facto boycott of corporations not respecting the World Health
   Assembly Code. Following an October 1997 meeting with Nestli, the
   Executive Director of UNICEF sent a letter to the company stating
   that differences of opinion "continue to raise a barrier to the
   establishment of any kind of working relationship between UNICEF
   and Nestli".

   The 1997 NGO report Cracking the Code provides extensive evidence
   of continued violations of the World Health Assembly code on
   marketing of breastmilk substitutes in countries like Bangladesh,
   Poland, Thailand and South Africa. The baby food industry --
   organized in the Association of Infant Food Manufacturers (IFM)
   -- has rejected the report as "inaccurate". The IFM denies the
   responsibility as set out in the Code for industry to monitor its
   own practices, but unequivocally insists that Code implementation
   is a question of national legislation in the country under
   question. Yet hypocritically, the IFM -- and Nestli in particular
   -- is presently attempting to undermine national legislation for
   the implementation of the Code in Uganda, Pakistan and Zimbabwe.
   In an ongoing court case in India, Nestli has even challenged the
   constitutionality of the national law.

   IBFAN is seeking allies in our attempts to keep the United
   Nations free of corporate dominance. We feel that it is
   preferable to swim against the tide and risk drowning than to go
   with the corporate flow and lose our principles. We welcome
   insight and practical ideas from other NGOs about how to bring
   effective pressure to bear upon the UN system.

   For more information, contact:

   c/o GIFA (Geneva Infant Feeding Association)
   P.O. Box 157, 1211 Geneva 19, Switzerland

   Phone: +41 22 798 91 64
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