Home / News & Speeches / This is the text of an article which was published Wednesday, August 7, 2002 in The Guardian newspaper

With the Johannesburg summit’s stated emphasis on “partnerships for solutions”, it would be nice to get away from the cycle of mutual recrimination and c oncentrate on working together in the shared interest of a more sustainable world. Sadly, Tony Juniper’s comment in this space last week sought yet again to portray business as the arch enemy of sustainable development.

By Richard
Holme

Juniper,
director designate of Friends of the Earth, called for one of the summit’s key
outcomes to be the creation of a “corporate accountability
convention”. As he described it, this would be “a treaty to enshrine
in international law rights for affected citizens to seek redress from
multinationals, introduce duties on big business to take account of social and
environmental concerns and create a baseline for sound practices”.

 

The
stereotype he perpetuates is that business resists all regulation in the sacred
name of free markets. This is untrue. Far from disagreeing with his call for
greater corporate accountability, the International Chamber of Commerce (ICC),
which he singled out for criticism, represents businesses that are, in general,
strongly in favour of improved reporting and appropriate regulation.

 

Contrary to
his assertion that the ICC has been instrumental in blocking international
environmental conventions, such as those on toxic waste and biological
diversity and the Kyoto protocol on climate change, the business community
simply assesses the likely impact of these conventions and searches for
realistic regulations which do not stifle innovation and enterprise – the very
“animal spirits” which John Maynard Keynes identified as the
wellspring of economic success.

 

Of course,
no successful market has ever existed without rules and regulations. But in
accepting the place of regulation, we should not do so at the expense of, or in
competition to, the more powerful force of voluntary action and initiative.

 

Juniper
complained that the UN’s global compact with business – setting out nine basic
principles of business social responsibility – is nothing but a PR opportunity
for companies. Apart from being insulting to secretary-general Kofi Annan’s
leadership in establishing the compact, this fails to recognise its power to
inspire companies to adopt a “compliance-plus” attitude and up their
game.

 

More and
more businesses are declaring their values, publicising their policies and
setting out their standards. That is as it should be. The modern world rightly
requires power to be accountable – we live in a “show me”, not a
“tell me”, world – and large companies are powerful bodies.

 

There is an
unanswerable case for proper reporting on economic, social and environmental
performance – what is sometimes called in shorthand the “triple bottom
line”. But the main utility of accountability and reporting is to improve
performance. It is not to provide a conveyor belt of juicy issues for
campaigning NGOs, or to feed the blame culture of the media.

 

Robert
Lovett, advising Robert Kennedy, once said: “Good judgment is the result
of experience. And experience is frequently the result of bad judgment.”
If we want companies to do better in these important areas of sustainable de
velopment, we must let them learn from their mistakes. After all, competitive
emulation is a great stimulus to raising your own game.

 

There is,
however, a strong case for common benchmarks and the global reporting
initiative, supported by all stakeholders including many leading NGOs and trade
unions, is designed to produce a framework for social and environmental
reporting while remaining sensitive to sectoral and regional differences.

 

Fortunately,
the Johannesburg summit is certain to show that it is possible for business,
governments and NGOs to work together. Also fortunate is the fact that in the
debate over corporate accountability, the majority view is held by people who
maintain that job and wealth creation are essential and who want to ensure it
is done more responsibly and equitably. So while some want to bind Gulliver
hand and foot, so that he cannot move an inch, most want to ensure that he
treads carefully – and that his giant footprint doesn’t leave people squashed.

 

Lord Holme
is chair of the ICC environment commission and vice-chair of Business Action
for Sustainable Development