January 29, 2002

His Excellency Kofi Annan
United Nations, NY 10017
Via fax (212) 963-4879

Dear Mr. Secretary General,

As supporters of the United Nations, we write to you once again regarding the Global Compact and the UN’s private sector partnership initiatives. We know that your motivation with the Global Compact is to improve corporate behavior, and we agree with this goal.

Nevertheless, as we have written in our letters of July 20 and July 25, 2000, shortly before the launch of the Global Compact, we believe the Compact as currently designed has serious flaws that threaten the integrity and mission of the United Nations. In particular, we believe that the Compact allows companies to improve their reputation through association with the UN, without committing to concrete changes in corporate behavior. It allows these corporations, and the private sector as a whole, to block substantial measures for sustainability and accountability – even to oppose agreements under the framework of the United Nations itself – while offering only token changes when convenient.

In addition to fundamental design problems, several contradictions have come out in the first 18 months of the Compact’s operation. First, while the Global Compact website claims "transparency" as one of the tools of the Compact, the corporate membership remains largely secret. Second, despite repeated avowals that the UN logo would not be misused by corporations under the Global Compact, at least one company, DaimlerChrysler, has appropriated the Global Compact logo in its own publication. Third, the Compact claims learning from case studies as a fundamental tenet, yet at the first Global Compact Learning Forum last October, not a single case study was deemed worthy of publication by the Global Compact Office. Finally, we have documented violations of one or more Global Compact principles by five companies that have endorsed the Compact, as well as one major business lobby group.

Documentation of the violations by Aventis, Nike, Unilever, Norsk Hydro, Rio Tinto and the International Chamber of Commerce are attached to this letter. We ask that you ascertain the facts around these cases, and that you act on your findings. We call on you to demand that these companies correct their violations or leave the Global Compact.

Mr. Secretary General, we too believe in the value of dialogue and the wisdom of sharing experiences. Towards the end of creating a more constructive context for these processes, we propose the following re-design of the Global Compact.

1. The full name should be changed to the Global Accountability Compact, to communicate to the public that the ultimate goal is not only to bring private sector activities in line with universal values but to make the private sector accountable to the public.

2. The UN should clarify that the Compact is not to be construed as an equal partnership between sectors that share all values and goals. Your Office should further clarify that the Compact’s purpose is not to advance a business agenda regarding trade and investment rules.

3. Global Compact companies must agree to support the implementation, and entry into force, of multilateral agreements under UN auspices. Without such an agreement, companies can make a mockery of the UN by claiming to support it while working behind the scenes to weaken agreements such as the Kyoto Protocol, Convention on Biodiversity and agreements under the framework of the World Summit on Sustainable Development.

4. The Global Compact’s nine principles should be further defined so as to be able to determine whether companies are implementing them or not. A forum should be established to which citizens and NGOs can bring evidence of violations of the principles by Compact companies. The companies could bring their own evidence. The UN would determine whether a violation had occurred, and if so, present the company with a timetable for correcting the violation in order to avoid suspension from the Compact.

5. Global Compact Learning Forum examples and case studies should be open to public review and comment, which should be published along with the corporate contribution. Companies should adopt plans to implement "best practices" at all levels of their company, including international subsidiaries, and publish these plans on the Global Compact website.

6. Your office should undertake a review of the last 3 decades of corporate-related activity, including lessons from the WHO/Unicef International Code of Marketing of Breast-milk Substitutes, the increasing interactions of the WHO with the private sector, the UNCTC’s work until 1993, Unicef's ongoing interactions with corporations, etc. This review would form the basis for public evaluation of the advantages and disadvantages of various forms of engagement with the private sector. This in turn could assist in efforts to draft a Convention on Corporate Accountability to be considered by Governments at the World Summit on Sustainable Development in Johannesburg.

Enclosures:
Six articles on Global Compact violations
Greenwash + 10 Report