Reuters Africa, July 5, 2007

TOP EXECUTIVES SEEK TO BOLSTER UN BUSINESS PACT

[Rachel's introduction: Executives of transnational corporation say the United Nations Global Compact provides needed rules governing corruption and environmental protection, tacitly acknowledging that corporations cannot do these things themselves.]

GENEVA (Reuters) -- Top executives from some of the world's biggest companies sought on Thursday to bolster a U.N. corporate responsibility pact, saying their firms would benefit from stricter rules on corruption and the environment.

U.N. Secretary-General Ban Ki-moon backed calls from the heads of Coca-Cola, Anglo American and Petrobras for more checks and balances to ensure members of the seven-year-old Global Compact uphold its standards.

Ban, who took over as United Nations chief in January, said firms who signed up to the voluntary initiative must present their records on human rights, labour practices, corruption and the environment for scrutiny each year.

"We are going to strengthen this accountability and transparency," he told a news conference in Geneva, where 1,100 business and government leaders were meeting to review the Global Compact's effectiveness.

About 3,000 companies from 116 countries are members of the Global Compact, created in 2000 as a counterweight to discontent over the effects of globalisation. It requires firms to follow 10 principles, including pledges to abolish child labour and to work against corruption, extortion and bribery.

Human rights and environmental activists say the initiative has brought little change in company practices because of the United Nations' failure to monitor adherence to the principles, some of which are vague.

Principle 7, for instance, simply asks signatories to "support a precautionary approach to environmental challenges".

Executives meeting in Geneva noted the Global Compact had revoked the membership of hundreds of companies that failed to report on their corporate governance performance as required.

"The good news is that the number of signatories is increasing (and) the quality is also increasing, because of the delistings," Anglo American chairman Mark Moody-Stuart told Reuters on the sidelines of the summit.

Jose Sergio Gabrielli, chief executive of Brazil's state-run petroleum company Petrobras, said he supported a shift toward closer monitoring of companies' commitments under the initiative to ensure its legitimacy.

Copyright Reuters 2007