Transnational corporations wield considerable power. In an increasingly globalized world, transnational corporations are powerhouses of economic growth and innovation both in the developed and developing world. But this power has often gone unchecked, either by rent-seeking states or by corrupt international bodies that allow corporations to exploit the land, labour and natural resources of developing countries and have turned a blind eye to blatant violations of international law and in many cases, to the abuse of human rights.
Although there has been much discussion in the UN itself on how to regulate transnational corporations since the 1970s, the pace and scope of globalization has intensified, and with it the need for greater regulation. There are now transnational corporations that are more powerful than the developing nations in which they operate and while they have generated economic development there, they have also sometimes generated dire social consequences. There are countless examples of transnational corporations exploiting cheap labour, draining water resources, dumping toxins and in some cases, even accusations of assassinations. This behaviour has often been conducted with impunity.
We believe that the UN plays a vital role in setting the standards for human rights recognition and compliance and has a duty of care to those affected by corporate abuse.
The inter-governmental working group has made significant headway in this sense and we commend its move away from voluntary rule-setting to a more legally binding instrument that safeguards human rights. We particularly commend its focus on justice for victims of corporate human rights abuses and the emphasis placed on corporate social responsibility in resolution 26/9 on the elaboration of an international legally binding instrument on transnational corporations.
However we feel that the adoption of the resolution does not have sufficient support in the highly developed home states of transnational corporations where their power is often concentrated.
Increasingly transnational corporations are becoming stateless, allowing them to conduct illicit activities with no accountability or transparency. We believe the governments of the world must hold transnational corporations to account and ensure that the highest ethical standards are applied to their behaviour. We urge them to withhold contracts from those corporations that do not adopt proper policies in regard to their social responsibility and from those corporations that fail to examine and counter bad practice such as bribery and corporate capture within their own ranks.
Often corporations will adopt social responsibility policies as a simple marketing ploy rather than out of any sense of genuine morality. We, therefore, call on the UN to hold these organizations to account. But more importantly, we urge corporations to adopt a business culture that fosters the values of tolerance, inclusivity and above all responsibility. It is only in this way, that we can ensure human rights are extended to citizens everywhere and are abused nowhere. We believe that globalization should be a positive force that benefits the many, not an elite few.