Community, CSR management, Public Policy
February 01 2000
by Mike TuffreyGlobalisation is fast becoming a catch-phrase like community - so often used that it loses its meaning and with it, the power to define the issue. So let's try to see what is at stake here. UNCTAD, the United Nations Conference on Trade and Development, reported during February that foreign direct investment grew 25% during 1999, to reach $827 billion. Nearly three quarters of this goes to developing countries, dwarfing official aid flows. The powerful increase in 1999 itself followed 40% growth the previous year. More staggering is the fact that the UK is now the largest outward investor, surpassing even the US.
Long gone are the days when international trade essentially operated between discrete national economies, with national governments setting the rules and players sharing a common set of national norms and values. In its place has yet to arise a coherent rules-based system of the sort the ICC is calling for, with common principles and values articulated through the UN and other international agencies. This is urgency needed and a good start has been made. Global economic anarchy is not in companies' interest. Business needs stability to plan and invest. Free trade needs free societies at peace with themselves if it is to prosper. Firms trying to be socially responsible need a level playing field for labour and environmental standards so they are not undercut.
Formerly 'national' companies like BT and CEOs with vision like Sir John Browne are not afraid to get involved in these issues. At the macro-level, they and more like them should engage in vigorous debate, not just with governments and international agencies, but with wider civil society through the media and in dialogue with NGOs. Their message should be that global capitalism can be responsible and a force for sustainability, not destruction, in a fragile world. At a micro level, in the countries and communities where they operate around the world, they need to run their businesses and invest in local communities in ways which demonstrate the truth of their message. For so long as a credibility gap continues, global corporations will be distrusted, and their prosperity hindered.