Monday, October 27, 2008

Do we need a World TNC Regulatory Authority?

As companies grow ever larger it becomes harder for governments to regulate them. If a company misbehaves in a country, the government may be reluctant to act. Nestlé threatened to pull out of Zimbabwe if it introduced strong regulations on the marketing of baby foods. When the Philippines was introducing regulations, the US Chamber of Commerce threatened the President with disinvestment.

At the same time, the home country of a company is often reluctant to act because of the contribution a company makes to its economy - and unethical companies that break the rules may make a bigger contribution than those that are forced to abide by the rules. Often there is a double standard where companies are allowed to get away with behaviour abroad that is unacceptable at home. An example of double standards from last week was the claims Nestlé makes for Maggi Noodles in Bangladesh that was ruled as unacceptable in the UK. We campaigned in the past over Nestlé's objection to labelling products in Sri Lanka in three languages, while it uses three languages on labels in Switzerland.

In theory there are minimum standards. Companies are called on to abide by the World Health Assembly marketing requirements independently of government measures, but they do not do so. Where there is independently monitored and enforced regulations or pressure from campaigns such as the Nestlé boycott companies can be forced to comply, showing it is not impossible to do so, but where national measures are not in place or not enforced there is currently no way to hold corporations to account.

As a member of a Task Force of the UN System Standing Committee on Nutrition I contributed a chapter to a book on 'Global Obligations for the Right to Food' about holding corporations to account. This draws on my experience dealing with Nestlé and other companies and argues that there needs to be an international regulatory framework for when national measures fail. The book is available at:

We are building alliances to promote regulatory frameworks in place of the voluntary UN Global Compact system, which has no monitoring or enforcement system.

As part of this process I have submitted a summary of the proposals from my chapter for inclusion in the Simultaneous Policy, an international campaign where people vote on the action they want to see taken on global problems. Speaking in my personal capacity, I am particularly fond of the Simultaneous Policy approach, because of its focus on solutions. The campaign does not protest against current action by government, nor is it calling for changes existing policy as such. Both of these approaches are important. The Simultaneous Policy has a parallel approach, promoting an international democratic discussion on what policies people wish to see implemented to address global problems. In other contexts these aspirations are often drastically curtailed by what is possible, what powerful vested interests will tolerate. In the Simultaneous Policy the focus in on the policies we would like to see implemented if we, the people, could decide, if there was a global democratic space where we had a voice. It aims to create that democratic space.

Politicians are simply asked to pledge to implement these policies alongside other governments - and an increasing number are doing so, including in the UK. The theory is that it is easy for politicians to say they will do something if other countries will do so too (such as properlty regulating transnational corporations), partly because simultaneous implementation removes the fear of putting the country at a competitive disadvantage and partly because they may think it will never happen. If politicians are also asked to sign during elections and see votes in it, that's another incentive. Those signing up to the Simultaneous Policy campaign (which is free) are asked to either give a preference at elections to candidates, within reason, who make this pledge, or to encourage their preferred candidate to make it. When there are sufficient politicians who have made the pledge it would become government policy, so building to the day when there are enough governments. On that day the Simultaneous Policy would be ready, with solutions to global problems that have the backing of people around the world.

That's the theory.

At the same time the discussion of policies itself is important for raising awareness and encouraging implementation of them - or aspects of them - through other means. Accordingly I've summarised aspects of the proposal in the Global Obligations to the Right to Food book and submitted this as a call for a World Transnational Corporation Regulatory Authority.

Annual voting on policies is currently taking place until 1 November. Proposals that receive high levels of support are given space in campaign publications and at public meetings, which will be a good way to promote this proposal to a wider audience. You can find out more about this campaign, the proposal for a World Transnational Corporation Regulatory Authority and how to vote on this and other proposals on my personal, dedicated blog at:

For a briefing on the shortcomings with the UN Global Compact system see the International Baby Food Action Network (IBFAN) site at:

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