(New York) – In its first meeting of the year, the Global Compact Board, the highest-level advisory body involving business and civil society at the United Nations, addressed the issue of companies being delisted from the Global Compact for failure to communicate progress. Board members approved a measure proposed by the Global Compact Office to introduce a one-year moratorium on delisting companies from non-OECD/G20 countries, following the recent removal of a disproportionate number of companies in these countries. The measure was deemed necessary pending a further review of the current Communication of Progress (COP) mechanism and its suitability for companies in emerging and less-developed economies.
As the Board’s chair, UN Secretary-General Ban Ki-moon opened the meeting at UN Headquarters. In his remarks, the Secretary-General reflected on the upcoming 10th anniversary of the Global Compact on 26 July of this year, emphasizing: “Ten years ago, there was much doubt and suspicion about business supporting societal goals. Today, enlightened companies realize that integrating sustainability issues in a responsible manner is important for the success of both business and society.”
Following the opening, Board members provided updates on their working groups on human rights, labour, environment, anti-corruption, and business and peace – all of which are preparing resources to be launched at the Global Compact Leaders Summit 2010 on 24-25 June. In the discussions, Board members were supportive of exploring stronger linkages between the Global Compact issue areas, stating that the ten principles are fundamentally connected.
The Board then discussed recent developments regarding the Global Compact’s integrity measures. Following a presentation on the status of companies being removed from the initiative for failure to meet COP deadlines, Board members expressed concern that, following the introduction of a stricter COP policy on 1 January 2010, a high proportion of companies from non-OECD/G20 countries had been delisted . The Board agreed to a one-year moratorium on delisting of companies in these countries, to be in effect between 1 January 2010 and 31 December 2010. As a result, 347 companies from non-OECD/G20 countries that had been delisted between 1 January 2010 and 1 March 2010 have been reinstated.
The Board unanimously agreed that the moratorium is not intended to weaken the COP requirement. Instead, it is a temporary measure to allow for a thorough review of COP preparation and submission procedures to ensure their suitability for all companies. The Board asked the Global Compact Office to present a long-term solution to the COP process at its next meeting in June this year.
Subsequent discussion on the agenda centered on the structure and content of this year’s Global Compact Leaders Summit. The Board expressed strong support for the Summit’s objectives and preparations.
Following formal deliberations, Board members attended a lunch with the Secretary-General, Ambassadors and other Member State representatives. The Board briefed attendees on key outcomes of the morning’s discussion. In addition, ambassadors from Brazil, Columbia, Germany and India addressed the group underscoring their work to advance corporate responsibility in their countries.
A detailed report of the Board meeting will be made available shortly.