UNDP: AGENCY ASSAILED FOR SOLICITING MONEY FROM COMPANIES
KEY UNITED NATIONS AGENCY SOLICITS FUNDS FROM CORPORATIONS Corporate
Watchdog Leaks UN Plan (The Actual Press Release & Letter)


UNDP: Agency Assailed For Soliciting Money From Companies

The UN Development Program (UNDP) has solicited funds from
multinational companies with "tarnished records on human rights, labor and
the environment," a trio of watchdog groups are charging. But the UNDP says
the effort is proper and offers the prospect of a "breakthrough" in
corporate support for sustainable development.
According to the UNDP, 16 multinational companies have so
far joined discussions aimed at establishing a "Global Sustainable
Development Facility" (GSDF). Each of the 16 has contributed $50,000 to
cover the costs of the "design and dialogue process," but there was no
promise of any special favors, said Henry Jackelen, director of UNDP's
Private Sector Development Program. UNDP Assistant Administrator Eimi
Watanabe: "The breakthrough we are aiming for is to demonstrate that it is
possible for corporations to meet [universal labor, environmental and human
rights] standards, improve the lives of poor people and be profitable."
But according to the Transnational Resource and Action
Center (TRAC) of San Francisco, internal memos say the GSDF offers the
companies "a special relationship with" the UNDP. Participation in the GSDF
will provide companies with "unprecedented access to UNDP's network of
offices, high-level governmental contacts and its reputation," the watchdog
group charges, adding that the agency is considering creating a
UNDP-sanctioned logo for use by corporate sponsors.

Who Are We Talking About Here?
Among the companies that have signed on as GSDF sponsors are the British
mining firm Rio Tinto; the Swiss-Swedish engineering firm ABB; Germany's
RWE; US-based AT&T, Dow Chemical and Citibank; electric utility ESKOM of
South Africa; IKEA of Sweden; Novartis of Switzerland; and Norway's
state-owned oil company, Statoil.
"Many" of the companies have "come under fire" for
"significant human rights,labor or environmental abuses," the critics said.
In a letter to UNDP AdministratorJames Gustave Speth, copied to UN
Secretary-General Kofi Annan,nongovernmental groups from around the world
called on the agency to halt the project.
John Cavanagh, director of the Institute for Policy Studies
in Washington, DC, said the UNDP's effort may stem from the United States'
reluctance to pay arrears it owes the UN. Cavanagh: "Unfortunately, US
policy results in pressure on agencies such as UNDP to serve the short-term
interests of corporate shareholders rather than foster the long-term goals
of sustainable human development."
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2)
Please excuse cross-postings

From: Corporate Europe Observatory <ceo@...>

Corporate Europe Observatory forwards you a press release by the US-based
Transnational Resource Action Center (TRAC) / Corporate Watch.

Last year, Corporate Europe Observatory reported on the Geneva Business
Dialogue, organized by the International Chamber of Commerce with the aim
to forge a partnership between international business and the UN
institutions (http://www.xs4all.nl/~ceo/observer2/gbd.html).

Today, 12 March 1999, a leaked internal UNDP memo, outlining plans for a
partnership between the United Nations Development Programme (UNDP) and
several transnational corporations, has been published on the Corporate
Watch web site (http://www.corpwatch.org), where you will also find the
TRAC report "A Perilous Partnership: The United Nations Development
Programme's Flirtation with Corporate Collaboration".

Corporate Europe Observatory has endorsed a letter to James Gustave Speth,
Administrator of the United Nations Development Programme, urging the UNDP
to halt the proposed GSDF program. The text of this letter is included at
the end of this e-mail message.

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Corporate Europe Observatory ceo@... http://www.xs4all.nl/~ceo/
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NEWS RELEASE

EMBARGOED UNTIL: Friday, March 12, 1999, 9:00 a.m. EST (New York time)

CONTACT: Joshua Karliner TRAC Transnational Resource & Action Center
+1-415-561-6567

or: Kathy Parrent Pro Media Public Relations +1-212-245-0510

Documents available on www.corpwatch.org

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KEY UNITED NATIONS AGENCY SOLICITS FUNDS FROM CORPORATIONS Corporate
Watchdog Leaks UN Plan

New York, NY -- In a sharp detour from its mission of serving the world's
poor, a key UN agency, the United Nations Development Programme (UNDP), has
solicited funds from global corporations with tarnished records on human
rights, labor and the environment.

An internal UNDP memo obtained by the Transnational Resource and Action
Center (the San Francisco-based corporate watchdog that released Ernst &
Young's audit of a Nike' factory in Vietnam last year) reveals that UNDP
has approached at least 30 major global corporations and at least eleven
are paying $50,000 each to UNDP for privileges that flow from this
patronage. As part of its plan, the UNDP appears to be considering special
UNDP sanctioned logos for use by corporate sponsors.

Called the "Global Sustainable Development Facility" (GSDF), the plan calls
for corporate sponsors to funnel donations to a separate entity, which they
will manage. Sponsors will "benefit from the advice and support of UNDP
through a special relationship" according to the internal memo.
Participation in the GSDF will afford corporations unprecedented access to
UNDP's network of offices, high level governmental contacts and its
reputation.

"We fear these global corporations care more about 'greenwashing' their own
tarnished public images than about meeting the pressing needs of the
world's poor," said Joshua Karliner, Executive Director of the
Transnational Resource and Action Center (TRAC). He adds, "The needs of
poor communities around the world constantly conflict with corporate goals.
Corporations often use child labor, obstruct trade unions, and engage in
practices that destroy natural resources and pollute poor communities."

In a letter to UNDP Administrator Gus Speth, copied to UN Secretary General
Kofi Annan, prestigious NGOs from around the world today called on UNDP to
"halt its Global Sustainable Development Facility project and in so doing
preserve the credibility of its mission to serve the world's poor." The
letter was signed by such prominent international figures as Upendra Baxi,
the former Vice Chancellor of India's premiere university, the University
of Delhi, and SM Mohamed Idris, President of the Malaysia-based Third World
Network, one of the South's most highly respected centers of research and
analysis.

The GSDF project reflects a broader trend of growing UN collaboration with
transnational corporations. Secretary General Kofi Annan has accelerated
the trend over the past year, notably in a recent speech in Davos,
Switzerland. At the same time, the UN is considering undercutting a
sub-group of the UN Human Rights Commission which is addressing the impacts
of corporations on a broad spectrum of rights issues.

"The UN is at a crossroads," said Upendra Baxi, a visiting professor of law
at New York University and former Vice Chancellor of the University of
Delhi. "It can take the low road and favor trade based, market friendly
corporate rights or take the high road carved out by its founders, which
would allow it to continue to stand up for universal labor, environmental
and human rights in this age of globalization."

"The U.S. government's refusal to pay the $1.6 billion it owes the UN may
be leading the world body to seek political and economic support from
corporations," observed John Cavanagh, Director of the Institute for Policy
Studies, a Washington, D.C.-based think tank. "Unfortunately, US policy
results in pressure on agencies such as UNDP to serve the short term
interests of corporate shareholders rather than foster the long term goals
of sustainable human development," he said.

"A Perilous Partnership: The United Nations Development Programme's
Flirtation with Corporate Collaboration," a report from the Transnational
Resource and Action Center, the Institute for Policy Studies, and the
Council on International and Public Affairs, names the corporations that
have signed on as GSDF sponsors. Many, including the British mining concern
Rio Tinto Plc; the Swiss-Swedish firm, Asea, Brown Boveri; US corporations
Dow Chemical and Citibank; and Stat Oil, Norway's state-owned oil company,
have come under fire from groups around the world for significant human
rights, labor or environmental abuses.

"The UN should be monitoring the human rights and environmental impacts of
corporations in developing and industrialized nations, not granting special
favors," said Ward Morehouse, President of the Council on International and
Public Affairs. "Increasing collaboration will lead to a reluctance to
criticize corporations which are central players in the human rights,
environmental and development dramas unfolding every day across the globe."

"This is precisely the wrong moment for the UN to do this," said John
Cavanagh. "Much of the world is now suffering because there are no checks
and balances on the global financial market. The United Nations should act
as a check on global corporations."

###

NOTE TO REPORTERS: A copy of the internal memo describing the UNDP's plans,
the letter urging the UNDP to halt the proposed GSDF program and the TRAC
report, "A Perilous Partnership: The United Nations Development Programme's
Flirtation with Corporate Collaboration" will all be posted on the Internet
at www.corpwatch.org on March 12, 1999.

To arrange an interview with Joshua Karliner, Executive Director of
TRAC--Transnational Resource and Action Center; John Cavanagh or Phyllis
Bennis of the Institute for Policy Studies; Ward Morehouse of the Council
on International and Public Affairs; Professor Upendra Baxi; or Kenny
Bruno, TRAC Research Associate and greenwash specialist, please contact
Kathy Parrent at Pro-Media Public Relations, 212-245-0510.


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March 12, 1999

James Gustave Speth Administrator, United Nations Development Programme The
United Nations New York, USA Via Fax: 212-906-5700

Dear Mr. Speth,

We write as individuals who care deeply about the United Nations system and
who have worked for years to strengthen and support it.

We want to express our deep concern about the United Nations Development
Programme (UNDP) initiative called the Global Sustainable Development
Facility-2B2M: 2 Billion to the Market By the Year 2020. We believe this
project could cause serious harm to the organization's independence and
credibility. We are also concerned that the UNDP not fall victim to
inappropriate corporate influence.

We are writing to you before the UNDP launches this unprecedented
collaboration with a number of global corporations with the hope that you
will reconsider and halt the project.

Our concerns are various. First, many of the transnational companies you
are partnering with are well known for their negative impacts on
development, human rights and the environment. For instance:

*Rio Tinto Plc is a British mining corporation which has created so many
environment, human rights, and development problems that a global network
of trade unions, indigenous peoples, church groups, communities and
activists has emerged to fight its abuses. For instance, the company
stands accused of complicity in or direct violations of environmental,
labor and human rights in Indonesia, Papua New Guinea, Philippines,
Namibia, Madagascar, the United States and Australia, among others.

*Asea, Brown, Boveri is a Swiss-Swedish company that has faced sustained
campaigns by environmentalists and human rights advocates against its
involvement in various hydro projects, including the Three Gorges Project
in China and the now indefinitely postponed Bakun dam in Malaysia.

*Dow Chemical (GSDF steering committee member) is one of the biggest
polluters in the United States, the world's largest producer of
chlorine-the root source of dioxin-and one of the largest pesticide
companies on the planet.

*Citibank is the U.S. financial services corporation which played an
important role in the Asian financial crisis that threw millions of workers
out of work in 1997. Citicorp was also a major lender to developing
countries in the 1960s and 1970s, leading up to the Third World debt crisis.

*Stat Oil, "Statoil, Norway's state-owned oil company, has been and is
involved in environment, development and human rights conflicts at home, as
well as in Venezuela, Russia, Malaysia, Nigeria, East Timor and the Caspian
Sea.

Given the collective record of these and other corporations involved, it is
not clear how much they see this proposed joint venture with the United
Nations as having to do with the stated goal of "sustainable development."
Rather, it may be more of an opportunity for these corporations to practice
"greenwash"--a public relations exercise aimed at improving their troubled
images.

Second, the UNDP claims that the lives of the world's poorest 2 billion
people can or will be improved by drawing them into the world economy as it
exists today-the stated objective of its collaboration with this group of
global corporations through the GSDF. Yet the most pressing needs of the
poor-- the provision of basic health, education, and food resources--are in
arenas of little or no interest to most transnational corporations. Indeed,
corporate activities-including those of your partners in this
endeavor--frequently undermine the needs of the poor. So far we have seen
no substantial indication that these corporations or most others are
changing their priorities.

Furthermore, the GSDF "joint venture" raises the specter of UNDP programs
and priorities increasingly being diverted to serve corporate shareholder
interests rather than those of the poor. This is a sharp diversion from
the original intentions of the United Nations and of the UNDP in
particular. Yet those organizing the GSDF seem to see no conflict here,
citing the "strong relationship^Åbetween sustainable human development and
the growth of shareholder value." The fact that the UNDP appears to be
embracing such a stance through the GSDF project is profoundly disturbing
to us and, we feel, antithetical to the organization's mission. Indeed, we
believe that in today's global economy the relationship between the
enrichment of shareholders and the goals of poverty alleviation is more
often antagonistic than constructive.

Third, we are of the opinion that the GSDF initiative represents a worst
case example of the potential outcome of the "Global Compact" proposed
recently by UN Secretary General Kofi Annan in Davos, Switzerland. The
Secretary General's challenge to business leaders represents an important
step in pressing transnational corporations to adhere to universal values
defined by the United Nations in the areas of human rights, labor rights
and the environment. We agree with the Secretary General that the UN
should be given the resources and authority to monitor the realization of
these internationally agreed upon values as the search for effective
mechanisms of enforcement continues.

However, what the Secretary General's hopeful vision fails to address, is a
fundamental divide: that between the interests of global corporations and
the multilateral trading system they have been instrumental in devising on
the one hand, and the interests of the world's poor, the environment and
democratic institutions on the other. The growing concentration of wealth
and power in the hands of fundamentally undemocratic global corporations
and other institutions of globalization clashes with the overriding purpose
of the United Nations to enhance human dignity and the capacity for
self-governance.

Transnational corporations and the globalization process they are leading
frequently extract wealth from communities and countries, engendering
severe social, economic, human rights and environmental costs. Meanwhile,
the basic needs and desires of the world's poor-two thirds of whom are
marginalized from the global economy-are often diametrically opposed to the
corporate imperatives to maximize profits and accumulate wealth and power.

What's more, transnational corporations-including some of those involved in
the GSDF initiative--often work at cross purposes to UN objectives such as
international environmental and labor rights agreements.

Thus, while the Secretary General calls for giving "a human face to the
global market," we are concerned that efforts such as the UNDP's GSDF
project may only serve to mask the unfortunate nature of the core
activities of many of these transnational companies.

We understand that given the difficult financial and political situation in
which the United Nations finds itself--in large part because of the United
States government's refusal to pay the $1.6 billion it owes--the UN may
feel compelled to seek political and economic support from the corporate
world. This would be similar to what many public institutions have faced
as their government budgets have been reduced and they have turned to the
corporations for support. Many of these institutions have lost some of
their independence as a result. The UN now faces a similar dilemma.

It was the US government which successfully pressured for drastically
downsizing the UN Centre on Transnational Corporations (UNCTC) in 1992. The
UNCTC had been set up to monitor the social, economic and environmental
impacts of corporate investment in developing countries.

We recognize that the UN needs to find a way to inject itself more
forcefully into the debate about globalization. But to base that
intervention on misguided initiatives such as the GSDF is a step in the
wrong direction.

We respectfully submit that the UN should be working to subordinate the
ravages of the so-called "free market" to the imperatives of human rights,
environmentally sustainable and socially equitable development, the rights
of women, indigenous people and of the poor. We believe that the UN should
be monitoring the human rights and environmental impacts of corporations in
developing and industrialized countries, while helping to build truly
effective and enforceable mechanisms of international accountability.

We firmly believe that the United Nations can and should serve as a
counterbalance to unrestrained globalization rather than building
collaborative projects with corporations who are the architects of a system
that is usurping the UN's authority, and who are the perpetrators of human
rights and environmental problems which so hinder sustainable human
development.

At a moment when the gap between rich and poor countries and people is
growing, it would be a grave disservice to the goal of sustainable
development for a key United Nations agency to have its independently
determined priorities threatened by an exercise that is likely to bring
benefits primarily to the public relations of several global corporations.

Therefore we call on UNDP to call off its GSDF project, and in doing so, to
preserve the credibility of its mission to serve the world's poor.
Similarly, we hope that the Secretary General will continue to openly
explore ways in which the UN can position itself at the center of efforts
help build a future where human rights, labor rights and the environment
come first. In this way, the United Nations could move into the 21st
Century with its integrity intact.

Sincerely,

Upendra Baxi, Professor of Law, University of Warrick, UK, former Vice
Chancellor University of Delhi, India

Walden Bello, Director, Focus on the Global South, Thailand

Phyllis Bennis, Fellow, Institute for Policy Studies, USA

John Cavanagh, Director, Institute for Policy Studies, USA

Susan George, Fellow, Transnational Institute, The Netherlands; President
Observatoire de la Mondialisation, France

S M Mohamed Idris, President, Third World Network, Malaysia

Joshua Karliner, Director, Transnational Resource & Action Center, USA

Ward Morehouse, President, Council on International and Public Affairs, USA

Atila Roque, Programme Coordinator, IBASE--Brazilian Institute of Economic
and Social Analysis, Brazil

Yash Tandon, Director, International South Group Network (ISGN), Zimbabwe


Cc: Secretary General, Kofi Annan


Endorsed by,

Nicholas Hildyard, The Corner House, UK

Olivier Hoedeman, Coordinator, Corporate Europe Observatory, The Netherlands

Danny Kennedy, Director, Project Underground, USA

Jerry Mander, Director, International Forum on Globalization

Patrick McCully, Campaigns Coordinator, International Rivers Network, USA

Kinhide Mushakoji, Secretary General, International Movement Against All
Forms of Discrimination and Racism (IMADR); Former Vice-Rector, United
Nations University, Japan

Morten Ronning, The Future in our Hands/NorWatch, Norway

Kavaljit Singh, Director, Public Interest Research Group, India

Lori Wallach, Director, Global Trade Watch, Public Citizen, USA