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Least developed countries: CSR giving companies kudos

Mark Tran
News Source: 
News Date: 
Thu, 2011-05-12

The UN Global Compact, launched in 2000, seeks to persuade companies to adopt business practices in line with universally accepted principles in human rights, labour practices, environment and anti-corruption.

The compact is corporate social responsibilityput in practice at a global level and represents an attempt by Kofi Annan, UN secretary general when it was created, to get big business onside.

Some of the world's largest corporate names – from drinks giant Diageo to Rio Tinto, the mining company – have adopted the Global Compact. Even manufacturing armaments, in the case of the French group Thales, does not disbar a company from joining, although it might prompt sniggers from cynics. The Global Compact is also making inroads to the least developed countries (LDCs).

The Istanbul conference on LDCs has put the private sector very much at the heart of development. The number of business stalls at the conference's trade fair does make it seem as if the event is as much a huge marketing opportunity for Turkish businesses as it is about development.

Away from the hurly burly of the trade fair, a small panel heard on Thursday how individuals are making the case for social responsibility in companies in LDCs, through the Global Compact Local Network. Rashedur Rahman is the driving force behind the Bangladeshi network. He said the adoption of UN principles has changed company behaviour. For example,Viyelletex, a textiles and garment manufacturer that employs 13,000 people, made a commitment not to use child labour and has a written anti-corruption policy. The company also reuses effluent water from toilets used by 8,000 workers, which, combined with a rainwater harvesting system, saves 135 million litres of underground water each year. And when Square Pharmaceuticals, another Bangladeshi company, shifted to energy-efficient light bulbs it cut electricity use by 80%; it also offers free medical care to poorer workers.

Most interestingly, Rahman said Bangladesh's central bank has actively adopted the corporate social responsibility mantra, which, given its status, could give the global social compact a real boost. But he said there was much to do, such as engaging the media, which is a key issue. As always, there are limited resources as those who want to spread the word on the UN Global Compact are volunteers.

Shaffi Manafa Masai, from Uganda, spoke of the four companies in his local network. Kakira Sugar, one of Uganda's biggest employers, has struck a partnership with its growers, providing a matching fund for roads, schools and other infrastructure. Another company that had transformed many lives, said Masai, was Nile Breweries, a subsidiary of SABMiller, one of the world's biggest brewers. Nile is using local farmers to supply sorghum, which has reduced barley imports, benefiting 100,000 farmers.

The UN says about 100 of these local networks exist, organised by volunteers who want to spread the UN Global Compact and its principles to their own regions. Companies seem to adopt the compact partly to gain kudos but also for a marketing advantage.

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