Criticisms of the Global Compact

Criticisms of the Global Compact

The UN Global Compact is a UN initiative aimed at promoting public-private partnerships in corporate governance. It includes ten principles that promote human rights and corporate responsibility (Deva, 2006). The principles require private and public organizations in UN member countries to adopt these guiding principles. However, this initiative faces criticism, just like many other UN-sponsored initiatives.

A common criticism of the UN Global Compact is the lack of enforcement mechanisms. Participating nations are expected to voluntarily pursue the ten guiding principles of human rights under the initiative (Hemphill, 2005). Naturally, this makes it hard for the companies to comply. For instance, some of the target companies of the initiative are those companies that practice child labor. Such companies may not comply with the human rights guidelines voluntarily if the practice helps them garner more profits. It takes authoritative enforcement to get some organizations to comply with some regulatory requirements.

Moreover, since there are no enforcement mechanisms, the Global Compact initiative fails to assess or pass judgment on non-compliant companies (Bendell, 2004). Participating companies only need to publish how far they are in complying with the ten guiding principles in their annual reports. In a nutshell, the member nations only communicate progress. The lack of accountability measures results in non-compliance.

In summary, the UN Global Compact is more of a guide than a watchdog. Although the process of reporting is mandatory, there are no standards against which compliance is determined. In addition, the lack of enforcement bodies means that stakeholders are at liberty to decide when to comply and when not to comply. As a result, the UN Global Compact is a mere prescriptive initiative without enforcement guidelines.

References

Bendell, J. (2004). Flags of inconvenience?: the global compact and the future of the United Nations.

Deva, S. (2006). Global Compact: A Critique of the UN’s public-private partnership for promoting corporate citizenship. Syracuse J. Int’l L. & Com., 34, 107.

Hemphill, T. A. (2005). The United Nations Global Compact: the business implementation and accountability challenge. International Journal of Business Governance and Ethics, 1(4), 303-316.

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In your opinion, which of the three major criticisms of the Global Compact is the most significant?

Criticisms of the Global Compact

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