Organized by the Employers’ Federation of Pakistan in collaboration with the ILO, a one-day pre-launch workshop on Global Compact (GC) was held in Karachi in the last week of September to urge Pakistani business to support the Global Compact (Dawn, 28-9-03).
The Global Compact is an international initiative that was first proposed by the United Nations’ Secretary-General Kofi Annan on January 31, 1999 in his address to The World Economic Forum. Its operational phase was launched on July 26, 2000 at the UN headquarters in New York.
The UN Secretary-General challenged business leaders to come together with UN agencies, labour and civil society to support nine principles in the areas of human rights, labour and the environment. It was time for business administrationists, who promote practice of good principles of business management, to take heart. The Global Compact’s nine principles cover the domains of labour law, personnel/human resource management, and sustainability in economic growth without depreciating environmental capital.
Full support to the nine principles of Global Compact was announced by the employers’ federations of Pakistan, Bangla Desh, India, Nepal, and Sri Lanka on October 16, 2002 (ibid). According to ILO, India’s senior specialist on employers’ activities for South Asia, 1240 companies have declared adherence to GC’s principles. These include 180 from France, 176 in Poland, 118 in Spain, 93 in the Philippines, and 87 in India. With a large number of adherents in India, the concept cannot be viewed as absolutely alien to the third world in general and to the region in particular. Its specific application given the current stage of development or underdevelopment may, however, merit closer examination.
The Global Compact’s nine principles, that the private sector is expected to embrace and enact as a part of their core values, are: (International Herald Tribune, 25-1-2001)
Human Rights: 1) Businesses should support and respect the protection of internationally proclaimed human rights. 2) Make sure they are not complicit in human rights abuses. Labour: 3) Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining. 4) The elimination of all forms of forced and compulsory labour. 5) The effective abolition of child labour. 6) The elimination of discrimination in respect to employment and occupation. Environment: 7) Businesses should support a precautionary approach to environmental challenges. 8) Undertake initiatives to promote greater environmental responsibility. 9) Encourage the development and diffusion of environmentally friendly technologies.
While all of the above are compatible with good principles of business management, it is the fifth GC (Global Compact) principle that might not be in complete sync with the stage of our (under)development. This by no means is an attempt to support child labour as children’s place is in schools and homes where they should be raised to lead healthy and prosperous lives. However, if schools and comfortable homes are not available to a vast majority of children, their parents are keen on ensuring that the children begin to acquire some vocational skills at an early age so that they may eventually have a means of livelihood. For, even if they are per force made to go through a school system in an economy which is not generating enough jobs, years of schooling will not be able to turn over into gainful employment for the deprived in a society with an employment vacuum. So, as long as early employment is not harmful for health, the parents find it rational to pursue it for their children under the above circumstances.
Against the above backdrop, Pakistan’s soccer ball kind of strategy has been well received even internationally. That is, children are required to work for only half the time and for the remaining time, they are schooled. In addition, nutritional aspects of child workers are taken good care of. In some other industries though in which children’s tender fingers or health otherwise is adversely affected, there is a case for outright abolition of child labour.
The country’s socio-economic conditions have to be made conducive in parallel with the effort to eliminate/phase out child labour so that opportunities for the gainful absorption of all children in the society are made available as soon as they are ready to avail them. Until such time that the society and the economy create an absorptive capacity for the country’s upcoming human resource, slamming the doors of whatever little employment is available to our desperate job seekers who begin to do so at a very early age is to ignore the country’s sordid realities. They would alternatively take to counterproductive hobbies and activities. While this is no reason to allow child labour, lack of opportunities might be a consideration. So, if child labour is to be eliminated, the macro scenario requires to be focused upon as well.
As for the macro scene, the UN has the free market, free trade model in mind for all parts of the world even though the underdeveloped world is not quite cut out for it yet. In fact, it is this very market reform that has, inter alia, contributed to unemployment and poverty in Pakistan during the 1990s and thereby added to the supply of child labour the UN wants to eliminate. All those desirous of eliminating child labour ought to understand that this issue cannot be controlled only by decreed reduction in business demand for it. For as long as the supply of child labour continues to grow, forced demand reduction might contain child labour in formal business but cannot eliminate it from the economy as they will find alternative engagement either in the informal sector or in the illegal or illegitimate underground economy.
The issue of child labour will remain or will, at best, be shifted from the formal to the informal sector unless inclusive development strategies are devised and implemented on which the international agencies either remain silent or promote policies that exclude the majority thus exacerbating underdevelopment issues in general and that of child labour in particular. So, even though Kofi Annan’s vision behind the Global Compact is “a more sustainable and inclusive global economy,” his macro vision around free markets and free trade tends to marginalize and exclude those awaiting inclusion in the underdeveloped part of the world.
As a delegation of corporate executives from the business lobby group of the International Chamber of Commerce announced support for the Global Compact in July 1999, the “UN in return committed to support corporate demands for continued moves towards global ‘free trade’.” That is, support for greater economic integration of the world that the less developed are quite uncomfortable with as it has been working against the interests of the disadvantaged of the world. Decreed elimination of child labour from the formal sector thus squares with the demands of the developed countries’ business interests who are seeking the same in the interest of “level playing fields” and “fair trade.”
It might be argued that the Global Compact does not intend to regulate, police, or enforce as it seeks to facilitate and engage the concerned. To this extent, the intent is self-regulation by businesses which if choose to support and enact all of the GC’s nine principles will be virtually decreeing it on themselves. So, while a principle for whose implementation the ground may still be ill-prepared might be decreed, the principles that might need to be adopted without delay might still not be enforced as the Global Compact is a mere promotional device for such values.
The critique of the Global Compact, therefore, is that not all those corporations which opt for the GC actually comply with all of GC’s principles. For, many of them just tend to “bluewash” corporate activity by camouflaging their not-so-desirable actions in the blue UN flag. So, while they have themselves labelled as socially responsible global corporate citizens through the UN name and logo, the UN in return advocates free (as well as ‘fair’) trade for them. In the process, a range of UN programmes hope to receive funding from cash surplus huge global corporations.
End of the day, the Global Compact may be a fund raiser for some cash starved UN programmes. While this is innovative promotion for the UN programmes and their values, there is a need to ensure that the good values are actually enforced through this partnership between the UN and the private sector and that the application of its principles is customized to country-specific requirements. Above all, the link between the Global Compact and human development and poverty should appear less simplistic than is being projected currently.
These links should be seen in a more holistic perspective identifying all the other related variables in the network which is a lot more complex than the ineffective free market, free trade model that is inadvertently also getting promoted through the otherwise well-intentioned Global Compact initiative that can actually revolutionize business practices provided the other pieces in the jigsaw puzzle fall in place as discussed herein.