‘Entrepreneurial action driven by universal values’

By joining the United Nations Global Compact, Bertelsmann pledges to observe ten principles in the areas of human rights, labor standards, environmental protection and anti-corruption, and to implement them in its sphere of influence. Georg Kell, Executive Director of the Global Compact, which is based in New York's UN building, talks about the Global Compact’s genesis and mission.

What is the Global Compact?

George Kell: The Global Compact is an initiative set up by the United Nations. It calls on companies worldwide to implement ten universal social and environmental principles in their spheres of influence. This is done on a purely voluntary basis; the Global Compact is not yet a certification, but ultimately a value framework for entrepreneurial action. The initiative is supported by the Global Compact Office, which coordinates it with about 20 employees.

Why was the Global Compact established?

George Kell: The Global Compact goes back to a January 1999 speech by former UN Secretary-General Kofi Annan before the World Economic Forum in Davos. In his speech, Annan urged companies across the world to "initiate a global compact of shared values and principles, which will give a human face to the global market." This call was made against the backdrop of numerous corporate scandals in the 1990s and an increasingly heated debate between critics and supporters of globalization. At the same time, it became clear that the great challenges of our time, such as HIV/AIDS and malaria, widespread poverty, armed conflicts and climate change could only be addressed with the involvement of the business sector. So the Global Compact was created as a platform for gearing entrepreneurial action toward universal values and for developing solutions to global problems through constant dialog with other social forces.

How many members does the UNGC have?

George Kell: The Global Compact currently counts a good 6,000 member companies in over 130 nations. In addition there are nearly 2,200 civil society organizations, especially non-governmental organizations, foundations, universities and employers' and workers' associations.

What are the current priorities?

George Kell: The Global Compact aims to support companies in implementing the ten principles within their spheres of influence. This includes developing clear and practical guidelines on all thematic areas, namely, human rights, working conditions, environmental protection and anti-corruption. In the past few years, the Global Compact has also established several platforms on current topics, for example on climate change (“Caring for Climate”), sustainable investment (“Principles for Responsible Investment”), and water ("The CEO Water Mandate"). They all serve the goal of focusing concern on these challenges and achieving a greater impact through collective action. Together with several academic partners, the Global Compact created the “Principles for Responsible Management Education,” an initiative to anchor the subject of corporate responsibility in all areas of business management training and to thereby better prepare future managers for the challenges and opportunities of a sustainable economy. An important substantive focus this year is the private sector’s contribution toward meeting the Millennium Development Goals of the United Nations. The Global Compact has introduced several events and new publications to help stimulate a stronger partnership between business, civil society and the UN system.

What do companies gain by joining?

George Kell: No other initiative offers a comparable global network of like-minded companies and organizations. Under the umbrella of the United Nations, participating companies will find a unique platform for dialog and exchange of experience. It is also important that the ten Global Compact principles enjoy the greatest possible acceptance, as they are based on ratified global conventions and instruments, for example, the Universal Declaration of Human Rights and the United Nations Convention against Corruption. Many of our members report that the Global Compact finally enabled them to place their sustainability strategy in a universal framework and to develop a globally applicable framework for action. This not only strengthens credibility, but can also significantly reduce operational costs.

How can companies get involved in the Global Compact?

George Kell: There are many ways of getting involved. The Global Compact is always keen to learn how participating companies have dealt with specific challenges and how they have put the ten principles into practice. Case studies and practice reports are one way to contribute to knowledge exchange and to offer other – perhaps less experienced – firms guidance and inspiration. This happens at the global and local level, at events and in the form of printed publications. At the same time, all companies are invited, depending on their capabilities and priorities, to participate in the initiatives mentioned earlier. For instance, nearly 300 companies are currently involved in the "Caring for Climate" platform. The Global Compact welcomes companies’ own initiatives, and often the impetus to advance relevant issues is provided by individual companies, whether through sector-specific projects, as in tourism, or on cross-sector topical issues, such as water.

What obligations does a company incur by joining?

George Kell: Commitment to the Global Compact is made on a voluntary basis, so there are no direct reviews of the company. However, participating companies commit to publishing an annual report (“Communication on Progress") in which they describe how they implement the ten Global Compact principles within their sphere of influence. If a company repeatedly fails to do this, it may be delisted from the initiative. On the one hand, this promotes transparency and credibility for the companies and the Global Compact itself. And on the other, if it is done systematically and seriously, it also helps firms to better evaluate their own way forward, and make corrections where appropriate. The Global Compact offers help in many different ways, for example, through cooperation with the Global Reporting Initiative (GRI), which has developed an extensive system of indicators for meaningful sustainability reporting.