Global Compact gets tough

The United Nations has expelled more than 2 thousand companies from its Global Compact for failing to meet the group’s principles. The Compact is a framework for businesses willing – and committed – to aligning their operations with ten social and environmental principles. 

The expulsion brings the number of participants to the Compact down to 6 thousand in 132 countries, a far cry from the group’s target of reaching 20 thousand by the end of the decade. Among those expelled are companies such as Allianz in France, Barclays Bank Gambia, Euronext in France, GlaxoSmithKline Bulgaria and Nordea Bank Finland Plc, Latvia Branch.

The Global Compact requires participants to communicate every year with stakeholders on their progress in integrating its principles, which cover human rights, anti-corruption and labour rights as well as environmental factors. Companies that do not issue a Communication on Progress (COP) for two consecutive years face expulsion and must reapply for participation in the initiative.

“We are moving forward on transparency and disclosure through a dual, complementary approach,” said Jerome Lavigne-Delville, Head of Communication on Progress in the Global Compact Office. “On the one hand, we are driving a strict enforcement of our integrity measures to ensure that every business participant disclose information on its progress, every year. On the other, we are introducing a platform that provides incentives and recognition for businesses at all levels to make meaningful progress towards a comprehensive implementation of the principles in strategy and operations.”

Next month sees the launch of a “differentiation framework” in a bid to motivate companies to strive for greater integration of the principles. Georg Kell, Executive Director of the Global Compact, said: “It will provide deeper incentives at both ends of the performance spectrum, and help stakeholders critically assess the performance and progress of our companies.”

The full list of expelled companies is available here.

For more information: www.unglobalcompact.org