UN Global Compact: Approaching the Second Decade

The second Private Event at the World Economic Forum in Davos was co-hosted by the Federal Department of Foreign Affairs (FDFA), KPMG and Novo Nordisk.

Fondation Guilé presented its study "Taking stock of disclosure on the UN Global Compact: The 2009 Guilé Communication on Progress survey", which was compiled in coordination with the UN Global Compact Office and supported by Deutsche Bank and Novo Nordisk, to fifty corporate sector representatives.

Participants then discussed several proposals to strengthen the UN Global Compact in its second decade. These proposals had been developed based on the discussions at the 2008 Private Event and a workshop with the co-hosts and 12 corporate Global Compact member companies.

The two main objectives of the Private Event were:

Take stock of the past decade and look back on what the Global Compact has achieved; Look forward: How can the reputation and credibility of the Global Compact be strengthened?

The Guilé Foundation mandated a team of corporate responsibility experts to analyze and benchmark 40 Communication on Progress (COP ) reports of Global Compact participants. The study was executed in late 2008 in coordination with the Global Compact Office and supported by Deutsche Bank and Novo Nordisk.

Thomas Streiff of the Guilé Foundation presented the main findings of the COP study:

Leading companies have strong reporting practices and provide relevant information about how they implement the Global Compact principles. Yet, there are large differences in the comprehensiveness and level of detail provided by the companies. Many COPs are relatively vague on the materiality (relevance for a company’s core business, value chain or stakeholders) of the ten principles for companies. COPs tend to focus more on risks than on opportunities. Information about opportunities remains anecdotal, i.e. is often limited to philanthropic projects.

Five proposals to strengthen the Global Compact in its 2nd decade were developed in workshops with the co-hosts and twelve companies:

Proposal 1: Reporting & Assessment Framework - In view of the large variations that were found in existing COP reports, a more robust yet lean Communication on Progress (COP) reporting framework shall be developed and introduced.

Proposal 2: Reward Scheme - Definition of a reward scheme that incentivizes Global Compact signatories to deepen their engagement with the initiative.

Proposal 3: Synergies along the Value Chain - Make better use of the wealth of participants’ knowhow, efforts and potential synergies in developing, implementing and disclosing sustainability policies and practices.

Proposal 4: Integration of Topical Issues - Embed the two key topical initiatives (“Caring for Climate” and “CEO Water Mandate”) into the Global Compact framework.

Proposal 5: Sustaining the Initiative - Today and even more in the future, the Global Compact will have to deal with leading com-panies (“front-runners”) and a presumably faster growing bulk of newcomers (“learners”). Catering to the different needs of the two groups, and notably trying to close the gap between them, will challenge the Global Compact in different ways such as finding the right mix of products and services, efficient institutional and organisational set-up, or financing of its activities.

To learn more about each proposal and the conclusions reached, read the event's summary.

The Secretary-General welcomed the debate initiated by the Fondation Guilé as it will help advancing the Global Compact in its second decade. By implementing the Global Compact, the private sector may solve social, ecological and economic problems. With creativity and innovation, this crisis can be changed into an opportunity. It will depend on the visionary leadership of business people and the governments alike. The Secretary-General called for a Global Compact 2.0. The goal is to create a visionary blueprint for the coming decade. Thus, the force of Global Compact may be widened and deepened. The initiative can be the most effective tool to rebuild the economy and regain trust and confidence, which has been lost recently in the market. The Secretary General thanked the participants and the co-hosts for their contribution to strengthening the Global Compact.

The discussions were confidential. The summary contains the event's main findings, programme and list of participants.