CEO Water Mandate wins the Public Eye Greenwash Award

On January 26, the Public Eye Awards' Committee announced that the UN Global Compact's CEO Water Mandate won in the Greenwash category. Since 2005, at a ceremony outside the World Economic Forum in Davos Switzerland, the Public Eye Awards have been given out to corporations that have exhibited "irresponsible and damaging behavior".

In 2009, the Polaris Institute submitted a nomination of the CEO Water Mandate in the Greenwash category for "its role in facilitating greater control of water resources by multinational corporations while simultaneously 'greenwashing' socially and environmentally damaging corporate behavior."

The UN Global Compact launched the CEO Water Mandate in 2007 as a "public-private initiative designed to assist companies in the development, implementation and disclosure of water sustainability policies and practices." Corporate endorsers of the initiative include Nestlé, Coca Cola and PepsiCo. Since its creation the Mandate has been heavily criticized by civil society organizations and social movements, such as the Polaris Institute, Corporate Accountability International and the Sierra Club.

"Not only does the Global Compact and the CEO Water Mandate facilitate more corporate control of water," said Richard Girard of the Polaris Institute, "but it makes the United Nations an apologist and enabler of corporate greenwashing." Tony Clarke, director of the Polaris Institute added that "The United Nations has no business facilitating corporate water grabs. Instead, the UN should return to the mandate they abandoned some 35 years ago, effectively regulating the operations of transnational corporations around the world.".

Prior to the awards ceremony in Davos, the secretariat of the CEO Water Mandate issued a note to address "a number of basic misrepresentations being promulgated by organizations associated with the 'Public Eye Awards'." According to the secretariat, "[…] there are many organizations, including prominent NGOs, who recognize the business community as a significant user of water resources and believe in working with business organizations to improve their water footprints and impacts in ways that benefit society, including by contributing to the Millennium Development Goals. This fundamental belief in the key role businesses can and should play in advancing sustainable water management is the basis of the CEO Water Mandate."

CEO Water Mandate secretariat: organizers of the Public Eye Awards spread misrepresentations

Last week the secretariat of the CEO Water Mandate – an initiative of the UN Global Compact – issued a note in response to the nomination of the Mandate for the Public Eye Awards. Earlier that week, the organizers of the Public Eye Awards announced that the Mandate had been shortlisted for an award in the Greenwash category. The Public Eye Awards will be presented at a ceremony tomorrow, on the opening day of the World Economic Forum in Davos. The other contenders for the award in the Greenwash category are Health Promotion Switzerland and the Round Table on Responsible Soy.

The note published by the CEO Water Mandate secretariat seeks to address "a number of basic misrepresentations being promulgated by organizations associated with the 'Public Eye Awards'." The secretariat states that there are differences of opinion about the role of the private sector in addressing global water challenges: "It is clear that certain individuals and groups feel strongly that the private sector has little or no role to play, and indeed that involving the private sector in water issues runs contrary to the public's interest. At the same time, there are many organizations, including prominent NGOs, who recognize the business community as a significant user of water resources and believe in working with business organizations to improve their water footprints and impacts in ways that benefit society, including by contributing to the Millennium Development Goals. This fundamental belief in the key role businesses can and should play in advancing sustainable water management is the basis of the CEO Water Mandate."

The authors of the note argue that the CEO Water Mandate has established "advanced accountability and transparency mechanisms, both for endorsing companies and the initiative as a whole". The secretariat emphasizes that the companies that have endorsed the CEO Water Mandate are required to submit specific "Communications on Progress" reports, which are publicly available on the initiative's website. Failure to communicate progress will ultimately result in an endorser being publicly delisted from the initiative The secretariat also stress that it commissioned Arthur D. Little to carry out an audit of the initiative's first year of activities, which it has made public on the Mandate's website for purposes of accountability.

The secretariat's note is available here.

© Photo by Tanya Ann.

CEO Water Mandate on shortlist for the Public Eye Awards 2010

The CEO Water Mandate, an initiative of the UN Global Compact, has been shortlisted for the Public Eye Greenwash Award. Swiss NGOs Berne Declaration and Greenpeace Switzerland will present the Public Eye Awards at a ceremony on the occasion of the annual meeting of the World Economic Forum in Davos. For this year's edition the organizers of the Public Eye Awards have added a category: the Greenwash Award. This new category was conceived to "account for the rapidly growing number of institutions that fabricate social-environmental fig leaves in an attempt to make inveterate corporate players look greener than they are."

The Global Compact launched the CEO Water Mandate in 2007 as a "unique public-private initiative designed to assist companies in the development, implementation and disclosure of water sustainability policies and practices." Corporate endorsers of the initiative include Nestlé, Coca Cola and PepsiCo. Since its creation the Mandate has been heavily criticized by civil society organizations and social movements, such as the Polaris Institute, Corporate Accountability International and the Sierra Club. According to these groups, the initiative "facilitates corporate control of water resources" and "allows corporations to undermine democratic control of water under the aegis of the United Nations".

The rationale behind the nomination for the Public Eye Greenwash Award is the following: "Within the framework of the CEO Water Mandate, companies dependent on water such as Coca Cola, Dow Chemical and Nestlé profess to tackle the water crisis together with UN organizations, NGOs and other stakeholders. In reality, the companies pursue systematic water privatization with little regard for existing mandatory environmental and social standards."

The Public Eye Awards will be presented at a ceremony on January 27, the opening day of the World Economic Forum in Davos. A jury will select a winner in each category. The other contenders for the Greenwash Award category are Health Promotion Switzerland and the Round Table on Responsible Soy.

Read more about the nomination of the CEO Water Mandate here.

Global Compact participants urged to support UN relief efforts in Haiti

Haiti is facing unimaginable suffering and loss following a devastating earthquake which has resulted in widespread and significant damage, especially in the heavily populated capital of Port-au-Prince. The Global Compact is appealing to its participants to support relief efforts. Companies are urged to visit the UN-Business partnership platform to learn about specific financial and relief needs in the wake of this tragedy.

Haiti is among the world's poorest countries, and this catastrophe will exacerbate the already critical situation for its people. In addition to rescue and recovery, there is immediate need for the provision of water, food, temporary shelter, and essential medical supplies. There will be a variety of needs – short, medium and long-term – determined in the coming days, weeks and months. Please periodically visit http://business.un.org to check for updates on how your organization can help.

Source: UN Global Compact (14/1/2010).

Pension group TIAA-CREF divests from PetroChina

TIAA-CREF, the giant US$ 402 bn US pension plan and investment fund group for US teachers and researchers, has sold its shares in four Asian companies: PetroChina, CNPC Hong Kong, Oil and Natural Gas Corporation and Sinopec, in protest at their business links to the Sudanese government presiding over genocide in Darfur. The move makes it the first major US asset manager to take this action.

TIAA-CREF had called upon the companies either to stop working with the Sudanese government or else to take other steps to alleviate the suffering of the population in Sudan. Petronas, a Malaysian oil and gas company with Sudanese interests that was also a TIAA-CREF lobby target, has agreed to further talks about its influence in Sudan.

The Sudanese Ministry of Foreign Affairs dismissed the move suggesting that the group's action stemmed from its own financial problems rather than any political position-taking. It said that there would be no impact on other investments in the country.

In September 2009, the Global Compact Board dismissed a complaint against PetroChina. At the time, the Vice Chair of the Board, Sir Mark Moody-Stuart, said that CNPC, PetroChina's parent company, had "been active in supporting sustainable development in the country [Sudan] and engaged in the newly formed and embryonic Local Network, although not itself a Global Compact signatory." The Board also took note that CNPC "had engaged in Global Compact learning and dialogue activities on conflict sensitive business practices."

TIAA-CREF's decision to divest from PetroChina indicates that the compliments given by the Global Compact Board to CNPC / PetroChina were misplaced, to say the least.

UN links contracts to support for Global Compact

From Ethical Performance.

Business that fail to commit to the Global Compact could find themselves frozen out of contracts and partnerships with the United Nations.

Revised guidelines on cooperation between the UN and business state that before the organization seeks to engage in deals with companies it must consider whether they "demonstrate a commitment to meeting or exceeding the principles of the Compact".

This should include consideration of whether they translate the ten principles "into operational corporate practice within their sphere of influence - including [...] policies, codes of conduct, management, monitoring and reporting systems".

Although the guidelines are open to interpretation, they appear to suggest that companies not signed up to the Compact will struggle to win UN business, and that signatories that have been subject to Compact disciplinary measures might find themselves in a similar position.

The guidelines were first developed in 2000, setting out best practice on choosing a business partner and outlining general principles on UN-business cooperation. But they have been revised in response to UN member states' requests that the organization place greater emphasis on the transparency, accountability and sustainability of business partnerships.

Aside from a section on the Compact, the guidelines - which apply to the UN Secretariat as well as to separately administered organs, funds and programs within the UN - state emphatically that no engagements will be made with firms involved in child or forced labor, human rights abuses, or the sale or manufacture of anti-personnel landmines and cluster bombs.

Please also read the post Global Compact Critics published in July 2007 on the link between UN procurement and the Global Compact.

Source: Ethical Performance, volume 11, issue 8, January 2010 .

© Photo by Joe Dunckley.

Responsible investment not a priority for UN pension fund

According to on-line magazine Responsible Investor, the United Nations Joint Staff Pension Fund (UNJSPF) has requested just over US$ 200,000 in budget to pay for a consultant to help implement a responsible investment program after the appointment of a dedicated internal officer for responsible investment was rejected by its general assembly. The fund said the consultant would develop "responsible investing language and requirements" as well as review existing proxy voting services. The market value of the fund’s assets is about US$ 36.6 billion.

The UNJSPF - a signatory to the UN-backed Principles for Responsible Investment - had sought to boost its internal investment staff following a decision against the outsourcing of investment management operations, leaving 90 percent of scheme assets run in-house. The assembly's budget committee approved just five of a requested 14 positions at a vote before Christmas. The move came despite an internal UN report saying there are "fundamentally unsound and potentially dangerous" levels of staffing in the UNJSPF's investment department. The fund began the process of the process of establishing a policy on responsible investment and defining a plan to implement it in 2008. It aims to incorporate environmental, social and governance criteria into its investment analysis and decision-making process.

Responsible Investor reveals that the fund's Investment Management Service was initially asked to implement the initiative "from within existing staff capacity". The UNJSPF said in its most recent budget submission that it would "direct the projects with the goal of adopting environmental, social and governance policies that are consistent with the UN Principles for Responsible Investment and the Global Compact, without compromising the four investment criteria of safety, profitability, liquidity and convertibility".

Source: Responsible Investor (10/1/2010).

© Photo by Jorge Proctor.

CEO Water Mandate signatory accused of destroying and discarding new clothes

This week the New York Times reported a disheartening story about Wal-Mart and Hennes and Mauritz. The latter is a participant in the Global Compact and a prominent signatory of the CEO Water Mandate - a public-private initiative designed to assist companies in the development, implementation and disclosure of water sustainability policies and practices. In 2008, the giant Swedish retailer even submitted a special Communication on Progress on water issues to the Global Compact Office in New York.

Hennes and Mauritz has found itself at the center of an angry protest after one of its leading outlets in Manhattan was accused of cutting up unsold garments and dumping them in giant trash bags on the street. The claim that the global chain was destroying unused clothes in the middle of one of the bitterest winters and deepest recessions to have hit New York in many years led to an outpouring of angry comments on Twitter.

Trash bags full of pristine clothes were found by a graduate student of the City University of New York, who came across them one night as she walked to the subway. The student, Cynthia Magnus, tracked them to the 34th Street Hennes and Mauritz store, a popular venue for tourists and New Yorkers in the center of Manhattan. Inside the bags were gloves with the fingers cut off, socks, patent leather shoes with the instep cut up, and warm men's jackets slashed across the body and arms. "It was a very frigid night, and there were bags upon bags of warm winter clothing not 50 feet away from where a homeless man slept on cardboard boxes," she said. 

Shocked by what she had found, she took some of the bags home to Brooklyn and tried to salvage the clothes. She contacted Hennes and Mauritz's Swedish headquarters complaining about the dumping, and when she received no reply took the story to the New York Times. She also exposed an alleged dumping exercise carried out by a contractor of America's largest retailer, Wal-Mart, on the neighboring block. 

According to the Associated Press, Hennes and Mauritz has promised to stop destroying new merchandise that it cannot sell at one of its Manhattan stores. The chain said it will instead donate the garments to charity. Hennes and Mauritz's spokeswoman Nicole Christie said, "It will not happen again". Ms. Christie said she did not know why the store was mutilating and discarding clothing. She said that the Sweden-based company would make sure none of its other stores were doing so and that Hennes and Mauritz's policy is to donate unworn clothing. 

Destroying and throwing away unused clothes is certainly not good for any company's water footprint. Just to give an example: it takes about 1.900 liters to make a pair of stonewashed jeans. Reduce, Hennes and Mauritz, Reduce.