The UN Inc.: The United Nations and the Corporate Agenda

by David C. Korten

New York - It was a true power lunch, with the highest officials of the United Nations sitting down to a meal of lobster and an exotic mushroom salad with the CEOs of some of the world's most powerful transnational corporations (TNCs).

On June 24, 1997, 37 invited guests were ushered into a private dining room at the UN for a meeting co-hosted by UN General Assembly President Razali Ismail and Bjorn Stigson, Executive Director of the World Business Council on Sustainable Development (WBCSD). The purpose: to discuss business-sector participation in the UN's policy-setting process and explore partnerships between the UN and the TNCs in the use of UN development assistance funds.

The players in the meeting included 15 high-level representatives of government, including the heads of state of Norway, Guyana and Zimbabwe, the Secretary General of the UN, the Administrator of UN Development Program (UNDP), the UN Under Secretary General (who presides over the UN Commission on Sustainable Development), the Secretary General of the International Chamber of Commerce and 10 CEOs of transnational corporations.

The CEOs were mostly members of the WBCSD, a band of TNCs originally established in 1992 to represent the interests of global corporations at the United Nations Conference on Environment and Development in Rio - the Earth Summit.

Serving Lunch with Kofi

UN Secretary General Kofi Annan gave the corporate CEOs a warm welcome with his message that he sees many opportunities for cooperation between the UN and the private sector. He praised the Earth Summit as an example of the private sector participating in setting environmental standards - rather than having the UN or governments impose them. The secretary general failed to mention how corporate participation in Rio helped assure that few standards were actually set. He called on the private sector to devise alternative energy sources for the poor so they "don't have to cut down every tree in sight" - but made no mention of the role TNCs play in stripmining the world's forests.

Annan praised UNDP for promoting private investment in Third World countries and called on these governments to provide more incentives to attract business. In short, Annan is firmly committed to using UN funds (and other public monies) to subsidize the corporate buy-out of Third World economies.

UNDP Administrator Gus Speth said that the best hope for the 3 billion people in the world who live on less than $2 a day is to bring them into the market by redirecting more private investment to low-income countries. UNDP is apparently facilitating this process by giving priority to using its limited funds to "leverage" (read "subsidize") private foreign investment.

In a limited gesture toward transparency and multi-stakeholder participation, two nongovernmental organization (NGO) representatives and two "academics" were invited to observe. The NGO participants were Chee Yoke Ling of the Third World Network and Victoria Tauli-Corpuz of the Indigenous Peoples' Network. The academics were Jonathan Lash of World Resources Institute and myself.

The meeting's outcome was preordained. It closed with General Assembly President Razali announcing that a framework for the involvement of the corporate sector in UN decisionmaking would be worked out under the auspices of the WBCSD.

Listening to the presentations by the governmental and corporate representatives left me deeply shaken. It revealed the extent to which most of the messages that the world's NGOs have attempted to communicate to the UN and the Earth Summit and other UN conferences have fallen on deaf ears.

Few Dissenting Voices

On the positive side, Mr. Thorbejoern Jagland, the Prime Minister of Norway, called for a tax shift to place the burden of taxation on environmentally damaging consumption. And both Clare Short, Secretary of State for International Development of the United Kingdom, and Margaret De Boer, Minister of Environment for the Netherlands, called for giving high priority to ending poverty.

Chee Yoke Ling of the Third World Network, the only non-corporate voice given the floor, spoke critically about the growing concentration of corporate wealth and the corporate pursuit of the unattainable goal of creating a universal consumer society. She observed that there are not enough resources in the world for everyone to live at the current consumption level of the average Malaysian - let alone the average American or European.

She noted that people are becoming increasingly cynical about the TNCs professed commitment to sustainability, given that in corporate-dominated forums such as the World Trade Organization (WTO), the talk is only of the "rights" of corporations, never about their obligations.

Samuel Hinds, the president of Guyana, was the only speaker to take any note of Chee Yoke Ling's comments, which he dismissed out of hand. Indeed, Hinds went on to accuse NGOs of causing popular unrest by trying to postpone - in the name of environmental protection - the development that people so desperately want. Besides, he pointed out, if he does not cut down his country's forests, someone might grow marijuana in them.

Sommerizing the Issues

The US sent Larry Sommers, Deputy Secretary of the Treasury, as its representative to the luncheon. The Clinton administration could hardly have sent a clearer message about how it views the trade-off between its commitment to sustainability and its commitment to its corporate clients.

Sommers is the former World Bank chief economist who gained notoriety for advocating that US industry's toxic wastes be shipped to low-income Third World countries because people there die early anyway, and they have less income earning potential, so their lives are less valuable.

Sommers offered a litany of neoliberal platitudes. He praised privatization, noting that people take better care of their homes when they own them (implying that environmental resources will be better cared for when they are all privately owned by the corporate sector). Sommers assured the lunch guests that economic growth would lead the way to creating both the will and the means to deal with environmental problems. In short, Sommers believes, the more a person consumes, the more careful that person will be of the environment.

Sommers also argued that countries could save scarce public funds by attracting private foreign capital to build bridges and roads on a "fee-for-use" basis. He might well have noted that these roads and bridges would be less congested than public facilities since the fees would exclude their use by the poor.

Twisted Logic and Friendly Fascism

Underlying the words of every speaker (with the sole exception of Chee Yoke Ling) was an embrace of the neoliberal logic of market deregulation and economic globalization. According to the prevailing official wisdom, economic globalization and the economic dominance of corporations are irreversible realities to which we must simply adapt. Since global corporations have the money and the power, any viable approach to dealing with poverty and the environment must center on providing market incentives (read public subsidies) that will make it profitable for TNCs to invest in job creation and environmentally friendly technologies.

Thus it follows, by this twisted logic, that corporations need to be brought in as full partners in the public decisionmaking process to assure that the resulting policies will be responsive to their needs.

The underlying commitment to the use of public resources to advance unrestrained global corporate expansion brought to mind the central message of a book that first appeared in 1980 written by Bertram Gross titled Friendly Fascism: The New Face of Power in America. Gross looked beyond the familiar racism, hatred and brutal authoritarian rule associated with the practice of fascism to describe the institutional structure of fascist regimes. Herein he revealed a nasty little secret: The defining structure of fascist regimes is a corporate-dominated alliance between big business and big government to support the expansion of corporate empires.

Those of us who have been studying these issues have long known of the strong alignment of the WTO, the World Bank and the International Monetary Fund to the corporate agenda. By contrast the UN has seemed a more open, democratic and people-friendly institution. What I found so shattering was the strong evidence that the differences I have been attributing to the UN are largely cosmetic.

It seems that all our official forums function within the culture of ideological dogmatism that international financier George Soros denounced in his Atlantic Monthly article on "The Capitalist Threat." With dissenting voices quickly silenced, there is no challenge within the halls of power to flawed logic and assumptions.

So long as official forums remain captive to this closed and deeply flawed ideological culture, our governmental and corporate institutions will almost surely lead our world ever deeper into crisis. The burden of providing alternative leadership falls on those elements of civil society that are not captive to the official culture. This burden is enormous.

We must speak fearlessly with force and clarity to penetrate the veil of silence that shields our official and corporate institutions from confronting the devastating consequences of their ideologically driven leadership.

David C. Korten is the author of When Corporations Rule the World [Kumarian Press, (860) 233-5895, and Berrett Koehler Publishers, (415) 288-0260] and chair of the Positive Futures Network, publishers of Yes! A Journal of Positive Futures [(206) 842-0216] and president of the People-Centered Development Forum [fax: (212) 242-1901, http://iisd1.iisd.ca/pcdf].