Private Sector and Government

1
Private Sector and Government

• Foreign and Commonwealth Office
• Nick Baker
• nick.baker_at_fco.gov.uk

2
Corporate Social Responsibility

• What are we trying to achieve?
• Improve business standards internationally on key
  issues in high impact sectors
• Why?
• We want business to act responsibly so that it
  fulfils its essential role in driving sustainable
  development.
• Ensure that UK companies are competing on a level
  playing field with other companies

3
What are the key issues?

• Child labour/
• forced labour
• Human Rights
• Environment
• Corruption

4
What are the high impact sectors?

• Extractives (oil,
• gas and mining)
• Finance
• Construction
• Retail
• Pharmaceuticals

5

• For extractive companies (oil, gas and mining)
• Particularly relevant to work in insecure
  environments e.g. Niger Delta, Colombia
• Provide practical advice on avoiding complicity
  in human rights abuses
• Brings governments, NGOs and companies together
  to discuss security and human rights
• We want to extend the number of participants,
  both companies and governments e.g. Colombia,
  Nigeria
• www.voluntaryprinciples.org

6
The Global Compact the 10 Principles

• 6 The elimination of discrimination in respect
  of employment.
• Environment
• 7 Support a precautionary approach to
  environmental challenges
• 8 Undertake initiatives to promote greater
  environmental responsibility
• 9 Encourage the development and diffusion of
  environmentally friendly technologies
• Anti-Corruption
• 10 Work against all forms of corruption,
  including extortion and bribery.

• Human Rights
• 1 Support and respect the protection of
  internationally proclaimed human rights
• 2 Businesses should ensure that they are not
  complicit in human rights abuses.
• Labour Standards
• 3 Uphold the freedom of association and
  recognise the right to collective bargaining
• 4 The elimination of all forms of forced and
  compulsory labour
• 5 The effective abolition of child labour

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OECD Guidelines for Multinational Enterprises

• HOW THEY WORK
• Signed by governments
• System of National Contact Points
• Complaints can be brought against a company e.g.
  by an NGO or Trade Union
• Form of mediation

• ISSUES COVERED
• Human Rights
• Labour rights
• Corruption
• Sound environmental practice
• Equal opportunities
• Access to information

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What other tools are available to us to
achieve this?

• Project Funding
• Chevening Fellowships
• Political Messages ministerial speeches
  meetings between senior executives and Ministers
  or senior officials. Both in the UK and countries
  where UK companies have operations.
• Lead by example
• Promotional Activities
• Export Credit Guarantees
• Business Awards and "badge" schemes e.g.Business
  in the community awards. Promote the business
  case for CSR.
• Working with other government departments

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Corruption on the International Agenda
Why tackle corruption and bribery?

• Undermines good governance and democratic values
• Creates an unfavourable business environment and
  the need for a level playing field
• Hits the poorest people in the poorest countries
  hardest
• Threatens the UKs reputation
• Allows organised crime to flourish

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Corruption on the International Agenda
Corruption is rising up the international
agenda...

• Globalisation of business
• Poverty and governance issues
• Commission for Africa
• World Bank priority
• G8 priority

11
International Architecture

• UN Convention Against Corruption (2003)
• Council of Europe Criminal Law Convention on
  Corruption (2002)
• Asian Development Bank/OECD Anti-Corruption
  Initiative for Asia-Pacific (2001)
• OECD Convention Against Bribery of Foreign Public
  Officials in International Business Transactions
  (1999)
• Organisation of American States Inter-American
  Convention Against Corruption (1997)
• US Foreign Corrupt Practices Act (1977)
• African Union Convention on Preventing and
  Combating Corruption (not yet in force)

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UK Response Government
Legislation

• Proceeds of Crime Act (2002)
• Amended in 2005 to simplify MLA arrangements and
  allow prompt asset freezing
• Anti-Terrorism Crime and Security Act (2001)
• To stifle the supply side of bribery.
  Extra-territorial application
• Public Interest Disclosure Act (1998)
• Whistleblower protection
• Proposed Corruption Bill
• To tidy up existing definitions of offences of
  corruption

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UK Response Business
What does this mean for UK business?

• UK companies and individuals subject to
  prosecution in the UK for acts of bribery
  committed wholly overseas
• Clear message to UK companies not to engage in
  corruption
• Reputational and business risk for companies
• Potential black listing, e.g. World Bank

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UK Response Business
What can UK businesses do?

• Develop corporate anti-corruption strategies
• Include corruption in risk assessments
• Report solicitations to host Government
  anti-corruption body
• Report solicitations to nearest UK mission
• Build co-operation with like-minded companies
• Use industry bodies and chambers of commerce

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UK Response FCO
Staff in overseas missions will...

• Be alert to suspicious activity
• Report all allegations to FCO London
• Seek to make UK companies are aware of their
  obligations
• Encourage dialogue with the UK business community
• Consider joint approaches with EU, OECD or
  business colleagues to address problems
• Lobby host Governments and/or donors to tackle
  local problems

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What is the Security Information Service for
Business Overseas (SISBO)?

• SISBO is funded by business but located in the
  FCO.
• It can assist businesses by providing information
  on business risk they may face when operating in
  particular markets overseas.
• Areas covered may include - cross-border
  issues
• crime and civil disturbance - human rights
• local politics - bribery and corruption
• local law enforcement arrangements - personal
  protection
• ownership of physical or intellectual property
  rights
• terrorism

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SISBO Future Plans

• By December 2007, SISBO have a web portal,
  offering a one-stop briefing service for UK
  business operating overseas.
• By early 2008, it will offer a subscription
  service for business, with briefing derived from
  both the FCO and from subscribers themselves.
• By mid-2008 SISBO will offer a web-based
  information-pooling network across business
  sectors.

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Corporate Social Responsibility Nick Baker
(x2670) Bribery and Corruption Nigel Dickerson
(x2682) or Rob Wood(x2683) Nick
Khosler(x2672) Alistair Starling (x3675)