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ILO Director-General urges business to become "part of the solution" to challenge of globalization

GENEVA (ILO News) - The Director-General of the International Labour Office (ILO), Mr. Juan Somavia, today urged business leaders to become "part of the solution" to the problems of globalization by addressing the issues of social equity, human dignity and labour rights through corporate responsibility.

Press release | 05 November 1999

GENEVA (ILO News) - The Director-General of the International Labour Office (ILO), Mr. Juan Somavia, today urged business leaders to become "part of the solution" to the problems of globalization by addressing the issues of social equity, human dignity and labour rights through corporate responsibility.

In an address to some 600 CEOs, government, corporate and labour leaders and economic experts attending the second "Enterprise Forum" organized by the ILO here on 5-6 November, Mr. Somavia outlined a series of actions he said were essential to avoiding the negative impacts of globalization.

"Globalization has brought both prosperity and inequalities, which are testing the limits of collective social responsibility," Mr. Somavia said "If we are to avoid a serious backlash against the process of globalization, concerted action is needed."

Such action, he said, included:

  • providing disadvantaged countries an opportunity to develop the business environment and infrastructure without which they will see themselves left further behind in the global market;
  • giving "a human face to the market" amid the growing realization that markets do not function in isolation from their social and political contexts; and,
  • involving "those with the most direct stake in globalization - business" as "part of the solution by addressing issues of equity, human dignity and labour rights, and by lifting those who are in danger of being left behind."

"The pressure for change is already being felt," Mr. Somavia said. "Business is facing intensified social demands for good corporate practices. This has a direct bearing on consumer demand and corporate reputation through the media. A good corporate social image is increasingly essential for business success."

"At the ILO, we are keenly aware of the need for a more inclusive process for defining the emerging rules of the global market place to ensure that we achieve balanced development which maximizes market potential and social justice, competition and community," Mr. Somavia said. "In this respect, there is an urgent need to develop a framework which integrates the economic and social aspects of development."

The Forum will review the different dimensions of the relationship between enterprise competitiveness and social progress - a relationship which the ILO believes is not only compatible but mutually supportive. It will also explore key challenges facing enterprises at the threshold of the 21 st Century and various ways in which enterprises can, and in some cases already are, contributing to solving key social development issues.

In addition to Mr. Somavia, who opens the Forum, key speakers include United Nations Secretary-General Kofi Annan with a taped message; Mr. Pascal Couchepin, Minister for Economic Affairs of Switzerland and Mr. Klaas de Vries, Minister for Social Affairs and Employment of the Netherlands; Mr. Ashraf Tabani, Chairman, Seri Sugar Mills & President, International Organization of Employers; Lord Bill Brett, Chairman of the Workers' Group of the Governing Body of the ILO; Charles Handy, a leading management and social issues expert; Ms. Angeline Low, a leading Asian entrepreneur and CEO of a large multinational accountancy group; academics from INSEAD and the Massachusetts Institute of Technology; Mr. Risto Pentilla, Director of the World Economic Forum; and representatives of enterprises and groups such as ManPower, Motorola, Arthur Andersen, Danone Group, South African Breweries, Tata Group of India and the European Roundtable of Industrialists.

The three key themes of the Forum will be:

• Human resource based competitive advantage: There is increasing evidence that good human resource practices are essential to enterprise competitiveness and long term survival. The session will look at how some of the most successful companies are achieving competitive advantage through people;

• Corporate citizenship and social initiatives: Social pressures on enterprises through consumer groups and other interest groups is pushing many to embark on corporate citizenship practices. The Forum will look at the "why" and "how"of several such initiatives and hear from the social partners and leading academics;

• Tapping the employment potential of small business: Around 80% of new jobs are created in small enterprises. A number of specific issues will be looked at including how mutually beneficial linkages between large and small enterprises can contribute to job creation and how such linkages can be encouraged. The Forum will also examine how many of these new enterprises, which are being started by women and young people, can be supported.

"Of all the challenges facing us, none is more significant than the need to create decent and productive work for women and men everywhere", Mr. Somavia said. "One thing is certain. Enterprises of all sizes are emerging as some of the most influential institutions on the planet, and will be playing a major part in any realistic strategy to address the challenges of creating decent work for tomorrow."