HIGHLIGHTS OF PRESS CONFERENCE ON OPENING OF 2007 GLOBAL COMPACT LEADERS SUMMIT

On the occasion of the opening of the 2007 Global Compact Leaders Summit, UN Secretary-General Ban Ki-moon and a panel of leaders from business, labour and civil society today held a press conference this morning to discuss the status of the Global Compact and the significance of the Leaders Summit – the largest the UN has ever convened on this topic of corporate citizenship. The Global Compact Leaders Summit is being held over two days – 5 and 6 July – at the Palais des Nations in Geneva.

Panellists included Mr. Ban; Neville Isdell, Chairman and CEO of Coca-Cola; Jose Sergio Gabrielli de Azevedo, CEO of Petrobras; and Huguette Labelle, Chair of Transparency International. The moderator was UN Global Compact Executive Director, Georg Kell.

A transcript of the Secretary-General's interventions in today's panel are being issued in extenso in a separate document. Below are highlights of the statements made by other panellists and the interactive discussion.

Jose Sergio Gabrielli de Azevedo, CEO of Petrobras and a Board Member of the Global Compact, said the Global Compact Leaders Summit was a forum for discussing inequalities and climate change, and how to act as a business leader to change the world, the global reality. For its part, Petrobras, one of the world's largest oil companies, was committed to addressing climate change. The company had a long track record of producing biofuels and using them as a substitute for fossil fuels. Petrobras believed that the Global Compact was a very important instrument for the international community to transform the world.

Neville Isdell, Chairman and CEO of Coca-Cola, said today they could proudly say that thousands of companies had made a genuine commitment to corporate action by signing on to the Global Compact and its 10 principles. All divisions of the Coca-Cola Company were now part of the Compact, and Coca-Cola embraced the Compact's purpose and promise. Coca-Cola also endorsed the CEO Water Mandate and the climate change statement ("Caring for Climate: The Business Leadership Platform").

Mr. Isdell also highlighted that Coca-Cola had issued statements of principles on workplace rights and human rights in the company. Today's world was ever more complex and interconnected. A company that depended on the health of the communities around the world had to engage in the issues those communities faced. For Coca-Cola to be sustainable, those communities also had to be sustainable. Today, health, climate change and human security were not just public issues – they were business issues.

Huguette Labelle, Chair of Transparency International and a Board Member of the Global Compact, reaffirmed what the Secretary-General had said about the Global Compact: that it was a tremendous framework for businesses to implement their social responsibilities. Businesses needed the trust of people locally and globally if they were to be successful. As everyone knew, trust was earned. So the Global Compact allowed companies to act with transparency, integrity, and social responsibility. Those were matters that, if not implemented, would not allow them to get rid of poverty in this complex world: they were matters of life and death.

Ms. Labelle recalled that the World Bank currently estimated that 5 per cent of global gross domestic product, some $2.5 trillion, was lost annually to corruption; quite enough to pull the millions around the world who were in poverty into a new life. Businesses had the potential to close the tap on corruption, through the Global Compact and its code of conduct. Transparency International was also working on a self-assessment tool for companies, so that they could know how they were doing. That tool would be launched at this Summit.

A journalist, noting that there were criteria for joining the Global Compact, wondered if there were criteria for being expelled from it. In particular, two German companies on the list of the Compact had recently been involved in large scandals. Ms. Labelle said that delisting was very important. Also important, however, was to look at what companies involved in major scandals did to investigate them, fix the situation, and prevent such situations in future.

Mr. Isdell, responding to a query about Coca-Cola's integrity given allegations about its use of contaminated water in India, said that Coca-Cola was very proud to be a member of the Global Compact and also of its company in India. Following allegations, the Indian Ministry of Health and others had tested the water used by Coca-Cola at its plants there. The allegations had been unfounded, and the same results had not been achieved when the tests had been done by responsible authorities.

Asked to comment on benefits to his company, and companies in general, for adhering to the Global Compact, Mr. Gabrielli de Azevedo said Petrobras strongly believed that transparency and a firm commitment to the Global Compact was a very important part of its business strategy. That strategy had three pillars: Petrobras wanted to grow fast; they wanted to be profitable; and they wanted to be socially and environmentally responsible. Petrobras was fulfilling its commitments in those last areas. Among others, it had very large social programmes in Brazil and it was one of the largest biofuel companies in the world. It was working actively for change.

Responding on the issue of what real impact the Compact could have, as it was voluntary, Mr. Isdell said Coca-Cola believed that the Global Compact was reaching a critical mass now, where it could really be effective. Coca-Cola has spearheaded that movement. If Coca-Cola was to flourish in the future, if it was to employ the highest calibre people, it had to be seen that it was upholding the 10 principles of the Compact. The companies who did so would be the ones who were successful in the 21st century. That had not been the case in the 20th century, but that was a business model that was reaching extinction.

Mr. Kell, responding to a question on how the Global Compact actually made change happen, affirmed that the Global Compact was an engagement and a learning platform. It was signed onto by management, staff were informed, and an internal change process was then expected to occur. Participants had to inform public shareholders on their progress in implementing the Global Compact principles annually. That encouraged transparency. It encouraged checking, recognizing, encouraging and changing. The Global Compact encouraged accountability in all the areas that it covered.

Mr. Kell highlighted the great success stories that had been realized through the Global Compact. More and more companies were indeed disclosing when things went wrong. Addressing the concerns voiced by non-governmental organizations that the Compact did not have adequate machinery to ensure its implementation, Mr. Kell said that those comments had not been seen as an attack on the Compact. The Compact worked with non-governmental organizations and that had been a beneficial relationship. The Compact had been working to address the issue of regulation.

Responding to challenges that no companies had ever been kicked out of the Compact for not fulfilling its commitments, Mr. Kell stated that 400 companies had in fact been delisted last year, and some 500 were expected to be delisted this year for not having followed the Compact's principles. However, there were also hundreds of stories where disclosure had led to dialogue. The Global Compact was not a seal of approval: it was a learning tool, and required commitment to change over time.