Transnational Corporations, Human Rights and Development

Davos, 24.01.2003 - While government leaders meet business leaders from Shell, BP, Dow, and financial institutions in Davos, at the World Economic Forum (WEF), community and civil society activists meet with international NGO's just up the road at the Public Eye on Davos conference.

At last year's Public Eye in New York and at the World Summit on Sustainable Development (WSSD) corporations committed themselves to improved practice and sustainable development. However, since then we have seen a continuation of 'business as usual' in which local communities world-wide are negatively impacted. Today's panels at the Public Eye conference present an analysis of Foreign Direct Investment and case studies of corporate crimes.

"It is claimed that Foreign Direct Investment promises to deliver jobs, capital and spill-overs to further development," says Andreas Missbach of the Berne Declaration. "Sadly, this is a myth and the empirical evidence illustrates a picture of job losses, the creation of additional constraints on a country's current account balance, and the failure to deliver on economic development promises."

Marcelo Lucca, former Secretary of State in the state government of Rio Grande do Sul, Brazil, describes how transnational corporations can use their power to extract concessions from governments to lure FDI with the threat of choosing another location. He presents the case of Ford Motor Company and the unsuccessful struggle of the state government to set terms that would benefit the local economy. „This is an example of how big corporations completely ignore wider social concerns of host countries.“

What was delivered to the people of India in 1985, as a result of one investment by a foreign company, was death to thousands of people as a result of the leak at the Union Carbide chemical plant. Ganesh Nochur of Greenpeace, campaigning on Bhopal/Dow, points out that untested technology, a reduction in safety personal, and the failure to replace redundant equipment on the plant to secure company profits led to these deaths. "Dow Chemicals, who has since bought out Union Carbide, now owns the plant and must be held accountable and liable for the deaths and injury."

Oil companies have been at the forefront of environmental and social justice abuses world-wide. Be it in apartheid South Africa or a democratic South Africa, Shell has and continues to abuse the rights of local residents. "Shell calls for trust, but how can they be trusted when they continue to lie, unduly pressurise our government to not hold them legally accountable for the polluting Shell oil refinery in south Durban" asks Bobby Peek, a neighbour of the Shell oil refinery, and Director of groundWork, Friends of the Earth South Africa.

The practice of ignoring communities and their needs continues with the practices of BP with the Baku-Tbilisi-Ceyhan oil pipeline. Kety Gujaraidze, of the Green Alternative for the Georgian Republic, campaigning against the construction of this pipeline, calls on Lord Browne, CEO of BP to walk the sustainability talk and commit BP to a course that does not disrupt local livelihoods, to consult openly with local people and to be truthful about the potential for environmental hazards which are associated with pipelines.