Secretary-General

Boosting social and environmental standards in international trade

 

Remarks by Angel Gurría, OECD Secretary General


31 March 2014, Paris, France

(As prepared for delivery)


Minister Bricq, Minister Ploumen, Ladies and gentlemen.


Congratulations on this excellent initiative and thank you for inviting me to join today’s discussion on “boosting social and environmental standards in international trade.” This is an incredibly important topic!


Citizens are losing trust in our institutions, in the effectiveness of our governments, in the capacities of our lawmakers and in the banking sector’s conduct. This is a great loss. Transparency, responsibility and accountability are essential to the well-functioning of society, and are the cornerstones of a healthy business environment. Responsible business conduct is essential to restoring public trust.


The OECD has produced a full range of tools to promote responsible business conduct.


To help enterprises build a better business environment, the OECD has created the “2011 OECD Guidelines for Multinational Enterprises” and the UN has produced the “2011 Guiding Principles for Business and Human Rights.” These tools guide enterprises to meet their responsibilities and create an accountability mechanism for standards on business ethics, human and labour rights, environment, anti-bribery, consumer protection and taxation.


In our most recent update of the Guidelines, we introduced a new and comprehensive approach to risk-based due diligence. This calls on companies not only to continue “doing good”, but most importantly, to do no harm. Companies must take steps to prevent or mitigate damages potentially linked to their operations or products, such as negative impacts resulting from the production of materials that enter global supply chains.


We also introduced a Proactive Agenda to create a safe space for collective action between governments, businesses and civil society. This will help to develop practical, effective solutions that are unique to each region.


The Proactive Agenda helps to clarify the nuts and bolts of due diligence and includes five substantive focus areas: conflict minerals; stakeholder engagement in extractive industries; the financial sector; agricultural supply chains; and the textile and garment sector. Given your discussions today, I’d like to expand on our conflict minerals, extractives and textiles-related work.


1) The OECD’s work on Conflict Minerals

The OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High Risk Areas, developed through a multi-stakeholder process, aims to ensure businesses do not finance or contribute to conflict or serious human rights impacts through mineral production or metal procurement practices.


The standards, which provide detailed recommendations to companies in entire mineral supply chains, are becoming a success! They have now been incorporated into the national legal frameworks in many African nations, and they are referenced as a model approach in US and EU legislation.


Industries are already starting to apply the Guidance. These include efforts from the leading associations in tin, tantalum, tungsten (the 3Ts), and the gold industry, as well as regional bodies from around the world. Currently, more than 85% of gold refined annually is audited under an industry scheme that stems from the OECD Guidance. Similarly, about 18% of the world’s smelters of tin, tantalum or tungsten participate in industry-led audit programmes based on the OECD Guidance, to ensure conflict-free production and trade.


After listening to the presentations here today, I would encourage you all to explore how the recommendations contained in the Due Diligence Guidance may be useful to the supply chain of coal, and how the BetterCoal Initiative could improve their effectiveness. Let me now turn to our work on the extractive sector.


2) The OECD’s work on the Extractive Sector: Developing a User Guide

The OECD is also currently developing a user guide on stakeholder engagement in the extractive sector. Extractive sector practitioners from industry, government, civil society and trade unions have been working together to provide their input and feedback throughout the process. A complete first draft is scheduled to be available mid-May and will be presented for wider commentary at our upcoming Global Forum.



3) The OECD’s work on Textiles: Developing Due Diligence Guidelines

In collaboration with the International Labour Organization (ILO), amongst others, we are developing additional practical due diligence guidance for the textile and garment sector.


The project will focus on countries at particular risk of adverse impacts or facing challenges in implementing responsible business conduct. The French National Contact Point (NCP) work on this topic, as well as ongoing government initiatives in France, Italy, Belgium and Canada, will serve as valuable contributions to the process.


The OECD-ILO high level roundtable planned for September will focus on sharing obstacles to responsible business conduct in this sector and on identifying gaps for future work. A panel on this subject is planned for the OECD’s Global Forum this June. Let me tell you more about this event.



Global Forum on Responsible Business Conduct

The Global Forum on Responsible Business Conduct was created in 2012 as an important tool for the OECD’s on-going dialogue with non-OECD economies on responsible business conduct. To reinforce this role, this year’s Forum will feature a parallel Ministerial Session on the international ecosystem of responsibility and the participation of key partners in the governance of Global Forums.


Under your joint leadership, Madame Bricq and Madame Ploumen, Ministers from around the world will discuss ways to support due diligence on labour, safety and other conditions that companies operating in the textiles and extractives sectors need to undertake.


They will discuss ways to coordinate aid efforts in the promotion of responsible business conduct and the OECD Guidelines. They could also explore opportunities offered by regional and bilateral investment and free trade agreements to promote responsible business conduct and the role of National Contact Points. And I very much hope that the outcome of this Ministerial meeting will be communicated through a public statement by all the Ministers present.


Ladies and gentlemen,

Responsible business conduct is crucial to restoring public trust. In an increasingly complex world, cooperation amongst governments, business and civil society is essential to win back public confidence.


The dedication and innovation that industry, government and civil society groups have demonstrated today provides ample ground for optimism. And I urge you to go further – to use all of your firepower to create a more responsible and credible business environment that our citizens can be proud of.


Thank you.

 

 

 

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