IOs Affecting Private Actors

International organizations are often in a position where they affect the private sector. The declaring of a pandemic by the WHO in March 2020 constitutes a great example of this. The pandemic and the actions taken to tame the virus had a great effect on the world economics. There is, however, many other examples as well. IOs often sign agreements with big corporations to gain expertise and money in order to fulfil projects. As already noted on the "Setup-page" the ideological shift towards more capitalistic views in the 1980s taken in conjunction with the increased need for funding have increased the partnerships between IOs and the private sector.

One or a few companies are better off and competitors are not - the markets are affected.

On the 3rd of December 2021 China filed a complaint against the U.S. to the Committee on the Peaceful Uses of Outer Space concerning its long-term space station Tiangong currently being constructed in Earth’s low orbit. On the 1st of July and 21st of October 2021 Tiangong was compelled to take preventive collision avoidance measures because of two close encounters with Starlink’s satellites which had manoeuvred to change orbits. In its note China refers to article V of the Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space providing “States Parties to the Treaty shall immediately inform the other States Parties to the Treaty or the Secretary-General of the United Nations of any phenomena they discover in outer space [...] which could constitute a danger to the life or health of astronauts ”. China also insisted on article VI of the Treaty stating that States are responsible for the activities carried on by their national non-governmental entities.

© UNOOSA’s Document

Starlink is a division of Elon Musk’s SpaceX and has received permission from U.S. authorities to launch 12, 000 satellites. These incidents illustrate a new reality concerning the use of outer space by private companies.

There’s more debris and there’s more active satellites. Things are just getting a lot busier and a lot more crowded up there. It’s a commercially dominated space age … where we’re stressing the space environment for the first time.

Jonathan McDowell, Harvard-Smithsonian Center for Astrophysics.

© The Guardian, 28 December 2021

The multiplication of satellites and "space junk" is also causing a number of problems in astrophysics, and optical and radio astronomy. Therefore, the United Nations Office for Outer Space Affairs (UNOOSA) and International Telecommunication Union (ITU) are being called upon by many to step in and provide more regulation on these issues

The World Food Programme (WFP) partners with many private actors within the framework of its activities, many of them provide technical expertise and at the same time financially contribute to the funding of the organization. In its private-sector partnerships and fundraising strategy (2020-2025), the WFP remarks that “the private sector is increasingly responsive to employee and consumer demand for the utilization of a company’s expertise, reach and influence to achieve wider societal impact”

94 percent of consumers are likely to switch to brands that demonstrate a social conscience. 

© WFP Private Sector & Private-Sector Partnerships and Fundraising Strategy

A list of the WFP’s partners can be found on their website (WFP Private Sector); examples include Balenciaga which raises funds by selling clothing reading “WFP supported by Balenciaga” or “Balenciaga supports WFP”.  Another example is the partnership with the PepsiCo Foundation that invests in a “healthier future for people.”

© Balenciaga and WFP & PepsiCo Philantropy

As for the partnership with Mastercard, according to the WFP, it has allowed the organization to “change the way it does business.”

Mastercard’s work toward ending hunger is an inspiring example of how the private sector plays a vital role in social good.

WFP’s Executive Director, David Beasley

© Mastercard and WFP

 

The innovative collaboration agreement between the FC Barcelona and the UNICEF was signed in 2006. In an interesting use of the UNICEF brand, players of the FC Barcelona team wore the UNICEF logo on their jerseys not because the UNICEF was sponsoring and financially contributing to the football team, as it is the norm, but to publicise the engagement of the FC Barcelona towards the welfare of children.

FC Barcelona has a strong focus on children and young people, not only through our millions of fans and those who love the game, but also through the FC Barcelona Foundation, which works for the welfare of children, especially the most vulnerable.

Maria Valles, Director General of FC Barcelona Foundation. 

© UNICEF Webpage & FC Barcelona Webpage

In addition, the partnership has also involved regular financial contributions from the Barça to the UNICEF and further collaboration on some UNICEF projects, such as recently in a research project on the impact of sport on children’s development.

© Sport for Development Research

The United Nations Office for Outer Space Affairs is a UN organization charged with the promotion of international cooperation in the peaceful uses of outer space. It particularly works on the development of space law and access to space by developing countries. With its initiative Access to Space for All, it seeks to provide technology and infrastructure to facilitate access to space by collaborating with private actors, such as Avio and Sierra Nevada Corporation.

© UNOOSA Space for All partners

The space arena is growing increasingly diverse as private industry actors become more involved in space technologies and exploration. It's great to see a company like SNC bring their expertise to UNOOSA's holistic approach to capacity building and our goal of bringing the benefits of space to all.

UNOOSA Director Simonetta Di Pippo

© United Nations and Sierra Nevada Corporation Sign Agreement

Avio’s commitment to structured collaboration with the United Nations highlights its focus on supporting, through business excellence and Research and Development, the use of the resources offered by space to benefit the entire international community. We will therefore contribute – through launching micro and nano-satellites and against a backdrop of constant technological innovations – to making the United Nations Sustainable Development Goals more achievable.

Giulio Ranzo, CEO of Avio

© UNOOSA and Avio Provide Space for All

Country Responses and the Reaction of the Stock Market to COVID-19—a Preliminary Exposition. This is an article by Dinh Hoang Bach Phan & Paresh Kumar Narayan.

© Dinh Hoang Bach Phan & Paresh Kumar Narayan: Country Responses and the Reaction of the Stock Market to COVID-19—a Preliminary Exposition, Taylor and Francis online (published online 25 July 2020) 

The World Health Organization (WHO) in December 2020 listed the Comirnaty COVID-19 mRNA vaccine for emergency use, making the Pfizer/BioNTech vaccine the first to receive emergency validation from WHO since the outbreak began a year ago. This validation is a clear benefit for Pfizer/BioNTech. See the second link for more information. 

© WHO Webpage, 31 December 2020

The Internation Organization for Migration has entered several partnerships with private sector actors, using their expertise, innovation and networks in order to promote humanitarian and development objectives.

IOM Finland has partnered with the Finnish company Logonet to improve maternal health in Somalia with Finnish Baby Aid Kits. Especially developed to be used in difficult situations, the Finnish Baby Aid Kit is a childbirth and nursing kit containing essential materials for childbirth and nursing a new-born. This is a clear example of an IO affecting the market.

© IOM Finland Web Page & IOM UN Migrations Webpage

The IOM also has a long-running collaboration with Microsoft and this partnership contributed to the development of the Counter Trafficking Data Collaborative Global Data Hub on Human Trafficking. Within the scope of the accelerator programme of the Tech Against Trafficking coalition IOM and Microsoft contribute to providing critical information and data about the profile of victims of human trafficking.

“We are grateful to IOM for our deep partnership in developing a new approach to data sharing that is grounded in the needs of the anti-trafficking community. By protecting the privacy and safety of victims with synthetic data, and empowering policymakers to view, explore, and make sense of data through rich interactive dashboards, we are showing one of the many ways in which research and technology can support the global fight against human trafficking.” 

Darren Edge, Director of Societal Resilience at Microsoft Research and project lead.  

© IOM-Microsoft Collaboration  Enables  Release of Largest Public Dataset  to Bolster Fight Against Human Trafficking

Other partners of the IOM include, for instance, Deloitte, Adidas, Asiacell, Google or VF Corporation.

The LEED+ project builds on successes of the Local Empowerment through Economic Development (LEED) Project. From 2011–2018, LEED has helped to reduce poverty, create sustainable jobs and build the peace in northern Sri Lanka.

The impact of the market approach is sustained and scaled outcomes. Thereby the project will achieve lasting change among both public and private actors by playing on their incentive and capacity to adopt new ways of working, so impact continues long after the project has ended. With constraints to economic growth removed, change can be replicated and mainstreamed across sectors rather than only be confined to the individual actors the project is working directly with.

Partners: Ministry of Labour & Trade Union Relations, Employers’ Federation of Ceylon, Department of Cooperatives, Department of Agriculture, Department of Fisheries, Cooperatives, Producer Organizations, National Chamber of Exporters, Sea Food Exporters Association, District and Provincial Departments.

Many of these partners, such as the National Chamber of Exporters, are working thightly with the private sector. The second link leads to the web page of the National Chamber of Exporters (Sri Lanka), where you easily will find information about all their partners. 

© ILO Web Page & National Chambers of Exporters Sri Lanka Webpage

In 1994, the World Heritage Committee launched the Global Strategy for a Representative, Balanced and Credible World Heritage List. Its aim is to ensure that the List reflects the world's cultural and natural diversity of outstanding universal value. To be included on the World Heritage List, sites must be of outstanding universal value and meet at least one out of ten selection criteria. It is not far-fetched to think of this listing performed by Unesco as market-affecting. Areas with sites included on the list have a better chance to attract tourists and visitors, which certainly affects private sector actors.  

© Unesco Webpage

The UNESCO also has a number of partnerships with private actors. In 2020, it has signed an agreement with the Vietnamese group SOVICO led by Nguyễn Thị Phương Thảo.

Allowing Madame Phuong Thao to give back to the city of her youth, under the partnership SOVICO Group will collaborate with UNESCO, UNIDO and UN Habitat to support Ha Noi's development as a UNESCO Creative City for design through the preservation and restoration of cultural heritage, revitalization of craft villages and support for young creative talent of Ha Noi. Guided by the values of sustainability and respect for local culture, the partnership supports Ha Noi’s City’s new vision as "Creative Capital", where development finds inspiration from its creative past and the energy of its youth. 

© UNESCO Signs Agreement in Viet Nam

UNESCO also collaborates with the LVMH group. In 2019, LVMH and the UNESCO have signed a 5 year partnership to promote biodiversity. within the framework of the « Man and Biosphere » programme. With Guerlain, part of the LVMH group, the UNESCO promotes women engagement and biodiversity through the Women for Bees programme.

© LVMH Announces Five-Year Partnership with UNESCO & Women for Bees Programme

Another example is the partnership between the UNESCO and ARMOR on a project to support education in Togo by supplying solar kits and equipment to school children.

© ARMOR and UNESCO Sign Partnership

We venture by the present circular to invite the heads of Meteorological Institutes, the Meteorological and other Learned Societies, as well as private scientific men and practical observers in the domain of Meteorology, to this consultative meeting, which is to be held in Leipzig …

From the invitation letter to the Meteorological Conference at Leipzig, August 1872

© Public Private Engagement Open Platform

In the last years, like many other IOs, the World Meteorological Organization has increasingly developed collaborations with a variety of partners, including the private sector, to promote greater engagement of the different actors in the global weather enterprise.  

© WMO Webpage Public Private Engagement

Some projects implemented by the WMO directly involve private actors such as, the Aircraft Meteorological Data Relay (AMDAR) for Kenya which has for partner Kenya Airways, or the Coastal Inundation Forecasting Demonstration Project in Fiji partnering with Tonkin and Taylor.

© Aircraft Meteorological Data Relay (AMDAR) for Kenya & Coastal Inundation Forecasting Demonstration Project Fiji

 

 

 

Cooperation with the private sector is essential, not only to prevent and control cybercrime, but also to protect privacy and other fundamental rights. I am pleased to continue and develop the partnership with Microsoft that we started in 2006.

Thorbjørn Jagland, Council of Europe Secretary General

© Council of Europe Press Release

In 2013, The CoE signed an agreement with Microsoft to collaborate on cybersecurity in the framework of the Octopus project, aimed at supporting the implementation of the Budapest Convention on Cybercrime. The project was renewed in January 2021.

© Council of Europe Octopus Project Webpage

 

The Commonwealth of Nations, or the Commonwealth, is a political association of 54 member states, almost all of which are former territories of the British Empire. The chief institutions of the organisation are the Commonwealth Secretariat, which focuses on intergovernmental aspects, and the Commonwealth Foundation, which focuses on non-governmental relations between member states. The Commonwealth does a lot of things, this international organisation for instance helps boosting trade between member countries, to create prosperity. Naturally they cooperate with the private sector as well, which affects the markets. 

© The Commonwealth Webpage & Commonwealth Secretariat Strategic Plan 2017/18 – 2020/21

According to this IO's web page:

Active collaboration with the private sector ensures the Center’s research can reach a broad base of farmers. Seed companies benefit from access to the World Vegetable Center Genebank; they can obtain the Center’s breeding lines to use as parent lines or as a source of traits for backcrossing programs.  The companies’ strength in commercial seed multiplication and marketing helps to rapidly spread beneficial research outcomes to farmers.

© World Vegetable Center Webpage 

The World Vegetable Center is working with the private sector in order to strengthen the efficiency of the vegetable-based agriculture-sector in developing countries. This naturally has an effect on the markets. 

© Chris Ojiewo, Abdou Tenkouano, M.O. Oluoch, Ray-Yu Yang: THE ROLE OF AVRDC -THE WORLD VEGETABLE CENTRE IN VEGETABLE VALUE CHAINS, Research Gate

Since 2000, National Contact Points (NPC) for Responsible Business Conduct (RBC) have had the mandate to act as non-judicial grievance mechanisms under the Organisation for Economic Co-operation and Development's (OECD) Guidelines for Multinational Enterprises. With globalised corporate activity intensifying and related developments, such as climate change and global inequalities accelerating, RBC and access to remedy are more relevant than ever. 

The OECD Guidelines undoubtly have an effect on the private sector and the NPC-requirements further enhance the meaning of these. 

© OECD Webpage: National Contact Points for Responsible Business Conduct (mneguidelines.oecd.org) & OECD Webpage: More about NCPs

 

More must be done by businesses globally to accelerate corporate sustainability and responsible business practice. Our strategy and ambition are to grow and take our participants on a journey of demonstrated continuous improvement in the impact that they create.

- Sanda Ojiambo CEO & Executive Director UN Global Compact

Both the OECD and the UN have aimed to regulate multinational corporations' conduct through non-binding recommendations and standard setting. The OECD encourage the participation of multinational and the implementation of its recommendations through the NCPs as explained above.

© OECD Guidelines for multinational entreprises

The UN Global Compact seeks to encourage businesses to behave in a more responsible and sustainable way in order to achieve the Sustainable Development Goals (SDGs) by 2030. It has recently revealed its Africa Strategy 2021–2023 which “aims to accelerate and scale the impact of the private sector to drive progress towards the Sustainable Development Goals across the African continent.” By involving key actors and, large and smaller businesses as well, its ambition is to accelerate responsible businesses’ practices and to grow the impact of the UN Global Compact.  It is described as a “call to action for all companies everywhere to align their operations and strategies with Ten Principles in the areas of Human Rights, Labour, the Environment and Anti-Corruption.” Companies are seen as active partners in the realization of the UN SDGs. This soft-law approach can be considered as promoting the establishment of a virtous circle where companies engagement encourages more companies to engage making it more difficult to not follow the strategies for fear of reputational damage.

© UN Global Compact Webpage & UN Global Compact Africa Strategy 

In their article Lucio Baccaro and Valentina Mele are prudent in assessing whether codes of conduct issued by IOs could improve the behavior of businesses in the long term. By evaluating the impact of the OECD guidelines and the UN Global Compact on non-state actors, they, however, emphasize that these approaches are most efficient when they are part of a wider mix of international regulations approaches.

© Lucio Baccaro and Valentina Mele: For lack of anything better? International Organizations and Global Corporate Codes, Public Administration, Vol 89 (2), June 2011

 

The first article discusses the growing number of arrangements between public and private actors, i.e. Public-private partnerships (PPPs) in the fight against climate change. 

Public-private partnerships can be defined as agreements for collaborative governance between public actors (national governmental agencies, subnational governments, or IOs) and nonstate actors (foundations, firms, advocacy organizations, or others), which establish common norms, rules, objectives, and decision-making and implementation procedures for a set of policy problems. PPPs thus involve the institutionalization of hybrid authority at the international arena, beyond traditional forms of interaction between state and nonstate actors such as lobbying, consultation, or subcontracting. The rise of hybrid authority raises fascinating questions about the evolving role of states, nonstate actors, and IOs in global environmental governance. What political factors drive this institutional diversification? Do partnerships undermine the authority of intergovernmental and state institutions? Why is the environmental arena particularly conducive to collaborative governance? What are the resulting patterns of PPPs and how do they contribute to sustainability? To address these questions, the paper examines the politics and patterns of PPPs for the environment in the multilateral system...

© Andonova, Liliana B: Public-Private Partnerships for the Earth: Politics and Patterns of Hybrid Authority in the Multilateral System, Global Environmental Politics, Volume 10, Number 2, May 2010, pp. 25-53.

The second article discusses PPPs as a tool of international governance in general.

© Börzel, Tanja A. and Risse, Thomas: Public-Private Partnerships: Effective and Legitimate Tools of International Governance?, Prepared for the Edgar Grande/Louis W. Pauly (eds.), Complex Sovereignty: On the Reconstitution of Political Authority in the 21st Century.

The Global Environment Facility (GEF) is discussed quite a lot in the above-mentioned article, as one example of an IO involved in PPPs. Ever since its establishment on the eve of the 1992 Earth Summit in Rio de Janeiro, the GEF has been a key actor in the battle against environmental problems. The GEF provides grants to developing countries and countries with economies in transition.

It goes without saying that cooperation with the private sector is absolutely necessary in order to make the switch from fossil fuels towards renewable energy sources smoother. The GEF is, therefore, also naturally cooperating with the private sector in an attempt to expand the use of non-grant instruments and mobilizing the private sector. This constitutes a great example of an IO whose collaboration with market actors, at least by first look, is vital and easy to justify. It is also quite obvious that the GEF and its intense work of trying to put pressure on and influence the private sector has an effect on businesses.

© GEF Web page (thegef.org) & 58th GEF Council Meeting June 2 – 3, 2020 Virtual Meeting Agenda Item 06

The United Nations High Commissioner for Refugees (UNHCR) is a UN agency working for refugees and homeless people. Ever since the refugee crisis originating from the Kosovo war in the late 1990s, the UNHCR has been operating with Microsoft in worldwide places during different crisis. Microsoft has contributed in developing better information management techniques and providing education opportunities about digital skills and has adopted an active role in the implementation of the projects while doing so.

This once again poses as a perfect example of an IO and a multinational corporation working together on serious issues that effect the entire globe. A partnership like this would have been quite unlikely before the idelogical shift towards more neoliberalistic views in the 1980s. It is also a more cost-effective way for an IO to promote its strategies and work for its goals.

© UNHCR Webpage (unhcr.org) 12.5.2021; UNHCR Web page (unhcr.org/partners) 12.5.2021 & Usa for UNHCR (unrefugees.org) 12.5.2021

Established in 1865, the International Telecommunication Union (ITU) is the oldest existing intergovernmental organization. Since 1947 the ITU is part of the UN family, as its specialised agency for telecommunications. The widespread transfers in ownership of national telecommunications to the private sector that have taken place during the second half of the 20th century has from the 1980s onward directed the focus of the ITU towards the private sector. This increased concentration to businesses and the markets has been discussed in a quite critical manner in the article Privatisation in the United Nations system: Patterns of influence in three intergovernmental organisations found on the setup-page of this web page. The article describes the ITU as an IO giving private sector interests a big role, a circumstance that challenges the claim that these forums are concerned primarily with apolitical issues. This is of course a claim that could be said to apply to many IOs. 

An intergovernmental organization such as the ITU is an organization composed primarily of sovereign states. IGOs are established by a treaty that acts as a charter creating the group. Treaties are formed when lawful representatives (governments) of several states go through a ratification process, providing the IGO with an international legal personality. IGOs are in other words founded on interests sprung from the public sector (governments). Are the public sector interests being hollowed out by the increased private sector involvement in the multilateral system? On the other hand, since the branch of telecommunications is so market-based today, why shouldn't the private sector be involved?

Check out the links to the left for further information about the private sector interests embedded in the operations of the ITU! 

© ITU Web page (itu.int) "development"

 

 

 

When IOs grow strong and powerful so do the money and interests involved in their missions. Because of the tragic weaknesses of human nature this may lead to extreme cases of malfeasance. The importance of transparency and openess has already been discussed under the second research angle, but as this case visualizes the affect on the private sector, this particular failure is discussed under the third research angle.

The Oil-for-Food Programme (OIP) was established by the United Nations in 1995 as the largest humanitarian initiative in UN history with the mission to allow Iraq to sell oil on the world market in exchange for food, medicine, and other humanitarian needs for ordinary Iraqi citizens without allowing Iraq to boost its military capabilities. The objective had at least to some degree a nobel cause - help the Iraqi civilians that suffered because of the sanctions imposed on Iraq by the UN Security Council. Yet due in great part to mismanagement and fraud, the OIP led to hefty profits for Saddam Hussein, hundreds of foreign companies, and several UN officials. The illegal profit for Saddam’s regime alone was about $2 billion. According to the independent think-thank organization, the Council on Foreign Relations, nearly half of the 4,400 companies involved in the program participated in bribery and kickbacks to benefit from the program. Over hundreds of western banks participated in the shady dealings and the former head of the OIP, Benon Sevan, himself received vouchers for at least 11,000,000 barrels (1,700,000 m³) of oil, worth some $3.5 million in profit.

This shameful conduct certainly shook the hole UN up and poses as a sad example of how partnerships between IOs and the private sector can lead to shameful briberies. A UN summit in September 2005 addressed several management reform initiatives, including reforms for: ensuring ethical conduct and strengthening internal oversight and accountability in the UN programmes and initiatives. 

© Grigorescu Alexandrue: Horizontal Accountability in Intergovernmental Organizations, Ethics and International affairs volume 22, issue 3 (2008), Wiley Online Library

© Robert McMahon: The Impact of the UN Oil-for-Food Scandal, Council on Foreign Relations Web page (cfr.org), published May 11, 2006 5:01 pm (EST)

© George Bartsiotas: An expanding role: internal auditors in intergovernmental organizations are seeing an increase in their governance responsibilities, Internal Auditor (Vol. 65, Issue 2), April 2008

While access to information is considered a human right and while democratic states have strict rules about the right to access to information this is, however, not the case when it comes to IOs. These organizations are not bound by the same rules as states are and yet they often exercise the same sorts of powers - IOs are composed mainly of sovereign states and are a very important aspect of public international law. On top of this, IOs are often considered quite bureaucratic, which is sometimes problematic as IOs exercise a great amount of power. Check out the article by Alasdair Roberts to the left for more information on this particular subject. 

© Alasdair Roberts: A Partial Revolution: The Diplomatic Ethos and Transparency in Intergovernmental Organizations, Public Administration Review (PAR), volume 64, issue 4, Wiley Online Library, 16 July 2004

Speaking of the importance of transparency in the section above, the World Bank Group has already in 2001 established its own institution that investigates allegations of fraud and corruption in the World Bank Group activities. Even though the INT has solved a big number of such cases ever since its establishment, the world bank group has still been accused of being secretive, unaccountable and ineffective and several World Bank officials have been under investigation for skimming millions of dollars from an African job creation program. Steps towards the right direction have been taken, but it is apparent that this IO still has some way to go...

© World Bank Web page (worldbank.org) "Integrity Vice Precidency" 25.4.2021 & World Bank Web page (worldbank.org) "Access to Information" --> "Overview"

© Danaher, Kevin: 50 years is enough, The Case Against the World Bank and the International Monetary Fund, South End Press Boston MA, 1994

© Woods, Ngaire: Unelected Government: Making the IMF and the World Bank More Accountable, Brookings Web page (brookings.edu), 1 March 2003

©The Guardian Web page (theguardian.com), 18 May 2007

 

On December 17, 2019, the International Committee of the Red Cross (ICRC) and Grundfos, one of the world's top pump – and water solutions providers, officially signed an agreement that will gather their technological and humanitarian expertise around a clear and shared target: Bringing safe water to the world's most vulnerable.

We are aware that the ICRC is actually an NGO and not an IGO, but this example still provides a great example of an international organization affecting the private sector.

© ICRC Webpage