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Business needs rules to cooperate

Earth Summit, Johannesburg, 29 August 2002

Connect direct to Video of the speech.

In a speech from the plenary floor at the UN World Summit on Sustainable Development in Johannesburg, BASD Chairman Sir Mark Moody-Stuart said that in order to maximize its contribution to sustainable development business needs regulation of markets and strong local governance.

Business has come to Johannesburg with a commitment to work in partnership with other major groups, governments and agencies to deliver sustainable development. I should like to make a few general remarks on the elements needed to facilitate the growth of the beneficial economic activity which is essential if we are to achieve sustainable development.

Perhaps the most important contributor is sound governance systems at a national and local level in each and every country. By sound governance we mean institutions whereby all sectors of society – be they women, indigenous people, youth, small business, civil society, labour organisations or other actors – feel that their views have been taken into account and that the outcomes are fair and equitable. This will include sound governance of business – with the rules and frameworks necessary for markets to operate fairly and openly in each and every country and with, for example, appropriate environmental regulation applied impartially to all. But it will also include such elements as the rule of law, security, human rights, intellectual property etc. The establishment of this sound national governance is a prime responsibility of government and it is this prime responsibility which has rightly been recognised by African governments in NEPAD, an initiative strongly supported by business. But business recognises its responsibilities to contribute to this process, by reporting openly and transparently on our activities, but also working in consultation with other groups as well as government to ensure that the impact of these activities on the environment is taken into account and that they are indeed of benefit to society as a whole. The conditions created by this sound local governance are not only beneficial to the environment and society, but they are exactly the conditions in which sound economic activity flourishes and it is to areas where such sound governance is in place or developing that investment will flow. I hope that through these remarks I have dispelled the myth put out by others that business in against all regulation – it is just not true.

We are also committed to a number of initiatives, in partnership with governments and others, to increase investment and to grow business in developing and least developed countries. This includes paying close attention to the growth of the small and medium enterprise sector which is not by and large represented at the Summit and yet which is so essential to sound development.

Much is made by our NGO colleagues for the need for supranational standards or regulation. The essential international agreements on climate and trade are addressed in other fora, and we in business strongly support access to developing country products to developed markets. We believe however that any attempt at one size fits all international regulation is inappropriate. We do however support the development of international best practice standards which can inform the development of national legislative frameworks and against which the activities of international companies may be judged. There are many current examples of the development of such global standards by partnerships of stakeholders in various industries. Examples of this approach are the Global Mining Initiative, the chemicals Industry Responsible Care programme, the new Sustainable Agriculture and Rural Development Initiative (SARD), and the ongoing Marine Stewardship Council activities which have certified some forty fisheries around the world. The work of the Global Reporting Initiative – developing sustainability reporting standards which can be used by business to report in standard ways for core indicators but to develop specific indicators for different sectors - is essential to the transparency and open reporting to which business is committed. Support in the Summit Agreement for these partnership activities would be welcome in addition to a strong Type I outcome. The outputs can then be used as a basis for developing local governance and legislative activity, but in national fora where the voices of small business, artisanal workers and communities can be taken into account to ensure that the outcome is also appropriate to local conditions. Capacity building partnerships such as the agLe@rn programme or the ICMM and World Bank Community Development Tools for local communities in mining regions are partnerships in this field.

We have appreciated the opportunity to participate in the discussions on each of the WEHAB areas. I will therefore only comment briefly on each.

Delivering Water to the poor is crucial for Sustainable Development. Business as usual will not make it happen – there is a need to create new partnerships and mobilise private sector investment. Business is open to this and to work with governments in creative ways to ensure that water systems serve all sectors of the community.

In Energy, the development of renewables is important and business is for the development of renewables as for any other business opportunity. But there is also need for better access to energy for industrial, commercial and domestic markets, both urban and rural. For this we need long term targets and better applications of conventional energy. Solar panels in rural villages will not be enough. The Africa Energy Fund being launched today is an effort to address this in Africa.

In Health, while business can play its part in the development of drugs and in addressing the health issues of employees around the world, synergy with government activity for the population at large is critical. In the Accelerating Access Initiative UNAIDS is working with business and six major pharmaceutical companies to improve access to AIDS care in the hardest hit regions of the world. Integration with government efforts is essential.

In Agriculture farms need better access to markets both locally ad internationally. Governments need to establish enabling policies addressing transport and communications. Simply lowering tariffs will not be enough.

For Biodiversity the private sector is aware of the need to work with local communities and others to identify best practice solutions. The Energy and Biodiversity Initiative is a partnership between major conservation groups such as the IUCN and leading energy companies to define policies in relation to reserved areas.

Lest we depress ourselves that nothing is happening on the ground, may I draw your attention to the Virtual Exhibition, produced by a partnership between BASD and UNDP which showcases some 200 sustainable development partnership projects from all around the world many of which have no direct business involvement. Every half hour or so there is a live discussion of these projects between those here in the Sandton Centre and the projects in the field. We have covered more than twenty countries so far already in these connections. This is giving real access to the summit to the grass roots in the projects and the process can be viewed live or in archive by anyone with internet access anywhere. Already more people have visited it than are here. I hope that ministers and Heads of State will take the opportunity to visit and interact.

Finally, the business community calls on governments to provide forward looking outputs from WSSD leading to real implementation through transparent action in partnership with us and other major groups. We all have a role to play.

29 August 2002