In May, Greenpeace applauded a company for logging in the Amazon rainforest. Precious Woods, the only logging operation in the Amazon certified by the Forest Stewardship Council (FSC), was recognized by Greenpeace Brazil as proving that "the logging industry can work in a responsible, ecologically sound manner". Loggers and Greenpeace agreeing on something! You could call it a sustainability fantasy, the manifestation of which was due in no small measure to the credibility of the system that oversees the management practices of the logging company involved.

Today's business environment is increasingly characterized by a kaleidoscope of codes, audit systems and certifications which, backed up by critical non-governmental organization (NGO) action, are helping to stem the governance hemorrhage brought by globalization. This is because NGO pressure is actually enabling some businesses to act in more sustainable and ethical ways without losing markets or share value. If Greenpeace didn't exist, business people would have to invent it.

Painting: Bea Meira

This "civil regulation" of global business means that governing is no longer being left to Government or their intergovernmental institutions. One of the common precursors to the new civil regulation schemes was a frustration with the apparent inability of governmental and intergovernmental agencies to deliver effective regulatory mechanisms so that business could make a positive contribution to a just and sustainable society, globally and locally. The very fact that these initiatives exist is due to the failure of the United Nations to effectively implement the principles in its Charter. What then is the implication for the future work of the United Nations? Should it become involved in this new arena of governance, and if so how?

There is certainly a need for the United Nations to become involved. Those companies certified to meaningful social and environmental criteria might no longer be few and far between, but there remains far too much scope for irresponsible business behaviour to go unpunished.

Another argument for the United Nations to become involved is to learn from experience. The Organization already has some experience of business partnerships to tackle the logistical challenges of aid relief, for example. However, it is quite another thing for it to attempt to govern markets and market actors to do the right thing. At the Davos Forum in January 1999, Secretary-General Kofi Annan called for a "Global Compact" between the United Nations and the business community. He challenged business leaders to embrace and enact nine core principles derived from international agreements on labour standards, human rights and environmental practices.

At this stage, the initiative is limited to information-sharing and the expression of principles. However, it is bound to evolve in time, as the pressure from civil society and progressive business to plug the governance gap continues to grow, as illustrated by last year's debacle in Seattle and at this month's protests against the International Monetary Fund. How the United Nations responds is critical, and there is much that can be learned from existing initiatives.

The example of Precious Woods is, unfortunately, that of an unusual business in a business-as-usual world where the timber, mining and smelting industries remain involved in highly damaging practices in the Amazon and beyond. The United Nations could help promote civil regulation by supporting the standards development and review processes of the respective schemes, and by securing recognition of them in international fora, such as the World Trade Organization. Given the importance of global business to planetary sustainability, such action should only be the start of efforts to make "voluntary" schemes a prerequisite to trade.

This would not be without complication. First, not all schemes operate to the same standards of transparency and accountability as the FSC. There have been justified criticisms made of other schemes that, unlike the FSC, they are not democratically accountable to the stakeholders in the trade being affected, and that they are dominated by Western representatives.

Second, there is a confusing profusion of schemes, some better than others. The United Nations could therefore establish best practice in this area, including what organizational structure is appropriate for a credible international non-governmental standards and certification body. This should then lead to the creation of a UN accreditation agency which might also help promote the consolidation of schemes.

Schemes like the FSC share a number of innovative approaches which could be replicated. Importantly, they use a system of certification, where companies pay for the costs of being audited, so there is only a limited need for raising external funds. As the auditors are themselves audited by the standard-setting body, so the integrity of the process is maintained. In a world of limited tax revenues and funds, this is a practical route for the United Nations to move forward.

This new agenda for the United Nations will be challenging. It will have to face up to new and old corporate enemies, as well as find new corporate friends. This is because the growing concentration of wealth and power in the hands of undemocratic global corporations, with minimal accountability to Governments or peoples, contradicts the principles and aims of the United Nations to enhance human dignity and the capacity for self-governance. In recent years, we have seen the values of profit, open markets and free trade become paramount in the system of world politics. Instead, we need a governance system which reflects the values of the United Nations -- human rights, peace, environmental protection, labour rights, health and so on. At times, these will be congruent with the interests of business, but it would be naïve to ignore that, at times, they will be in conflict. The United Nations will need support from civil society if it is to succeed in this challenge.

This support will only be forthcoming if the United Nations maintains its credibility. Greenpeace's support for a company logging in the Amazon clearly illustrates how an organization's credibility with stakeholders is key to its role in making equitable sustainable development a reality. Here, then, is a key lesson for the United Nations.The world needs the United Nations to become involved in innovative ways of improving and regulating corporate behaviour, but this must be done in a transparent and accountable manner. It must be vigilant to prevent initiatives like the Global Compact becoming a talking shop, and must not allow corporations to use their relations with the United Nations as a kind of "bluewash" to defend their performance. At the same time, it should ensure that civil society groups and Governments have as much input as the business community into the development of new regulatory initiatives. In short, the United Nations must safeguard its image, mission and credibility. To use business-speak: no amount of cash-flow problems should lead it to risk damaging the value of its unique brand. The irony would be that if this happened, it would not only be unacceptable to civil society, but might become unattractive to business as well.

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