Frequently Asked Questions
1. How do companies participate in the Global Compact?
Answer:
To participate in the Global Compact, a company:
- sends a letter from the Chief Executive Officer (endorsed by the board) to the Secretary-General of the United Nations expressing support for the Global Compact and its principles; and
- sets in motion changes to business operations so that the Global Compact and its principles become part of strategy, culture and day-to-day operations
- is expected to publicly advocate the Global Compact and its principles via communications vehicles such as press releases, speeches, etc.; and
- is expected to publish in its annual report or similar public corporate report (e.g. sustainability report) a description of the ways ("Communication on Progress ") in which it is supporting the Global Compact and its principles.
In addition to these actions, companies have the added opportunity of participating in a number of Global Compact-sponsored initiatives and programs (see Further Engagement Opportunities for more information). More information on how to participate can be found here.
2. Who can join the Global Compact?
Answer:
Participation in the UN Global Compact is open to any company that is serious about its commitment to work towards implementation of the Global Compact principles throughout its operations and sphere of influence, and to communicate on its progress. Properly constituted (under prevailing national law) companies from any industry sector are eligible for participation, except those companies involved in the manufacture, sale etc. of anti-personnel landmines, companies that are the subject of a UN sanction or that have been blacklisted by UN Procurement for ethical reasons. Remaining in good standing requires communicating the company's progress in implementing the principles, respecting the Policy on the Use of the Global Compact Name and Logos, and a willingness to engage in dialogue under the integrity measures in the event that a matter is raised under those procedures.
3. How can non-governmental organizations and other non-business participants get involved?
Answer:
As equal partners and important stakeholders, civil society and other non-business organisations can participate through a number of Global Compact engagement mechanisms, including Policy Dialogues, Learning, Local Networks and Partnership Projects . In these areas, such organizations have a crucial role to play in helping to foster partnerships and produce substantive action. Non-business participants are also encouraged to commit their organization to the ten principles and to report on progress made within their organization.
4. Is the Global Compact legally binding?
Answer:
No. The Global Compact is a purely voluntary initiative. It does not police or enforce the behavior or actions of companies. Rather, it is designed to stimulate change and to promote good corporate citizenship and encourage innovative solutions and partnerships.
5. If there is no monitoring or enforcement, how does the Global Compact know that a company is truthfully portraying its actions?
Answer:
The Global Compact is not a performance or assessment tool. It does not provide a seal of approval, nor does it make judgements on performance.
Participants are also expected to publish in their annual report or similar corporate report (e.g. sustainability report) a description of the ways in which they are supporting the Global Compact and its ten principles. This is known as the "Communication on Progress ". The Global Compact believes that this sort of openness and transparency encourages good practices by participants (see also question 5 below).
6. Isn't there a danger of companies using UN logos and their affiliation with the UN and the Global Compact to "blue-wash" their operations that might actually be harming society?
Answer:
The Global Compact has developed its own logo, which is used frequently in official Compact documents and publications. The use of the Global Compact image is strictly regulated and the same restrictions apply to its use as the general United Nations logo. Those policies are contained in the UN Business Guidelines, which can be accessed at http://www.un.org/partners/business/otherpages/guide.htm.In addition, following the recommendations made by the working group of the Secretary General's Advisory Council, the GC adopted a set of integrity measures to safeguard the initiative and to avoid potential abuse. They also encourage companies to communicate at least annually to their stakeholders and the public at large on progress made in internalizing the principles within their own operations and activities. Global Compact participants are also expected to submit a short description and a web link to these communications to the Global Compact and/or Global Compact local network website. Participants that do not submit such a description within two years of signing on to the Global Compact will be removed from the list of participants until a submission has been made.
7. Is the Global Compact a substitute for existing regulatory approaches?
Answer:
Absolutely not. The Global Compact views itself as complementing other voluntary initiatives and regulatory approaches by helping to establish the business case for human rights, labour standards, environmental stewardship and the fight against corruption. The Global Compact is a purely voluntary initiative designed to promote innovation in relation to good corporate citizenship. Many of the existing standards support the principles of the Global Compact and are therefore are quite consistent with its overall objectives.
8. Why should a company that has already established its own code of conduct participate in the Global Compact?
Answer:
Corporate codes of conduct are extremely important and many companies have demonstrated leadership and positive change through their development and implementation. The Global Compact is not a code of conduct. Rather, it offers a policy framework for organizing and developing corporate sustainability strategies while offering a platform - based on universal principles - to encourage innovative initiatives and partnerships with civil society, governments and other stakeholders.
9. Are there any financial obligations in becoming a Global Compact participant?
Answer:
The Global Compact is a voluntary initiative, not a formal membership organization. As such, we do not collect any fees for core funding. The Global Compact only accepts core funding from government donors. However, the Global Compact encourages financial contributions and sponsorships to support non-core activities. This is accomplished through The Foundation for the UN Global Compact .
10. I operate an organization with less than 10 employees. Can I still participate in the Global Compact?
Answer:
Due to administrative constraints, organizations with less than ten direct employees (micro enterprises) will not be entered into the participant database. However, we encourage micro enterprises to stay informed about all Global Compact activities via this website and to engage with their Global Compact country network. Network information can be found in the "Networks Around the World " section of this website.
11. Can company subsidiaries join the Global Compact?
Answer:
The Global Compact applies the leadership principle. If the CEO of a company's global parent (holding, group, etc.) embraces the Global Compact by sending a letter to the UN Secretary-General, the Global Compact will post only the name of the parent company on the global list assuming that all subsidiaries participate as well. Subsidiaries that wish to directly send a letter to the Secretary-General, to underline their commitment, will be listed as participants, and are invited to become active in the Global Compact country network of their host country.
12. What if my company chooses to no longer participate in the Global Compact?
Answer:
The Global Compact is a voluntary initiative, and signatories are free to end their participation at any time. However, as the initial commitment to the Global Compact requires a letter from an organization's top executive, the same is expected in order to leave the initiative. The letter should be addressed to the UN Secretary-General and specify the organization's reasons for ending the commitment.
Please note: as the Global Compact office reserves the right to make the participation letters public, so to do we reserve the right to make the departure letter public as well.
(Last update 18 December 2007)
