Rio+20 summit under siege from corporate lobbyists

19.06.2012
Carbon trading

The UN's Rio+20 summit this week will be the target of unprecedented levels of industry activity, including lobbying and greenwash. At the same time, there is growing critique of the corporate capture of the UN - with UN agencies appearing to endorse greenwashing without any criticism. This article is also available in French.

In addition to government officials, journalists and civil society activists, thousands of industry representatives from around the world are descending this week on Rio de Janeiro, Brazil, for the third UN Summit on Sustainable Development.

Hundreds of industry lobbyists are accredited to the official summit (June 20-22), seeking to influence the government negotiators that are finetuning the summit declaration. Lobby groups like the International Chamber of Commerce (ICC) and the World Business Council for Sustainable Development (WBCSD) will be present in full force at the summit venue, 40 kilometres outside Rio. But already earlier in the week, before the official summit starts, there is a plethora of high-profile industry events happening in Rio. Examples include the Corporate Sustainability Forum (with an expected 2000 participants), the World Green Summit and 'Business Day 2012'. The message from all these activities is that large corporations are embracing sustainability and introducing solutions to the social and environmental crisis that is the focus of the Rio+20 summit.

A similar public relations and lobbying offensive happened in 2002 when the Rio+10 summit took place in Johannesburg. Industry presented a flood of voluntary initiatives which had been taken to address social and environmental problems, arguing that this proved they were part of the solution and that regulation was not needed. This propaganda show had the desired impact of greenwashing the image of companies whose activities were and are far from sustainable or socially responsible.

Founder of WBCSD sentenced to 16 years

At the first Earth Summit in 1992, Stephan Schmidheney, a corporate social responsibiliy (CSR) pioneer and founder of the Business Council for Sustainable Development urged "a bold new partnership between business and governments.. Business must move beyond the traditional approach of backdoor lobbying; governments must move beyond traditional over-reliance on command-and-control regulations.” 1 Schmidheney' will not be addressing the 2012 Rio+20 Summit as earlier this year he was sentenced to 16 years in prison for being responsible for the death over 2000 people due to one of his companies producing asbestos 2. But his group, the WBCSD, accompanied by an army of corporate lobbyists, will be the official voice of business at the UN.

UN, a helping hand for business

For the summit in Rio this week, the scale of industry lobbying and greenwash activities has increased, but there's another striking feature. Key industry lobby events in Rio this week are co-hosted by UN agencies. The Corporate Sustainability Forum, for instance, is organised by the UN's Global Compact office in cooperation with the Rio+20 Secretariat and the UN system 3. Organisers offer business and investors "an opportunity to meet with governments, local authorities, civil society and UN entities". The programme will showcase business initiatives on water, ecosystems, agriculture, food and climate. By co-hosting such events, the UN appears to be uncritically endorsing an approach that leaves it up to the corporations themselves to act to improve their environmental and social impact. The risk of greenwash, with the UN's seal of approval, is obvious.

The United Nations Global Compact (UNGC) 4brings together some 6,000 companies who have pledged to abide by a set of labour, environmental and human right principles. The Global Compact is widely criticised for its non-binding character, enabling corporations to 'bluewash' (that is enhance their reputation through the blue flag of the UN) themselves without any genuine change in practice.

The 'Business day'on 19th June, a day before the official summit starts, is also co-hosted by the UN's Global Compact office.5 During Business Day, companies with controversial records on the environment such as BP, Shell, Dow, BASF, Eskom and Coca-Cola will promote themselves as leading the way on sustainability in the oil and gas sector, on chemical, water, agriculture and more. The day also features a high-level lunch for 400 participants where head of states share table with the chief executives of those and other corporations 6

Reviving the BASD

The UN's Global Compact is also a convenor of the corporate campaign coalition Business Action for Sustainable Development (BASD), together with the World Business Council for Sustainable Development (WBCSD) and the International Chamber of Commerce (ICC). BASD has been running a high-profile campaign to promote industry demands for the Rio summit for the last 18 months, with conferences with UN agencies and government negotiators in Paris, The Hague and New York7.

BASD claims to be the official voice of business for the Rio+20 summit and brings together many of the world's largest corporations, including Monsanto, Shell, BASF, ArcelorMittal, Suez and many others, who claim to hold the solutions to the world's social and environmental crisis. They argue that these problems should be tackled with a 'green economy' model that gives global corporations a central role. Regulations that restrict their activities should be avoided and targets should be pursued through market-based mechanisms such as carbon trading or biodiversity offsets.

The ICC's task force on 'green economy', lead by Martina Bianchini from Dow, is made up of some of the companies with the worst social and environmental track records, including ExxonMobil, BASF, Monsanto and Shell.

Industry can be expected to use heavy doses of greenwash during the Rio summit this week. A look at WBCSD's publications in the run-up to the summit shows what's in store. In its lobby documents on biodiversity policies, the WBCSD highlights several case studies from member companies, including the examples from BASF and Holcim examined below 8.

BASD uses classic CSR tactics, promoting corporate case studies that give an unrealistic picture of their company members as champions of sustainability, taking advantage of its high-level access to governments representatives and high-level UN officials.

It is a paradox, to put it mildly, that a UN body (the Global Compact) is lobbying a UN Summit by becoming a full and active member of a corporate lobby coalition.

BASD recently expressed how pleased it was that, in contrast to 20 years ago, “the role of the private sector as a constructive partner, and engine of growth and sustainable development is widely recognised”9. One of its main ambitions for Rio+20 is to further deepen the close collaboration between big business and policy makers, with a stronger role for business lobbies in multilateral agreements such as the Convention on Biodiversity and the UN climate negotiations. BASD also calls for more public-private partnerships and for voluntary initiatives, which are designed to secure public funding for industry projects, as well as to pre-empt regulation 10.

Challenging the corporate capture of the UN

The corporate lobbying presence will reach new levels at Rio+20, but at the same time civil society groups will protest about the degree to which UN policy-making has been captured by industry. A growing coalition of critics has pointed to the close cooperation between UN agencies and large corporations, which imperils the UN's ability to pursue people-centred policies that effectively address the social and environmental crisis. The green economy model promoted for the Rio summit, centred around market-based mechanisms, is a clear example. Many are calling on the UN to restart efforts to ensure that global corporations are effectively regulated and can be held accountable for their environmental impact. Hundreds of civil society groups have already signed an open letter to the UN calling for strong measures to end the corporate take-over of the UN 11.

A blast from the past

The very same groups which now lead the corporate input in the Rio+20 debate also hi-jacked the Earth Summit back in 1992. The Business Council for Sustainable Development (BCSD), founded by Shcmidheney,managed to avoid proposals for new regulations of corporations and succeeded in having industry heralded as the new partner of the UN in its pursuit of sustainable development. According to Pratap Chatterjee and Matthias Finger in Earth Brokers, “UNCED set up a process through which TNCs were transformed from lobbyists at a national level to legitimate global agents, i.e. government partners. UNCED gave them a platform from where they could frame the new global issues in their own terms”. 12 Twenty years later it is clear that big business is seen by many as part of the solution instead of as part of the problem. As a result, the drive to regulate corporations in ways which could curb their activities has almost disappear from the international arena, granting them free reign to continue business as usual. The business council and its allies have cultivated an increasingly strong partnership with the UN and its various agencies.

In 1995 BCSD merged with WICE, the World Industry Council for the Environment, which was initiated by the International Chamber of Commerce (ICC) and chaired by BP's Rodney Chase, and formed the WBCSD. The ICC and WCBSD joined forces in the run up to the second UN Summit on Sustainable Development, known as Rio+10, which took place in Johannesburg, South Africa. A new business platform, Business Action for Sustainable Development, BASD, chaired by Shell's Mark Moody-Stuart was set up for the Johannesburg Summit.

The main BASD strategy for Rio+10 was to greenwash their companies' core activities, which had serious environmental and social impacts in sectors such as oil, mining or chemicals. And to employ a divide and rule strategy: dialogue and partnerships with the 'responsible' NGOs while discrediting the more critical ones, who were unwilling to engage with business.

However, these same corporations did not stop being involved in operations which had and have environmental, social and human rights impacts that contradict the sustainable development rhetoric. The Rio+10 summit gave its seal of approval to those isolated initiatives and to the public-private partnership approach promoted by business. Binding UN regulations for corporate activities were once again avoided and big business reinforced its status as part of the solution.

Greenwashing the role of corporations

Corporate groups such as the WBCSD, the ICC and BASD specialise in greenwashing the activities of its member companies, and seek to prevent regulations that would curb their main activities. Yet the glowing case studies they promote rarely tell the whole story.

Here we examine two of these cases promoted by the WBCSD in their lobby on biodiversity: BASF and Holcim.

BASF, promoting sustainable agriculture?

BASF, the German agrochemical giant is held up by the WBCSD for its efforts to 'protect and preserve ecosystems through respectful agricultural practices.' 13 One of the activities cited in this case study is planting trees to restore 300 hectares of land around a chemical complex in Brazil, in the project 'Mata Viva'. BASF claims to educate farmers and restore biodiversity.

Yet this project is tiny compared with the size of the soy and other monoculture areas that BASF promotes in Brazil and across Latin America. Soy production has already destroyed 21 million hectares of forest in Brazil, and soy monocultures destroy tropical ecosystems, accelerate climate change, and cause human rights abuses primarily to produce agrofuel and livestock feed. The soya industry wipes out biodiversity, destroys soil fertility, pollutes freshwater and displaces communities 14.

BASF produces and promotes the use of agrochemicals that support the overall production of soy in Brazil.

BASF is one of the group of six corporations, with Monsanto, Syngenta, Bayer, Dow and DuPont, which controls 75 per cent of the global pesticides market and 67 per cent of the seeds market.

Recently the Permanent Peoples Tribunal 15 gave its verdict against BASF and the other five big agrochemical companies. The tribunal met in Bangalore, in a session where witnesses from all over the world gave testimony on the human rights violations perpetrated by the agrochemical transnational corporations.

Among the tribunal findings are that BASF and the other companies are responsible for “gross, widespread and systematic violations of the right to health and life, economic, social and cultural rights, as well as of civil and political rights, and women and children’s rights.” 16 The verdict adds that “their systematic acts of corporate governance have caused avoidable catastrophic risks, increasing the prospects of extinction of biodiversity, including species whose continued existence is necessary for reproduction of human life.”

BASF aims to show that 'modern and registered crop protection and good agricultural practices are compatible with biodiversity', to improve its relations with farmers and enhance the reputation of BASF. However, scratching the surface of this PR exercise it appears that the negative impacts caused by the company with its promotion of deadly pesticides and chemicals totally dwarfs the potential benefits that this type of project might have.

Holcim, sustainable cement?

Quarrying for the raw materials to make cement is hugely environmentally damaging, destroying habitat and depleting biodiversity, as well as causing noise and air pollution, water depletion and sedimentation.

Yet the Swiss cement company, Holcim, claims to have created an oasis of biodiversity in Spain, after restoring the area where it had a gravel quarry near Toledo. According to the company, “the rehabilitated areas now have greater environmental quality than before quarrying began, attracting species that were not there at the time when the land was occupied only by agricultural fields.” 17

Local environmental groups do not agree. According to Ecologistas en Acción, a federation of environmental groups in Spain, there are several problems with the restored areas and also with Holcim’s operational quarries in the area.

The artificial lakes created by Holcim are altering the quality of the water in the river Jarama, increasing the pollution of the river. Public no longer have access to the area.

In the area close to the project Holcim has other quarry which has failed to comply with environmental legislation. At a cement plant near Toledo, local communities are challenging Holcim's permit to burn tyres and other materials that are hazardous for human health. Two Holcim mining sites in the Madrid region have been denounced by environmental groups for infringing environmental and mining regulations. Local species of bird have been affected 18.

At global level, the fact that Holcim has restored a site which is not operational does not change the fundamental unsustainability of its activities. Holcim’s growing operations in Latin America are increasingly being challenged due to environmental and social conflicts 19.

In May 2010 Holcim was brought to the Peoples Permanent Tribunal accused of environmental and social damage caused by its extraction activities in Colombia, Guatemala and Mexico, including cases of human right abuses and the criminalisation of communities who oppose the exploitation of their living resources 20. The Court condemned Holcim for its immoral and illegal practices 21.

Holcim is also very active lobbying in the EU to oppose an increase of the emission reduction targets. Holcim had the seventh biggest surplus of permits within the EU Emissions Trading System (the ETS - a carbon market) in 2011, resulting in windfall profits. According to the the UK NGO Sandbag, Holcim ended the year with a surplus of 12.5 million permits, valued at 213 million euros 22. This follows the same trend as previous years. This excess of permits, which will allow Holcim to meet its targets without making real changes to reduce emissions, has not stopped the company lobbying hard to continue getting permits for free. Working through the cement industry lobby group, Cembureau, it has played an important role in persuading the Commission not to auction permits to the manufacturing industry, which will now continue receiving free permits at least until 2020, creating windfall profits from the ETS.

Holcim is also a founding member of the Cement Sustainability Initiative (CSI), one of the WBCSD's flagship projects. 23 Bringing together 23 major cement producers, CSI was established in 1999 to address the key sustainability issues voluntarily, proactively and over an extended time period. The cement industry is widely criticised for its impacts on carbon emissions, destruction of biodiversity and water issues. The CSI has been exposed as an attempt by its members to promote non-binding voluntary guidelines and goals and to avoid fixed emissions targets.

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