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ILO Enterprise Forum 96

DIRECTOR-GENERAL'S SPEECHES

ADDRESS OF MR. MICHEL HANSENNE,
DIRECTOR-GENERAL,
INTERNATIONAL LABOUR OFFICE

Honourable Ministers, Ladies and Gentlemen,

Welcome to the first Enterprise Forum organized by the International Labour Office. I should like to extend a special welcome to Mr. Jean-Philippe Maître, Conseiller d'Etat of the canton of Geneva, and to Mr. Claude Smadja, Managing Director of the World Economic Forum, who will open this Forum with me.

This is the first time we are holding a meeting focused specifically on the enterprise. It is also the first time that such an important meeting is being organized as an open forum. This twofold uniqueness is, I think, worthy of an explanation.

The general theme of the Forum is, as you know, "Promoting social progress and enterprise competitiveness in a global economy". The ILO has always been firmly convinced that social progress and enterprise competitiveness are not only compatible but support one another. Yet, in the new context of a globalized economy, there may be reasons to doubt this.

The world of work, with the enterprise at its centre, is characterized today by persistently declining employment with unprecedented unemployment rates, resulting in an alarming growth of poverty, inequality and exclusion. According to the most recent figures available to the ILO, some 1.2 billion people - one-fifth of the world's population - live below the poverty line.

Yet there are those who continue to be resolutely optimistic. In the words of the communique issued by the last G7 summit in Lyons, "the process of globalization is a source of hope for the future". This is certainly true of the major industrialized countries as well as some regions such as South-East Asia, as it is for the myriad multinational enterprises that are being given an increasing amount of room to deploy their strategies. But is it true for everyone? The last World Bank report shows that many developing countries face serious difficulties in adapting to an open world economy, leading to major disparities with the risk of a permanent gap between rapidly integrating economies and those that are slow to integrate. And what about the many small and medium-sized enterprises that find themselves increasingly dependent on forces beyond their control? We are very concerned about this situation, as you must be, or you probably would not be here today.

We have been engaged in an in-depth reflection on the ways in which we can deal with this situation since 1994, when we commemorated our 75th anniversary by thinking about our future.

Today's world is infinitely more complex than yesterday's. Instead of trying to control it, as we have aspired to do in the past, we have to learn to live with uncertainty. This must not prevent us from taking action - quite the opposite - but instead of dreaming of a global order that would appear out of nowhere we should draw on an increasing number of experiences at the local level, analyse them and try to adopt those that yield the most promising results - for reasons that we still do not fully understand. The lessons to be drawn from the latest discoveries in physics are reflected in social or political action. An example of this is the relationship between order and chaos. If a butterfly beating its wings can cause a cyclone thousands of kilometres away, there is reason to believe that bold social initiatives can also result in a more satisfactory state of social justice.

Seen from this viewpoint, enterprises and the way they operate have a determining role to play. One of the characteristics of the globalization of the economy is incontestably the major role of the enterprise. One could talk endlessly about the disparities that exist in the world, about the different ways in which groups of countries or whole economic sectors evolve, but what all countries have in common is the new situation in which enterprises find themselves, regardless of their size, form or structure, simply because today's market is, in fact, a global market and they have to act in accordance with this new reality.

When it comes to enterprises, it often seems that the ILO either does too much or too little.

For the vast majority of enterprises, the global economy is a major challenge, since the resulting competition is infinitely tougher than before. Some of them find it difficult in these circumstances to observe rules which, being too rigid, are not adapted to the contexts in which they operate. The international standards supervised by the ILO are often perceived as outdated or inappropriate. The ILO itself is often seen by these enterprises as more of a curator in a museum of antiquities than as a promoter of progress, capable of keeping up with changes in the global environment. Of course this is an exaggeration and overlooks the wide-ranging efforts we have made over the years to adapt to new realities, but there remains a certain amount of distrust and we should be sensitive to this.

Others feel on the contrary that the ILO is not doing enough. An increasing number of enterprises are rethinking their role in today's world and ways in which they can meet their obligations to the workers and the community in which they live. Ethical considerations are coming to the fore, and the concept of corporate citizenship, or the socially responsible enterprise, has given rise to a number of initiatives. A panel discussion will be held on this subject. But for the enterprises that intend to meet the requirements of social justice, the question arises: should they confine themselves to an individual code of ethics or should new rules of conduct be invented by the actors themselves and be imposed on everyone in the context of a new international "level playing field" in the social sphere? And what role can the ILO, as a tripartite body and international champion of certain universal values, play in the emergence of these new rules of the game?

One of the ILO's permanent concerns has been to ensure that the observance of the values for which it stands is not at the expense of those practising them. This is the meaning underlying the famous words of the Preamble to its Constitution, "the failure of any nation to adopt humane conditions of labour is an obstacle in the way of other nations which desire to improve the conditions in their own countries". This originally referred to those States considered as the main, if not the only, agents of progress. Is it not high time to reinterpret it for the benefit of enterprises that do not confine themselves to complying with national legislation but undertake to observe, wherever they may operate, essential humane conditions of labour?

This is a subject I raised in the report I submitted on the occasion of our 75th anniversary, referring to the role of non-governmental actors, and multinational enterprises in particular, in the ILO's future standard-setting.

This two-day forum, or public debate, is a valuable and unique opportunity for us to exchange experience and analyses of the new social relationships that are emerging in your enterprises and of employment trends. How can we make sure that progress in enterprises is translated into progress in employment on a sufficient scale and in a sufficiently well balanced manner to ensure that the resulting social tensions do not strain or tear the social fabric? If economic progress is not translated into an equal amount of social progress, especially in terms of jobs, there is a real risk that a backlash could result which would seriously jeopardize the very opportunities for growth afforded by the opening up of the market in the last few years.

This applies to all types of enterprise, including multinationals, which have the real capacity to stimulate the emergence and growth of small and medium-sized enterprises, and hence create jobs. It also applies to the many production units managed by women, whose growth is hampered by specific difficulties which have to be understood if we are to contribute solutions conducive to greater equality in the world.

We hope these two days will be an enriching experience and one that will provide food for thought and a stimulus to your work as entrepreneurs. But your presence here could also be the beginning of a broader action. By trying to achieve a better understanding of how the development of the global market will affect the future of enterprises and the future of work, the shape of labour relations and employment in the world, we also want to make sure that economic development is not jeopardized by excessive social imbalances and that it meets the goals of progress and justice that are at the heart of our Organization.

What you have learned from your own experience, whatever your responsibilities within the enterprise may be, can only serve to enrich the current debate on the Organization's standard-setting policy, which must increasingly keep pace with developments in the labour market. They will also help to improve the service we provide to our constituents throughout the world in the form of advice and cooperation projects.

This forum was organized thanks to the active involvement of the social partners which, together with government representatives, define our policies and actions. Ours is first and foremost an organization of the social partners. The concerns and ideas you express here will be reflected in the proposals put forward, discussed and decided on by our constituents - employers' and workers' organizations working alongside governments - in the policy-making bodies of this Organization.

You may be sure that they will receive my full attention.


Updated by BB. Approved by MH. Last update: 21 February 1997