Building a sustainable and inclusive global economy from the ground up

As the world’s largest voluntary corporate sustainability initiative, it’s easy to think of the Global Compact as a community solely connecting boardrooms across continents. But it is the interconnections that have spread and blossomed at the local level that make the Global Compact a truly global network.

Today, 88 of the 193 UN member states have an active Local Network. These networks bring local communities together to carry out meaningful change, whether that’s improving access to clean water in India, enshrining human rights in Argentinian work practices, stamping out corruption in Nigeria, or creating online tools to help small business owners in Spain. In this way, the universal principles that the Global Compact champions across human rights, labour, the environment and anti-corruption are supported by every facet of society.


BEING GLOBAL MEANS GOING LOCAL

Every country faces a unique set of challenges and opportunities. Cultural, political, economic and linguistic contexts vary across the world, creating vastly different environments which businesses must navigate. The Global Compact Local Networks act as both a compass and an anchor for local participants. They help guide businesses through country-specific pitfalls, such as substandard
working conditions or high levels of corruption. At the same time the Local Networks help unite companies with communities and authorities, so they can work together to address these problems at the source. In this way the networks anchor the Global Compact’s universal principles at a local level. This is what makes the Local Networks so critical: they have the local insight needed to bring about genuine change from the ground up.


ACTION ON THE GROUND

At the most basic level, Local Networks help local communities
bring the Global Compact principles to life. They help get sustainability
initiatives up and running, then teach communities how to monitor and report on programs to make sure they’re having the right impact. Most networks are geared towards helping smaller and midsized enterprises, meeting their needs in a myriad of ways. This could include providing workshops for education and training,
building partnerships, or giving a voice to small stakeholders
in policy debates. Local Networks also localise global campaigns and resources.
They can take overarching Global Compact initiatives like the WEPs, the CEO Water Mandate or B4P, and make them relevant at a local level. In this way, important campaigns trickle down throughout the entire network. Local Networks
also collaborate with neighbouring networks, sharing ideas and solutions around regional issues. The graph below charts the consistent growth of Local Network
activities over the past decade. There has been a strong increase in the learning category, and also in efforts to recruit new companies to join the Global Compact.


A GROWING NETWORK OF NETWORKS

India was the birthplace of the very first Local Network back in 2003. Today, the initiative has grown to encompass 88 countries across the world. The Global Compact encourages its member companies to engage with Local Networks in the
countries where they operate, helping to spread the initiative. But this spread has been uneven: while there are active Local Networks in most European counties, the take-up has been slower in other regions. Africa has the fewest Local Networks.
Networks are based on a bottom-up approach. Each has a large degree of freedom to act when it comes to deciding how the network should be run, choosing the most pressing local issues to tackle, and sourcing funding. This level of autonomy and the staggered establishment of Local Networks over the past 15 years mean different networks are at very different stages of maturity. Some are well-established in their communities, very active, and can provide
sophisticated support. Others are much more informal and are not as effective yet. Regardless of their structure, each Local Network checks in with the Global Compact Office every year, renewing their Memorandum of Understanding.


A PATCHWORK OF PROGRESS

The progress is encouraging: our review of the Local Networks shows corporate sustainability has gained a stronger foothold across the globe over the past 15 years. But given the diversity of the Local Networks and their freedom to prioritise issues,
it is not surprising that we see very different rates of change across the different areas.

On top of the internal differences, we also need to factor in the external context in which each Local Network operates. Different political and economic systems affect the progress Local Networks can make. The relationships between business and society and the responsibilities companies have are regarded very differently around the world. Likewise, the issues themselves carry different meanings: in some countries for example, human rights largely centres around non-discrimination. In other regions, the key human rights issue could be
freedom of speech. Some of the most advanced Local Networks and companies
are found in Europe, the first region to really focus on corporate sustainability. In North America however corporate sustainability has developed more slowly, with the focus instead on corporate philanthropy and regulatory compliance. In the following section, we turn the spotlight on four Local Networks across the world. These insights show how networks are anchoring the Global Compact in their communities, joining the groundswell of sustainable economic change.

“I would say that one of the key contributions of the Global Compact is that it has brought broad local dialogue amongst all stakeholders. It has uniquely been able to drive dialogue forward in a way that
other institutions really could not do to the same degree.”
ARON CRAMER, CEO, BUSINESS FOR SOCIAL RESPONSIBILITY

LOCAL NETWORKS UNDER THE LENS

We’ve taken an in-depth look at four Local Networks: India, Argentina, Nigeria and Spain. We spoke with Local Network representatives, as well as stakeholders from business, finance, civil society, government and academia. We’ve also interviewed Local Network representatives in Bangladesh, Germany, Turkey and South Korea. The insights they shared form part of the overall Local Network study. Here we present the highlights from the assessment.