Equity over exploitation:
global guidelines for corporate giants
"There's something very restful about Costa Rica's rainforest.
The air is warm, humid and clean. It's a very beautiful place, like a cathedral:
dark, very still and peaceful... There are all kinds of sounds: monkeys
calling in the distance and swinging in the trees, birds everywhere."
by Rosemary Brown, reprinted from Co-op America Quarterly
- Lynn Helena Corporale, senior director and scientific liaison for
Merck Research Laboratories, who negotiated the Merck-INBio agreement
eeting amid insects, rain and heat in Costa Rica's Guanacaste
National Park, negotiators from the National Institute of Biodiversity (INBio)
and US-based Merck & Company developed a revolutionary agreement to
research local rainforests.
In 1992 Merck, the world's largest pharmaceutical company,
and InBio, a Costa Rican nonprofit research center committed to cataloging
the country's half-million insects and plants, arranged a mutually beneficial
joint venture. INBio would provide Merck with plant and insect samples in
return for $1 million in funding and a $140,000 donation of equipment. Part
of the money would be used to fund rainforest preservation.
The controversial Merck-lNBio venture is among the case
studies in an international research project exploring the impact of transnational
corporations on the developing world. Recognizing transnational corporations
as the powerhouses of the global economic system, the Council on Economic
Priorities (CEP) and its British partner New Consumer launched the project
to promote responsible corporate behavior.
Transnational corporations have the power to do good
and bad, at home and abroad. Harnessing socially and environmentally responsible
behavior, and putting a stop to harmful corporate deeds, are important steps
in countering the damaging effects of globalization. CEP and New Consumer
are researching model initiatives.
"With global influence comes global responsibility,"
says Deborah Leipziger, CEP project director for the Transnational Corporations
Project in the U.S. "Because of their extensive resources, corporations
are in a position to address social and environmental problems by developing
Negative examples of transnational corporations' involvement
in developing countries are well known, says Leipziger. "The success
stories are not, despite their relevance to other companies and to the development
process in Latin America, Africa and Asia."
The Merck-lNBio venture is heralded by some as a benchmark
initiative to curb exploitation and cultivate corporate responsibility in
The agreement stipulates that Merck receives the exclusive rights to screen
INBio's samples for medicinal properties. If a drug is developed from one
of the samples, INBio will receive royalties from drug sales.
"Historically, companies looking for plant and
animal species simply went to developing countries and took them,"
says Leipziger. "Not only does the Merck-lNBio agreement compensate
Costa Rica by funding conservation efforts, it also fosters the local scientific
community. For the first time, a developing country will receive royalties
if a drug is developed from INBio's samples."
In the agreement, much of which remains confidential, INBio contributes
10 percent of its budget and 50 percent of its royalties to conserving national
parks in Costa Rica. Merck will also provide technical assistance to Costa
Rica to develop indigenous drug research capabilities.
To many, the agreement is just another example of corporate
exploitation of resources in developing countries. INBio director Dr. Rodrigo
Gamez disagrees. He believes the biodiversity within the forests of Costa
Rica belongs to everyone, not just Costa Ricans.
Another model emerging from the research is the work
that Levi Strauss & Company has done with its contractors in developing
countries. "While many transnational companies seek low-wage havens
where occupational safety and environmental standards are not enforced,
Levi Strauss produces clothing only where strict safety and environmental
standards are upheld and where employees are treated ethically," says
While being applauded for its overseas initiatives,
Levi Strauss is being assailed closer to home. Criticized and boycotted
for relocating factory operations - and therefore jobs - away from communities
in the United States, the actions of Levi Strauss help to illustrate the
global vs. local dilemma.
One step towards solving that dilemma is ensuring that
corporations are accountable and understand their global and local responsibility
to people and the planet. By promoting corporate guidelines and models,
the CEP/New Consumer project aims to help corporations meet their responsibilities.
There are lessons in the research for everyone - corporations, developing
countries, national governments, trade unions, consumer groups and non-governmental
organizations, as well as individuals who want to use their purchasing power
to support "better practice."
3M: Global environmental impact reduction program.
Hitachi: Training and technology transfer. Unilever: Development
of appropriate technology on plantations in Africa and Asia. Shell:
Training and skill extension in Nigeria. Premier Beverages: Quality
assurance project incorporating social and environmental standards on tea
plantations. Ford: Reduction of CFC use in Brazil.
For more information, contact: CEP, 30 Irving Place,
New York, NY 10003; (212) 420-1133.