THE WORLD BUSINESS COUNCIL ON
SUSTAINABLE DEVELOPMENT

The World Business Council for Sustainable Development (WBCSD) has only recently stepped up its involvement in the MAI. Masquerading behind its carefully-cultivated image as a "green" industry lobby group,⁹¹ the WBCSD has been tremendously successful in promoting global market liberalization and self-regulation by business instead of government intervention as the recipe for sustainable development. The WBCSD approach has left its mark on for instance the 1992 Rio Declaration and the climate treaty which emerged from Kyoto in December of 1997. It is not surprising that the WBCSD has come out strongly in favour of the MAI, despite acknowledging potential problems.

The 15 January 1998 BIAC consultation was the first time that the business council's secretariat participated in official consultations on the MAI. In general, the group's involvement has been on the informal level. Stigson has attended various BIAC meetings, and is a member of its environment committee. Several WBCSD member companies are represented in BIAC, and the secretariats of both organizations interact and share relevant information.⁹²

WBCSD president Bjorn Stigson has also expressed his concern in writing to OECD official Don Johnston about the inclusion of binding language on environmental standards in the MAI, and in the same letter has generally promoted the WBCSD's gospel of business self-regulation.⁹³ Quoting Agenda 21,⁹⁴ Stigson argues that "trade liberalization is a positive force for supporting the most environmentally and economically efficient use of goods and resources, and hence for contributing to sustainable development." He then concludes that "investment liberalization is a close relative of trade liberalization, and can be expected to produce a similar positive impact." He expects that the greatest benefits will arise from the inclusion of Third World countries in the MAI.

Stigson acknowledges possible conflicts between new environmental regulation and the MAI, and suggests these could be solved by "making explicit the types of assurances that business and many negotiators say is already in the agreement, while maintaining the very important goals of the MAI." He suggests that the reference to NAFTA Section 114.1 in the MAI draft already "ensures all stakeholders a balanced implementation of the agreement in dispute resolution processes". This, however, is hardly reassuring -- this very clause did not prevent the US Ethyl Corporation from challenging a Canadian environmental law as an expropriation in a NAFTA court last year.

In his letter, Stigson expresses strong reservations about a provision under which countries would obligate themselves not to reduce their environmental standards in order to attract or maintain investments, be it non-binding or mandatory. He does not altogether reject mandatory provisions, provided these can be really enforced and will bring clear benefits. Stigson also recognizes that MAI could encourage companies to shift investment to pollution havens. Rather than including environmental standards for investments in the MAI, he suggests the WBCSD 'solution': "sound environmental management systems as an alternative to command and control environmental standard setting."