Edited by John R. McIntyre, Silvester Ivanaj and Vera Ivanaj
Chapter 2: The UN Galaxy, Transnational Corporations and Sustainable Development
Tagi Sagafi-nejad INTRODUCTION 1. The changing character and increasing complexity of the relationship between TNCs (transnational corporations) and nation-states has been reflected in the way the various entities of the UN (United Nations) galaxy have perceived and performed their mandate and faced emerging challenges during the past half-century. With respect to TNC–host-country relations and particularly FDI (foreign direct investment) and the related subject of corporate conduct, two competing institutional paradigms have persisted – one legalistic, the other moralistic. Followers of the legalistic approach have argued that, in order to be efficacious, rules of conduct and behavior must have legal teeth, i.e. courts, cops and penalties. Moralists, on the other hand, have relied on less formal incentive structures, e.g. mutual benefit, good citizenship, corporate social responsibility, engagement, dialogue and the learning process. New York and Geneva have formed the axis for UN activities on TNCs, and UNCTC (UN Center on Transnational Corporations) and UNCTAD (UN Conference on Trade and Development) in these cities have played pivotal roles. However, other UN agencies, scattered worldwide, have played their specific, and sometimes significant, roles. Each is part of the UN constellation that has contributed to knowledge and understanding about TNCs and FDI and has contemplated the relative merits of these alternative approaches as they have discharged their respective duties. Of necessity, the UN has increasingly turned its attention to matters of ecology, social responsibility and sustainability, building on extant structures and processes and injecting them with new mandates. There are some 30 UN agencies...
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