REINVENTING DEVELOPMENT Reforming the UN for People and Planet ROSA LUXEMBURG STIFTUNG NEW YORK OFFICE by Barbara Adams and Karen Judd Table of Contents

REINVENTING DEVELOPMENT Reforming the UN for People and Planet ROSA LUXEMBURG STIFTUNG NEW YORK OFFICE By Barbara Adams and Karen Judd Table of Contents

Beyond Tinkering. By the Editors...... 1

Reinventing Development

Reforming the UN for People and Planet...... 2

By Barbara Adams and Karen Judd

How Did Things Come to This?...... 3 An Obsolete Government Model?...... 5 “Corporate Courts”...... 6 Financing the Three Pillars...... 8 Is the 2030 Agenda a Game Changer?...... 11 A Universal Normative Framework...... 12 Integrate and Rebalance the Three Pillars...... 15 Financing...... 20 An Accountability Culture...... 25 Moving Forward...... 29

Published by the Rosa Luxemburg Stiftung, New York Office, June 2016

Editors: Stefanie Ehmsen and Albert Scharenberg Address: 275 Madison Avenue, Suite 2114, New York, NY 10016 Email: [email protected]; Phone: +1 (917) 409-1040

With support from the German Federal Ministry for Economic Cooperation and Development (BMZ).

The Rosa Luxemburg Foundation is an internationally operating, progressive non-profit institution for civic education. In cooperation with many organizations around the globe, it works on democratic and social participation, empowerment of disadvantaged groups, alternatives for economic and social development, and peaceful conflict resolution.

The New York Office serves two major tasks: to work around issues concerning the United Nations and to engage in dialogue with North American progressives in universities, unions, social movements, and politics.

www.rosalux-nyc.org Beyond Tinkering

Since the United Nations’ founding 70 years ago, UN reform has been on the table—and, indeed, the institution has undergone several phases of reform. What is meant by reform, however, varies greatly depending on who is raising the issue. While there is no question that the UN is in need of renewal, proposed reforms are oftentimes diametrically opposed to one another.

Some reformers seek to streamline the institution, to make it more efficient so that it can better serve its purpose with fewer resources. Such proposals sidestep questions of power and interest and are presented as neutral and technocratic. But no reform is truly neutral, and in a context where corporate interests have been gaining greater control—through what could be called a stealth reform agenda—we must always ask whose purposes are served by proposed reforms.

On the other hand are proposals that address power balances within the UN, seeking for instance to change the composition of the Security Council or to reduce the dominance of the Permanent Five (P5) members. These proposals, however, stand little chance of being enacted any time soon due to the difficulty of amending the Charter and the intractable resistance of the veto-wielding P5. While advocates of such reforms may have justice, equity, and democracy on their side, their focus on these fundamental changes may stand in the way of pursuing the kinds of changes—short of amending the Charter—that can make the UN a more capable force for people and planet.

In this study, Barbara Adams and Karen Judd take a close look at the UN development policies. Trained as an economist, Adams has spent decades working in (and writing about) international politics both in and out of the UN. She is the author, with Kathryn Tobin, of the recent RLS–NYC study Confronting Development: A Critical Assessment of the UN’s Sustainable Development Goals. Judd, a former speechwriter and policy analyst at UN Women, is currently Associate Editor of New Labor Forum, published by the Murphy Institute—CUNY.

Transformational changes are needed to make the UN into a body that advances the public interest through democratic governance and commitment to its founding values. These changes will not be easy to bring about, but Adams and Judd give us the guideposts we need to set off on this path in the field of development. For one thing is clear: A piecemeal approach won’t get us the UN we need. A reform agenda that’s worth pursuing will recognize the entrenched interests that support the status quo and take on critical issues of financing, adopting a values-based framework, integrating the three UN pillars—human rights, sustainable development, peace and security—into that framework, and developing a culture of accountability.

Stefanie Ehmsen and Albert Scharenberg Co-Directors of New York Office, June 2016

1 Reinventing Development Reforming the UN for People and Planet

By Barbara Adams and Karen Judd

On the occasion of the United Nations’ 70th development without peace and no peace anniversary, UN reform is very much on the without sustainable development.” agenda. Not only will member states select a ⇒⇒ The traditional approach to development new Secretary-General in 2016—through a based on the (income-defined) categories new process that promises to be more open of developed, developing, and least de- and transparent—they will also begin to im- veloped states is eroding, as no country’s plement or endorse several new global agen- development is currently sustainable and das, all demanding greater coherence within multidimensional poverty is a challenge in the three pillars of the UN system: peace and all countries. The UN development system security, human rights, and sustainable de- (UNDS), which is based on these categories, velopment. Notable among these are Agenda has declining relevance to developed and 2030 for Sustainable Development, hammered developing countries alike. out in a member-state driven process with un- ⇒⇒ So-called developed countries can no lon- precedented input from civil society; the Addis ger set goals and standards to which so- Ababa Action Agenda on Financing for Devel- called developing countries must adhere. opment; and the Paris Agreement on Climate The 2030 Agenda for Sustainable Develop- Change. Together they provide a framework ment has set universal goals and targets for through which UN member states can trans- all countries to meet. form the organization in order to ensure its relevance for the next 70 years. ⇒⇒ Unlike in 1945, economic growth can no longer be seen as the sole or primary ob- What these global agendas recognize is that jective. Issues of inequalities within and the challenges faced by the UN have changed. between countries cannot be addressed The world is a very different place than it was in by national or global strategies that rely 1945 when the UN was founded. For example: on economic growth. Furthermore, global challenges must be met within the reality of ⇒⇒ Unlike in 1945, a global commitment to finite natural resources. peace and security cannot be rooted in a winners and losers mindset, nor can it be By contrast, institutions and their capacity, dominated by a war or non-war approach governance, and financing have not changed, to peace and security. Ongoing national not substantively. Instead, recent UN reform and regional conflicts as well as the eco- discussions tend to be dominated by a process nomic violence experienced in vastly un- of assessing the effectiveness and relevance of equal communities and daily lives make existing UN institutions in terms of efficiency, elusive the 2040 Agenda’s commitment to calling for their rearrangement, amalgama- “foster peaceful, just and inclusive societies tion, strengthening, or elimination and urging which are free from fear and violence,” rec- the UN to do more with less. Successive waves ognizing that “there can be no sustainable of UN reform have generally been weighted to-

2 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

ward working methods, reporting schedules, sibility for the Universal Periodic Review. This aligning business plans, common financial and is a promising step forward in that it calls on all administrative systems, and so on. However member states to report on their efforts to im- no matter how efficient they may become, the prove human rights. However, a commitment institutions that carry out the work of the UN’s to human rights is still not central across all three pillars along with their funding streams parts of the UN system. and governance arrangements are out of sync with today’s realities. They continue to operate System-wide coherence remains elusive. This in their separate pillars, failing to coordinate is particularly evident with the UN Develop- with, and at times even competing with, dif- ment System (UNDS) as specialized agencies, ferent parts of the system, especially when it funds, and programmes initiate overlapping comes to financing. programs and compete for resources to fund them. An effort to address the resulting du- The Economic and Social Council (ECOSOC), plication and fragmentation was the creation, for example, although strengthened in 2013 in 2006, of the UN Entity for Gender Equality to enable it to coordinate the UN development and Women’s Empowerment (UN Women), an system, still lacks the authority, resources, experimental hybrid to link the normative and and decision-making power vis-a-vis the Secu- operational dimensions of UN development rity Council on the one hand and the Bretton activity. Created on the recommendation of Woods Institutions (BWIs) and the Group of 20 the 2005 High Level Panel on system-wide Co- Major Economies (G20) on the other. Interna- herence, its lack of resources and of bold lead- tional economic, investment, and trade policy ership and its limited mandate leaves it in dan- decisions continue to be dealt with outside of ger of becoming a member of an increasingly the UN and its agreed norms and standards. dysfunctional UNDS.

And while the Security Council has added mem- Piecemeal approaches to institutional strength- bers in response to the changed dynamics of ening and the failure of global governance to as- global conflict it has kept veto power limited sert multilateralism reflect a more fundamental to the same five states. Moreover the ongoing problem. Many players in all sectors, member power imbalances that have largely frustrated states as well as UN agencies and the corporate Security Council reform also affect the Gener- sector, have a vested interest in the continua- al Assembly, which experiences its own power tion of weak global governance. This, in turn, has disparities not only vis-a-vis the Security Coun- rewarded or reflected the status quo and power cil but also in establishing an action agenda that asymmetries and has been passively abetted by reflects in a timely fashion today’s challenges. the pressure from or inclination of those who favor “doing something,” albeit limited, to enter- With regard to human rights, the Human Rights ing protracted and potentially fruitless negotia- Council, created in 2006, now includes respon- tions over a more challenging agenda.

How Did Things Come to This?

With the increased intrusion of external fac- tional and global levels, there has been a grad- tors in economic policy making, at both na- ual shift from the legislative to the executive

3 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

branch. Legislators have failed to recognize or porate—and unaccountable—influence. More- address the incursion of the global econom- over, the increasing influence of large founda- ic and financial system into some domestic tions and large NGOs, manifest most clearly policy decisions and are in danger of becom- in multi-stakeholder approaches, threatens ing marginal to economic planning and policy to weaken democratic governance. This is- making. Structural adjustment prescriptions sue goes to the essence of the UN needing to as a condition for IMF loans in the 1980s un- champion public space and accountability and dermined national capacity and restricted the to advocate for state responsibilities as duty ability of governments to regulate investments bearers to rights holders. In failing to meet this and corporate operations, shifting the weight challenge, the UN and its members implicitly of economic decision-making away from na- accept a lack of political will and allow the UN tional priorities. to become a multi-stakeholder lapdog, which uses its convening power to facilitate special This neglect has been matched at the global interests instead of people’s rights in a world level as governments and UN agencies increas- of finite resources. ingly turn to private sector partnerships to fill funding gaps without putting in place report- The starting point for addressing the institu- ing, monitoring, or governance requirements tional, financing, and governance challenges and without systematically assessing the im- facing the UN is not through the lens of effi- pact of these arrangements in terms of the ciency but against the backdrop of today’s goals they are meant to achieve. The UN, like pressing need for a vibrant and accountable its member states, has shifted from providing global body—in a world where no country is governance to managing it. sustainably developed and inequalities are rising dramatically. Can the international com- Indeed, part of the reason for the focus on munity approach UN reform from the outside tinkering—rather than transformation—is the in, not only from the inside out—particularly unwillingness of member states to agree to a in terms of defining and measuring effective- funding formula for the UN in line with the in- ness? Instead of starting with the existing insti- creased mandates they have given the organi- tutions and asking how they can be rearranged zation. A recent example is the adoption of a to better fit today’s realities, we should start UN biennium budget for 2016-2017 at a level with today’s realities and ask what kind of insti- lower than for the previous biennium. This pat- tutional and financing arrangements are need- tern of inadequate funding has become so en- ed to tackle them. trenched that some have argued that this situation—less funding, more demands—is itself a In asking how the UN can position itself to tack- part of the new global reality, one to which, im- le today’s challenges given continued power plicitly, the UN must adjust.1 To do so however imbalances and unsustainable development, is to doom the organization to ever-increasing it is useful to recall what makes the organiza- marginalization and ultimately irrelevance. tion unique. The UN remains the only global body that can convene member states to set The damage done to the UN because of state universal norms and standards that all mem- power asymmetries now risks being replaced ber states are obliged to adhere to—including or amplified by another: the embrace of cor- those on human rights, gender equality, and environmental sustainability. It is also the only 1 See Barbara Crossette, “In 2016, the UN Will Be Trans- global body that has a mandate for peace and formed. Will That Be Enough to Bring It Back to Life?” The Nation, December 22, 2016. justice, empowering it to address issues of in-

4 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

creased inequalities and insecurities and to In 2015, the negotiation and adoption of the tackle urgent problems such as climate change. 2030 Agenda for Sustainable Development sought to correct these trends, identifying a The UN’s unique role includes setting interna- total of 17 integrated goals that are to be mea- tionally agreed norms and standards and its sured and monitored in all countries, not just global convening power, not only of member developing countries, based on human rights, states but of all those who recognize its au- and integrating the need to foster peaceful, thority, especially its moral authority. The pro- just, and inclusive societies. And in the Paris cess of decolonization that began after World Agreement on Climate Change, 195 Member War II and continued until the early 1980s was States agreed to a series of commitments on largely spurred by the recognition by leaders measures to reduce emissions and on a con- at the UN that colonialism was inconsistent cept of “common but differentiated respon- with a peaceful world. And later, the develop- sibilities,” recognizing that disproportionate ment conferences of the 1990s quickly filled power has resulted in disproportionate use the space opened by fall of the Berlin Wall to of the world’s resources and a corresponding redefine national and global security beyond responsibility to address the consequences, in- military threats to include sustainable devel- cluding natural disasters brought on by climate opment, reproductive health, gender equality change. and women’s rights, and social development— including the right to development—in all countries. An Obsolete Governance Model?

In 2000, the Millennium Declaration continued When the UN was founded most economic ac- this holistic vision, emphasizing the right to be tivity took place within national and territorial free of want and free of fear. However, pressure limits and cross-border dynamics were driven to concentrate attention on a limited number by efforts to prevent war and conflict. The war of priority goals in order to make demonstra- threat soon became defined and dominated ble progress resulted in the selection of eight by nuclear war even as “conventional” warfare Millennium Development Goals (MDGs), which was waged in proxy conflicts, often reinforced significantly changed the UN development by the nuclear power veto-wielding mem- agenda. The MDGs not only largely ignored the bers of the Security Council. The UN human issue of peace and security but reduced the rights conventions, at the insistence of the concept of “development,” with its potential super-powers, divided political and civil rights for structural transformation, to the provision from economic, social, and cultural rights, even of basic needs.2 In addition, the MDGs depart- though many countries, especially in western ed in significant ways from a much broader Europe, did not pursue such a separation “at approach to development by focusing on and home,” embracing the concepts of the right to measuring results that developing countries education, health, housing, and social security. were expected to achieve, thereby perpetu- ating existing global power imbalances and As UN membership has expanded follow- curtailing a more holistic approach to developing decolonization, the breakup of the Soviet ment, especially sustainable development, in Union, and the success of national indepen- all countries. dence movements, the cross-border move- ment of people, trade, and finance has also 2 Sakiko Fukuda-Parr, “The 2030 agenda and the SDGs – a course correction?” SPERI.comment, Sheffield Political increased, greatly accelerated by processes Economy Research Institute, September 30, 2015. of globalization and market liberalization. The

5 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

national governance model has not kept pace, foreign direct investment (FDI), the extent to leaving huge gaps in areas such as climate, in- which FDI itself can benefit developing coun- formation and communication technologies tries greatly depends on the extent to which (ICTs), and global capital flows. the recipient countries are able to use it within the framework of national policy designed to The conventional approach in international re- advance certain sectors, particularly industri- lations of the balance of power among states al sectors. Yet the past two decades have seen does not extend to the threat from climate rapid liberalization of FDI regimes and erosion change and is strained by massive movements of policy space in developing countries vis-a- of people, driven by violence and a desire for a vis transnational corporations. Some of this peaceful society and by aspirations for sustain- approach results from commitments under- able livelihoods. taken in the WTO as part of the Agreement on Trade-Related Investment Measures. Much, Norms and standards are not applied consis- however results from bilateral and regional tently even across the UN system. Many oth- investment treaties that in practice privilege er institutions of global governance (WTO, foreign investors.5 IMF, G20) do not adhere to them and are not challenged to do so. The more the actions and Countries that sign on to such agreements, initiatives—including the Secretary-General’s often not fully realizing how they limit their “multi-stakeholder global partnerships”—take ability to adopt laws or policies to protect their place outside the UN system, the greater the populations and advance sustainable devel- risk of UN values being pushed aside and delib- opment goals, find themselves constrained by erately or otherwise undermined. The reality is the existence of arbitration clauses embedded that despite repeated commitments by mem- in so-called investor-state dispute settlement ber states, including rich countries, to promote (ISDS) systems. UNCTAD reports that there are greater coherence, there is no agreement 608 known international arbitration cases ini- upon a normative framework through which tiated by investors, of which 243 are pending.6 to ground and implement such a framework.3

This can be seen particularly clearly in the case “Corporate Courts” of regional trade and investment agreements, whereby states bypass the UN, and even the An ISDS is a special legal right which foreign WTO, in order to secure market access and the investors can use to challenge a law, regula- promise of foreign direct investment (FDI). The tion, judicial or administrative ruling, or any UN Conference on Trade and Development other government decision that they claim (UNCTAD) reports there are currently 2,778 bi- reduces the value of their investment or rep- lateral investment treaties in force, 27 percent resents potential lost profits. It allows foreign of them in Africa.4 While there is no clear evi- investors to bypass host country courts, pub- dence that bilateral investment treaties attract lic hearings, and regulatory bodies and sue

3 Universal Rights, Differentiated Responsibilities: Safe- 5 Bilateral investment treaties totaled 3,262 at the end of guarding human rights beyond borders to achieve the 2014. See Yilmaz Akyüz, Foreign Direct Investment, Inter Sustainable Development Goals,” Center for Economic Press Service (IPS), December 29, 2015. and Social Rights/Third World Network Human Rights 6 UNCTAD, “International Investment Agreements,” Invest- Policy Briefing, April 2015. ment Policy Hub, investmentpolicyhub.unctad.org/IIA. 4 Kinda Mohamadieh and Daniel Uribe, “The Rise of Inves- Since most such agreements allow for fully confidential tor-State Dispute Settlement in the Extractive Sectors: arbitration, the actual number is likely to be higher. Mo- Challenges and considerations for African countries,” hamadieh and Uribe, “The Rise of Investor-State Dispute Research Paper 65, South Centre, February 2016. Settlement in the Extractive Sector.”

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the host-country government before a panel the Government of Uruguay over a decision of private “arbitrators,” who are neither dem- to include health warnings on cigarette packs. ocratically elected nor subject to rigorous The company brought its claim under the Swit- conflict of interest rules. Of the total number zerland-Uruguay Bilateral Investment Treaty of cases, sub-Saharan Africa accounts for 16 (BIT) to the World Bank’s International Center percent.7 ISDS provisions are routinely includ- for Settlement of Investment Disputes (ICSID), ed in bilateral and regional trade agreements, claiming that the warnings violated the invest- including the Trans-Pacific Partnership (TPP) ment protection agreement signed between and the Trans-Atlantic Trade and Investment Uruguay and Switzerland, where Philip Mor- Partnership (TTIP), currently being negotiated. ris is headquartered. The TPP’s ISDS provisions will enable foreign investors to sue a government in an offshore A former UN official argues that the TPP goes tribunal if they claim that new regulations re- far beyond what is needed to facilitate trade, duce their expected future profits, even when greatly constraining “the policy space needed such regulations are in the public interest.8 for countries to accelerate economic development and to protect the public interest.” He Unlike WTO agreements, under which a gov- concludes that it is “really the thin edge of a ernment can be sued only by another govern- wedge package which will fundamentally un- ment, these trade agreements typically allow dermine the public interest.”10 individual foreign investors to sue a host government through the ISDS system. Moreover, These disputes typically tie up millions of dol- they contain no similar provisions under which lars in taxpayer money, in rich and poor coun- host governments can initiate claims against tries alike. In Europe, for example, a Swedish the foreign investor. Often, the threat of a energy corporation, having successfully sued lawsuit is enough to get the proposed law or the government for 1.4 billion euros to force regulation withdrawn, as contesting it can cost the government to withdraw its regulations millions of dollars. on a proposed coal-fired power plant, is now using ISDS to sue Germany over its decision to Critics of these arrangements cover the spec- phase out nuclear power (see Box 1).11 trum, from governments that wake up to the consequences of what they have signed, to In addition to undermining public interest rule of law experts, to civil society organiza- laws and regulations, foreign investors are tions, including labor organizations. The AFL- increasingly using the investor-state system CIO points out that investors can “use this sys- to challenge court judgments, thereby also tem of ‘corporate courts’ to challenge anything “undermining the principles of legal certainty, from packaging rules for cigarettes to denials state sovereignty, and rule of law more gen- of permits for toxic waste dumps to increases erally.”12 While domestic courts often employ 9 in the minimum wage.” safeguards, such as the principle of judicial review, judicial independence, and transparency In March 2010, tobacco giant Philip Morris in their decision-making, these safeguards are launched a multi-billion dollar lawsuit against notably absent in investor-state arbitrations,

7 Mohamadieh and Uribe, “The Rise of Investor-State Dis- 10 Sundaram, “The Trans-Pacific PartnershipFraud.” pute Settlement in the Extractive Sector.” 11 “ISDS: The devil in the trade deal,” Bilaterals.org, Sep- 8 Jomo Kwame Sundaram, “The Trans-Pacific Partnership tember 14, 2014. Fraud,” IPS, January 26, 2016. 12 “Corporations Now Using Foreign Tribunals to Attack 9 AFL-CIO, “What Is ISDS?” aflcio.org/Issues/Trade/What- Domestic Court Rulings,” Eyes on TRADE, Public Citizen, Is-ISDS. October 16, 2013.

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Box 1: What ISDS Costs14

In Ioannis Kardassopoulos and Ron Fuchs v. The Republic of Georgia, the tribunal ordered the respondent to pay the claimants’ arbitration costs, a total sum of US$7.9 million, which included legal fees, expert fees, administrative fees, and the tribunal’s fees. The respondent state also had to bear its own legal fees (approximately US$4.8 million) and other costs (approximately US$1.5 million).

In Plama Consortium v. Bulgaria, the claimant’s legal costs amounted to US$4.6 million, while the respondent’s legal costs were US$13.2 million. The tribunal ordered the claimant to pay all arbitration costs and half of the respondent’s legal fees.

In Pey Casado v. Chile, the claimant’s legal fees totaled approximately US$11 million while the respondent’s legal fees amounted to US$4.3 million. The respondent was ordered to pay 75 percent of the arbitration costs and US$2 million of the claimant’s legal fees.

In ADC v. Hungary, the tribunal ordered the respondent State, which had been found to have breached its BIT obligations, to pay the full costs of the arbitration totaling US$7.6 million. This included the investor’s legal fees.

In Siag and Vecchi v. Egypt, the tribunal found that the claimants were entitled to receive from Egypt the amount of US$6 million to cover their legal fees, expert costs, and other expenses.

where lawyers who represent the investors Not surprisingly, a number of countries, both take turns as ostensibly “impartial” arbitra- developing and developed, are reviewing tors, interpretations of international law are their approach to these treaties, particular- regularly inconsistent and erroneous, and de- ly in view of the increasing number of inves- cisions often cannot be appealed. tor-state dispute cases. According to UNCTAD, some 40 countries and four regional organiza- In 2012, a tribunal ordered Ecuador’s govern- tions either have recently revised or are cur- ment to interfere in the operations of its inde- rently revising their international investment pendent court system on behalf of Chevron by agreement models, and at least 60 countries suspending enforcement of a $18 billion judg- have developed, or are developing, new mod- ment against the oil corporation for mass con- els.15 tamination of the Amazonian rain forest. Ecua- dor had argued that compliance with an order to suspend enforcement of the ruling would vi- Financing the Three Pillars olate the separation of powers in the country’s constitution, which mandates an independent Another critical area for UN reform concerns judiciary.1314 the issue of financing—always a weak link in enabling the organization to live up to its man- 13 Ibid. dates. While UN Secretariat functions were to 14 “Awards and decisions,” Investment Treaty News, Interna- tional Institute for Sustainable Development, December 15 UNCTAD, “Taking Stock of IIA Reform,” UNCTAD Issues 16, 2010. Note, March 2016.

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be paid for through assessed contributions give up some national policy space in exchange from all member states, these contributions for external resources. have become increasingly inadequate with major contributor imposed caps on assessments While the concept of mutual accountability, yet steadily growing mandates in all areas— advanced more recently through the devel- from peacekeeping to humanitarian assistance opment effectiveness agenda, has recognized to sustainable development—and the accom- the two-way relationship between funder and panying rise in expectations. recipient, it is still finance driven and risks promoting an approach whereby recipient gov- Peacekeeping financing, introduced in 1992, in- ernments are more accountable to external volves a separate procedure from that used to funders than to their citizens and residents. meet expenditures under the regular UN budget, but both assess developed countries at This system, increasingly distorted, is no lon- relatively higher amounts than less developed ger working. Traditional donors promise in- countries. In addition, the five permanent creasingly less official development assistance members of the Security Council, who can (ODA) or emphasize its use to respond to do- dominate peacekeeping decisions and opera- mestic market or security concerns. In fact, in tions, are assessed at higher levels. Today this February 2016, the Organisation for Economic too is inadequate, prompting calls for greater Cooperation and Development (OECD) agreed and more predictable financing.16 to redefine ODA to include support to military and security forces in fragile countries, as long Development resources, by contrast, although as this still “promotes development goals.”18 In originally part of assessed contributions, shift- 2014, an estimated €7.1 billion of European aid ed to a voluntary basis as the number of coun- was spent domestically—on refugee services tries seeking programmatic and development among other things, including hosting over- assistance grew throughout the 1950s.17 The seas students.19 concept of “programme countries” has embedded the north-south divide between pro- Public-Private Partnerships Don’t Work gramme providers and recipients. This divide was further emphasized by combining devel- Today not all developing countries are seek- opment and humanitarian aid in the same ing ODA, which tends to come with a range of voluntary category. This “programme country” donor priorities and conditionalities, ranging approach has reinforced a double standard of from governance to donor country procure- reporting and governance, in which recipients ment obligations. Some prefer the develop- are accountable for national policies and pro- ment contracts offered by emerging econo- grammes and donors are accountable only for mies, on terms that recognize partners as con- voluntary contributions. In this domain, the UN tractual equals and essentially negotiate quid has become a forum where some countries pro quo arrangements. Others actively seek private and corporate sector financing, but of- 16 “Letter dated 29 June 2015 from the Chair of the Secre- ten at the cost of the ability to determine or tary-General’s Advisor Group of Experts on the 2015 Re- promote national development policy. view of the United Nations Peacebuilding Architecture addressed to the Presidents of the Security Council and of the General Assembly.” 18 Rowena Mason, “OECD redefines foreign aid to include 17 Erin R. Graham, “Money, Power, and the United Nations: some military spending,” The Guardian, February 20, Examining the Causes and Consequences of Voluntary 2016. Funding,” paper presented at the International Rela- 19 “Aid in 2016: Call on world leaders to help refugees - tions Faculty Colloquium, Princeton University, March without jeopardising the world’s poorest people,” Euro- 26, 2012. dad, February 8, 2016.

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A report by Public Services International (PSI), them in, making it next to impossible to re- “Why Public-Private Partnerships Don’t Work,” verse them, regardless of outcomes. explores the importance of public investment in controlling national development. Based A further danger is the recent effort by the on 30 years assessment of privatization, the World Bank, the G20, OECD, and others to “fi- report concludes that public-private partner- nancialize” PPPs in order to access the trillions ships (PPPs) are not only an expensive and inef- of dollars held by pension funds, insurance ficient way of financing infrastructure and ser- companies, and other institutional investors.23 vices but also are “fundamentally incompatible with protecting the environment and ensuring The flow of finances has come to exercise un- universal access to quality public services.” 20 due influence not only on development pro- gramming but also on the shape of the UN development system with some mandates fa- vored more than others. PPPs are used to conceal public borrowing, while providing long-term state guarantees For too long the UNDS as a whole has resigned for profits to private companies. Private itself to declining state power in the wake of sector corporations must maximise profits if globalization while continuing to hold states they are to survive.21 accountable for upholding human rights and rule of law standards and meeting their obligations under successive global development The PSI Report also notes that the UN, similarly agreements. Over the last two decades the strapped for resources, has jumped onto the UNDS has fragmented into a myriad of activ- same quick-win solution:21 ities, some managed through UN proxies or partnership arrangements, which are in dan- Local and national governments and the UN are ger of becoming competitors rather than sup- heavily influenced by the powerful lobby of the porters of the United Nations. biggest services and financial corporations, global consulting and law firms, all intent on reaping profits from basic public services such as health, water, As the UN system has become more opportu- energy. It is our job, in alliance with social move- nistic and less articulate in its support of UN ments, to raise the alarm bells, to demand trans- standards, it has lost or alienated many in the parency and accountability of our public officials natural constituency for UN values among and elected politicians and to create mechanisms public advocates and social movements. for systematic participation in decision making.22

The Secretary-General and UN senior staff These privatization policies are also linked to feel the pressure to look for “innovative” ap- the new wave of trade negotiations, such as proaches to development financing in the the TPP, TTIP, and the Trade in Services Agree- face of declining or earmarked donor contri- ment (TISA), which are also conducted in se- butions. Agencies turn increasingly to enti- cret, without public consultation, and heavily ties outside the UN system, such as the UN influenced by business interests. These trade Foundation, the Global Compact, and a pro- deals not only facilitate PPPs but will also lock liferating number of “multi-stakeholder partnerships,” which also come with less member 20 David Hall, “Why Public-Private Partnerships Don’t Work: state scrutiny and possible micro-manage- The many advantages of the public alternative,” Public Services International (PSI), February 2015. ment. A 2014 review by the International Civil 21 Public Services International, 2015. 22 Ibid. 23 Ibid.

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Society Centre (ICSC) found that of 330 part- This is clearly the wrong response. UN agen- nerships in the database of the Commission cies are not leading with human rights and en- on Sustainable Development (CSD) 38 percent vironmental standards and have relinquished “are simply not active or do not have measur- any leadership in macroeconomic policies.25 able output,” while of the 26 percent of part- They typically turn too much to powerful nerships that do show activities these are “not states—and by consequence away from those directly related to their publicly stated goals dependent on or invested in multilateralism and ambitions.” The study pointed out that and global democratic governance. So long as not only do such partnerships have vague and member states remain locked in a belief that diffuse goals but also “lack appropriate mon- progress depends on growth in Gross Domes- itoring and reporting mechanisms,” raising tic Product (GDP) and rich countries not only doubts not only about the ineffectiveness of privilege national security and markets, but such partnerships but also their undermining also define the terms of tax and investment of democratic governance.24 policy, change will remain elusive.

Is the 2030 Agenda a Game Changer?

Despite these failings, the role of the UN as a countries and not only in aggregate or income global governance body is needed more than terms. ever, even as nation states abdicate their responsibilities in the face of globalized financial In addition, the engagement of civil society and corporate power. The negotiations on the bringing both expertise and local experienc- 2030 Agenda for Sustainable Development, es into the drafting and negotiations process the Addis Ababa Action Agenda on Financing was illustrative of how to engage constituen- for Development, and the Paris Agreement cies and communities without undermining on Climate Change have all shown there is a state responsibilities. Is the 2030 Agenda a worldwide constituency for the engagement game changer for UN? Its implementation is of sovereign member states to forge interna- driving the UN system and its member states tional cooperation under the auspices of the to re-examine their mandates, functions, and United Nations. programmes.

The 2030 Agenda represents an important However, it is not sufficient to simply plead for break with past agendas and reflects a politi- stronger role for the UN. Instead, the UN role in cal effort to come to terms with the new eco- global governance must be revitalized so that nomic, political, and planetary realities—at all the new realities are driving its re-positioning levels. It is perhaps the first truly post-colonial and reform. This requires the UN system and agreement in that it is universal, going beyond its member states to recognize a number of notions of development cooperation and re- imperatives, including: quiring all countries to measure and report on progress, not just developing or “programme” 25 See UNICEF, Adjustment with a Human Face, Giovanni 24 International Civil Society Centre, “Multi-stakeholder Andrea Cornia, Richard Jolly, and Frances Stewart, eds., Partnerships: Building Blocks for Success,” 2014. Oxford: Clarendon Press, 1987.

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1. Adopting an overarching values-based Under international law, states are the prima- framework for intergovernmental pro- ry duty bearers for upholding human rights cesses; within their territories and these obligations 2. Integrating the three UN pillars—human include addressing inequalities that inhibit the rights, sustainable development, and enjoyment of human rights. peace and security—into that framework; 3. Implementing a new funding formula; and In today’s globalized world, one country’s 4. Developing a robust accountability culture actions often have significant cross-border to champion the public interest, including impacts, seriously impacting and possibly changing the way progress is conceptual- constraining the ability of other countries to ized and measured. meet their human rights and sustainable development commitments. The duty of states It is important to note that these impera- to respect and support the achievement of tives are for a reform agenda that responds human rights outside their territories is also to the new realities of our global world, not anchored in international law—notably the just another reassembling of the existing in- UN Charter, the Universal Declaration of Hu- stitutions with their governance and funding man Rights, and various other international arrangements. Hence for example, they make human rights treaties, including the Interna- clear that respecting and promoting human tional Covenant on Economic, Social, and Cul- rights must include extraterritorial responsi- tural rights. bilities; UN pillars must be not only integrated but rebalanced; and financing must address In addition, the Declaration of the Right to De- the constraints on all countries, particularly velopment addresses international systemic developing countries to mobilizing national issues and the creation of an international resources to fulfill the 2030 Agenda and the enabling environment which includes trade, Paris Agreement through such things as trade debt, technology, and the reform of the finan- and investment treaties, tax policy rules, illicit cial architecture and global economic gover- financial flows, and other drains on the public nance. purse. The extraterritorial human rights obligations embraced in these documents are definitively A Universal Normative Framework articulated in the Maastricht Principles on Ex- traterritorial Obligations of States in the area The first imperative is to adopt a universal of Economic, Social, and Cultural Rights, which normative framework that lays out the duties recognize the obligation of states to respect, that states have to cooperate and coordinate protect, and fulfill economic, social, and cul- with each other in advancing more equitable, tural rights not only internally but also exter- peaceful, and sustainable societies. The UN nally. Issued in September 2011 by 40 interna- Charter and the human rights treaties and in- tional law experts, these principles constitute struments provide the starting point, as do a an international expert opinion, clarifying the full range of environmental treaties and instru- extraterritorial obligations of states on the ba- ments. These lay out a value-based framework sis of existing human rights law. They include that distinguishes the UN as an accountability responsibility for the conduct of non-state ac- mechanism from other global or multilateral tors, such as corporations and other business entities and processes. enterprises,26where they are empowered by

26 CESR and TWN, “Universal Rights, Differentiated Re-

12 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

the state to exercise elements of governmental Among the alternatives proposed in the de authority.27 Zayas report is the creation of an international investment court which would give priori- The Maastricht Principles apply directly, for ty to the UN Charter and the core UN human example, to the resolution of investor-state rights treaties, replacing the existing ad hoc investment disputes. The UN Independent tribunals and giving the proposed investment Expert on the promotion of a democratic and court some institutional relationship with the equitable international order, Alfred de Zayas, UN. has called for the abolishment of the investor-state dispute settlement system, stating in Another alternative the report puts forward is his report to the Human Rights Council, “Over that trade and investment contracts be obliged the past 25 years bilateral international trea- to rely exclusively on domestic dispute resolu- ties and free trade agreements with inves- tion, “abolishing the right of investors to bring tor-state dispute settlement have adversely claims against States in international tribunals impacted the international order and under- and directing them to the jurisdiction of the mined fundamental principles of the UN, State States where they are operating and making a sovereignty, democracy and the rule of law.” profit.”

In an interconnected and interdependent world with vast disparities in power, capacity and means, states exert significant influence on sustainable development beyond their borders in a plethora of ways—be they through the cross-border spillover effects of national policy decisions, via their bilateral and multilateral policies on tax, trade, investment and finance, through their capacity to regulate multinational corporations over whom they have jurisdiction, or as voting Member States in international financial institutions. The experience of the last fifteen years has shown how profound- ly these factors limit the capacity of other national governments to realize their human rights and development commitments.25

His report concludes that maintaining inves- In addition to addressing the incompatibility of tor-state dispute settlement is not an option many bilateral, regional, and global agreements and that it should be abolished as a fundamen- with international human rights standards, tally flawed system having adverse human member states must also come to grips with the rights impacts and […] has upset the interna- reality of the permanent loss of natural resourc- tional order by debilitating States, encroaching es, atmosphere, and biodiversity and the con- on their regulatory space and aggravating in- sequences for realizing human rights, including equality and inequity in the world.”28 to food, water, and livelihoods, particularly for future generations. Thus in operationalizing the sponsibilities: Safeguarding human rights beyond bor- Maastricht principles, states must deepen their ders to achieve the Sustainable Development Goals,” obligations to ensure intergenerational rights. Human Rights Policy Briefing, April 2015. 27 ETO Consortium, “Maastricht Principles on Extraterrito- rial Obligations of States in the Area of Economic, Social In the words of the 2030 Agenda, in an era of and Cultural Rights,” Heidelberg: FIAN International, Jan- economic, social, and environmental intercon- uary 2013. 28 Alfred-Maurice de Zayas, “Statement by Alfred-Maurice de Zayas, Independent Expert on the promotion of a 70th session of the General Assembly,” New York, Octo- democratic and equitable international order at the ber 26, 2015.

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nectedness, universally agreed principles are nizes the particular responsibilities developed “the precondition for living together in justice countries bear in view of their disproportion- and peace and in harmony with nature.” ate impact on the global environment and the superior technological and financial resources Principles Guide the Way Forward they command. Reiterated in the 2012 Rio + 20 outcome document (The Future We Want), the A basic non-negotiable principle of inter-state concept, while highly contested, has been in- relations is that of “do no harm.” This princi- cluded in the 2030 Agenda for Sustainable De- ple, derived from medical ethics, is applicable velopment. It underlines both the universality in any situation and is increasingly relevant of the 2030 Agenda as well as the differentia- to humanitarian and sustainable develop- tion of responsibilities and capacities for its re- ment as well as peace and security. It has alization. This principle needs to be developed been included in the humanitarian principles to address the responsibilities of countries of UNICEF since 2003 and has been adopted across the different stages of development— in a code of conduct by major humanitarian from least developed countries (LDCs) to mid- organizations. In essence, the commitment to dle income countries (MICs) to emerging econ- implement policies in a way that they do no omies Brazil, Russia, India, China, and South harm to people or nature should be regarded Africa (BRICS) to high-income countries—ac- as a guiding principle in all policy areas and at cording to their capacity to respond, based all levels. on varying and diverse degrees of resources, levels of development, and effective influence. In today’s interconnected world two principles, both adopted in the Rio Declaration, are The principle of CBDR requires the UN to cham- essential. One is the “polluter pays principle,” pion universality and a unified framework with which holds that the costs of pollution must the necessary differentiation of capacities and be borne by those who cause it. A second is responsibilities, reflecting power asymme- the “precautionary principle,” which states tries. The 2030 Agenda states, “All of us will that in the absence of consensus, if an action work to implement the Agenda within our own or policy has a suspected risk of causing harm countries and at the regional and global levels, to people or nature, the burden of proof that taking into account different national realities, it is not harmful falls on the initiators of this capacities and levels of development and re- action or policy. Both principles should be specting national policies and priorities.” extended beyond international environmental law to such areas as global economic and However, the principle of CBDR goes further. financial crises. The precautionary principle It implies that rich countries have special re- could oblige states to take regulatory or pro- sponsibilities, going beyond an international tective measures to shield all states from such enabling environment. A 2014 paper by the Civ- crises, while the principle of polluter pays il Society Reflection Group on Global Develop- could be shaped, for example, to hold the ment Perspectives identified three broad types banks and the financial industry to bear the of goals and targets: those that are of particular costs of a crisis they provoked. relevance to the internal affairs of all countries, including rich countries, requiring changes in A vital principle laid out in the Rio Declaration their domestic policies (domestic sustainability and adopted in climate change and biodiversi- targets); those that address the need to change ty regimes, is the principle of “common but dif- domestic policies in order to reduce negative ferentiated responsibilities” (CBDR). It recog- external effects beyond a country’s borders

14 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

(do-no-harm targets); and those that zero in on ⇒⇒ Adopt as an organizing principle the their international duties and responsibilities reduction of inequalities, income and (international responsibility targets).29 non-income, and include it as part of the UN mission—alongside poverty eradica- In the implementation of the 17 Sustainable tion. Development Goals, the 2030 Agenda empha- ⇒⇒ Expand the normative framework to in- sizes their universality, interlinkages, and com- clude extra-territorial obligations and plementarity. And Sustainable Development inter-generational rights and affirm that Goal 10 includes not only the promotion of the state responsibilities as duty bearers are social, economic, and political inclusion, but domestic and external and collective. also the adoption of fiscal and social policies ⇒⇒ Develop a universal review mechanism of to progressively achieve greater equality and state obligations, addressing their domes- better regulation of global financial markets tic, international, and do-no-harm respon- and institutions. sibilities.31 In the assessment and measurement of progress towards the SDGs, Yet, in his most recent report, the UN Indepen- require explicit reporting on obstacles to dent Expert on the effects of foreign debt and progress as well as implementation steps other related international financial obliga- and support this with a new approach to tions of states on human rights, Juan Pablo Bo- measurement and indicators. hoslavsky, points out that the linkages among economic inequality, financial crises and hu- ⇒⇒ Explore ways to review and recall trade man rights have been inadequately explored: and investment agreements that counter the obligations of states on human rights there are strong indications that inequality may and that undermine the ability of states substantially contribute to and exacerbate the to achieve their commitments under the emergence and the course of financial crises, even 2030 Agenda and meet the SDGs. if other factors, in particular financial deregula- ⇒ th tion, obviously also play a crucial role. Inequality ⇒ Task the 6 committee of the General As- erodes States’ tax base, thereby impacting sover- sembly with developing criteria for dispute eign revenues. Inequality also appears to prompt settlement consistent with the obligation increased levels of private credit, which in turn of states to fulfill their obligations for the may adversely affect sovereign debt and stability protection of human rights and sustain- of the financial markets.30 able development, including the right to a livable planet.

Beyond Tinkering to Transformation: Action Steps Integrate and Rebalance the Three To operationalize a universal normative frame- Pillars work based on human rights, the UN system should: The second imperative is to integrate and re- 29 Civil Society Reflection Group on Global Development balance the three UN pillars. Integrating the Perspectives, “Goals for the Rich: Indispensable for a pillars of human rights, sustainable develop- Universal Post-2015 Agenda,” discussion paper, Fried- rich Ebert Stiftung, March 2015. ment, and peace and security is essential in 30 Juan Pablo Bohoslavsky, “Report of the Independent order to counter the tendency of UN institu- Expert on the effects of foreign debt and other related tions and their governance processes to con- international financial obligations of States on the full enjoyment of all human rights, particularly economic, tinue to operate in silos. social and cultural rights on his mission to Greece,” Hu- man Rights Council, February 29, 2016. 31 Civil Society Reflection Group, “Goals for the Rich.”

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Both the 2030 Agenda on Sustainable Devel- porteurs, special representatives, or indepen- opment and the Paris Agreement on Climate dent experts, they are mandated to respond Change require progress on integrating the to requests, from either heads of government three pillars in order to enable the UN and or members of parliament, and to carry out member states to address such challenges country visits, meeting with national and local as structural inequalities and power asym- authorities, including members of parliament metries. Together the agreements provide and of the judiciary, human rights organiza- a “framework on sustainable development” tions, civil society organizations, and victims that pulls together what a 2008 study of suc- of human rights violations, as well as UN and cessive UN reform efforts called “the various other inter-governmental agencies. interpretations and applications of sustainable development, and that adds coherence to in- The Special Rapporteur on the Right to Food, ternational environmental and development Olivier de Schutter, for example, who served law and policy.”32 from 2008, at the outset of the world food crisis, to 2014, prepared reports covering food price At the same time it is necessary to rebalance volatility, trade and investment in agriculture, the three pillars, currently dominated by short regulating agribusiness, agrofuels, food aid term conflict, disaster and crisis interventions, and development cooperation, nutrition, so- and quick-win approaches to sustainable de- cial protection, women’s rights, human rights velopment. To implement the 2030 Agenda impact assessments, national strategies, agri- in particular requires both a strategy of re- cultural workers, contract farming, small-hold- sistance to quick-win approaches and “short- er farmers, agroecology, and reinvestment in term-ism.” This would represent a dramatic agriculture. In so doing he examined the con- change of direction for the global body. straints to realizing the right to food embod- ied in proliferating bilateral and regional trade Norms and Standards agreements. In his final report on the right to food he criticized the WTO’s inability to finalize Human rights obligations must be taken up the Doha Round on Agriculture, for example, more broadly by the entire UN system, linking saying that no area, not even trade, should be the three pillars of human rights, peace and se- left aside from discussions concerning this par- curity, and development and engaging a range amount objective.33 of different actors at global and national levels. In a briefing note following a visit to the WTO The work of independent UN human rights in 2011, he acknowledged that the mixed re- experts, or groups of such experts, provides cord of the WTO in securing the right to food analyses and recommendations that should “reflects the dominance of net food exporters be used system-wide. Covering as they do the in the negotiations for whom food security is entire range of rights, both civil and political, as a low priority compared to opening markets well as economic, social, and cultural, these ex- for their exports.” He added that the structure perts are the key to integration across the UN of WTO negotiations themselves, which in- system, from peace and security to sustain- volve tradeoffs between agriculture and other able development. Variously called special rap- goods, prevents food security from being ad-

32 Hugh Wilkins, The Integration of the Pillars of Sustain- 33 Olivier De Schutter, “Final Report: The transformative able Development: A Work in Progress,” McGill Interna- potential of the right to food,” Report of the Special Rap- tional Journal of Sustainable Development Law & Policy, porteur on the right to food, United Nations General As- Vol. 4, No. 2, 2008. sembly, January 24, 2014.

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dressed on its own merits instead of as a “bar- cies and programmes.35 And the restructured gaining chip.” CFS provides valuable lessons on engaging stakeholders together with governments in Among his report’s recommendations is that governance processes.36 WTO members should “Take steps to limit countries’ excessive reliance on internation- The International Labour Organization (ILO) is al trade in the pursuit of food security” and unique as a UN entity with a tripartite gover- in building their capacity to produce needed nance structure (governments, employers, and food, prioritize poor small-scale farmers and workers) that aims to promote rights at work, the production of staple foods. And “in the encourage decent employment opportunities, case of a failed Doha Round,” they should pro- enhance social protection, and strengthen di- pose medium and long-term changes to the alogue on work-related issues. Standing apart WTO framework to ensure pro-food security as well as under-used by the system, not only programmes are not categorized as “trade-dis- for leadership on full employment and decent torting support.”34 work, but also for shaping the rules for the system’s engagement with the business sector. In order to increase compatibility between Such partnerships are increasingly explored by the global trade regime and international ef- the UN system, yet leadership roles have been forts to secure global food security, the report left to non-UN initiatives more committed to pointed to the need to establish a protocol to promoting partnerships with the business sec- evaluate and monitor the impact of trade liber- tor than to monitoring them. alization on world food prices, adding that “this should also include exploring potential ways to However, a target of full and productive and sequence the implementation of future trade decent work—included as an afterthought five commitments in order to minimize negative years into the MDGs—is now included as cen- consequences on the food security of the most tral goal of Agenda 2030. vulnerable populations.” The 2030 Agenda also reiterates the need to The Committee on World Food Security (CFS) implement a global social protection floor was set up in 1974 as an intergovernmental (SPF), a basic set of social rights, services, and body to coordinate review and follow up of facilities that every person should enjoy, in- food security policies across the UN system. cluding geographical and financial access to Headquartered in the Food and Agricultural essential services such as water and sanita- Organization (FAO), it was revitalized in 2009 tion, health, and education. The concept was following the world food crisis to incorporate adopted by the UN Chief Executives Board for a wider range of stakeholders, including civil Coordination (CEB) in April 2009 in response society and the private sector, to among other to the global economic crisis and was en- things, establish such a protocol. dorsed by the G20 later that year and by the UN MDG Summit in 2010. It identifies the so- The FAO has taken the first step in this regard, cial transfers, in cash or in kind, required to integrating the right to food into all FAO poli- 35 Food and Agriculture Organization of the United Na- tions, “Formulation and Implementation of Policies and Prorammes,” The Right to Food, www.fao.org/rightto- 34 Olivier De Schutter, “The World Trade Organization and food/our-work/policies-and-programmes/en. the Post-Global Food Crisis Agenda: Putting Food Securi- 36 Nora McKeon, “Global food governance in an era of ty First in the International Trade System,” Briefing Note crisis: Lessons from the United Nations Committee on 04, United Nations Special Rapporteur on the right to World Food Security,” Canadian Food Studies, Vol. 2, No. food, November 2011. 2, September 2015.

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provide minimum income security and access was an effort to fill a “gaping hole” in the UN’s to these essential services. All these aspects institutional and structural capacity to support are measurable, but they require each society countries in transition from violent conflict to define its standards of what is “essential.” to sustainable peace. However, in 2010 a first Through its Social Protection Initiative the ILO five-year review emphasized that “the hopes has conducted a number of studies on the af- that accompanied the founding resolutions fordability of social protection in developing have yet to be realized,” intending to serve “as countries.37 a wake-up call, helping to strengthen the collective resolve to deal with peacebuilding in a The universal social protection floor is an im- more comprehensive and determined way.” portant part of the implementation of the human rights obligations of governments to their The most recent review, in 2015, entitled “The people and of the international community to Challenge of Sustaining Peace” again conclud- support them. The obligations of states in en- ed that to date these hopes have largely not suring the enjoyment of economic, social, and been realized. Rather, it stated: “it is an overar- cultural rights go beyond providing just a bare ching finding of this report that the key Char- minimum of resources to ensure survival and ter task of sustaining peace remains critically require them to utilize “the maximum of their under-recognized, under-prioritized and un- available resources to achieve progressively der-resourced globally and within the United the full realization of economic, social and cul- Nations system.” 38 tural rights.” This recognizes that the realization of these rights can be hampered by a lack What is lacking in efforts to build sustainable of resources and can be achieved only over a peace is that they have been limited to disaster period of time. and conflict crises. Peace is more than just the absence of conflict, as the report essentially Job creation and decent work are central ob- recognizes. It is also the absence of economic jectives for an integrated approach. They are violence and destruction of livelihoods due to rooted in human rights and in economic jus- climate change and economic and financial pol- tice and represent the number one strategy for icies and processes that pit countries against eradicating poverty and reducing inequality. each other in tax competition and undermine They should be a top priority for the UN sys- decent work. tem as a whole. Recognizing that member states contribute Build Sustainable Peace most resources to the UN Development Sys- tem, it is particularly important to close the Integrating the three pillars is also showing up gap between the human rights framework, at the top of the peace and security agenda, the peace and security agenda, and the UN prompted by the recognition in the 2030 Agen- Development system. Indeed, the 2030 Agen- da that “there can be no sustainable devel- da states clearly that the General Assembly opment without peace and no peace without should use the UN policy coordination mech- sustainable development.” The current peace anism, the Quadrennial Comprehensive Policy and security architecture, created by the Secu- Reviews (QCPR), to include a “specific focus on rity Council and the General Assembly in 2005, sustaining peace, examining the UN system’s

37 International Labour Organization, “ILO-UN Social Pro- 38 The Challenge of Sustaining Peace, Report of the Advisory tection Floor Initiative: The role of social security in crisis Group of Experts for the 2015 Review of the United Na- response and recovery, and beyond,” June 16, 2010. tions Peacebuilding Architecture, June 29, 2015.

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success in bringing together development, hu- velopment has been repeatedly emphasized. manitarian and peace and security actions.” The problem was highlighted a decade ago: “sustainable development continues to be However, it is important that the financing of viewed as a niche area of development” syn- sustainable development is not narrowed or onymous with environmentalism, rather than redefined to conflict and crisis management. overarching: “although environment and de- Although the report recommends that in its velopment issues have been mainstreamed next (2016) and subsequent UN QCPRs, the into global policy debates, they have not yet General Assembly should include a specific been integrated with one another. Indeed, they focus on sustaining peace, there is a need to continue to be addressed on virtually separate overcome the implicit competition between tracks.”39 the financing of humanitarian and emergency programmes and development financing, the It continues: “Sustainable development re- latter with a long-term focus frequently losing mains a separate development objective out to perceived immediate needs as long as rather than an element of the overarching de- all contributions are “voluntary.” An integrated velopment framework in many key UN devel- approach respecting sustainable development opment-related initiatives, such as the 2005 may need a firewall between humanitarian World Summit and the 2006 High Level Panel and development financing. on System Wide Coherence. The 2005 World Summit […] could have allowed leaders to rec- Also with many sustainable development ognize the full value of ecosystem services in needs arising from pressures and actions ex- development planning, provided a forum to re- ternal to domestic governance and policies, affirm environment-related concepts such as the responsibility to meet and finance these the polluter pays principle and precautionary needs can benefit from the concept of “no- principle, and facilitated the identification of fault” liability and cannot be dependent on their links to human well-being.” external (pro-cyclical) voluntary contributions. The UN report for the 2016 World Humanitar- In this regard the concept of loss and damage ian Summit, “One Humanity: Shared Respon- is useful to build upon. This concept has been sibility” highlights similar concerns, urging hu- applied to biodiversity and climate change to manitarian, development, peace and security address the impacts of climate-related events and other institutions to “transcend humani- that occur despite efforts to reduce green- tarian-development divides” and move from house gas emissions. However, loss and dam- individual short term projects to collective long age can occur in human systems, affecting sus- term outcomes. The latter is particularly rele- tainable livelihoods, as well as in natural sys- vant with regard to assisting refugee and dis- tems and raises important and difficult issues placed persons. UNWRA estimates that there regarding liability and compensation. It is also are 20 million refugees and 40 million interconnected to cross border issues and raises nally displaced persons (IDPs) globally. One in similar issues about responsibility. every 122 people is now either a refugee, internally displaced, or seeking asylum.40 Build Sustainable and Peaceful Societies 39 Hugh Wilkins, The Integration of the Pillars of Sustain- able Development: A Work in Progress,” McGill Interna- The importance of linking the economic, tional Journal of Sustainable Development Law & Policy, vol. 4, no. 2, 2008. health, and social impacts of environmental 40 Jonathan Clayton, ed., “Worldwide displacement hits degradation to the concept of sustainable de- all-time high as war and persecution increase,” UNHCR,

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Above all the Secretary-General’s report calls ⇒⇒ Developing public information disclosure for increased investment in preventing human and conflict of interest standards to iden- suffering: “Supporting local and national ac- tify special interests and recognize that not tors to respond better themselves during cri- all non-profit groups are “public interest.”42 ses must be a core activity and outcome of humanitarian and development effort. Without strengthened local capacity, any investment Financing into response will remain without return.”41 The third imperative concerns financing. The For many, sustainable development is another 2030 Agenda for Sustainable Development, Fi- name for prevention as well as building sus- nancing for Development, and the Paris Agree- tainable and peaceful societies. ment on Climate Change are currently at the core of the UN reform agenda. Implementing Beyond Tinkering to Transformation: Action Steps them will require an enormous mobilization of resources, at both national and global levels. Realizing the potential of the 2030 Agenda re- Official estimates include: quires a joint UN report on its system-wide implementation. ⇒⇒ Peacebuilding estimates: US$100 million (1% of the total UN budget).43 Operationalizing unity across the three UN ⇒⇒ 2030 Development agenda: estimates from pillars requires the UN become an integrated US$3.5 to US$5 trillion per year.44 system. This means: ⇒⇒ Social safety net to eradicate extreme poverty alone: US$66 billion per year.45 ⇒⇒ All UN reporting be done against the base ⇒⇒ Climate change financing needs: US$100 bil- line of a unified normative framework and lion per year. Climate change flows reached standards. an estimated US$60+ billion by 2014. Most ⇒⇒ System-wide commitment and action to im- countries include export credits designed plement a universal social protection floor. to help local industries, along with ODA ⇒⇒ Reforming the Chief Executives Board (CEB) contributions labeled “climate friendly.”46 to accept responsibility for the UN system ⇒⇒ Humanitarian aid budget: US$40 billion as a whole, with collective accountability re- per year.47 The humanitarian aid budget for quirements including developing, present- 2014 was the largest on record but it cov- ing, and reporting on a system-wide UN ered only 62 percent of what was required budget to member states. to care for victims of natural disasters and ⇒⇒ Abolishing the individual executive boards and realizing ECOSOC’s charter responsi- 42 For details see Barbara Adams and Jens Martens, Fit for bilities for coordination of the UN Develop- Whose Purpose? Global Policy Forum, 2015. ment System. 43 AGE Peacebuilding Architecture report, section 108, p.43. ⇒⇒ Adopting new rules and tools for engaging 44 UNCTAD, “Investing in SDGs,” World Investment Report, with non-state actors, including how to dif- Geneva, 2014. 45 “Report on the Intergovernmental Committee of Experts ferentiate for-profit and non-profit commu- on Sustainable Development Financing,” United Nations nities. General Assembly, August 15, 2014. 46 Ed King, “OECD estimates climate finance flows at $60 June 18, 2015, unhcr.org/558193896.html. billion,” Climate Home, July 10, 2015. 41 Ban Ki-moon, “One Humanity: Shared Responsibility,” 47 “Too Important to Fail—Addressing the humanitarian fi- report of the Secretary-General for the World Human- nancing gap,” High-Level Panel on Humanitarian Financ- itarian Summit, UN General Assembly, February 2, 2016. ing Report to the Secretary-General, December 2015.

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conflicts such as the civil war in Syria. Two and governance standards.” More problemat- thirds of the funding came from the five ic is their preference for such financial instru- largest donors. ments as global loans to financial intermediar- ies like private banks that have few contractual Data from Credit Suisse shows that in 2014, obligations where they spend their money and the richest one percent of people in the world the proposed use of ODA to subsidize or sup- owned 48 percent of global wealth, with the report public or private sector projects. These maining 52 percent shared (unequally) among approaches risk aggravating inequalities and the other 99 percent of adults on the planet. poverty and tend to bypass effective govern- Almost all of that 52 percent is owned by those ment oversight or accountability. in the richest 20 percent, leaving a mere 5.5 percent for the remaining 80 percent of the Climate financing is one of the most pressing world’s population. If this trend continues, the issues in both the 2030 Agenda and the Paris top one percent will have more wealth than the Agreement. A report by the UN Environmen- remaining 99 percent in just two years, with tal Programme (UNEP), The Financial System the wealth owned by the top one percent more We Need, examines how to reshape and “align than 50 percent by 2016.48 crisis-prone global financial markets with the new SDGs.”50 Pointing out that the financial In April 2015, during the run-up to the Addis system underpins growth and development, Ababa Financing for Development Conference, it argues that achieving sustainable develop- the multilateral development banks and the ment will require a realignment of the financial IMF issued a joint report: “From Billions to Tril- system with the needs of real world econo- lions—Transforming Development Finance” mies. It asserts that “a transformation in pub- The report affirmed that international financial lic and policy awareness of sustainable devel- institutions (IFIs) “are well-positioned to assist opment has placed environmental and social member countries in creating the needed en- issues increasingly at the heart of economic abling environment to ‘attract more private policymaking.” This means, for example, that investment and financing’”. It also declared a capital flows must be redirected toward criti- commitment to help raise an important part cal priorities and away from polluting and un- of the needed funding, “either through direct sustainable natural resource and extraction financing, leveraging our capital or catalyzing activities. other resources.”49 The UNEP report also recognizes that upgrad- Among the report’s most welcome commit- ing the global financial architecture to enable ments are those to “building a global safety sustainable development is critical—a fact net by providing counter-cyclical support to urged in vain by the UN Stiglitz Commission in economies affected by adverse shocks,” and 2009 at the UN high-level conference on the “promoting the highest social, environmental impact of financial crisis. The report states at the outset that developing a sustainable finan- 48 Deborah Hardoon, “Wealth: Having it all and wanting cial system “will only be achieved by going be- more,” Oxfam Issue Briefing, January 2015. yond both business as usual approaches to fi- 49 African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and De- nancial market development and the adoption velopment, the European Investment Bank, the In- of ad hoc innovations.” Such work has already ter-American Development Bank, the International begun, the UNEP notes, “led by those govern- Monetary Fund, and the World Bank Group, “From Bil- lions to Trillions: Transforming Development Financing,” World Bank and International Monetary Fund Develop- 50 UNEP, The Financial System We Need: Aligning the financial ment Committee, April 2, 2015. system with sustainable development, October 2015.

21 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

ing the financial system, often in collaboration initiative is that of Tax Inspectors Without Bor- with market actors.” ders. Launched jointly with UNDP in July 2015, it will facilitate targeted tax audit assistance in The main argument for the turn to market ac- developing countries to address the problem tors, particularly with regard to climate financ- by which double taxation treaties turned into ing, has been that while public money is more double no-taxation treaties for corporations. 54 long term and accountable, it is severely limited, particularly in developing countries. Of course, These rich-country led initiatives in essence resource allocation is ultimately determined by compete with the more inclusive work of the national political priorities, which are subject UN Committee of Experts on International Co- to a variety of different interests. However, a operation in Tax Matters (UNTC), which regu- major source of limited resources, in rich and larly reviews and updates the UN Model Dou- poor countries, has to do with the diversion ble Taxation Convention between Developed of resources from the public purse through and Developing countries and the Manual for practices such as tax avoidance and evasion. In the Negotiation of Bilateral Tax Treaties be- 2008 Christian Aid estimated an annual loss to tween Developed and Developing Countries. developing countries to tax evasion from multi- nationals and corporations engaged in interna- Thus while private money will play a role, it tional trade operations of US$160 billion.51 must be in the context of a new globally agreed financial architecture that “does no harm” and More recently, a 2013 report from Global Fi- respects—and hopefully promotes—human nancial Integrity, Illicit Financial Flows from De- rights and sustainable development. veloping Countries: 2002-2011, found that the developing world lost US$5.9 trillion in illicit Another source of drain on the public purse financial flows from 2002-2011, with illicit out- is the issue of sovereign debt, long on the UN flows alarmingly increasing at an average rate agenda, and of particular concern now, as fall- of more than ten percent per year.52 ing commodity prices have the potential to drive many developing countries back to bank- The enormity of the problem has been con- ruptcy, especially when interest rates begin to firmed by the OECD. It estimates revenue rise. SDG target 17.4 states clearly the com- losses of US$120-140 billion each year and is mitment to “Assist developing countries in at- pursuing initiatives to address these problems. taining long-term debt sustainability through One, the Automatic Exchange of Financial Ac- coordinated policies aimed at fostering debt fi- count Information in Tax Matters, “provides for nancing, debt relief and debt restructuring, as annual automatic exchange between govern- appropriate, and address the external debt of ments of financial account information, includ- highly indebted poor countries to reduce debt ing balances, interest, dividends, and sales distress.”55 proceeds from financial assets, reported to governments by financial institutions and cov- Debt restructuring has been addressed regu- ering accounts held by individuals and entities, larly on the UN agenda for over a decade, fol- including trusts and foundations.”53 Another dard for automatic exchange of information,” my-horizons.com/oecd-releases-full-version-of-global-stan- 51 Christian Aid, “US$160bn—the price of tax dodging in dard-for-automatic-exchange-of-information. developing world,” press release, August 2014. 54 OECD, “Tax Inspectors Without Borders,” oecd.org/tax/ 52 Dev Kar and Brian LeBlanc, Illicit Financial Flows from De- taxinspectors.htm. veloping Countries: 2002-2011, Global Financial Integrity, 55 “Report of the Inter-Agency and Expert Group on Sus- December 11, 2013. tainable Development Goal Indicators,” UNESCO, Febru- 53 Horizons, “OECD releases full version of global stan- ary 19, 2016.

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lowing the agreement by the Monterrey Con- is the most important, the most reliable and sensus on Financing for Development to create the most sustainable instrument to resource an “international debt workout mechanism […] human rights in sufficient, equitable and - ac to restructure unsustainable debts.” countable ways,” the Lima Declaration on Tax Justice and Human Rights points out that a just On the initiative of developing countries, the system of taxation can enhance accountability UN General Assembly has set up a Commit- between the state and its people, encourag- tee for the creation of a new sovereign debt ing governments to be more responsive to the restructuring framework. This builds on the rights and claims of their citizens. “Tax policies mandate provided by Resolution 68/304 in can likewise counteract glaring market failures 2014, which recognized “the sovereign right and protect global common goods—not least a of any State to restructure its sovereign debt, healthy environment within planetary bound- which should not be frustrated or impeded by aries.” The statement concludes that “tax any measure emanating from another State,” laws, policies and practices must work to end and noted “with concern that the international structural discrimination rather than entrench financial system does not have a sound legal growing inequalities, including gender, ethnic framework for the orderly and predictable re- and economic disparities.”57 structuring of sovereign debt.” Tax reform must also address the imbalance in The committee’s work is intended to fill the revenue lost through global tax policies, which gap in the international financial architecture according to a senior adviser on finance and while at the same time embedding public debt development at the South Centre are three management in the UN development and hu- times more expensive for non-OECD coun- man rights agendas. In the current “non-sys- tries. Further, developing countries face huge tem,” the process can take more than ten years revenue losses as they are forced to provide of negotiations, and still it is not certain that tax breaks and incentives in order to attract there will be no holdouts. 56 Among the pro- investments from multinational corporations, posals under consideration is that future debt many of which are based in the OECD coun- restructuring processes be managed by an tries. The scale of loss is enormous, with an- “oversight committee” consisting of represen- nual global estimates ranging from US$100 bil- tatives of the debtor state and two other states lion to US$1 trillion. and should come with a clear deadline. Implementing more equitable and efficient tax A fair debt workout mechanism is essential to policies requires states to play a stronger role redirect public resources from debt servicing in monitoring and taxing foreign investment. to meeting domestic public needs and protecting human rights and environmental sustain- UNCTAD’s Offshore Investment Matrix shows ability. States can also do much to improve the how much investment comes from, goes to, and mobilization of domestic resources with tax is routed through tax havens and so-called Spe- reform. This was most recently articulated by cial Purpose Entities (SPEs) in other countries. a broad network of women’s rights advocates, Together, these can be considered “offshore in- labor rights organizations, legal scholars, and vestment hubs” in a hub-and-spoke system of others in June 2015. Stating that “tax revenue international investment. Some 30 percent of

56 Bodo Ellmers, “UN Debt Restructuring Framework Takes 57 “The Lima Declaration on Tax Justice and Human Rights,” Off in New York,” Debt and Development Coalition Ire- June 2015, cesr.org/downloads/Lima_Declaration_Tax_ land, March 5, 2015. Justice_Human_Rights.pdf.

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cross-border corporate investment stocks have These figures result from both legal and ille- been routed through offshore hubs before gal practices, “sometimes employing the same reaching their destination as productive assets, commercial mechanism used to evade taxes largely due to tax planning, although other fac- and customs duties.”61 Such practices include tors can play a supporting role. undocumented commercial transactions, criminal activities such as overpricing, transfer UNCTAD estimates that such practices are re- pricing, tax evasion, money laundering, arms sponsible for US$100 billion of annual tax rev- trafficking, and the shifting of profits by multi- enue losses for developing countries related to national corporations to subsidiaries in low tax inward investment stocks. Developing countries jurisdictions. with limited tax collection capabilities, greater reliance on tax revenues from corporate inves- The report also acknowledges the problems of tors, and growing exposure to offshore invest- corruption, largely stemming from non-trans- ments are particularly vulnerable.58 parent procurement and supply chains which serve to siphon off considerable wealth to When added to costs and claims through inves- domestic political and economic elites. How- tor-state disputes from bilateral and regional ever, civil society organizations (CSOs) point trade agreements, as noted above, the amount out that focusing on criminal and corrupt of monies flowing from poor countries to rich practices must not divert attention from the ones is considerable. need to focus on the structural and systemic dimensions of illicit financial flows that make Illicit Financial Flows it too easy for resources to be drained from the continent.62 Added to this are the burdens of illicit financial flows, most of which are trade-based. Although The Mbeki Report urges that regional inte- estimates vary, developing countries are re- gration arrangements be used to introduce portedly losing upwards of $1 trillion a year in accepted standards for tax incentives to pre- illicit financial flows. 59 The 2015 Report of the vent harmful competition in efforts to attract High Level Panel on Illicit Financial Flows from foreign direct investment. Without such stan- Africa (Mbeki report) estimates that illicit finan- dards, countries will continue to give gener- cial outflows from Africa could be as much as ous concessions to foreign companies on the US$50 billion a year (probably more since data assumption that foreign direct investment will is lacking for many countries and transactions), help create wealth and lift people out of pov- approximately double the official development erty. Instead these rules provide an avenue for assistance (ODA) that Africa receives. accumulation and repatriation of profits. “The fact that almost no country has ever developed The last decade has witnessed an exponential ac- celeration of illicit financial outflows from Africa. through FDI alone seems to be lost on most Af- 63 From a relatively modest figure of about 12.5 bil- rican countries.” lion US dollars in 2002, illicit outflows rose to 68.1 billion US dollars in 2009 and have averaged over Illicit Financial Flows from Africa, AU/ECA Conference of 50 billion US dollars over the period.60 Ministers of Finance, Planning and Economic Develop- ment, 2015. 58 JeffreyOwens, “Tax and Investment: UNCTAD’s contribu- 61 Ibid. tion to the ongoing BEPS debate,” Investment Policy Hub, 62 Cornelius Adedze, “Africa Is Not Doing Enough to Stem Il- UNCTAD, October 6, 2015. licit Financial Flows,” Third World Resurgence, no. 281/22, 59 See Dev Kar and Joseph Spanjers, “Illicit Financial Flows January/February 2014, pp. 14-15. from Developing Countries: 2004-2013,” Global Finan- 63 Sylvester Bagooro “African CSOs Call for Broadening of cial Integrity, December 2015. Concept of Illicit Financial Flows,” African Agenda, vol. 60 Illicit Financial Flows, Report of the High Level Panel on 18.1, May 2015.

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In addition, the report notes that while the The growing acceptance of the need for non- sources of illicit financial flows are within - Af OECD countries to have access to OECD de- rica, the mechanisms for moving them often liberations is an inadequate response to the involve non-African private and public actors concept of universality, which is central to the and are sometimes the result of laws and poli- 2030 Agenda. tics adopted by intergovernmental bodies and states outside Africa. It adds that African coun- As the Mbeki report points out, illicit financial tries must become involved with the work of flows “are not only an African problem but the OECD on profit shifting to make sure that are indeed a matter of global governance that its discussions on new tax rules do not result calls for a wide range of actions, including at in increasing illicit financial flows from Africa. the level of the global financial architecture” Thus the report concludes that banks and fi- The European Union (EU) too has taken action nancial institutions have a major role in pre- on tax evasion. The European Commission is venting and eliminating IFFs and that robust tabling legislation in 2016 aimed at making oversight regimes should be put in place for the world’s largest multinational corporations the supervision of banks and other financial open their tax arrangements with EU govern- institutions. ments to full public scrutiny. According to three senior EU officials familiar with the proposals, Beyond Tinkering to Transformation: Action Steps initial conclusions from an ongoing impact assessment have found in favor of obliging large Responding to these resource and policy chal- corporations to reveal their profits and the tax lenges requires global action to: they pay in every country in which they operate within the EU. ⇒⇒ Establish global tax authority under UN auspices. The EU has recognized the need for policies ⇒⇒ Adopt a debt workout mechanism under to address tax evasion and the debt issue but UN auspices. resists taking initiatives in the UN. It has boy- ⇒⇒ Adopt safeguards for public finance: The cotted the UN debt initiative and is dragging its UN should issue an annual report on the feet on a global tax authority. status of illicit financial flows.

Regional or Global Action? ⇒⇒ Strengthen UN capacity, research, reporting, and policy advice on public financing, including trends, obstacles, and recom- While the OECD and the EU have taken action, mendations. many countries and civil society organizations (CSOs) advocate that the UN’s work on tax mat- ⇒⇒ Replace the many trust funds with a few in- ters should be upgraded so that non-OECD novative pooled funds. countries do not find themselves as petition- ⇒⇒ Create a firewall between development and ers to a body of limited membership. Progress humanitarian financing. here is very slow. The proposal that the UN Committee of Experts on International Coop- eration in Tax Matters be upgraded into an in- An Accountability Culture ter-governmental committee with developing country representation was rejected in the Ad- The fourth imperative is to develop an ac- dis outcome document, which settled for some countability culture to champion the public changes to upgrade the expert committee. interest.

25 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

Is the 2030 Agenda for Sustainable Develop- development, like the various monitors on the ment a driver for UN reform? dashboard of a vehicle (speed, fuel level, etc.) which cannot be merged in a single indicator Its adoption is provoking much of the UN to ad- but together show what is important. While just itself to the new universal and integrated GDP remains important, as it informs about UN agenda. Its breadth and scope, especially trends of economic activity, it must be accom- the 17 Sustainable Development Goals, have panied by several other indicators, including captured the attention of the world beyond human well-being, equity, and distribution. the UN in civil society organizations, academia, corporations, and philanthropy. An example of this approach is the EU Sus- tainable Development Indicators (SDI), which In addition to specific goals for peace, sus- include over 100 indicators from 1990-2010 tainable development, and human rights, its across a variety of economic, social, environ- framework for action articulates clearly how mental, and governance themes. Themes essential it is to address the “enormous dispar- range from social inclusion and public health ities of opportunity, wealth and power.” to climate change and energy to biodiversity and land use to sustainable production and The 2030 Agenda recognizes the failure of un- consumption. fettered growth as a viable economic model and calls for new measures of progress that do Data experts of all sorts, including financial not rely solely on GDP. corporations and cell phone service providers, academics and so called global partnerships, In order to implement a universal agenda that are clamoring for the opportunity to define can address inequalities and planetary bound- and redefine measures of progress on different aries, member states must agree on new targets through big data, and may overwhelm measures of progress, moving away from the the ability of governments to hold onto their dominant market-based GDP to take account own development policy process. It is vital that of resource depletion and economic insecurity the UN and its member states recognize this and to measure human wellbeing in a context danger in order to make sure that the tail does of sustainability. The 2014 Human Develop- not end up wagging the dog. ment Report, for example, shows that while the United States ranked fifth on the Human De- The Accountability Trap velopment Index—which includes health and education in addition to income—it drops 23 If you can’t count it, it doesn’t count. If only places when the score is adjusted for inequality what can be measured matters and is imple- along all of its dimensions, below Greece and mented, it is only what can be measured that is Slovakia.64 subject to accountability.

One suggestion, advanced by Stiglitz and oth- Usually understood in application to measure- ers, is to use a “dashboard” suite of indicators: ment and results, the link between input and an array of different measures that collectively output applies equally to how member states give a picture of progress towards sustainable finance the UN system. A new funding formula for the UN system is urgent, one which is 64 Joseph E. Stiglitz, “Has the US Economic System Failed?” both adequate and based on assessed con- World Economic Forum, October 14, 2014, weforum. org/agenda/2014/10/joseph-stiglitz-inequality-econom- tributions. The current inadequate and piece- ic-system. meal approach fragments accountability. It

26 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

Regardless of how fast GDP grows, an economic system that fails to deliver gains for most of its citizens, and in which a rising share of the population faces increasing insecurity, is, in a fundamental sense, a failed economic system. And policies, like austerity, that increase insecurity and lead to lower incomes and standards of living for large proportions of the population are, in a fundamental sense, flawed policies.

Joseph Stiglitz, 2014

promotes a pay to play mentality and blocks general public support, as it aligns more with prompt action from an impartial UN. power centers and away from the less powerful. The UN regular budget that is financed by assessed contributions has stalled for over a The UN needs a new formula for financing its decade. Three months after the adoption by operations, one that is sufficient, reliable, and consensus and with much fanfare of the 2030 predictable. As such it has to have a strong Agenda, difficult negotiations in the UN Gener- component of assessed contributions, al- al Assembly resulted in a 2016-2017 UN budget though one that is robust—not paltry—and re- of US$5.57 billion, down 1.6 percent or US$90.8 alistic in light of the increasing demands placed million from 2014-2015.65 on the global body. With a world population of over seven billion, a figure of US$100 per per- Currently, the total funding of all UN sys- son per year verges on inadequate, yet the cur- tem-wide activities is just over US$40 billion rent figure is US$6 per person. per year—less than the annual budget of New York City, less than a quarter of the budget Not only is the UN chronically underfunded, of the European Union, and only 2.3 percent but by 2014, 76 percent of funds for UN oper- of the world’s military expenditures. As the ational activities for development were ear- World Bank calls on the global community to marked for specific programmes, often by sin- move from “Billions to Trillions” to meet the gle donors, reducing multilateral institutions investment needs of the Sustainable Develop- to programme contractors, chasing public and ment Goals, can the UN hope to be a major private funding.66 player? The Next Secretary-General The increasing use of non-core and earmarked funding has resulted in UN agencies adopting Implementing reform initiatives requires a range of funding strategies, including corpo- democratic governance and public account- rate and philanthropic partnerships. Driven ability, starting with the selection of the next by a belief that engaging the more economi- UN Secretary-General, who will be appointed cally powerful is essential to maintaining the in 2016. relevance of the UN, this practice has harmful consequences for democratic governance and 66 Development Cooperation Policy Branch, “Implemen- tation of General Assembly Resolution 67/226 on the 65 United Nations, “Secretary-General Unveils $5.57 Billion quadrennial comprehensive policy review of opera- 2016-2017 Programme Budget to Fifth Committee, Con- tional activities for development of the United Nations tinued Use of Recosting Draws Mixed Reviews from Del- system (QCPR): 2016,” Report of the Secretary-General egates,” Meetings Coverage and Press Releases, Octo- (advanced unedited version), Department of Economic ber 12, 2015, un.org/press/en/2015/gaab4164.doc.htm. and Social Affairs, United Nations, December 28, 2015.

27 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

Box 2: Sustainable Development Indicators: Alternative indices

Several indices seek to capture the well-being of societies in a single number, usually averaging different indicators including subjective perceptions of well-being as well as objective measures of malnutrition, mortality, educational levels, or time use. Other indices measure deprivation.

The UNDP Human Development Index (HDI) is used to rank and compare countries in terms of three components of economic and social well-being: longevity, education, and access to a decent standard of living (measured using adjusted gross national income (GNI) per capita). Subsequently, UNDP introduced the “inequality-adjusted HDI,” which adjusts the ranking for human development according to the distribution of each of its three components across different sectors of the population.

The UNDP/Oxford Multidimensional Poverty Index includes measures of time poverty alongside income poverty as well as access to some form of social protection. This shows that almost 1.5 billion people live in poverty and almost 800 million are vulnerable to slipping back into poverty. Eighty percent of the world’s elderly lack basic social protection, making them a particularly vulnerable group.

The Social and Economic Rights Fulfillment (SERF) Index, computed by the Economic and Social Rights Empowerment Initiative, can measure the distance between the actual situation of a country and what it might be expected to achieve using maximum available resources. Such an analysis can be used to hold a government accountable for not doing all it could possibly do, as well as to substantiate the claim of governments for a better deal in the global economy.

A number of member states, as well as civil soci- retary-General. A single term of office could ety activists, are supporting a process whereby make the Secretary-General more broadly ac- the next Secretary-General will be elected by countable to all member states, not just the members of the General Assembly, following a powerful members of the Security Council. By recommendation by the Security Council. This eliminating the need to campaign for reelec- process was followed with the election of the tion, it would allow him or her the necessary first Secretary-General but was pushed aside political space to develop a more independent, in the selection of subsequent Secretaries-Gen- long-term agenda and push for its implemen- eral as the Security Council recommended only tation in all countries.67 one candidate. A General Assembly election would restore some of that body’s original role Beyond Tinkering to Transformation: Action Steps in the selection process, which has gradually been taken over by the Security Council, and Accountability requires member states to en- enhance its transparency, which under the Se- gage different actors (such as local authorities, curity Council has been highly secretive. Public public interest groups, indigenous peoples, hearings with candidates are being planned. social movements, small farmers) in order to tailor the discourse to new realities, without Civil society activists are also advocating for a single, non-renewable term for the UN Sec- 67 See “1 for 7 Billion,” 1for7billion.org.

28 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

undermining democratic governance and the goods. This should be undertaken through responsibilities of states to their people This an open, transparent consultative process requires Member States to: that includes a wide range of hearings with parliaments and civil society. ⇒⇒ Adopt a formula for mandatory assessed ⇒⇒ Protect and champion public policy, pub- automatic contributions to finance the UN. lic administration, and public service. The ⇒⇒ Set a minimum annual budget for the UN UN needs to be required/empowered by system such as a global per capita amount its member states to challenge other glob- of US$100. al governance processes and institutions ⇒⇒ Establish a common pool to be able to ac- that undermine or block the UN system’s cept a variety of income streams—bilat- ability to fulfill its mandate. eral, individual, philanthropy, private sec- ⇒⇒ Revise human relations and ethics policies tor—without undue influence on program- and independent oversight accordingly. ming and governance. ⇒⇒ Actively support meaningful participation ⇒⇒ Strengthen the Advisory Committee on of civil society and social movements, in- Administrative and Budgetary Questions cluding through a High Level Political Fo- (ACABQ) as an independent advisory rum resolution and mandatory public group, to keep pace with the volume of comment periods. work, including extra-budgetary matters. ⇒⇒ Adopt rules and tools for partnerships and ⇒⇒ Clarify standards of transparency and re- engagement with civil society and the busi- porting as well as conflict of interest pol- ness sector. icies. ⇒⇒ Provide an integrated fund of a limited pe- ⇒⇒ Convene a high level panel as part of the riod, such as five years, with the specific revitalization of the General Assembly to objective to restructure the UN Develop- address the issues of financing the UN ment System into an integrated system system and the provision of global public with new integrated governance.

Moving Forward

The call for UN reform and for the rejection of How do we get out of this vicious circle? How business as usual is not unprecedented. Yet can the UN reclaim its values-based leader- this one has a particular urgency, as there is ship? already a shadow process of reform taking place, one driven by shifting funding patterns. How can the UN and its member states grap- The UN is chronically under-funded and the ple with the vested interests and power imbal- pick-and-choose way in which it is financed ances that have flourished in the global gover- has reduced the UN system to a collection of nance gap? special interests—and now the UN’s many con- stituent parts, especially of the development To re-commit to a values-based United Na- system, are behaving as a collection of special tions, the UN needs to champion the public interests. interest and democratic governance. Its mem-

29 BARBARA ADAMS & KAREN JUDD REFORMING THE UN FOR PEOPLE AND PLANET

bers need to embark on a truth and reconcil- defined, generated, distributed, and balanced iation process to reclaim its promise and po- against the needs of the planet. tential. For the UN and its institutions to engage with It is important not to waste the momentum, the far-reaching agreements highlighted by energy, expertise, and commitment that has the 2030 Agenda they must challenge—and be created the 2030 Agenda for Sustainable De- seen to challenge—power imbalances, what velopment. It represents an integrated agenda the document calls the “enormous disparities for people and planet, not an agenda for peo- of opportunity, wealth and power.” They must ple or planet, not an agenda for some people grapple with vested interests and power in- before others. It cannot succeed without ad- equalities at all levels. The UN must practice dressing the inequalities that are manifest in the impartiality and values on which it is built so many areas; without addressing the struc- and on which its legitimacy and credibility rest. tural obstacles to change; without address- It must be a robust space for implementation ing how the economy works, how wealth is and accountability.

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