A global movement that aims to encourage businesses to pay closer attention to their social impact has gained momentum in recent years. It received a boost in 2000, when the United Nations got involved: Secretary-General Kofi Annan launched the Global Compact, a voluntary association that asks corporate participants to uphold ten principles relating to human rights, labor, the environment, and noncorrupt business conduct.¹ Ever since, the Global Compact has pursued this agenda by publishing universal guidelines on corporate social responsibility and creating a network that companies, nongovernmental organizations (NGOs), labor groups, and UN agencies can use to share ideas about how to create better corporate citizens.

A study of the compact² shows that although participation in it has fallen short of expectations, particularly in the United States, it has become an important driver of corporate social responsibility, with 40 percent of the companies surveyed reporting that it had a positive effect (Exhibit 1). Projects in which companies, UN agencies, and NGOs collaborate for purposes such as helping businesses develop their own human rights policies or improve their health and safety guidelines are the most common way of supporting the compact's goals (Exhibit 2).