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INTRODUCTION

The crucial role played by transnational corporations (TNCs) on a planetary scale has been a point of focus for researchers and human rights militants for many years. In a recent publication, one of authors of this critical report summarized the matter thus: “To understand the system of dominant power in contemporary society, it is necessary to understand the role that TNCs play within it. TNCs are active in the production of goods and services – in practically all spheres of human activity – as well as in speculation in the financial markets. They engage also in illicit activities and in the gray area between legality and illegality. They play a role front and center in the making of decisions by the powerful and dominate the instruments that enable them to dictate human behavior, ideas, aspirations and habits. This multi-facetted activity is dominated by a fundamental objective: obtaining maximum profit in minimum time, and, to attain it, TNCs, especially those enjoying the greatest power, will use any means at their disposal, assured as they are of the complicity of a majority of national and international political élites and of the services of many of the intellectual élites as well as of civil society’s most-in-view personalities. And, when circumstances require it, they can count on the support of great power armed force, visible and/or clandestine – army, special forces etc. It thus comes down to understanding and explaining how the enormous power of TNCs is in the process of emptying representative democracy of all content and how it constitutes a major factor in the political, economic, social, environmental and cultural crises currently affecting humankind. This prompts reflection on how human beings “born free and equal in dignity and rights” can recover their decision-making power over their destiny within the framework of a democratic and participative society.”¹

These observations have since been corroborated by scientists. In a interdisciplinary study of some 43,000 TNCs (according to the criteria of the OCDE)², three researchers from the Swiss Federal Institute of Technology in Zurich concluded that 737 TNCs, through dense and complex networks woven across the world among all TNCs, control 80% of the value of all TNCs, while 147 of them (which the researchers call “a tightly-knit core of financial institutions” or “super-entity”) control 40%.³

This report attempts to bring up to date the booklet entitled Transnational Corporations and Human Rights published by the CETIM in 2005⁴.  Since the CETIM has produced many publications (books, booklets and reports) on diverse aspects of the problems posed – and the human rights violations committed – by TNCs, this report will concentrate mainly on: attempts, until now, to set binding international standards for TNCs; the armaments industry; TNCs dealing in mercenaries; the economic and financial crises, and the consequent impoverishment and the deterioration of the living conditions of large swathes of the world’s population.

Contents

• Introduction

• I. FAILED ATTEMPTS TO SET BINDING INTERNATIONAL STANDARDS FOR TRANSNATIONAL CORPORATIONS (TNCs)
  • A. Previous Efforts
  • B. Reopening of the Discussion
  • C. John Ruggie’s 2011 Final Report
  • D. The Global Compact, a Trojan Horse within the United Nations

• II. TNCs, THE ARMAMENTS INDUSTRY AND THE WAR
  • A. A Lucrative Large-Scale Private Industry
  • B. NATO ‘s “Marketing” of Armaments
  • C.The Paralysis of the Conference on Disarmament
• III. TNCs AND MERCENARIES
  • A. An Exponential Phenomenon
  • B. A Case Study
• IV. TRANSNATIONAL FINANCIAL CAPITAL, CRISES AND THE DETERIORATION OF LIVING CONDITIONS
  • A. The Hegemony of Financial Capital
  • B. Financial Crises
• Conclusion
• Annex