The Rio Summit in 1992 was a high point in many ways. It articulated a global commitment to the idea of "sustainable development" and to a broad plan of action and specific initiatives to effectuate tangible progress on a number of fronts. Namely, the UN Framework Convention on Climate Change, the Biodiversity Convention, the Rio Declaration and Agenda 21.

Rio's success was that it delivered a plan for environmental protection, poverty alleviation and economic development, while at the same time incorporating the principles of equity among people, between countries and between generations. Ten years later, however, it is widely accepted among both NGOs and governments that the promises of the Rio Earth Summit have not materialized.

While there are examples of progress at the national level in several countries, pollution driving climate change has not been adequately addressed, habitat and species are disappearing faster than ever, poverty continues to grow at an alarming rate and human rights abuses continue unabated.

Why?

Friends of the Earth's view is that one of the principle causes - if not the principle cause - has been the failure of many corporations to act in a socially and environmentally sound manner and be held accountable.

For some time, corporations have successfully lobbied against any efforts to set binding requirements by championing "voluntary" codes of conduct. Business typically argues that voluntary action is more effective; regulation will only stifle innovation, free trade and profitability.

In response to Friends of the Earth's call for a corporate accountability framework at the Johannesburg Earth Summit, Richard Holme of the Business Action of Sustainable Development - a well-heeled network of multinational corporations - summarized this case in point when he said, "But in accepting the place of regulation, we should not do so at the expense of, or in competition to, the more powerful force of voluntary action and initiative."

Leaving social and environmental concerns to the good intentions of the corporations will, in a competitive market, reward those who dodge their responsibilities. Corporations who want to become more socially and environmentally responsibly risk being undercut by bad actors who externalize social and environmental costs onto society and conduct their activities irresponsibly. In this era of corporate scandals, such as Enron and WorldCom, real accountability, transparency and legal liability are needed.

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