The OECD Declaration on International Investment and Multinational Enterprises
The Organisation for Economic Co-operation and Development (OECD) declaration is a policy commitment by member governments to: improve the investment climate; encourage Multi National Enterprises (MNEs) contributions to social and economic development; and minimise and resolve difficulties from their operations.
There are 4 elements to the Declaration:
- Guidelines for Multinational Enterprises – recommendations for responsible business conduct
- National treatment – to treat foreign owned enterprises like domestic ones
- Conflicting requirements – cooperation to avoid or minimise conflicting requirements on MNEs
- International investment incentives and disincentives – recognise that other adhering countries may be affected by such policies – make them as transparent as possible.
The guidelines for MNEs include requirements on:
- Disclosure
- Employment and industrial relations
- Environment
- Combating bribery
- Consumer interests
- Science and technology
- Competition
- Taxation.
The Declaration is subject to periodical review – the most recent being in June 2000 of the Guidelines for Multinational Enterprises. This review is undertaken by the OECD, however it is done in ‘constructive dialogue’ with businesses, non-governmental organisations and labour organisations.
The Declaration was created in 1976 and has been agreed upon by all 34 OECD member states as well as 8 non-OECD states.
The OECD was formed in 1961 and is based in Paris, France. It is an organisation of leading world economies and currently has 34 member countries. It is dominated by developed countries however a number of emerging economies have been recently admitted. In addition Brazil, China, India and South Africa were offered ‘enhanced engagement’ status in 2007, so starting the process towards accession.
OECD membership fees.