Study Guide - World Model United Nations

Organization for 

Economic Cooperation 

and Development 

World Model UN 2012 

Background Guide

Table of ConTenTs 

Letter from the Secretary General..............................................................1 

Letter from the Under-Secretary General...................................................2 

Letter from the Chair...................................................................................3 

Introduction...............................................................................................6 

History of the Committee...........................................................................7 

Topic A: Economic Development of the EU 

Statement of the Problem.......................................................................................9 

History and Discussion of the Problem................................................................11 

Past UN Actions.....................................................................................................15 

Proposed Solutions................................................................................................17 

QARMA..............................................................................................................18 

Key Actors and Organizations..............................................................................19 

Suggestions for Further Reading..........................................................................19 

Topic B: International Guidelines for Multinational Enterprise 

Statement of the Problem.....................................................................................21 

History and Discussion of the Problem................................................................21 

Discussion of the OECD Guidelines....................................................................25 

Evaluating the OECD Guidelines........................................................................29 

Revising the OECD Guidelines.............................................................................31 

Conclusion...................................................................................................32 

QARMA..................................................................................................32 

Key Actors and Positions.......................................................................................33 

Suggestions for Further Research..........................................................................33 

Bibliography..............................................................................................34 

Cover image courtesy of Vancouver Tourism Board.

KATHLEEN TANG 

Secretary-General 

SAMIR PATEL 

Director-General 

KEVIN LIU HUANG 

Under-Secretary-General for 

General Assemblies 

ANNA TROWBRIDGE 

Under-Secretary-General 

for Economic and Social 

Councils and Regional 

Bodies 

APARAJITA TRIPATHI 


Specialized Agencies 

RICHARD EBRIGHT 


Operations 

SAMUEL LEITER 


Administration 

SCOTT YU 


Business 

Letter from the Secretary-General 

Dear Delegates, 

My name is Kathleen Tang and I am serving as the Secretary- 

General of the WorldMUN 2012 conference. After being a part 

of WorldMUN for the past few years it is a bittersweet experience 

to be running my last WorldMUN ever, but I could not be more 

excited to share this experience with all of you! 

Within the pages of this guide you will find the topics that the 

WorldMUN staff has been hard at work on over the past few 

months. Each chair worked hard to find a topic that they are truly 

passionate about and provide the best guides possible through 

extensive research. However, the background guide should 

only be the first step in your substantive learning process. Read 

through the guide thoroughly and note what areas of debate are 

particularly interesting for your chair and use this as a starting 

point for your own research on the topic. Remember that you 

will be representing a country, a people, and a culture outside of 

your own during your week of debate. What viewpoints does your 

country have on this topic? What would they say to the issues the 

chair brings up in the guide? In what ways would your country 

most like to see these issues ‘resolved’? There are always more 

sources to look at and more news to be up to date with so the 

learning never stops! 

Of course, if you ever need help along the way there are many 

resources up online for you - WorldMUN 101 and the Rules of 

Procedure are both up on our website (www.worldmun.org) and 

will help you better understand how to write a study guide and 

how debate will run March 11-15th, 2012. Feel free to also reach 

out to your chair or USG via email. They are here to help you feel 

comfortable and prepared for the conference. 

I hope you enjoy the research presented here and also the learning 

process that comes with doing your own research on the topic. 

I look forward to meeting you in March! 

Sincerely, 

Kathleen Tang 


World Model United Nations 2012 

secretarygeneral@worldmun.org

KATHLEEN TANG 


SAMIR PATEL 









Bodies 






Operations 

SAMUEL LEITER 



SCOTT YU 


Business 

Letter from the Under-Secretary-General 


On behalf of the Economic and Social Council and Regional Bodies, 

welcome to World Model United Nations 2012, Vancouver! My 

name is Anna Trowbridge, and I am the Under-Secretary-General 

of EcoSoc. This year, WorldMUN officially enters into its second 

decade of existence, with more passion and dedication than 

ever. The Harvard team and the Vancouver host team have been 

working tirelessly to make this conference the most memorable 

yet—carefully putting together innovative committees, choosing 

fantastic venues, and generally putting in all their effort to craft 

an unforgettable experience. I am excited to share the experience 

with you! 

The study guide on the following pages was written by the chair 

of the OECD, Ioana Calcev. It’s the result of many hours of work, 

and I hope that it serves you well in your preparation for the 

conference. Ioana is an incredibly passionate chair and an amazing 

person. I know that you’ll have a great time in her committee! I 

hope that you are looking forward to meeting her and the rest of 

the delegates of the OECD. 

WorldMUN stands out among all other international conferences 

because of the enthusiasm of our delegates and the quality of the 

debate that they generate. I can’t wait to see you all and hear what 

you have to say in committee. Please don’t hesitate to contact 

Ioana or myself; we are here to help you both before and during 

conference. 

Good luck preparing—see you in March! 

Sincerely, 

Anna Trowbridge 


EcoSoc 

atrowbr@fas.harvard.edu

KATHLEEN TANG 


SAMIR PATEL 









Bodies 






Operations 

SAMUEL LEITER 



SCOTT YU 


Business 

Letter from the Chair 


It is with great pleasure that I welcome you to WorldMUN 2012! My name 

is Ioana Calcev and I will be the Chair for the Organization for Economic 

Co-operation and Development (OECD) Committee. I am a senior at 

Harvard, concentrating in Economics and Government. Model United 

Nations has been an important part of my life in high school and college, 

and I am genuinely thrilled to meet students from all over the world who 

strive to make the world better each day. I am particularly excited to 

rejoin the substantive side of the conference after having served as Under 

Secretary General of the General Assembly last year in Singapore. Besides 

Model UN, I also enjoy hiking, rock climbing, and soccer. 

I hope that you will have an awesome time discussing the two topics that 

I have chosen for this committee. I believe that both are key discussions 

in the field of economic development. With FDE and venture capital 

surges in the developing countries, questions concerning guidelines 

for Multinational Enterprises pervade every days. Moreover, economic 

productivity growth in Europe has become an imperative consideration 

in light of the population dynamic and the sovereign debt crisis. 

Most important, I am look forward to meeting all of you in person in 

Vancouver. Welcome to the WorldMUN 2012 and the OECD! I hope that 

you have a wonderful time reading up on the development topics and 

learning your positions. Please feel free to contact me, if you have any 

questions or comments. 

Sincerely, 

Ioana Calcev 

Chair, OECD 

oecd@worldmun.org

I n t r o d u c t I o n 

The Organization for 

Economic Co-operation 

and Development (OECD), 

originally established in 

1961, aims to improve the 

economic and social well 

being of people around 

the world. At the turn of 

its fiftieth anniversary, the 

OECD has targeted its focus 

in four main areas: 

1. First, the OECD aims to 

help governments restore 

confidence in markets and 

institutions by helping 

improve regulation and 

governance at all levels of 

political and business life. 

2. Second, the OECD aims 

to help governments 

re-establish health public 

finances in order to sustain future 

economic growth. 

Harvard WorldMUN 2012 

OECD’s Way of Working. (www.oecd.org) 

OECD Operational Structure. (www.oecd.org) 

OECD 6

3. Third, the OECD is looking to foster innovation 

through ‘green growth’ and advancement in 

emerging markets. 

4. Finally, to underpin innovation and growth, the 

OECD seeks to ensure that people can develop 

the skills necessary to work productively and 

satisfyingly. 

Seeking to develop these important goals, this 

committee will discuss fundamental challenges that 

disrupt financial markets, impede innovation, and 

stunt economic development. Specifically the two 

topics demonstrate how critical the OECD is for 

economic development and stabilization following the 

financial crisis of 2007. Both topics 

While it is challenging to come up with universal 

guidelines for multinational enterprises, this 

committee will aim at finding measures that could 

be applicable globally. In order to do so, the OECD 

will delve into the specific cases and past experiences. 


OECD Member Countries. (Wikipedia.org) 

Furthermore, the question of European economic 

growth is important not only for the wellbeing of 

European markets, but also for key trading partners 

and investors around the world. 

As members of the OECD you have been given the 

responsibility to discuss these issues and to come 

up with solutions that will improve the wellbeing of 

markets and people all around the world. 

Preparation is an important factor for excellence in 

Model UN. I urge you to spend a significant amount 

of time conducting further research into the issues 

that will be debated in your committee as well as your 

country’s position in order to prepare. 

H I s t o r y of tHe commIt t e e 

The Organization for Economic Co-operation and 

Development (OECD) is a forum for political and 

economic co-operations in which countries identify 

successful practices, tackles shared challenges, and 

co-ordinate domestic and international policymaking. 

OECD 7

The mandate of the OECD covers economic, 

environmental, political, and social issues. 

The precursor of the OECD, the Organization 

for European Economic Cooperation (OEEC), 

was established in 1957 to administer American 

and Canadian aid under the Marshall Plan for 

the reconstruction of Europe following World 

War II. “Determined to avoid the mistakes of 

their predecessors in the wake of World War I, 

European leaders realized that the best way to ensure 

lasting peace was to encourage co-operation and 

reconstruction, rather than punish the defeated.” 1 The 

OEEC functioned to promote co-operation between 

participating countries, develop intra-European 

trade, study the feasibility of creating a customs 

union or free trade area, study muli-laterlisation 

of payments, and achieve conditions for better 

unitilization of labor. Organized along fifteen vertical 

and five horizontal technical committees, the 18 


nation committee was responsible for handling a 

variety of European economic concerns including 

food and agriculture, iron and steel, and even balance 

of payment coordination. Inspired by OEEC’s 

cooperative achievements, the Rome Treaties created 

the Convention on the Organization for Economic 

Co-operation and Development, which enhanced the 

OEEC and extended membership to the United States 

and Canada. 

Since it superseded the OEEC in 1961, the OECD 

has moved beyond a focus on its own countries 

and has aimed to achieve the highest sustainable 

economic growth in its member countries, to 

improve market system efficiency, to encourage 

industrialization among developing countries, and to 

expand free trade. 2 For instance, in May of 2001 the 

Organization has launched a Green Growth Strategy 

initiative, which provides a practical framework for 

governments to boost economic growth while also 

Signing of the OECD Convention, 1960. (http://www.oecd.org) 

OECD 8

protecting the environment. In South Africa, the 

OECD is establishing a sovereign debt management 

center in order to create a stronger securities market. 

Meanwhile, in Europe the OECD has been helping EU 

government’s design and implement deficit reduction 

strategies. 3 Not only has the Organization expanded 

its policy area considerations, but also the OECD has 

come to analyze how various policy areas interact with 

each other, across countries, and beyond the OECD. 

For instance, in considering interactions between 

social and economic operations, the OECD analyzes 

how globalization opens new growth opportunities 

and triggers new social attitudes such as trade 

protectionism. Undoubtedly, “as it opens to many new 

contacts around the world, the OECD will broaden its 

scope, looking ahead to a post-industrial age in which 

it aims to tightly weave OECD economies into a yet 

more prosperous and increasingly knowledge-based 

world economy.” 4 

The OECD consists of three major bodies: the 

Secretariat, OECD committees, and the Council. The 

OECD Secretariat collects and analyses data, after 

which committees discuss policy, the Council makes 

decisions, and then the Secretariat helps governments 

implement recommendations. In order to discuss 

and formulate ideas, representatives of the 34 OECD 

member countries meet in some 250 committees, 

working groups and expert groups to advance and 

review progress in specific policy areas. Approximately 

40,000 senior officials from both member and nonmember 

countries attended OECD committee 

meetings each year and relay information back to 

their national governments. The decision-making 

powers of the OECD, however, are exclusively vested 

in the Council. This body is made up of delegations 

from each member country plus a representative of 

the European Commission. At the level of permanent 

representatives, the OECD meets regularly and takes 

decisions by consensus. At the ministerial level, the 

OECD meets once a year to set OECD priorities. All 

the work discussed by the committees and mandated 

by the Council is implemented by the Secretariat. This 

branch, headed by Angel Gurría, is made up of some 

2,500 economists, lawyers, and scientists who collect 

data, support the activities of the OECD committees, 


and prioritize OECD objectives. 5 

The OECD differs from other intergovernmental 

organizations and in particular from the United 

Nations because it has neither supranational legal 

powers nor financial resources, and therefore 

functions to solely direct co-operation among Member 

countries. Co-operation means that, using soft-law 

provisions, the OECD motivates Member countries 

to adapt domestic politics to minimize international 

conflict. In other words, the OECD is a forum that 

facilitates discussion, negotiation, and collaboration. 

“Discussions at OECD committee-level sometimes 

evolve into negotiations where OECD countries agree 

on rules of the game for international co-operation. 

They can culminate in formal agreements by countries, 

for example on combating bribery, on arrangements 

for export credits, or on the treatment of capital 

movements. They may produce standards and models, 

for example in the application of bilateral treaties on 

taxation, or recommendations, for example on crossborder 

co-operation in enforcing laws against spam. 

They may also result in guidelines, for example on 

corporate governance or environmental practices.” 6 

The implementation of OECD proceedings is 

stipulated in Article 5 of the bylaws, which enables the 

OECD to take decisions that may be binding on all of 

its Members, to make recommendations to Member 

countries, and to enter into agreements with Members, 

non-members and international organizations in order 

to achieve its aims. Thus, the primarily enforcement 

mechanism is based on mutual examination, mutual 

surveillance, and peer review carried out at committeelevel. 

Using this collaborative process, OECD 

participants, which account for 80% of world trade and 

investment, regularly turn to one another to identity, 

analyze and solve international challenges facing the 

world economy. 

t o p I c A: e c o n o m I c d e v e l o p m e n t I n 

t H e europeAn unIon 

Statement of the Problem 

Productivity is a measure of output per input of 

production. For instance, labor productivity is the 

ratio of production output per labor hours worked. 

OECD 9

Productivity measures are economically significant 

because they go hand in hand with growth. That is, 

a country’s economic growth is measured in terms 

of production increase over time. For this reason, 

European leaders are concerned that while the United 

States has been experiencing an upward structural 

shift in productivity growth since the 1990’s, European 

nations such as Germany, Spain, Italy, and France 

have been experiencing a downward shift. 7 Especially 

inefficient industries, such as the manufacturing 

of office machinery and computers, wholesale and 

retail trade, air transport, and financial services have 

productivity rates considerably lower than those of 


European Union. (http://europa.eu/) 

American industries. 8 These downward trends have 

led to widespread job losses in manufacturing and 

more importantly stagnating GDP growth. 

In 2000 EU Heads of State met and drafted a ten-year 

agreement known as the Lisbon Agenda, in order to 

“make Europe the most competitive and dynamicbased 

economy in the world.” The three main issues 

that the Lisbon Agenda sought to realize were: (1) 

investment in R&D at a level of three per cent of EU’s 

GDP, (2) the promotion of entrepreneurship, and (3) 

the reduction of unemployment. The mid-year report 

in 2004 concluded that although Europe had made 

OECD 10

some progress, it would not reach its ambitious goals. 

In the face of these past failures and its rapidly aging 

population, European prosperity is contingent upon 

pre-1994 productivity growth rates. Productivity 

targets have, however, been set back by the onset of 

the financial crisis in 2007. Initially, the subprime 

crisis halted European economic growth and derailed 

the financial markets. The ensuing sovereign debt 

crisis has challenged European cooperation and has 

shifted attention away from the Lisbon Agenda’s 

goals. European governments have grown reluctant 

to push through difficult economic reforms in such 

economic precarious times. Nevertheless, the EU still 

struggles with low levels of productivity growth. As 

such, delegates must devise a plan that aims to revive 

European productivity growth but can realistically be 

implemented. 

To undertake this task, delegates will represent 

member of the Organization for Economic Cooperation 

and Development (OECD). This political 

and economic forum helps member nations identify 

successful development practices, tackle shared 

challenges, and co-ordinate policymaking. Conceived 

after World War II, the OECD aims to help nations 

achieve sustainable economic growth and improve 

market efficiency. The OECD must help European 

Heads of State coordinate their national strategies in 

order to help reinvigorate economic growth. 

To help delegates prepare for the policy challenge 

ahead, the following topic area provides a general 

introduction into research material. The first section 

provides background on Europe’s productivity 

lag and denotes several contributing factors. The 

second section covers past actions that the European 

community has taken to address its growth problems. 

Finally, the third section covers proposed solutions 

among policy makers. 

History and Discussion of the Problem 

Origins of the European Growth Crisis 

Following World War II, Europe experienced 

substantial economic growth. This catch-up growth 

can be attributed to imitation and adaptation of 

foreign technology and the strong investment in and 


support for institutions. Initially, Europe began to grow 

because the reparations of wartime damages enabled it 

to rebuild its capital stock and restore its productivity 

capacity. Following this initial leap, Europe sustained 

rapid economic growth by exploiting new technologies 

such as the assembly-line method and modern 

personnel-management practices. By adopting US 

knowledge and management practices, Europe’s per 

capita income and productivity converged towards 

those prevailing in the United States. 

Then, beginning in 1973, the economic growth that 

exemplified the post-World War II era came to an 

abrupt end. GDP growth slowed down both in the 

United States, from 3.9 to 2.8 percent, and in Europe, 

from 5.5 to 2.0 percent. This turning point can be 

attributed to European labor markets becoming 

increasingly tight. In particular, market issues such as 

high payroll taxes, generous unemployment benefits, 

poor educational standards, and high unionization 

accounts contributed to the rise in unemployment in 

the 1970s. It is thought that European productivity 

growth prior to the 1970’s was thus not the result of 

access to advanced technology and innovation, but 

rather market rigidities. Europe’s catch-up growth 

can be accredited to labor productivity advances 

and increased GDP per hours worked rather than 

multifactor productivity, a measurement of post 

accounting output levels. 

In addition, since the mid 1990’s, European and 

US productivity growth patterns have diverged 

dramatically, the former declining and the latter 

growing substantially. After the 1970s, the United 

Stated re-emerged with a renewed political energy that 

facilitated increased competition, the restructuring 

of corporations, and the immediate adoption of 

the innovations from the information revolution. 

Meanwhile, European countries, especially Germany, 

France, Italy, and Spain, were unable to garner 

the same sufficient energy to reform. 9 “Indeed, 

while productivity growth in the United States has 

accelerated in the last decade, from an average of 1.6 

percent to 2.7, productivity growth in Europe has 

gone in the other direction, declining from 2.3 percent 

per year to 1.4 percent.” 10 On a micro scale, during 

OECD 11

the latter half of the 1990s and throughout the 2000s 

European Union Member States reported markedly 

different productivity levels. 

Breaking Down the Productivity Lag 

The European productivity crisis, first evident 

in 1995, can be attributed to numerous socioeconomic 

trends ranging from inefficient market 

integration and a slowdown in innovation, to a labor 

market slowdown. The problem of below average 

productivity is particularly pronounced in the service 

sector. In 2004, the European Commission released a 

working paper evaluating service market integration 

and its impact of the European economy. The 

A report by Robert Inklaar, Marcel P. 

Timmer and Bart van Ark evaluates 

growth differences rather than policy 

mandates in regards to ICT. What they 

EU Member States. http://www.ce-authorizedrepresentative.eu/ 

find is that the inefficient development 

of information and communication 

Commission came to the conclusion that barriers in 

technologies contributed to labor productivity 

the service industry in the Internal Market, stemming 

growth. “On average, over all countries, the ICT 

from cross-border barriers, have a negative effect of 

investment to value added ratio increased from 

competitive performance. In the European Union, 

3.9% during 1980–1995 to 4.9% during 1995–2000.” 

market services account for approximately 53.66% 

In other words, productivity gains across Europe 

of the GDP. In 2000, 86% of EU firm population 

are closely related to the use and diffusion of ICT. 

constituted service providers and these numbers 

Namely, several economists have found that the 

underestimate the role of services because they do not 

productivity gap results from numerous factors such 

distinguish between primary and secondary sectors. 

as new technologies, economies of scale, managerial 

Although the European service market accounts for 

skill, and changes in the organization of production. 

many jobs, because of the complex and intangible 

The multifactor productivity lag, according to 

nature of services, the provisions of services if often 

various papers, has occurred because Europe has 

subject to complex rules. At the same time, a wide 

restrictive regulations that limit the productivity of 


divergence between the rules of Member States renders 

cross-border service activity inefficiently costly. 

Indeed, three authors, Robert Inklaar, Marcel P. 

Timmer and Bart van Ark, show that while investment 

in physical and human capital may account for a 

substantial portion of labor productivity growth in 

market services, cross-European differences in labor 

productivity growth are mainly due to technology 

inefficiency. That is, some political scientists have 

found that policies and institutions, which facilitated 

the imitation of technologies in the past, are no longer 

well-suited for growth close to the technological 

frontier. Information and communication technologies 

(ICT) are an important complement 

to research and development. ICT is a 

significant contributor to productivity 

growth because it enables better 

information processing, and thus 

reduces co-ordination costs that are 

detrimental in decentralized economies 

such as Europe’s. For instance, enhanced 

information and communication 

technology improves the production 

and distribution of inventory across 

countries. 

OECD 12

ICT. In Europe, a lag can be explained by restrictive 

regulations such as store-opening hours, land zoning, 

and cultural differences. In the United States, a faster 

rise in information and communications technology 

has increased productivity with the use of equipment 

such as barcodes, transaction-processing software, 

and inventory tracking devices. It is possible that 

this equipment changes the depiction of investment’s 

contribution of growth accounting. Regardless of 

which alternative is correct, the overall conclusion is 

that a more flexible approach towards labor, product, 

and capital markets in Europe would allow resources 

to flow to their most productive uses. 

Besides service market inefficiency and a lack of 

innovation, domestic labor trends have constrained 

productivity growth: declining birth rates and rising 

life expectancy. On the one hand, the total population 

size is projected to fall, reducing the ratio of workingclass 

population to retirees by approximately 18%. 11 

This new ratio implies that the demand for pensions, 

healthcare assistance, and other welfare programs 

will increase substantially. In fact, the European 

Commission estimates that increased welfare spending 

will reduce the potential growth rate of the EU from 

2%-2.5% to 1.25% by 2040. What is more, lower 


economic growth will reduce public finances 

and thus cause even further problems. Moreover, 

when looking at the European Union as a whole, 

enlargement has made the problems of cohesion 

even more pronounced. Since 2000, the EU has 

accepted Malta, Cyprus, Estonia, Latvia, Lithuania, 

Poland, Czech Republic, Slovakia, Slovenia, Hungary, 

Akrotiri, Dhekelia, Bulgaria, and Romania. These 

new members have much lower employment rates 

and productivity levels than the original 15 members 

of the Lisbon Agenda. The strong regional disparities 

and inequalities in these regions have, for example, 

reduced EU employment by approximately 1.5%. Even 

the prospect of growth for the newly added members, 

suggests that their lower tax and wage rates will deflect 

investment from the rest of the EU. These internal 

strains highlight why it is important that the EU 

achieve a better growth agreement. 

European productivity setbacks have been further 

exacerbated by the economic and financial crisis 

of 2007. The financial crisis and trade collapse of 

2007 operated via three transaction channels: the 

connections within the financial system itself, wealth 

and consumer confidence, and global trade. 12 Because 

there was great variation among Member States in 

Productivity Growth. (http://economistsview.typepad.com) 

OECD 13

Information and Communication Spending Trends. (http://maps.grida.no) 

regards to these three channels, the financial crisis hit 

some countries more severely than others. Initially, 

Ireland, the Baltic countries, and Germany seemed 

much more affected than countries such as Bulgaria, 

Poland and Cyprus. The EU response to the financial 

crisis with the use of automatic stabilizers such as tax 

policies and job loss insurance functioned in a counter 

cyclical manner, relaxed employment laws through the 

Lisbon Agenda, shovel ready projects that could reduce 

the high unemployment rates, and the liquefaction of 

banks. 

Even though the total factor productivity did not 

shrink in Europe, significant labor declines resulted 

in a lower potential growth rate. For instance, the 

downturn was much more severe for new EU members 

such as Latvia. Despite their prior faster growth rates, 

the newly added EU countries are now converging 

to lower European economic growth rates. In other 

words, their economies are now shrinking. In 2009, 

Europe’s GDP had fallen by 4%, unemployment had 

reached approximately 10%, and government debt 


Europe wide has increased 

by 20% over the course 

of two years. In addition 

to substantial growth and 

labor costs, the fiscal costs 

of the financial crisis will 

be enormous because 

there is increased pressure 

on contingent liabilities 

related to financial rescue 

and intervention. Because 

the financial and economic 

crisis had such a substantial 

impact on the European 

economy and the EU was 

not able to effectively 

coordinate in order to 

reduce unemployment, 

the likelihood of persisting 

European divergence is 

very high. Europe must 

solve the economic 

problems that have arisen 

from the financial crisis of 

2007 if it wishes to change 

the course of its growth decline. 

Continued Case For Economic Strides 

For the European Union, higher productivity is 

central to ensuring economic growth and recovery. 

To illustrate the capacity of productivity growth, 

consider a comparison between the United States and 

the EU-15. Because of the US’s accelerated productivity 

after 1995, its gross domestic product (GDP) is 1.9$ 

trillion greater that it would otherwise be. Meanwhile, 

if the EU-15 had been able to maintain the same 

productivity growth rates attained prior 1995, its GDP 

would be 1.1 trillion euros greater than it is today. If 

the European Union today could revert back to 1994 

productivity average, real output would increase by 

approximately 75%. On the other hand, if Europe 

continues to persist at the same growth rates, its output 

per capita will grow at a mere 41%. 13 

One reason why boosting productivity is especially 

important is because Europe faces international 

OECD 14

pressure to reinvigorate its economy. As international 

competition has intensified over the past decade, 

Europe has come to face twin challenges from China 

and India. First, with China’s economy growing so 

quickly, Europe is pressured to establish an appropriate 

economic base in order to remain competitive. A 

combination of the 

increasing stock 

of foreign direct 

investment has 

enabled China to 

compete not only 

in low value-added 

goods, but also in 

high value-added 

goods. Some argue 

that even though 

there is great 

differentiation 

between wages in 

China and those in 

Europe, the quality 

difference between 

goods produced in 

the two countries 

is becoming non-existent. In a similar way, India’s 

practice of outsourcing service sector functions has 

come to undermine European economic power. 14 

Another reason why a productivity boost is imperative 

for Europe is because labor particiaption rates are 

significantly lower in the EU than in the United States. 

Namely, a greater share of the European population 

is older and not working. 15 For instance, in 2005 17.4 

percent of the EU-15 populations was 65 and older 

compared to only 12.4 percent in the United States. 16 

At the same time, in 2010 the total fertility rate in 

Europe was 1.5 children per woman, whereas the 

overall US rate was 2.06. Two decades of such low 

fertility rates in Eurpe could produce in a decline 

in labor force participation and a decline in the EU 

population from 375 million to around 285 million 

over the course of the century. 17 In the face of such 

generational dynamics, Europe will have to raise its 

productivity growth rate in order to enjoy growing 

standards of living. 


Technology. (http://www.w3ins.com/) 

All the while, the financial crisis made the task of 

securing future economic growth more difficult. The 

fragile financial system is holding back firms and 

households, who are having a difficut time borrwing, 

spending and investing money. “Our public finances 

have been severely affected, with deficits at 7% of 

GDP on average and 

debt levels at over 

80% of GDP – two 

years of crisis erasing 

twenty years of fiscal 

consolidation. Our 

growth potential 

has been halved 

during the crisis. 

Many investment 

plans, talents and 

ideas risk going 

to waste because 

of uncertainties, 

sluggish demand 

and lack of funding.” 

Without notice, 

the steady gains in 

economic growth 

and job creation throughout the early 2000s were 

wiped out and industrial production plummeted 

and unemployment rose. Exposing the structural 

weaknesses of Europe’s markets, the financial crisis has 

given rise to new challenges. 

Past EU Actions 

To tackle the economic slowdown, the European 

Union adopted a ten-year agreement known as 

the Lisbon Agenda in 2000 with the intent of “making 

Europe the most competitive and most dynamic 

knowledge-based economy in the world.” 18 The Lisbon 

Agenda outlined its purpose in terms of three distinct 

goals: preparing the transition to a knowledge-based 

economy and society with the use of better policies 

towards information and R&D, modernizing the 

European social model, and sustaining a healthy 

economy with appropriate macro-economic policies. 

These goals called for a friendly environment for SMEs 

and efficient integration of financial markets among 

other things in order to attain 3% GDP growth across 

OECD 15

the European Union. 

Regrettably, the Lisbon Agenda was not able to alter 

the course of EU’s growth because several events 

increased economic instability; Europe fiscal policy 

was limited by its weak budgetary position; and the 

EU did not place enough priority on the completion 

of a single market for services. A midpoint evaluation 

explains that the 2001 terrorist attacks darkened the 

international climate for trade and development and 

that the increased oil prices heightened insecurity. 

Furthermore, although the Lisbon Agenda helped 

Europe reduce unemployment levels and helped 

outline development and integration policies, the 

EU did not attain many of the targets outlined in 

the Agenda. For instance, because of lack of labor 

market reforms and insufficient educational training 

opportunities, the EU was not able to achieve its target 

of a 70% employment level among the working age 

population. Moreover, even though proposals such 

as the Small Business Act, adopted in June of 2008, 

helped reduce VAT rates and called on Member States 

Parisian Open Air Market. (http://ontheroadwiththewhites.blogspot.com) 


to exempt micro-enterprises from accounting rules, 

the EU has not realized a single market for goods 

and services. There exists continued competition in 

network industries such as gas and electricity. Finally, 

the EU has not been able to close the productivity gap 

seeing as how research and development expenditures 

as a percent of GDP improved by only .08 percent 

from 2000 to 2008 (1.82% in 2000 to 1.9% in 2008), 

when the GDP spending target was actually 3%. The 

key challenge that has restricted R&D is that the EU 

has not been able to make domestic investments 

more attractive. Based on the Lisbon Agenda’s failure, 

insufficient investment in R&D and education, 

indifferent capacity to make research marketable, 

and lower performance in ICT has eroded the EU’s 

capacity to reach its development goals. 19 

“The European Union and its Members States have 

clearly themselves contributed to slow progress by 

failing to act on much of the Lisbon strategy with 

sufficient urgency.” 20 

Overall, the inadequate 

progress of the 

Agenda was largely 

due to ineffective 

coordination, lack 

of commitment and 

political action, and 

conflicting domestic 

priorities. Indeed, 

although the Lisbon 

Agenda is applauded 

for helping build 

broad consensus 

on reforms and for 

delivering concrete 

benefits to EU citizens, 

European countries 

did not recognize 

the significance of an 

integrated economy and 

did not communicated 

effectively. It has been 

suggested that in order 

for the EU to attain its 

OECD 16

goals, it must increase transparency, Heads of State 

or Government must signal their commitment to 

their particular national strategy, and the EU budget 

should be reshaped to reflect the Lisbon priorities. On 

the nonpolitical front, the Report for the High Level 

Group encouraged the EU to prepare an action plan 

to reduce the administrative obstacles for moving 

to and within the EU for world-class scientists and 

researchers, to ensure the completion of an internal 

market for services and a market for labor, and 

promote greater economic strategy coordination 

between countries. 21 

In brief, while the Lisbon Agenda had many of the 

technical elements necessary to reduce divergence, 

it did not insist that nations cooperate quickly 

enough. In order to reduce divergence from this point 

on, Europe 2020 has to place greater urgency on 

modernizing the systems and reducing unemployment 

by creating a knowledge economy that is based on 

a single goods and labor market which supports a 

favorable business climate. 

Proposed Solutions 

Between the Lisbon declaration and the Kok 

Report, Europe’s problems are well known. “To 

one degree or another, European countries support 

large bureaucracies that stifle risk-taking, their public 

sectors are often inefficient, and social policies usually 

protect jobs rather than people. At the EU level, 

national interests prevent the creation of a unified 

research space and countless protectionist measures 

hinder competition in the services sector, which 

account for far more than half of value added. In 

short, Europe needed structural reforms.” 22 In other 

words, as the original plan intended, Europe must 

generate growth developing the growth of intangible 

factors such as technical progress and organization 

innovation. 

In evaluating the failures of Lisbon Agenda, the High 

Level Group highlighted several policy areas that the 

European community should prioritize. First, Wim 

Kok the leader of the High Level Group, urged the 

EU to make R&D a higher priority, to do a better 

job promoting ICT, and to focus on education and 


training. This goal, the Group explains, entails the 

reduction of administrative obstacles for scientists 

and researchers, the creation of European Research 

Council, and better follow-up with the Europe action 

plan. 23 

Second, the Group urged the European community 

to complete the internal market for free movement 

of goods, and create a single market for services. In 

other words, the European Union must prioritize 

the integration of goods and factor markets. A 

major driver for economic efficiency is competition 

either through trade openness, a reinforced Single 

Market across Europe, or product market reform. 

According to the European Competitiveness Report 

of 2006 by the European Commission, coordination 

at the EU level when carrying out these reforms 

reinforced effectiveness because of positive crossborder 

knowledge spillovers. 24 The European 

Economic Community suggests that in order to foster 

productivity and growth, Europe must reduce crossborder 

barriers, and facilitate intra-European trade. 

Although Europe has made strides by creating the 

customs union known as the EU, non-tariff barriers 

and market-access restrictions still impede higher 

productivity. 25 

Third, the Group concluded that European Member 

States must facilitate entrepreneurship, create favorable 

conditions for emerging businesses, and reduce red 

tape. However, unlike in previous attempts, Member 

States must improve business climate by reducing 

administrative burden and improving legislation, not 

just by facilitating the rise of new enterprises. Although 

there have been numerous attempts at integration 

European capital markets in order to facilitate lending 

and investing, the debt crisis has contested financial 

coordination among European nations. 

Although countless economists and analysts have 

proposed feasible solutions, the European Union must 

not only outline priorities for micro economic reform, 

but they must also devise a realistic implementation 

plan. That is to say, a development recommendation 

must outline implementation techniques that muster 

political co-operation and do not get stumped in 

OECD 17

For instance, some economists advise that European 

Member States should use tax incentives and tariff 

reductions to spur ICT investment. This means 

that policymakers should refrain from taxing ICT 

investments such as broadband telecommunications 

and should avoid placing tariffs on ICT imports. 

Other economists suggest that European productivity 

trends are result of increased marginal tax rates, which 

lower worker participation and delay entry into the 

labor source. Alberto Alesina argues that increased 

tax rates combined with union-imposed standards 

for work time, and a preference for leisure convinces 

Europeans to work less and thus stunts productivity 

growth. 26 Regardless of which economists are correct, 

it is important that delegates of this committee realize 

that solutions being considered today do not just list 

priority areas; rather effective solutions specify how the 

EU can take action given the political and economic 

challenges that stand in its way. 

Questions a Resolution Must Answer 

Why did the Lisbon Agenda fail to make the EU “the 


most competitive and 

dynamic knowledgebased 

economy in 

the world capable of 

sustainable economic 

growth with more and 

better jobs and greater 

social cohesion?” 

Learning from the 

implementation of the 

Lisbon Agenda, what 

key policy areas should 

the European Union 

focus on in order 

to achieve the most 

efficient productivity 

gains? 

European Stock Exchange. (http://news.markets247.com) 

How can the European 

Commission improve 

its measure of 

bureaucratic discord. 

innovation in order to 

evaluate how innovation policies influence its goals? 

How can a new strategy help Member States achieve 

a more competitive market either through trade or 

financial integration? That is, what is the most efficient 

way to achieve a competitive market? 

Given that the recession has resulted in a considerable 

loss of capacity in the European economy, how should 

Europe combat long-term growth pressures that it 

faces due to its ageing population? 

Who should supervise the implementation of future 

goals and to whom should Member States be held 

responsible if they fail to implement their targets? 

How can a leadership body facilitate greater political 

co-operation and coordination once a new plan is in 

effect? 

In light of the recent debt crisis, what are reasonable 

objectives and timelines to get Europe back on 

track? Should productivity targets be applicable to all 

Member States regardless of their financial standing? 

OECD 18

What should the European community consider if it 

is to devise a plan that creates sustainable productivity 

growth? 

Key Actors and Organizations 

Because of its heterogeneous nature, the OECD 

does not fall neatly into voting blocs. Given 

cross-sectional differences and the complexities of 

the topics at hand, the position of each representative 

is nuanced and contingent upon many factors. In 

order to understand individual country platforms, 

delegates should research how their nation interacts 

with Europe, what their nation’s policy is following the 

financial collapse, and what issues their nation deems 

a priority. Despite the complexities at hand, the OECD 

comprises of member nations and representatives that 

best represent certain positions around the topic at 

hand. 

European Commission Representatives 

For instance, the European Commission is the 

original supervisor of the Lisbon Agenda and as 

such has overseen earlier implementation attempts. 

Nations that are a part of the European Commission 

can best speak on what is and is not feasible to enforce, 

what political impediments stand in the way of 

implementation, and what economic priorities they 

foresee. This body will consist of both a European 

Commission representative and member states. These 

include Austria, Belgium, Czech, Denmark, Estonia, 

Finland, France, Germany, Greece, Iceland, Ireland, 

Italy, Luxembourg, Netherlands, Norway, Poland, 

Portugal, Slovak Republic, Slovenia, Sweden, and 

Switzerland. 

European Debt Crisis Key Players 

Although nearly all of Europe has been affected 

by the debt crisis, some nations have played a 

crucial role in the downfall that has further reversed 

productivity growth. For instance, Ireland, Greece, 

and Portugal have, following loan controversies, the 

banking and economic crisis, and low borrowing, 

defaulted on their debt. These actions have placed 

the rest of the European Union in a precarious 

circumstance because each default has destabilized 

the European interbank offer rate. On the other hand, 


nations such as Germany, France, and the UK have 

spearhead recovery efforts and have dictated the 

terms of the bailouts. These particulars are relevant for 

nations wishing to undertake development initiatives. 

Trade Partners 

The remaining block of OECD members have 

jointed the OECT because they have specific 

interests in OECD operations. Though the nations 

would not operate as a voting block in this particular 

instance, their interests in the topic of EU economic 

growth arise because of their trade and financial ties to 

the EU. For instance, Turkey is linked to the EU via a 

Customs Union established in 1963 by the EU-Turkey 

Association Agreement. In 2007 alone, 300 million 

Euros of EU inflows came from Turkey, while 12.4 

billion Euros of EU outflows went to Turkey. 27 Due to 

these trade relations, the remaining OECD members 

have a vested interest to use the successes and failures 

of their own economic growth strategies to advise the 

EU Members. Trade partner nations include but are 

not limited to Australia, Canada, Chile, Israel, Japan, 

Korea, Mexico, New Zealand, Turkey, and the United 

States. 

Suggestions for Further Reading 

Not a day passes without news on economic 

stability, unemployment rates, or the debt crisis 

in Europe. Since a strategic plan will be Europe’s 

current economic standing and capacity, it is essential 

that you follow these articles in order to get a clear 

understanding of what the EU is experiencing. Some 

excellent news sources include but are not limited to 

the BBC News, the Financial Times, the Guardian, Le 

Monde, El Mundo, Marca, and Bild. 

In addition to recent developments, Europa, the official 

website of the European Union has great resources to 

help you understand the structure of the European 

Union, how policy area is implemented & evaluated, 

and how current intra-Europe legislation operates. 

Also the OECD website is a wealth of statistical 

indicators that can give you a better picture of the EU 

fiscal situation and current economic projections. 

In order to read up on the specific detailed in this 

guide I suggest that you read through the excellent 

reports centered on the Lisbon Agenda, its failures, and 

OECD 19

its follow ups. As such, some of the most fundamental 

sources are the Lisbon Agenda, Annual Reports by 

the EU Member States, The Economic Impact of ICT: 

Evidence and Questions by the High Level Group, 

Creating an Innovative Europe by the Aho Group, 

and more recently a Commission Report entitled: 

The New Lisbon Strategy for Growth and Jobs. All of 

these reports can easily be found online and contain a 

wealth of knowledge. Particularly relevant to you as the 

OECD is the Economic Survey of the European Union 

2009. The report outlines some of the critical faults of 

the EU, as evaluated by the OECD in 2009, and would 


provide an excellent starting point for your research. 

Although there are a variety of information sources on 

the World Wide Web, please make sure to evaluate the 

information sources carefully and be sure to seek out 

a variety of perspectives on the topic. Best of luck with 

your research! 

Foreign direct investment flows. (http://policytensor.com) 

OECD 20

t o p I c B: I n t e r n At I o n A l G u I d e l I n e s 

f o r mult I n At I o n A l enterprIse 

Statement of the Problem 

The OECD Guidelines for Multinational 

Enterprises are a set of internationally endorsed 

recommendations that aim to regulate multinational 

enterprises in abiding countries. Although the 

Guidelines are not legally binding, forty-two 

governments1 – accounting for 85 per cent of 

foreign direct investment – voluntarily encourage 

multinational corporations (MNCs) operating in their 

territory to observe the OECD principles. 

The Guidelines, part of the OECD Declaration 

on International Investment and Multinational 

Enterprises, “aim to ensure that the operations of these 

enterprises are in harmony with government policies, 

to strengthen the basis of mutual confidence between 

enterprises and the societies in which they operate, to 

help improve the foreign investment climate and to 

enhance the contribution to sustainable development 

made by multinational enterprises.” 28 To address this 

scope, the recommendations cover such issues as 

employment and industrial relations, environment, 

consumer interest, science and technology, 

competition, and taxation. 

Originally adopted by the OECD in 1976, the 

Guidelines have since been revised in 1979, 1984, 1991, 

2000, and most recently in May of 2011. The 2011 

revision has been of particular significance given the 

far-reaching structural changes in the international 

investment and multinational enterprise landscape. 

In April of 2010, the Working Party of the OECD 

Investment Committee approved a specific set of 

terms of reference to be included in the 2011 revision. 

These terms respond to altering consumption and 

production patterns, the rise of investment and MNCs 

among non-adhering countries, and low confidence 

prevailing after the financial crisis of 2008. 29 

The updated OECD Guidelines comprise of new 

provisions on human rights, workers and wages, and 

climate change. Nevertheless, the OECD Watch reports 

several shortcomings that remain to be addressed. 


Even since the first round of agreements in 1995, the 

OECD guidelines have faced longstanding concerns. In 

particular, due to conflict among OECD governments 

and strong opposition from outside groups, 

negotiations often undermine policy recommendations 

by stipulating numerous exceptions and by weakening 

enforcement mechanism. 

In response, the task of the OECD body is to: (1) 

evaluate the effectiveness of the Guidelines in 

responding to the terms of reference and therefore also 

in responding to the changing international investment 

landscape, (2) consider the prevailing concerns of 

businesses, labor organizations, NGOs, and nonadhering 

nations, and (3) recommend specific 

objectives and implementation procedures. To get you 

started on your research, this background introduces 

the Guidelines and some of the existing criticism. 

The first section summarizes the history of the 

Enterprises and their regulation. Section III introduces 

the historical precedent for the OECD Guidelines. 

Section IV presents evaluation nuances. Section 

V summarizes the recent round of revisions, and 

Section VI concludes. This background information 

is intended to help you have a better framework for 

understanding and analyzing the OECD’s Guidelines 

for Multinational Enterprises. However, please be 

aware that there is much greater body of criticism 

available that you may wish to explore. 

History and Discussion of the Multinational 

Corporation Regulation 

The Multinational Enterprises Debate 

Multinational corporations (MNC), otherwise 

known as multinational enterprises (MNE), 

are organizations that manage the production or 

delivery of goods or services in more than one 

country. The International Labor Organization (ILO) 

formally defines an MNC as an organization that has 

management headquarters in a single home country, 

but operates in several host countries. Irrespective 

of how they are technically defined, multinational 

enterprises are a source of debate and negotiation in 

international relations. On one hand, some findings 

suggest that the presence of multinational enterprises 

can lead to lower labor standards and dependent 

OECD 21

This table exhibits the coverage of the OECD Guidelines as it compares to that of the UN Global Principles. As the 

table demonstrates, the OECD Guidelines mirror the UN’s goals. (http://www.oecd.org) 


OECD 22

development in host countries. On the other hand, 

certain academics find that exposure to multinational 

enterprises are beneficial for labor standards. 30 

One group of thought argues that the presence of 

MNCs and trade openness are linked to inferior 

labor standards because competition incentivizes 

corporations in developing nations to reinforce lower 

standards. In other words, in order to attract business 

and trade nations lower existing regulatory standards. 

In their research, 

Elmslie and 

Milberg (1996) 

find historic 

evidence of this 

race to the bottom 

in the passage of 

the Fair Labor 

Standard Act of 

1938. Namely, 

when Congress 

passed the Fair 

Labor Standard 

Act, fierce 

competition 

between nations 

incentivized 

politicians to 

push for lower 

regulatory 

standards in the 

areas minimum 

wage, overtime 

compensation, and the employment of minors. 

Although their work centers on trade openness, there 

is concern that the same constraints apply to MNCs as 

well. 

Simultaneously, another group of theorists argues 

that a race to the bottom because of trade openness 

is virtually impossible. Wilson (1996), Lawrence 

(1996), Srinivasan (1996) and Krueger (1996) explain 

that firms cannot gain a competitive advantage by 

standards without pay increases because they are 

effectively cutting wages below a worker’s marginal 

value. So, competition for labor demand from other 


employers would effectively force the firm to raise 

standards such that it becomes equivalent to a worker’s 

marginal value. In other words, these authors refute 

the race to the bottom on the grounds that competition 

demand for labor will sustain marginal value wages 

and standards. 

Specifically, some find that the presence of 

Multinational Enterprises and increased exposure to 

trade actually serves as a mechanism that enhances 

labor standards 

in developing 

countries. 

Voegel (1995) 

first formulated 

the idea of the 

California effect 

in the contexts of 

environmental 

issues. He 

suggested that 

when developing 

countries produce 

for foreign 

markets with 

superior labor 

standards they 

experience an 

upward trajectory 

in domestic 

standards. In the 

field of trade, 

Blanton and 

Blanton (2007) find that developing countries with 

better human rights attract more global production 

activities. Similarly, Garcia-Jonnson (2000) and Moran, 

Graham, and Blomstorm (2005) find evidence that 

multinational firms bring their “best practices” to 

developing nations and because of the magnitude 

of the externalities that they create in the market, 

these practices often diffuse throughout the domestic 

economy. 

Examples of Multinational Enterprise. (http://en.wordpress.com/) 

Regardless of the long term impacts that MNCs have 

on host nations, the best interest of MNCs do not 

necessarily align with those of host nations. “The 

OECD 23

egime of nation state is built on the principle that the 

people in any national jurisdiction have a right to try 

to maximize their well-being as they define it, within 

that jurisdiction. The MNC, on the other hand, is bent 

on maximizing the well-being of its stakeholders from 

global operations, without accepting any responsibility 

for the consequences of its actions in individual 

national jurisdictions.” 31 In this respect, countries 

both on a domestic and international scale have 

endeavored to standardize MNC activity. 

The Role of Multinational Enterprise Regulation 

Because of the potential benefits of hosting 

multinational enterprises, most governments have 

used national regulation to define the terms under 

which MNCs can operate within their borders. Some 

governments have used regulation in a proscriptive 

matter and others in a prescriptive matter – for 

instance, some nations have prohibited foreign firms 


from engaging in certain activity while other nations 

have mandated that foreign firms engage in different 

activities. 32 

On a national level, developing countries initially 

viewed MNCs with unease in the postwar years. 

“The association of foreign companies with former 

colonial powers, their employment of expatriates in 

senior positions, their past history (real or imagined) 

of discrimination against local workers, and their 

embodiment of alien cultural values all contributed 

to the suspicion with which foreign [MNCs] were 

regarded.” 33 In response to these historically rooted 

concerns, most developing countries chose to regulate 

rather than to shut out Multinational Enterprise 

activity. Throughout the course of the late 1900s 

developing countries created regulatory regimes, 

imposed performance requirements, and sometimes 

limited the amount of profits that MCS affiliated could 

International Labor Organization. (http://www.arbormedia.nl) 

OECD 24

epatriate. Yet, restrictive-investment regimes yielded 

disappointing results (Jones 1996) and in response 

numerous developing countries have slowly moved 

towards greater openness, despite continued efforts to 

control MNC activity. 

In contrast, advanced industrialized countries 

have generally been more open to Foreign Direct 

Investment (FDI) and less determined to regulate 

MNC activity. Nonetheless, despite a greater tendency 

towards openness, advanced industrialized countries 

have been very sensitive to control of critical sectors. 

In 1985, the stock of FDI in the United States began 

increasing substantially (doubled over the course of 

an eight year period). This rapid increase immediately 

sparked concerns about foreign ownership of critical 

sectors such as computers and semiconductors. 

Government concerns became particularly evident 

when Congresses passed the Exon-Florio Amendment 

to the Defense Production Act of 1950 that enabled 

executive blocks of foreign acquisition of American 

firms for national security reasons (Graham and 

Marchick 2006). 

On an international scale, there is surprisingly no 

comprehensive set of rules governing multilateral 

activity. A partial set have been compiled by the World 

Trade Organization and specific agreements have been 

agreed upon by a handful of countries – for instance, 

the investment chapter of the North American Free 

Trade Agreement (NAFTA). In addition, to date, the 

OECD guidelines are comprised of a set of regulations 

that are only somewhat binding. The principle 

reason why countries have been unable to design 

a compressive framework is because of the conflict 

between capital-exporting advanced industrialized 

countries and capital-importing developing countries. 

Developing countries maintain that it is their right to 

restrict foreign firms operating within their borders, 

whereas advanced industrialized countries maintain 

that it is their right to protect their investments 

irrespective of where they are. With such divergent 

goals, the regulation on MNCs has always been a 

problematic discussion. 34 


Discussion of the OECD Guidelines for 

Multinational Enterprises 

OECD Guideline Coverage 

In June of 1979, the OECD ministerial Council 

announced that member country governments 

would begin to jointly enforce a set of common 

Guidelines to multinational enterprises operating 

within their territories. “Member countries should... 

accord to enterprises operating in their territories 

and owned or controlled directly or indirectly by 

nationals of another Member country…treatment 

under their laws, regulations and administrative 

practices, consistent with international law and no 

less favorable than that accorded in like situations 

to domestic enterprises (hereinafter referred to 

‘National Treatment’). 35 Although the coverage 

of the laws has evolved over time, at present the 

guidelines have specific provisions for such things as: 

employment, human rights, the environment, science 

and technology, competition, information disclosure, 

taxation, bribery, and consumer interest. 

In the areas of human rights, labor standards, 

the environment, and anti-corruption the OECD 

standards mirror the goals and principles of the UN 

Global Compact. In this way, the Guidelines serve 

as a means through which the OECD Investment 

Committee integrates the UN’s core values regarding 

substantial development into international investment 

strategy. 

Employment and Industrial Relations 

The Guidelines specify that MNCs must respect 

the right of bona fide employee representatives, 

must work to abolish child labor, and must eliminate 

both compulsory labor and employee discrimination. 

The standards towards which MNCs must uphold 

are those of comparable employers in the host 

countries. In addition, the OECD guidelines ask that, 

“in their operation, to the greatest extent practicable, 

[corporations should] employ local personnel.” 36 

It is worth noting that the OECD Guidelines do not 

define their own set of international labor standards; 

rather, they promote those created by the International 

Labor Organization (ILO). The ILO is an international 

OECD 25

organization whose objective is to define and enforce 

international labor standards as defined by the 1998 

Declaration on Fundamental Principles and Rights at 

Work. “The provisions of the Guidelines chapter echo 

relevant provisions of the 1998 Declaration, as well 

as the ILO’s 1977 Tripartite Declaration of Principles 

concerning Multinational Enterprises and Social 

Policy.” 37 In so doing, the Chapter on Employment and 

Industrial Relations echoes the fundamental principles 

of the ILO. 

Environment 

In regards to environmental protection, OECD 

Guidelines maintain that MNCs ought to consider 


Labor Supply and Demand Equilibrium 

(http://www.flatworldknowledge.com) 

international agreements and objectives in the areas of 

environment, public health and safety, and sustainable 

development more generally. In other words, MNCs 

must maintain systems of environmental management, 

must imbed said considerations into the decisionmaking 

process, must be aware of scientific and 

technical risks, and must maintain contingency plans 

for mitigating serious environmental and health 

damage. 38 

These environmental principles reflect the 

objectives of the Rio Declaration on Environment 

and Development, the Convention on Access to 

Information, Public Participation in Decision-making, 

OECD 26

and Access to Justice in Environmental Matters, and 

ISO Standards. 

Combating Bribery 

One of the more explicit specifications of the 

Guidelines concerns bribery. The OECD specifies 

that enterprises should not engage in bribery, should 

employ only legitimate services, should enhance 

transparency & disclosure, should promote employee 

awareness of bribery, and should institute management 

systems that discourage any form of incentive 

misalignment. 39 

Consumer Interests 

The specifications pertaining to consumer interests 

cover fair business practices, marketing and 

advertising practices, and safety/quality of goods 

and services. This implies that MNCs should abide 

by health and safety customer requirements, that the 

contents of goods and services should be accurately 

labeled, and that corporations should be transparent 

(not misleading) and respectful of consumer privacy. 40 

Consumer interests were first briefly referenced in 

1984 following a wave of international trade expansion. 

Since 1984, electronic commerce has exponentially 

increased the access of goods and services provided by 

MNCs. For this reason, the 2011 Review used the work 

of the OECD Committee on Consumer Policy to draw 

up a chapter on consumer interest. 

Science and Technology 

In the area of science and technology, corporations 

are asked that they comply with national laws and 

regard the protection of intellectual property rights. 

What is more, the Guidelines suggest that corporations 

“perform science and technology development work 

in host countries to address local market needs, 

as well as employ host country personnel,” when 

appropriate. 41 In the mindset of impact, the Guidelines 

also specify that when relevant to commercial 

objectives, corporations should develop ties with local 

universities, research institutions, or industry. 

“The chapter thus aims to promote, within the limits 

of economic feasibility, competitiveness concerns and 

other considerations, the diffusion by multinational 


enterprises of the fruits of research and development 

activities among the countries where they operate, 

contributing thereby to the innovative capacities of 

host countries.” 42 

Competition 

The term “competition” is taken to refer to laws that 

include both antitrust and antimonopoly measures, 

that prohibit collective or unilateral action that 

pertain to a) abuse of market power, b) the acquisition 

of market power by means other than effective 

performance, or c) or results in anti-competition 

agreements. 43 

The Guidelines emphasize competition in four regards. 

First, corporations are asked to refrain from fixing 

prices, engaging in collusive tenders, establishing 

output restrictions or quotas, or dividing up markets. 

Second, corporations are asked to abide by “applicable” 

laws that are relevant to their industry or corporate 

structure. Third, principles specify that corporations 

ought to co-operate with regulatory authorities. Lastly, 

they should promote internal compliance. 44 

Taxation 

The OECD specifies that multinational enterprises 

should comply with tax laws and regulations in all of 

the countries in which they operate. 45 

To deal with the cross border dynamics of taxation, 

the basic idea behind the commentary on taxation is 

that an MNC must cooperate with tax authorities so 

that tax liability is accurately identified. “A member 

of an MNC group in one country may have extensive 

economic relationships with members of the same 

MNC group in other countries. Such relationships 

may affect the tax liability of each of the parties. 

Accordingly, tax authorities may need information 

from outside their jurisdiction in order to be able to 

evaluate those relationships and determine the tax 

liability of the member of the MNC group in their 

jurisdiction.” 46 

Implementation Procedures of the OECD Guidelines 

The three main institutional elements of 

implementation are the National Contact Points, 

the OECD Investment Committee, the advisory 

OECD 27

committees of business and labor federation – BIAC 

and TUAC, respectively—and NGOs represented by 

the OECD Watch. 

Each adhering country has a National Contact Point 

(NCP), which is responsible for encouraging Guideline 

observance. “Adhering countries shall set up National 

Contact Points for undertaking promotional activities, 

handling inquiries and for discussions with the parties 

concerned on all matters covered by the Guidelines so 

that they can contribute to the solution of problems 

which may arise in this connection, taking due account 

of the attached procedural guidance.” 47 

The NCP, which meets on an annual basis, is primarily 

responsible for gathering information on national 

experiences, handling enquiries, and solving problems 

that arise in the application of Guidelines. Generally, 

the NCP deals with country specific problems in 

the country where the issue first arises. Although 


OECD Ministerial Council. (http://www.oecd.org/) 

governments are given the flexibility to organize 

NCPs, NCPs are not only accountable to national 

constituencies, but also to their peers and the oversight 

Committee. The 2000 review enhanced accountability 

by calling NCP to report activity on an annual basis. 48 

The Investment Committee, formed in 2004, 

was created by the merger of the Committee 


Enterprises (CIME) and the Committee on Capital 

Movements and Invisible Transactions (CMIT). “The 

OECD Investment Committee is responsible for 

the OECD liberalization instruments in the field of 

international investment and services. It interprets 

and implements the 1976 Declaration and Decisions 


Enterprises and is the guardian of the Codes of 

Liberalization of Capital Movements and Current 

Invisible Operations.” 49 Effectively, the Committee is 

a monitoring body, a forum for discussion, and a peer 

OECD 28

eview facilitator. 

The Guidelines note that, “the [Investment] Committee 

shall periodically invite the Business and Industry 

Advisory Committee to the OECD (BIAC), and the 

Trade Union Advisory Committee to the OECD 

(TUAC) (the “advisory bodies”), as well as other nongovernmental 

organizations to express their views on 

matters covered by the Guidelines.” 50 

The Business and Industry Advisory Committee 

(BIAC) to the OECD is an independent international 

business that advises the OECD on various policy 

initiatives. The BIAC consistent is made up of 37 

policy groups who are responsible for covering (BIAC) 

major aspects of OECD work. 51 Since 1948 the Trade 

Union Advisory Committee (TUAC) to the OECD has 

served as an interface for trade unions with the OECD. 

Originally an advisory committee for the European 

Recovery Program – the Marshal Plan, TUAC has 

become an integral coordinator and advising body. 52 

Together, the National Contact Points and the 

Investment Committee heed the advice of the BIAC 

and the TUAC in furthering and implementing the 

full effectiveness of the Guidelines. That is, the bodies 

oversee the interpretation, implementation and 

revision of the OECD Guidelines to Multinational 

Enterprises. 

Evaluating the OECD Guidelines 

Despite numerous achievements, the OECD faces 

criticism on the substance and implementation 

of the Guidelines. Although the “Guidelines were 

updated… competitive pressures between States 

reflected through discretionary investment incentives 

are suspected to push foreign direct investment 

away from those having high standards to ones 

with comparatively lower levels.” 53 In order words, 

one problem is that despite the Guideline’s efforts 

investments are diverted away from countries with 

higher labor standards and placed in countries with 

lower standards. Nevertheless, it is worth noting that 

in order to facilitate cross-border investment nations 

must agree upon performance baselines and their 

enforcement. 


Objections to the Guideline Methodology 

In terms of the overall tone, the Guidelines do not 

make clear fundamental principles such as what 

constitutes an MNC or what the overall approach 

is in dealing with them. Various passages of the 

Guidelines simply do not specify clear legal definitions 

and principles. This is an integral concern in the 

implementation of the Guidelines because although 

the Guidelines are binding on adherent nations they 

are not binding on MNCs themselves. 54 As such, it 

is up to each individual nation to enforce the agreed 

upon principles. However, though the original draft 

specified that since multinationals could make positive 

economic and social contributions their activities 

could be facilitated at the same time that it specified 

that there should be no difference in the treatment 

of multinational and domestic enterprises. “The 

Guidelines are not aimed at introducing differences 

of treatment between multinational and domestic 

enterprises; they reflect good practice for all.” 55 

Moreover, the first draft of the Guidelines made it clear 

that, “a precise definition of multinational enterprises 

is not required for the purposes of the Guidelines. 

These usually comprise companies or other entities 

established in more than one country and so linked 

that they may co-ordinate their operations in various 

ways.” 56 

To implement fundamental principles, the Guidelines 

require two forms of disclosure. “The first set of 

recommendations call for timely and accurate 

disclosure on all material matters regarding the 

corporation, including the financial situation, 

performance, ownership and governance of the 

company.” 57 In addition, the guidelines encourage the 

disclosure/communication of practices in instances 

where reporting standards are still evolving (i.e. 

social, environment, and risk reporting). 58 Specifically, 

“enterprises should ensure that timely, regular, reliable 

and relevant information is disclosed regarding 

their activities, structure, financial situation and 

performance. This information should be disclosed for 

the enterprise as a whole and, where appropriate, along 

business lines or geographic areas.” 59 

Yet, the contentious debate surrounding disclosure 

OECD 29

has been on how to define ‘geographic areas.’ When 

the Guidelines were first drafted, the Netherlands and 

the Scandinavian countries wanted to see country and 

entity specific disclosure, whereas the United States 

and Switzerland would not agree to such specificity. 

To deal with this disagreement the wording of the 

provisions has been kept vague in order to allow 

enterprises to determine whether a country or a group 

of countries is a more appropriate definition for a 

particular circumstance. 60 This reasoning has come 

under heavy criticism. “The wording of the provisions 

on the disclosure of information is so ‘vague’ that 

it leaves the door open to any interpretation, and 

that fact is bound to create difficulties in the MNCs 

relations with the host countries.” 61 

What is more, from an implementation perspective, 

“the Guidelines are not enforced per se: States are 

responsible for promoting their implementation, 

principally through NCPs, and in the vent of a dispute, 

business, trade unions and other interested parties 

may question their application to the particular 

circumstances.” 62 This heterogeneous system in which 

Diversification Induces Markets to Allocated Investments Internationally. 

(http://blog.oregonlive.com) 


states have the capacity to override transparency 

objectives has allowed for contrasting results among 

adhering states, prompting TUAC to describe NCP 

measures as ‘empty shells.’ 

Changes in the Global Investment Environment & 

Focus Points 

Since the 1970’s, international business has 

experienced far-reaching structural changes and 

the Guidelines have attempted to evolve to reflect these 

changes. Given the rise of service and knowledgeintensive 

industries and the expansion of economic 

activity on the Internet, service and technology 

enterprises have come to play an increased role in 

the international marketplace. In addition, although 

large enterprises still account for major shares of 

international investment, small and medium-sized 

corporate have played a significantly larger role in the 

international science and both large and small have 

evolved to encompass broader ranges of organizational 

arrangements. 63 

Over the past decade, the world economy has 

witnessed new and complex 

production and consumption 

patterns. Non-OECD countries 

have continued to attract 

increasing shares of worldwide 

investment and consequentially 

non-adhering countries have 

become increasingly important 

in international relations. And 

yet, the financial crisis of 2007 

triggered an enormous loss of 

confidence in markets and has 

thus accentuated the need to 

involve governments, private 

sectors, and social standards in 

new efforts to improve business 

conduct. 64 

Multinational Enterprises 

have also rapidly evolved their 

activities in the developing 

working. In countries 

throughout Latin America 

OECD 30

and East Asia, MNCs have “diversified beyond 

primary production and extractive industries 

into manufacturing, assembly, domestic market 

development and services.” 65 These activities have 

given rise to stronger linkages between regions of 

the world and have facilitated productivity gains, 

technology transfer, and the development of human 

capital. 

Simultaneously, the “nature, scope, and speed of 

economic changes have presented new strategic 

challenges for enterprises and their stakeholders.” 66 

In this regard, not only are the OECD Guidelines 

challenged by principle rigidities, but also the 

Guidelines are tested by their ability to adapt 

to a rapidly changing investment environment. 

Specifically, social and regulatory competition has 

incentivized enterprises to respond to public concerns 

and demonstrate corporate citizenship and good 

business practices. In working towards the same goal, 

governments and international organizations have 

moved to strengthen standards in order to capitalize 

upon welfare improvement initiatives. 

Revising the OECD Guidelines 

The Guidelines have previously been reviewed in 

1979, 1982 via a mid-term report, 1984, 1991, 2000, 

and May 2011. In each round of reviews, multinational 

enterprises have argued to limit the amount of changes 

to the text and the implementation mechanism. Indeed, 

throughout the course of earlier reviews Member States 

have argued that effective enforcement is contingent 

upon guideline stability. This attitude has often resulted 

in few textual revisions. For instance, in 1979 Member 

States agreed upon only one amendment pertaining 

to collective bargaining. In more recent examples the 

frequency of changes has increased, but success is still 

contingent upon consensus agreement. 

In 1998 modifications were made that increased 

protection of consumer interests and collective 

bargaining disclosure. Then in 1991, the OECD 

created the Chapter on Environmental Protection. In 

the 2000 Review the imperative became to reassert 

national credibility in light of OECD guidelines 

concerns. Following the 2000 Review, the Ministerial 


Conference Chairman, Mr. Peter Costello, asserted 

that the recent round of reviews consisted of the most 

“far reaching” changes to the Guidelines since their 

introduction in 1976. Yet numerous reviews have 

found that while the Chairman’s sentiments pertained 

to textual development, they did not improve the 

implementation mechanism of the Multinational 

Enterprise Guidelines 

A little more than a year before the latest round 

of revisions, in May of 2010, the 42 adherent 

governments began defining terms of reference for 

carrying out an update. Although their aim was not to 

embark on a revision of the scale of the 2000 Review, 

they sought to address both fundamental challenges 

and changes in the international investment regime. 

The terms of reference cover substantive, procedural, 

and institutional issues relating to specific sections of 

the Guidelines. 

Substantive 

The first substantive discussion the body was asked 

to address was the adoption of further guidance 

on the application of supply chains. Specifically, the 

2011 review took into account the 2003 Investment 

Committee discussion and recent discussion by 

UN Secretary-General for Business and Human 

Rights (UNSRSG). In response to the financial crisis, 

the update investigated how “the instruments and 

tools that have emerged on responsible lending or 

investment by financial institutions – such as the IFC 

Policy and Performance Environmental and Social 

Standards (last revised in 2006), the Equator Principles 

(2003, 2006), the UN Principles of Responsible 

Investment (2005), and the OECD Guidelines for 

Pension Fund Governance (2009) – could assist 

in clarifying the application of the Guidelines to 

multinational finance institutions, including by 

introduction specific provisions in the Guidelines for 

the purpose.” 67 

In respect to human rights, the Terms of Reference 

suggested that the Guidelines elaborate and include, 

when appropriate, the work of the UNSRSG. “Such 

additional guidance would also take into account due 

diligence recommendations under development by the 

OECD 31

UNSRSG and the guidance provided on other human 

rights aspects by the OECD Risk Awareness Tool, such 

as management of security forces and relationship with 

local communities and indigenous people” 68 

Building upon the adoption of the 2009 

Recommendation for Further Combating Bribery 

of Foreign Officials in International Business 

Transactions and ongoing work, the adhering 

countries agreed that Chapter VI could elaborate 

on: facilitation payments, the use of agents or other 

intermediaries, bribe solicitation and extortion, 

whistleblower protection, and measures for bribery 

prevention. 

Although there are several other significant substantive 

recommendations, the final one mentioned in this 

background guide concerns taxation. After some 

debate, the terms of reference came to specify that the 

OECD examine “whether the relevant chapter of the 

Guidelines should include provisions on the public 

disclosure of taxes, royalties, and other payments made 

to host governments.” 69 

Procedural & Institutional Provisions 

This section of the Terms of Reference aims to 

reconsider implementation procedures and 

how they seek to enhance Guideline awareness and 

visibility. To do that, nations agreed that the 2011 

revision ought to provide greater respect for individual 

circumstance through specific provisions, proliferate 

the corporate responsibility measures embedded in 

the OECD guidelines, and strengthen monitoring 

and implementation. At the same time, there was 

clear preference for clarifying OECD co-operation 

proceedings, peer reviews, and follow-up work 

programs. 

Modalities 

The concluding section of the Terms of Reference 

specifies that the OECD should consult with key 

stakeholders and non-adhering countries throughout 

the review process. These include but are not limited 

to: the BIAC, the TUAC, the OECD Watch, interested 

non-adhering countries – with preference to major 

emerging markets, the ILO, the UN, the UNEP 

Finance Initiative, and the International Organization 


for Standardization (ISO). These consulting actors 

will likely serve as key actors throughout the course of 

the conference because they are an integral part of the 

OECD’s review process. 70 

Conclusion 

The initial reactions by States to the 2000 and 2011 

revisions were quite favorable. NCPs gained a new 

role in ensuring prospective corporate compliance, the 

committee responded to NGO efforts to enhance the 

Guidelines, and the text fundamentally became more 

specific. At the same time, the additional new details 

meant greater exception clauses, and the NCPs’ role 

is still hindered by lack of enforcement mechanisms. 

Bearing in mind the fundamental ideas presented in 

this study guide, your task is to evaluate the pending 

long-standing criticism and new challenges in order to 

(1) identify the progress of the 2011 Revision as it was 

designed by the Terms of Reference and (2) identify 

prospective recommendations. In effect, you will be 

designing the first draft of the next round’s Terms of 

Reference. In order to do so, I urge you to consider the 

following questions. 

Questions a Resolution Must Answer 

How successful are the present Guidelines at attaining 

the OECD’s objectives and regulate the MNC 

behavior? 

What substantive and procedural measures fail to meet 

the objectives of the OECD in the context of today’s 

investment climate? And in regard to those measures 

what and how should the next OECD review integrate 

new changes? 

How effective has the 2011 review been in preparing 

the Guidelines for Multinational enterprises to deal 

with present challenges? In other words, has the 2011 

review failed to integrate any imperative changes? 

What can the OECD do to better integrate the 

comments and concerns of stakeholders and nonadhering 

countries? 

What is the capacity of the Guidelines to maintain 

current targets before new terms of reference and 

revisions are necessary? 

OECD 32

Key Actors, Organizations, and Country 

Positions 

The politics of Multinational Organizations and 

their regulation emerge from the competing 

interests of home countries, host countries, MNCs, 

and activist organizations. “Each group has distinctive 

interests regarding FDI. MNCs want to operate freely 

across the globe, with few government-imposed 

restrictions on their activities. Host countries want to 

ensure that the MNCs operating within their borders 

provide benefits to the local economy that offset the 

loss of decision-making authority that is inherent in 

foreign ownership. The home countries of the MNCs 

want to ensure that their firms’ overseas investments 

are secure.” 71 The conflicting interests of each entity 

make for heated political debate and stalemate in the 

realm of international regulation. 

In formulating your country position, there are several 

important factors that you should consider that 

influence an actor’s interests. “First of all, developing 

countries have been more vulnerable to foreign 

domination than advanced industrialized countries 

have been. The advanced industrialized countries 

have larger and more diversified economies than 

the developing countries; consequentially, a foreign 

affiliate is more likely to face competition from 

domestic firms in an advanced industrialized country 

than a developing country.” 72 This means that because 

foreign firms are more likely to dominate business in 

developing countries than they are in industrialized 

countries, advanced industrialized countries often feel 

less compelled to regulate MNC activity. 

Second, political science finds that there is a “strong 

correlation between a country’s role as a home for 

MNCs and its policies towards inward FDI. The two 

largest foreign investors during the last 140 years – the 

United States and the United Kingdom – also have 

been the most open to inward foreign investment.” 

73 The implications are that because developing 

countries typically host MNCs, their concerns are 

more specific to host-country issues. 

Finally, there are fundamental differences on how 

governments approach state interventions by MNCs 


in their national economics. “The two governments 

that were the most restrictive towards FDI, Japan 

and France, were also the two governments that 

relied most heavily on industrial policies to promote 

domestic economic activity. Thus attempts to regulate 

MNC activity were most likely in countries where 

governments played a large role in the economy.” 74 

When thinking about the OECD guidelines, I advise 

that you consider your country’s relation with MNCs 

and consequentially Guideline preferences. 

A final group or organizations that are active in this 

debate, are those that comment, participate, and 

implement corporate standards on any level or scale. 

Some of these key actors are either a part of the 

OECD discussion process or comment on OECD 

developments: United Nations Conference on Trade 

and Development (UNCAD), International Trade 

Organization (ITO), International Labor organization 

(ILO), World Trade Organization (WTO), World 

Bank (WB), and International Monetary Fund (IMF). 

Moreover, the Guidelines are also inspired by region 

or topic specific trade organization initiatives: Social 

Investment Forum, EuroSIF, and United Nations 

Environment Programme & the Principles for 

Responsible Investment. 

Suggestions for Further Reading 

In order to understand the basis of multinational 

regulation, the best starting point is the OECD 

website. Some of the relevant publications on this 

topic area are: (1) Annual Reports on the Guidelines 

for Multinational Enterprises, (2) OECD Risk 

Awareness Tool for Multinational Enterprises, and 

(3) The Investment Newsletter. In addition, the 

OECD regularly published Global Forum minutes, 

Roundtable agreements, and special on MNCs. I highly 

encourage you to look through these documents in 

order to get a better picture of both how the Guidelines 

have evolved over time and general prevailing 

discussions. 

For country specific research, I suggest that you look 

through OECD Investment Policy Reviews. These 

comprehensive reports dive into every aspect of a 

country’s Investment Policy and evaluate progress in 

OECD 33

key goal areas. Although these reports will provide 

useful insight into what measures a particular country 

is interested or not interested in, they will not provide 

insight on political dynamics. So in order to gage 

OECD debate dynamics, useful readings will be the 

Reports by the Chairs of the National Contact Points 

Meeting and the conference minutes. 

Besides the OECD, numerous organizations comment 

on and evaluate the OECD: BIAC, TUAC, the ILO, 

the UN, the UNEP Finance Initiative, the ISO, and the 

IMF. The publications compiled by these organizations 

along with those written by various activist 

organizations outline some of the critical faults of the 

OECD’s guidelines and by what means the next review 

may improve the current body of regulations. 

Some additional interesting materials include but are 

not limited to: 

1. Obsolescing Bargaining Model & Application – 

Theodore H. Moran’s Multinational Corporations 

and the Politics of Dependence: Copper in Chile 

(1974) 

2. Government Regulatory Measures – A.E. Safarain’s 

Multinational Enterprises and Public Policy: A 

Study of Industrial Countries (1993) 

3. Overview of international negotiations over 

investment rules – “United Nations Efforts 

to International Regulation of Transnational 

corporations,” in Legal Aspects of the New 

International Economic Order, Kamal Hossain 

(1980) 

4. Response to MNC Criticisms – Edward M. 

Graham’s Fighting the Wrong Enemy: Antiglobal 

Activities and Multinational Enterprises (2000) 

As iterated earlier, although there are a variety of 

information sources available on the Web, please do 

make sure to evaluate the information sources carefully 

and be sure to only seek out reliable work. Best of luck 

and enjoy the research process! 


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of Human Rights and Foreign Direct Investment.” 

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OECD 34

Consequences and Responses, Brussels, European 

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. 

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ary, pp. 141-194. 

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business: An introduction. London: Routledge. 

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of Productivity, Northampton, MA, Edward Elgar, pp. 

ix-xxviii. http://www.economics.harvard.edu/faculty/ 

jorgenson/files/EconOfProductivity_Elgar_2009.pdf 

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Moran Theodore, Edward M. Graham, and Magnus 

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OECD 35

“Opening to the World: International Cooperation 

in Science and Technology.” European Commission, 

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OECD. 1 September 2011

23 Opening to the world: International 

Cooperation in Science and Technology 

24 Wyplosz 

25 EU shows strong growth of productivity in 

2006 

26 Alesina 

27 Countries - Turkey 

28 OECD Guidelines 9 

29 OECD Guidelines for Multinational 

Enterprises: Recommendations For Responsible 

Business Conduct in A Global Context 11 

30 Tully 394-396 

31 Vernon 28 

32 Oately 190 

33 Jones 291 

34 Oatley 205 

35 Guidelines 7-8 

36 Guidelines 18 

37 Guidelines 43s 

38 Guidelines 19-20 










48 OECD Website 



51 BIAC Website 

52 TUAC Website 

53 Tully 2004 

54 Hagg 71 




58 Hagg 72 


60 Hagg 71 

61 Germidis and Negreponti 204 (Hagg) 

62 Tully 400 





67 Terms of Reference 3 




71 Oately 211-212 

72 Oately 204 

73 Oately 204 

74 Oately 204

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