Multipart thematic paper on multi-stakeholder ... - ISIS Europe

Democracy promotion and the market
The Corporate Social Responsibility (CSR) agenda of the 1990s that later led to the establishment of the
Global Compact has rendered increasingly political what used to be purely economic and trade policies. 14
This global tendency turned private actors into important interlocutors for democracy, human rights, and
good governance promotion. Despite numerous criticisms of big international businesses and MNCs,
especially by the anti-globalist activists, “multinationals’ influence in relation to democracy’s development
in emerging markets is less insidious but also more confused than is habitually suggested” (Youngs, 2004:
86).
In (post-)conflict settings basic security remains the core concern of international businesses. What is
interesting, however, is the growing recognition of links between stability, good governance, respect for
human rights, and democracy. For example, repression of basic human rights is increasingly considered a
cause of conflict and instability, and therefore, a factor for investment risks. Therefore, it is the security
considerations that are said to be at the heart of increasingly political approaches of international businesses
that start promoting respect for human rights, paying greater attention to ethnic tensions (including in
company’s hiring strategies), providing assistance to civil society organisations, addressing the roots of
conflict in inequality, corruption, and repression, supporitng media publicity promoting peace, and so on. 15
This position is not shared by all international businesses, many of whom insist that security and stability are
not necessarily best provided by democratic governance and that in many cases a firm autocratic rule can be
a better guarantor. It is not within the scope of this <strong>paper</strong> to go into this debate. What is important for MSPs
here is that private actors in post-conflict settings are increasingly taking on a political role and are
partnering with civil society and the state towards these goals, thus going beyond narrow efficiency rationale
that characterised public-private partnerships a decade ago.
Democracy promotion and civil society
The involvement of civil society in the so-called “aid industry” has been one of the key developments
inspired by the “democratic turn” discussed above. The rationale for involving civil society has been twofold:
normative-political and instrumental.
From the normative-political perspective, civil society is said to contribute to deepening,
consolidating, 16 and maintaining democracy in a variety of ways. It allows holding state officials accountable
in between elections, stimulates political participation, and increases citizens’ political efficacy and skill as
well as elucidating norms of tolerance, trust, moderation, and accommodation in society. It is widely
14 Here the growing importance of the “stakeholder” concept, i.e. giving a voice to all those who have a “stake”, is an important
component.
15 See for example, International Business Leaders Forum at www.iblf.org.
16 Consolidation has been defined as fixing democratic rules and institutions in such a way that they gain primary influence on the
behaviour of political actors as well as strengthening civil society and letting democratic values and norms penetrate the social fabric
– as argued in (Di Palma, 1990) As a result, democracy becomes “so broadly and profoundly legitimate and so habitually practiced
and observed that it is very unlikely to break down” (Diamond et al., 1995)
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