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EDB MONTHLY NEWSLETTER • MAY 2024

Responsible Business Conduct Matters - The growing network of NCPs across Africa

Background

The OECD Guidelines for Multinational Enterprises (Guidelines) promote responsible business conduct globally across topics such as human rights, labour, environment, anti-corruption amongst others. Countries wishing to adhere to the Guidelines are required to establish National Contact Points for responsible business conduct (NCPs). The NCPs essentially fulfil two main roles: promotion of the Guidelines and providing a mediation mechanism to address possible instances of violations of the Guidelines. The Guidelines are also open to non-OECD members.

The influence of NCPs globally

The geographical reach of NCPs is extensive, evident by the fact that the Guidelines addressed by adherent countries apply to companies operating in or from their jurisdictions. The table below shows that adherent’s to the Guidelines have an approximate 50% share of global GDP, 70% share of Global FDI stocks and 80% of Global Trade Volumes.

Over the past 20 years, NCPs have handled cases in over 100 countries spanning five continents and including over 50 countries which are not adherents to the Guidelines. The table below illustrates the geographical reach globally and interestingly underscores the importance of the African continent as a major place for business operations, in light of its regional issues handled by NCPs over the world.

Across Africa, Egypt was the first country in the MENA region to adhere to the OECD Declaration on International Investment and Multinational Enterprises (OECD Investment Declaration) and to adhere to the OECD RBC instruments, establishing its NCP in 2007. Morocco also established the National Contact Point in 2009, following its adherence to the OECD Investment Declaration. Across the region, Tunisia adhered to the OECD Declaration in 2012. This trend is gaining momentum with Mauritius being the first sub-saharan country to set up a National Contact Point in 2023. The growing network of NCPs across Africa represents a major milestone in the promotion of responsible business conduct and accordingly paves the way for NCP networks to discuss issues of joint interest on a regional basis.

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