Spring til indhold

Vision of the Danish Government to promote sustainable global value chains

Speech by Minister for Trade and Development Cooperation Mr Mogens Jensen at the high level conference: ‘Promoting sustainable global value chains through Public-Private Dialogue’ 10 March 2015.

Your Royal Highness, distinguished colleagues, esteemed business leaders and trusted partners. I am thrilled to be able to address this truly global group today.

No matter where I travel in the world one message resonates: Developing countries are calling for increased trade, investments and technology to tackle the development challenges. They want growth and higher productivity. They want jobs. They want to put an end to poverty. Aid is not enough.

There is an increasing demand for solutions where not only government but also the private sector can play a crucial role. Companies can bring knowledge, technology, innovation, investment and a new mind set. Today, let’s all keep an open mind as to how we as governments can cooperate with the private sector to create sustainable development in the world.

I believe it is possible to combine trade and development. And as minister for both areas, I’m working to generate new initiatives that enhance both development cooperation and trade – not least by engaging the private sector in delivering tangible results.

But ladies and gentlemen, these tangible results must depend on standards. Not least those that have to do with business integrity, human and labour rights and environmental protection. To create sustainable development, standards must be raised, respected and promoted. The Danish government is determined to fight for decent and sustainable working conditions. For me as a Social Democrat and former trade unionist it is in my political DNA.
Our conference today has a two-dimensional agenda: on the one hand we have the need for compliance with international standards. On the other hand the potential for creating shared value, meaning value for the company as well as for society. I am very well aware – and I respect - that private companies are in the game for profit. I am not here to change the logic of business.

But better business and better lives go hand in hand.

We will hear some examples from the business leaders and representatives speaking throughout the day [H&M, Anglo-American, Lego, Novo Nordisk]. Their enterprises are among the frontrunners internationally and showcase the win-win potential for shared value by making sustainability an integral part of business strategies. But they also acknowledge the huge challenges in becoming a sustainable enterprise. It is a long journey, but these companies have shown a way forward.

As government, there are several ways in which we advance this agenda. I have recently launched an action plan with six initiatives to promote corporate social responsibility. Focus is to create more sustainable value chains in countries and across countries. Trade agreements, climate agreements, ILO conventions are all important setting general standards. But we need more. I believe this can be done by building strategic international partnerships and promoting social dialogue and environmental standards in the market.

To really have impact, we must team up. The European Union has a key role to play as the home market for more than 500 million consumers and a key market regulator.

I work to ensure that CSR and sustainability becomes systematically integrated in EU trade agreements and development cooperation.

It is all about pushing this agenda and inspiring more stakeholders - companies, business associations, labour, civil society organisations and governments - to get on board as partners. I think the follow-up to the Rana Plaza tragedy has already shown what such partnerships can accomplish.

Let me highlight a couple of thorny issues that I would like you to discuss today:

First, when we talk about creating a level playing field for business, what do we actually mean? If we really want to raise social and environmental standards in producer countries, we must also be ready to integrate this area in our development assistance. Private sector and local governments can’t do this job alone.

Second, how do we provide the right mix of incentive and regulation – carrot and stick – to ensure a real transformation of markets?

There is no single answer to this question, but we must work actively to make responsibility a market condition within a number of industries. We cannot just sit back and wait for it to happen by itself.
And finally, how often do pre-conceived ideas about the nature of the public sector on the one side and business on the other prevent public-private dialogue in trade and development from working properly? How do we create the mutual trust which will allow us to move forward?

Taking my cue from this last question let me mention a couple of examples of public-private partnerships which we are involved in that really work and allow us to set seriously ambitious targets.

The Danish government has established the Danish Climate Investment Fund as a new innovative public-private partnership. We have raised private climate financing through a public/private agreement with a total commitment of 230 million dollars. The government’s funding is expected to be leveraged by a factor of 15 to 20. The Fund will for instance invest in wind and solar energy, energy efficiency in Africa and in regions with development needs.
This public private partnership contributes to growth and employment in the developing countries, to combat climate change and provide a reasonable return on investments.
We have another platform for public-private dialogue that has succeeded in producing some quite innovative partnerships: The Global Green Growth Forum – 3GF – meeting regularly in Copenhagen.
3GF has provided the platform for an exciting new initiative within the garments and textile industry in Vietnam, which is called a Race to the Top. It involves some major American companies, IDH, IFC and ILO through Better Work, the Vietnamese government, Denmark and the Netherlands.

The essence of Race to the Top is to handle the challenge of responsible business in the industry. The industry is encouraged to modernize management and invest in machinery and infrastructure. This is expected to improve productivity but also to raise the social and environmental standards in this sector. Through this partnership we create more responsible value chains to the benefit of the companies and the worker.
I look forward to hearing many more examples of how we can integrate sustainability in trade and development through public-private cooperation and how we can find answers to some of the challenging questions we are facing.
Thank you all for coming to Denmark today. Thank you for taking part in the fusion of better lives and better business.

Let’s race to the top together

Thank you.

Write html text here