OECD Guidelines for Multinational Enterprises: Recommendations for Responsible Business Conduct in a Global Context
The Organisation for Economic Co‑operation and Development (OECD) Guidelines for Multinational Enterprises (the Guidelines) provide voluntary principles and standards for responsible business conduct in a variety of areas including human rights, anti‑corruption, taxation, labour relations, environment, information disclosure and consumer protection.
A multinational enterprise (MNE) is broadly defined as a corporation which operates a business in and across countries in addition to the country of its registered offices or its headquarters.
The Guidelines are recommendations approved by governments to MNEs operating in or from the territories of the 42 countries that adhere to the Guidelines. They are complemented by implementation procedures where adhering governments agree to promote observance of the Guidelines.
The Guidelines aim to develop a sustainable approach to business conduct, and promote an atmosphere of mutual confidence between MNEs and the many societies in which they operate. These relationships are increasingly important in the context of globalisation and particularly as emerging economies play a greater role in this process.
Consequently, the Guidelines encourage greater levels of quality foreign direct investment and support MNEs in contributing to the efficient use of capital, technology and human resources. They act as catalysts for transferring international best practice across a range of disciplines. Such influence in the global market has invaluable flow on effects to sustainable and social development programs and to the achievement of the United Nations' Millennium Development Goals.
The Guidelines complement private sector efforts to define and implement responsible business conduct. Corporate social responsibility is now recognised as a core business strategy by most MNEs. There is a growing expectation on MNEs to maintain high standards in environmental and social responsibility and corporate governance.
While many codes of conduct for responsible business are available, the Guidelines are the only multilaterally endorsed and comprehensive code that OECD governments are committed to promoting. This makes them one of the world's foremost corporate responsibility instruments. Moreover, the Guidelines complement other instruments such as the United Nations' Global Compact, the Equator Principles, and the United Nations' Principles for Responsible Investment — all of which MNEs themselves may commit to.
The Guidelines form part of a package of investment instruments that come under the OECD Declaration on International Investment and Multinational Enterprises, and were updated in May 2011.