Public private partnerships: the role of the private sector in preventing funding conflict.

• Author: Bennett, Juliette

I am glad to be here at this important conference focusing on Corporate Governance, Stakeholder Accountability, and Sustainable Peace and to thank the William Davidson Institute and The Aspen Institute's Initiative for Social Innovation Through Business for inviting me.

I live less than three miles from the World Trade Center, and I was there on September 11 to witness the devastation and talk to the survivors. Like all of us, I am appalled at what terrible crimes against humanity can be committed by people with four or five hundred thousand dollars and a consuming hatred. It is important to remember that the target they chose--the World Trade Center--was a symbol of the global economy and also that the money that underwrote these crimes was generated in the global economy. It is fitting and timely that a focus of this conference is on sustainable peace.

Last year in New York City, I organized a conference bringing together NGOs and business to discuss how to work together to promote conflict prevention, crisis management, and post-conflict reconstruction. The conference focused on the extractive sector, where conflict prevention is an important element of business operations.

I recently also chaired a workshop at the NGO Transparency International, whose pioneering work in bringing worldwide attention to the role of financial institutions in promoting responsible corporate behavior and in concepts like the rule of "know thy customer" and "integrity pacts" have helped to ensure that money generated by multinational business operations is used properly and transparently.

As the case against Osama bin Laden develops, we are seeing how easily money generated by multinational business activity can be used to underwrite terrorism and other criminal activity. Bin Laden's reportedly vast inherited wealth comes from his father's hugely successful international construction company. Bin Laden has supplemented that wealth through his own network of multinational businesses, ranging from construction to banking and finance to heroin smuggling to Russia and Eastern Europe, and he has used the revenues generated by these business activities to fund terrorist operations in as many as twenty nations. (1) And, I have no doubt he used these funds to train and equip the nineteen men who carried out the crimes of September 11.

To prevent the funding of conflict by the private sector, whether directly or indirectly, the coalition of nations fighting terrorism needs the advice and counsel of non-governmental organizations who can provide valuable expertise, such as tracking the arms trade and preventing money laundering.

In recent years, we have seen groups dedicated to human rights, conflict prevention, and other important causes move from attitudes of opposition to engagement with companies. Increasingly, responsible members of the NGO community and companies are working together to prevent human rights abuses, to preserve indigenous communities, to protect the environment, to fight corruption, and, most importantly, to prevent conflict.

In a recent report to the Security Council, the United Nations Secretary-General had the following to say about business and conflict:

The impact of the pursuit of economic interests in conflict areas has come under increasingly critical scrutiny. Corporations have been accused of complicity with human rights abuses, and corporate ties have continued to fuel civil wars. It has become common knowledge that by selling diamonds and other valuable minerals, belligerents can supply themselves with small arms and light weapons, thereby prolonging and intensifying the fighting and suffering of civilians. (2) In recent years, leading human rights, environmental, conflict resolution, and anticorruption organizations have focused their energies on the extractive sector, not only because of its perceived...