Toward More Effective "Multi-stakeholderism"

We humans are not succeeding in addressing the biggest global challenges of the twenty-first century, namely limiting climate change, preventing pandemics, and connecting less advantaged with the online world. Our historical governance champions, national governments, have not demonstrated the capacity to unilaterally address vital global challenges, whether climate or pandemic, and our multilateral institutions are strained by political divisions, constraints on their mandates and resources, and inefficiencies. The United Nations (UN) was founded at the end of WWII with aspirations that national governments working together in multilateral action could address global challenges. The UN efforts have been successful in many areas. But domestic and international political support for multilateralism has ebbed and flowed.

As the UN Secretary-General António Guterres recently remarked before the General Assembly, "Today, we have a surplus of multilateral challenges and a deficit of multilateral solutions." He invited the UN to think seriously about the future of governance, including a more "inclusive multilateralism, drawing on civil society, cities, businesses, local authorities and more and more on young people."¹ As the UN evolves and reimagines international cooperation, so too are actors from civil society and the private sector who have been engaging more and more in multistakeholder models.

Scholars often cite the failures of government and multilateral institutions to solve the problems of globalization as the leading impulse behind multistakeholder actions. A fuller explanation should include the evolving role that businesses and civil society play in our modern societies. Today, businesses have rejected Milton Friedman's thesis that "the business of business is business," instead embracing a model of stakeholder capitalism."² Microsoft President Brad Smith summed up stakeholder capitalism: "If we do a good job of taking care of our customers, our employees, and the communities in which we live and work, our shareholders in my view will always benefit."

In the twenty-first century, many influential business leaders are redefining the role of corporations to reflect the belief that corporate profits depend on a healthy society. A recent survey by Deloitte found that 93 percent of business leaders worldwide see themselves as "stewards of society."³ In 2018, Larry Fink, the CEO of BlackRock, jolted the investing world when he informed CEOs that their companies needed to make a positive societal impact in order to receive support from BlackRock. "To prosper over time," he wrote, "every company must not only deliver financial performance, but also show how it makes a positive contribution to society."⁴ Satya Nadella, CEO of Microsoft, described the evolving role of business in modern society: "The corporation's purpose is to find profitable solutions to the problems of people and planet."⁵

The private sector and multistakeholderism

For global companies with customers and employees around the world, major issues like environmental sustainability, the protection of human rights, and equitable recovery from the COVID-19 pandemic are intertwined with business success and responsibility. Cooperation and collaboration with national governments and multilateral institutions, as well as civil society and other businesses, is becoming a normal extension of multistakeholder capitalism. Figuring out how best to engage becomes the question.

Corporate participants in multistakeholder initiatives should be well informed of criticisms of multistakeholder models and the pitfalls to be avoided.⁶ First, one must concede that not every problem has a multistakeholder solution. Government actions and regulations may be more appropriate and private sector contributions on some topics may not be appropriate. Second, one should look carefully at private sector participants' potential conflicts of interest and address them transparently. Transparency and open communication can build accountability with those who are outside looking in. Third, diverse opinions and perspectives are at the heart of multistakeholder actions. Participants should share a common goal, but the breadth and diversity of participation are fundamental to success.

Some governments and individuals are open to listening to what roles businesses think they can play in new initiatives, while others have fundamental objections to any private sector participation. We need to acknowledge that certain initiatives stretch beyond the comfort zones of some government actors, particularly in cases where governments have historically been the interlocutors.

The philosophical arguments over...