Seven years on, Compact sees 3,000th expulsion

The number of companies expelled from the UN Global Compact has now passed 3,000, and the organisation says CSR has reached 'a major crossroads' worldwide.

For failing to communicate progress on their implementation of the Compact's ten sustainability principles, 3,123 companies have been dropped since 2005.

More than 7,000 businesses remain members and the number of companies joining far outstrips those leaving, so that the Compact expects to have 20,000 business participants by 2020.

The expulsions level has always been a problem for the Compact, despite a recent one-year reprieve and last year's introduction of a two-tier system to make it easier for new signatories to reach the reporting requirements.

The 3,000 milestone means that for roughly every two signatories another is expelled, a proportion that has grown since the Compact introduced de-listing in 2006.  

The Compact has recently been extending its reach geographically, especially in Asia, but expelled companies are disproportionately based in developing countries without a strong CSR tradition.

More notable exclusions include GlaxoSmithKline's German arm, the UK-based financial service providers Man Group and Hiscox, the Spanish food and drink group Actel, Air India and Honda Cars Pangasinan.

The Compact said: "The fact remains that a large majority of the world's businesses have not yet made any commitment to universal principles, acting as a drag on sustainability efforts.

"Commitments must be followed by action, and we call on all of our 7,000 business participants to broaden and deepen their implementation efforts – and to encourage their peers, suppliers, subsidiaries, partners and corporate clients to do the same.

"We also hope that the international community – civil society, governments, academia, and media – will take note of this information and encourage more companies to make a serious and enduring commitment to universal principles."