DEVELOPING COUNTRIES need to play a bigger role in the drafting of environment, social, and governance (ESG) rules, a United Nations (UN) official said.
On the sidelines of the 16th edition of the Investment Policy Forum on Wednesday, UN Special Rapporteur on the right to development Surya Deva said that ESG regulations such as those imposed by the European Union, although well-intentioned, might not be inclusive.
“The difficulty I see is in terms of the process, whether the countries, let us say in the Global South or in Asia, were consulted properly before these regulations were pushed forward by the European Union,” he told reporters.
“So going forward, my suggestion would be that we need more global rules, but those rules must be developed in a more participatory fashion rather than being imposed by the European Union or any particular developed economy,” he added.
In the case of the Philippines, he said that its government has the ability to adapt itself to the global ESG regulations.
“It can be proactive in terms of preparing ready in terms of the economy, how these regulations are going to impact the local businesses and others,” he said.
“But in addition to that, the Philippine government can also work with other governments in Asia so that they can leverage better in terms of negotiation,” he added.
Asked about the readiness of the Philippines, he said the country has the technical expertise.
“Your human capital is definitely very well advanced in terms of that. But then, the Philippines is part of a global ecosystem. So, we have to ensure that the global rules are also there to ensure that the government of the Philippines is able to promote that kind of sustainability,” he said.
“Because if not everyone is following the same rules in terms of sustainability, the markets may not be ready to be at that kind of model of sustainable development,” he added.
The UN official also said that although investments are critical for development, there is a need to put focus on biodiversity, climate change, and the environment, especially in countries like the Philippines where a lot of natural disasters happen.
“So the private sector and the governments also have a key role to play because they need to align their tax incentives and other regimes in a way that they are promoting the right kind of investment,” he said.
He said that a right investment should not result in the displacement of indigenous peoples and must follow labor laws.
“Human development is something we should be aiming for. So, when we are talking about inclusive and sustainable development, it should not leave anyone behind, and I think the government should proactively ensure that,” he added. — Justine Irish D. Tabile