As part of the TWAILR symposium on the United Nations Centre for Transnational Corporations (UNCTC), River Baars reflects on a series of documents leading up to the establishment of the UNCTC, reading them alongside the work of Walter Rodney, and argues that radical anti-capitalist positions were foreclosed from the very outset of the UNCTC.
TWAILR: Reflections ~ 86/2026
Walter Rodney, the preeminent Marxist and decolonial scholar, organiser and teacher, understood that corporations stand at the core of imperialist capitalism. In his book, How Europe Underdeveloped Africa, he showed how corporations had been the ones carrying out the European colonial project, from the very start, in Africa as in Asia and across the Atlantic, until the 20th Century – and he showed how they continue to play this role through the presence of multinationals in Africa today. Rodney wrote this book not for western scholars, but for Africans. With it he offered them a tool and a weighty task: ‘every African has a responsibility to understand the system and work for its overthrow’ (p.34).
In meticulous detail, Rodney exposed how in five centuries of extraction and exploitation, European companies – on top of shipping thirteen million enslaved Africans to the Americas, taking the land, subjecting or massacring the people, and turning both land and labour over to maximalist profit extraction – deliberately destroyed indigenous African economies. Through their operations both during, and ‘post’ colonialism, the European and later also American transnational corporations replaced once-thriving crafts, manufacturing and domestic agriculture with purely extractive economies — growing, mining and pumping up raw materials for Western use.
Rodney published this work, his masterpiece, in 1972, when Third World liberatory struggles, international solidarity movements and Third World collective action in international fora opened up a sense that radical change was in fact possible. At the core of this sense of possibility was the knowledge that the configuration of the economy had to change, from the existence of private for-profit corporations, to the way workers are chained to them via the wage relation, through to the local and global division of labour that sees the few reap all the benefits. It was the growing awareness of, and attention upon, transnational corporations by scholars and activists including in new Third World member states that led the UN to start the process that would lead to the establishment of the UN Centre for Transnational Corporations (UNCTC) in 1974.
One might imagine the UN heard Rodney’s call. That, and gruesome incidents such as the June 1972 explosions at the Wankie mine (owned by Anglo-American Corporation) in what is now Zimbabwe, which left 427 workers dead and put corporate extraction firmly on the agenda. On 28 July 1972, the United Nations Economic and Social Council unanimously adopted Resolution 1721 (LIII), in which it requested the Secretary-General to appoint a Group of Eminent Persons to study ‘the role of multinational corporations and their impact on the process of development, especially that of developing countries, and also their implications for international relations… and to submit recommendations for appropriate international action’.1 The Eminent Persons were chosen, in consultation with governments, ‘from the public and private sectors and on a broad geographical basis’, and for being ‘intimately acquainted with international economic, trade and social problems and related international relations’ (UNESC Resolution 1721 (LIII)). They included the Algerian energy minister Ahmed Ghozali; Yugoslav energy company founder Emerik Blum; Tore Browaldh, CEO of the Swedish Handelsbank; John Deutsch, Chair of the Economic Council of Canada; AK Jhan, Governor of the Reserve Bank of India; and Mohammad Sadli, Indonesian Minister of Mining. The group also included Mohamed Diawara, an Ivorian businessman and chair of the Club of Dakar, a group of African business leaders seeking to lower barriers to European and American investment (later embroiled in various financial scandals). In other words, from all corners of the world, came men whose expertise lay in finance and resource extraction – including members of what Rodney, Frantz Fanon and Aimé Césaire would call the ‘national bourgeoisie’.
Perhaps to balance things out a bit, the group was helped in its task by two consultants — Argentine economist Raúl Prebish and Nat Weinberg, a former director of the United Automobile Workers union (UAW). To facilitate the deliberation, the UN Secretariat’s Department of Economic and Social Affairs produced a primer: Multinational corporations in world development (1973) (hereafter: Secretariat). At first glance this document seemed very much a mapping exercise, replete with facts and figures, but it also already contained an outline course of action (setting up an international forum and information centre, drafting an international agreement and creating an international dispute resolution mechanism (Secretariat pp.86-96)). It also, as we shall see, set the terms of the debate.
Rodney, in his book and elsewhere, detailed the precise role of specific companies as perpetrators and beneficiaries of the de-development of Africa, with the main example being that of Unilever. Having exhausted European sources of animal fat to make his soap, Liverpool entrepreneur Lever in 1902 Lever sent ‘explorers’ to Africa to find palm and groundnut oil. They struck liquid gold in the Belgian Congo where the Belgians offered Lever huge concessions of land with innumerable palm trees. This switch to cheaper colonially extracted vegetable fats proved a massive success for Lever. Lever went on a buying spree, purchasing European colonial companies in every colony in West Africa. It bought the gigantic Niger Company that Britain chartered in 1879 to colonise Nigeria, and the massive African and Eastern Trade Co., combining them to create the United Africa Company. When European wars created poverty at home, including shortages of butter, Lever merged with the Dutch company Margarine Unie to form Unilever. Together they became a powerhouse owning and running vast palm oil plantations in Africa by buying up smaller companies. By the end of the colonial period, Unilever dominated world markets in soaps, detergents, margarine, cooking oil and toiletries. It also perfected the techniques of mass production and advertising so as to achieve mass consumption, even selling back to Africans products manufactured using raw materials extracted from Africa in the first place. Thus, through Unilever and the many companies like it, European capitalism – having de-developed Africa through its colonial extraction – ensured Africa’s (and most of the Third World’s) continued dependence, creating a captive market and hampering its ability to develop its own productive capacities. Multinationals like Unilever are the cause of the international division of labour and consequently of global inequality, as Rodney wrote:
‘Undoubtedly, European capitalism achieved more and more a social character in its production. It integrated the whole world, and with colonial experience as an important stimulus, it integrated very closely every aspect of its own economy- from agriculture to banking. But distribution was not social in character. The fruits of human labor went to a given minority class, which was of the white race and resident in Europe and North America. This is the crux of the dialectical process of development and underdevelopment, as it evolved over the colonial period’ (p 217).
Setting the parameters of the discussion to come, the UN Secretariat’s primer erased the crucial historical role of corporations, suggesting large multinationals are a phenomenon of the ‘last 25 years’ (Secretariat p.1) rather than, as Rodney emphasised, the engines behind the very establishment of European empire four centuries ago (p.vii).
Thus relieved of the weight of historical exploitation, the Secretariat’s report’s recommendations for action were what we might today call a ‘nothing burger’: ‘The multifarious issues raised by the multinational corporation, if left unattended, may have far-reaching consequences. At the present stage of the public debate most of the issues are too complex and too far-reaching for ready solution and the appropriate strategy for action would appear to be to concentrate on the setting up of sufficiently flexible machinery that is capable of implementation.’ (p.96). Before actioning this recommendation by setting up the UNCTC, the UN Secretary General2 organised for the Group of Eminent Persons hearings to canvass the views on the Secretariat’s report. In what came to be a defining moment for the UN, and with it the global economy going forward, the Group heard testimonies from 32 experts, among whom were academic Detlev Vagts (Harvard Law School), economists Stephen Hymer (New School) and the only woman Elizabeth Penrose (SOAS), politicians including Ralph Nader, and the CEOs of several TNCs (See Summary of the hearings before the group of eminent persons to study the impact of multinational corporations and development and on international relations. ST/ESA/15 1973 (hereafter: Hearings).
Unilever Chairs Gerrit Klijnstra and Ernest Woodroofe testified alongside directors of Exxon, Pfizer, IBM, Rio Tinto, Shell, DuPont and Nestlé, a virtual who’s who of companies involved in major controversies in the Third World in the past 50 years. For example Nestlé had been subject from 1974 to a global boycott campaign following its unacceptable and aggressive marketing of baby formula in Third World countries (see The Baby Killer by Mike Muller for War on Want).
The Unilever Chairs stated in their testimony: ‘We believe that new regulations stand in danger of discouraging investment…The good the multinationals do is acknowledged by even the most severe critics. Let us beware the dangers of throttling the growth of good by international rules and regulations. Regulations are the stuff of politics; it would be a tragedy for world economic progress to be brought back by the limitations of world political progress.’ (Hearings,p.451) This classic Milton Friedman-esque positing of an imaginary separation between the spheres of ‘politics’ (where states rule) and ‘economics’ (where business should be free) was affirmed by the one lawyer present. The Harvard Law scholar Detlev Vagts observed that most fear of corporate power (leading to political influence) is probably exaggerated, while other critiques that may be levied at corporations were largely the result of ‘an understandable tendency to use the multinational enterprise as a scapegoat, because it is large, foreign and mysterious, even when it is simply carrying out the imperatives of impersonal economic forces.’ (Hearings p.386).
Yet in the middle of all this, Walter Rodney’s voice was heard through the words of Marxist economist Stephen Hymer.3 Citing surprise that authors who also informed Rodney, such as Amin, Arrighi, Girvan, Keynes, Kidron, Levitt, Mandel, Murray, O’Connor, Palloix, Papandreou, Rowthorn, Sunkel, Watkins and Wolfe had not been cited by the Secretariat, he pointed out the essential obfuscation at the core of the process (Hearings p.215). The report, in his words, was ‘myopic. The Secretariat accepted the current structure of the world economy as given and concentrated on how life could be made easier within it’ (Hearings p.216). It did not raise the question of whether MNC-driven capitalism can lead to our thriving and if not, what might alternatives be?
Hymer also expressed the sentiment behind the concept of permanent sovereignty over natural resources, a topic that the Primer had already hinted could be one on which corporations’ and states’ (or peoples’) interests could be diametrically opposed (Secretariat p.46). Would multinational corporate activity benefit the people? Hymer was not so sure: ‘We agree more or less that there is a correlation between the presence of multinationals and the rate of growth. Is there also a correlation between the presence of multinational corporations and the increase of inequalities? Is the solution to eliminate the multinational corporations, or are there precise ways and inducements so that the benefits of increased production can be spread more broadly over the entire population of the developing countries?’ (Hearings p.240). He concurs with Rodney’s conclusion: ‘The chief evil of the multinational corporation is that it separates the head from the hand and creates an international division of labour characterized by domination and subordination rather than co-operation.’ It follows that ‘the appropriate strategy for developing countries is to struggle against this domination and to develop their own capacity to plan within their own country and under their own control.’ Concretely, Hymer continues, ‘this means a policy of greater national self-reliance aimed at removing misery, rather than a policy of creating cheap labour to attract foreign capital.’ (Hearings p.227)
This was the future foreclosed by the United Nations, in the pivotal moment where a different route could have been chosen. As Hymer put it, ‘Even the United Nations Secretariat is not helping development, precisely because it does not formulate technical expertise and plans to help countries which want to take this path, but rather concentrates on development strategies which presuppose the existence of foreign investment, which presuppose that you can get the technology from outside’ (Hearings p.244) – and which presuppose the continued existence of an economic model based on profit-maximisation by multinational private corporations. (In fact the Secretariat accepted the essential role of foreign private investment to development as already recognised in the International Development Strategy for the Second Development Decade unanimously adopted by the United Nations General Assembly in 1970. (Secretariat p.2)) It should come as no surprise then that the eventual report of the Group of Eminent Persons themselves closely resembled the Secretariat’s own primer.
This report, similarly titled The Impact of Multinational Corporations on Development and on International Relations (Eminent Persons), also recommended both the setting up of a ‘technocrat’ Commission on TNCs, supported by an information and research centre and the adoption of a code of conduct. The commission would ‘be entrusted with the functions of promoting a dialogue among the parties concerned and offering advice’, and would consist of ‘persons who are intimately acquainted with the subject’ who ‘would devote considerable time to clarifying the issues, testing ideas and working out the practical details.’ (Eminent Persons p.6-7) The information and research centre would moreover function to provide ‘assistance in evaluating investment proposals’ and support in negotiating with multinational corporations (Eminent Persons p.10). The report that set the tone for the next 30 years of the UNCTC’s existence, as Hymer indeed predicted, ‘seeks merely to reconcile conflicts within a system of continued expansion of multinational corporations’ (Hearings p.227). In the decades that followed, the UNCTC, with its series of ‘nothingburger’ reports and ‘forever-drafts’, was set up to continue the neocolonial ‘de-development’ of the Third World by normalising the ideas that ‘development’ requires foreign direct investment, and that such investment must be protected at all costs against nationalisation, expropriation, and ‘unexpected’ legislation (what we now call regulatory takings).
Despite or maybe partly because of the illusion that ‘something is being done’ through the UNCTC and the efforts to formulate a binding treaty, Unilever and other multinationals like Volkswagen continue to run plantations with bonded labour working in dire conditions, send children into mines, and source garments from death trap sweatshops. Hymer, extrapolating on the basis of then-current growth figures, warned that by the end of the century, ‘the world’s industrial system [would] be dominated by 400 or 500 giants’, causing him to ask: ‘is this system compatible with our hopes for a peaceful and prosperous world?’ (Hearings p.216). Today, most of our food production is controlled by Unilever and 9 other ‘Titans of Industry’, while they and the other companies platformed in the Hearings are behind ever dwindling arable land, water scarcity, climate catastrophe and ecocide, while Unilever silenced those calling out Israel’s genocide in Gaza. Having declined the opportunity to pave a path away from corporate capitalism, from the very outset the UN, the UNCTC and the mechanisms it spawned were designed to continue to facilitate maximum corporate profit extraction, and to continue to restrict Third World countries’ and people’s ability to do anything about it.
Rodney knew that ‘African development is possible only on the basis of a radical break with the internationalist capitalist system, which has been the principal agency of underdevelopment of Africa over the last five centuries.’ Stephen Hymer was killed in a traffic collision in 1974 (aged 39), just as the Eminent Persons’ report was being finalised and Walter Rodney was assassinated in 1980 (aged 38). It is their spirit, and the potential for a radically different future, that lives on in transformative grassroots projects on the African continent such as the Mathare Social Justice Centre, the Abahlali base Mjondolo shack dwellers movement, the Sahrawi freedom struggle, the Shü-Mom Art sub-Saharan migrants collective in Tangiers, the work of individuals such as Momodou Taal and books suck as Kevin Ochieng Okoth’s Red Africa. Globally, it lives on in dissenting voices within the UN system, and in this specific moment in the grassroots movements seeking to disrupt energy corporations for the liberation of Palestine, in the Global Sumud Flotilla, in the Italian workers shutting down the country, and in the Palestinians who practice freedom and teach life in spite of it all.
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- The Wankie mine deaths may have been one of the ‘incidents’ that the ‘Multinational corporations in world development’ primer refers to as an impetus for Resolution 1721 LIII (p.1-2: ‘The political and social dimensions of the problem of multinational corporations are only too apparent. The United Nations’ present involvement in the subject was in fact prompted by incidents involving certain multinational corporations. The concern and excitement occasioned by those incidents testifies that the general public is no longer willing to stand by passively.’)
- It is notable, that the UN General Secretary at the time was Klaus Waldheim, former member of the Nazi Party’s paramilitary wing (SA), senior lieutenant in the Wehrmacht during World War II, war crimes suspect and future president of Austria. Waldheim’s appointment had been fiercely opposed by the Chinese representation at the UN, who had argued for a Third World UN SG.
- A second, devastatingly critical voice in the hearings was that of Ralph Nader (p.90-99).