When win-win turns into win-lose

Bilateral Investment Treaties are complex, technical, boring – and dangerous. They turn the win-win of CSR into ‘heads I win, tails you lose’.

These treaties specify the conditions under which a company will invest in a country. They’re typically used by large companies making major infrastructural investments in relatively unstable countries. From the companies’ point of view, their intention is to provide certainty around their investment. For example if a developing country improves its health and safety regulations, the company would be entitled to compensation for its increased costs. so it’s a way for a company to off-load risk. From the countries’ point of view, they have no choice. The investment, even with such conditions, is an offer they can’t refuse.

According to UNCTAD, there have been hundreds of such cases. When companies sue countries, money is sucked out of the country. It also acts as a break on the improvement of social and environmental conditions.

According to an IPS report, the companies involved include Chevron and Philip Morris – amongst many, many others.