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At UNICEF, Still No Answer on N. Korea Audit, Morgan Stanley Partnership Questioned

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, June 7 -- It is often said at the UN that you might have to deal with the Devil, in the service of some larger good. That is among the UN agencies' responses to the preliminary audit report of their operations in the Democratic People's Republic of Korea, otherwise known as North Korea, which was released one week ago on June 1. The report criticizes not only the UN Development Program and its affiliates, UNOPS and UNFPA, but also the better known UN Children's Fund.

            While North Korea among other things tortures those who try to leave the country, UN agencies including UNICEF were accepting staff seconded from the Kim Jong Il regime, and paying their salaries to the government. Meanwhile, there were limitations and then prohibitions on access to audit the programs. To date, UNICEF has not responded to the audit.

            On Thursday Inner City Press attended a talk-radio taping in the UN's basement, and took note when UNICEF's Ann Veneman was interviewed, by Jack Rice of CBS-affiliated WCCO in Minneapolis. Rice began by asked Veneman about her previous service on the New York City Council -- apparently confusing her with her predecessor Carol Bellamy -- and asked if UNICEF uses stamps to raise funds. "We're the greeting card people," Ms. Veneman gamely replied, mentioning UNICEF's partnership with Hallmark.

            As Ms. Veneman prepared to leave, Inner City Press asked her if UNICEF will be submitting a management response to the North Korea audit.

            "We're working on it," Ms. Veneman answered.

            "But you will be submitting one?"

            "I don't know exactly. I have to talk to my people. I don't know if they're going to do a management response. I don't know what the appropriate resp--" Ms. Veneman trailed off. "I don't know if they're going to do one yet. They're working on it."

UNICEF on tsunami, Ann Veneman at left (Morgan Stanley not shown, see below)

            Inner City Press apologized for the stakeout question. Inner City Press could have said but didn't that this very question was put to UNICEF in writing on Monday night, with an end-of-Tuesday deadline, along with other questions discussed below. Even by Thursday, the question of "will UNICEF be filing a management response, and will it be public" still had not been answered. Now we know why: it still hasn't been decided. But the Spokesman for the General Assembly President on Thursday noted that Inner City Press

"asked a question yesterday about the famous UNDP-DPRK audit report.  It is before the Advisory Committee on Administrative and Budgetary Questions (ACABQ) and is being discussed today."

       When exactly is it, that UNICEF will decide how to respond?

            One question that UNICEF did answer this week involves how the agency chose to partner with Morgan Stanley in a "Junior 8" youth project tied to the G-8 meeting.  Inner City Press asked

"could you describe how UNICEF's partnership with Morgan Stanley came about, for the 'Junior 8' Summit and anything else, and what UNICEF's policies and safeguards are for partnering with corporations, including any reviews done of the corporations' records on human rights as well as children's rights issues?"

            UNICEF's response has been:

Regarding how we choose partners:   We vett every potential corporate partner for a history of socially responsible activities and reputation, make a positive contribution to society, have a history of commitment to development-related causes, keep responsible labor and environmental practices.

You can read more about this process in the document linked on this page entitled Guidelines and Manual for Working with the Business Community

In the specific case of the Morgan Stanley International Foundation, which is UNICEF's partner in the J8:  We teamed up with them on the previous J8 in 2006 in St. Petersburg.  MSIF have been enthusiastic and generous partners in bringing children from all over the world to give them a voice and a platform in the issues of the G8 issues that will affect them for the rest of their lives.

            While this response was and is much appreciated, it must be noted, as examples, that as far back as 2002, on environmental issues, Friends of the Earth issued a report entitled "Rogue Traders: A Report on Morgan Stanley's Financing of Socially and Environmentally Controversial Projects in Asia." One wonders if UNICEF considered but rejected the report. As recently as April 2007, Morgan Stanley settled charges of gender discrimination, click here for that.

    Morgan Stanley had settled similar charges in 2004, here.  The company was exposed in as advising investors to steer clear of unionized companies, contrary to UN International Labor Organization principles; it has been named as funding a China wig company that uses forced labor.

    This sample litany is set forth in light of UNICEF's statement that it checks "every potential corporate partner for a history of socially responsible activities and reputation, make a positive contribution to society, have a history of commitment to development-related causes, keep responsible labor and environmental practices." With these be a management response to this?

            Other still-not-answered questions:

--are there any provinces of DPR Korea where UNICEF does not / will  not provide services, or will provide only some of its services? If so, what are the provinces, when was the decision made and why?
--In remarks for UNICEF's Executive Board meeting on June 4, [a Board member] said

"The Board of Auditors released its report late last week and we would like to know when the Executive Board can expect a full  report from UNICEF... We believe that reports of the Office of Internal Audit and the Evaluation Office should be available to the Executive Board."

   What is UNICEF's position on making internal audits available at least to members of its Executive Board and, separately, to the press and public? To the degree that the "full report from UNICEF" alluded to above it different from the management response asked about, when might this full report be produced, and will it be available to the Press and public?

 Also, beyond the outstanding India question, what about the question, raised on April 16 in connection with the Moro National Liberation Front, regarding which groups in control of territory, but not recognized governments, UNICEF has agreements with?

  Finally, is it possible to get list(s) of UNICEF Executive Board meeting attendees?

            This last one should have been easy -- in Conference Room 2, where the Executive Board has been meeting, there has been a slot for form "E/ICEF/2007/CRP.6," the list of attendees. It has been empty for days, but presumably it is an electronic document.  [In fairness, while more has been twice promised in response to the above-linked India article, UNICEF-NY has in the interim said that while it has

"not yet received information from our country office about this
particular incident... UNICEF believes that the use of children and
young people to highlight a particular cause (in this case illiteracy)
should always be done with their best interest as the guiding principle.This means that the child or young person should feel they are not only helping bring attention to a particular cause but that they are learning and growing from their experience."

  There are principles, and then there is practice. Inner City Press has previously praised UNICEF's expert on the Central African Republic, and work on child soldiers in Congo and Nepal. But even for one doing angelic work with children, there is a need for increased transparency.  To be continued.

Click here for Inner City Press' June 1 story on UNDP questions.

    Again, because a number of Inner City Press' UN sources go out of their way to express commitment to serving the poor, and while it should be unnecessary, Inner City Press is compelled to conclude this installment in a necessarily-ongoing series by saluting the stated goals of the UN agencies and many of their staff. Keep those cards, letters and emails coming, and phone calls too, we apologize for any phone tag, but please continue trying, and keep the information flowing.

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UN Office: S-453A, UN, NY 10017 USA Tel: 212-963-1439

Reporter's mobile (and weekends): 718-716-3540