Making the UN more businesslike


With the UN engaged with a range of pressing global issues in every part of the world, a renewed, revitalized and more responsive organization is needed more than ever. This article, written by Maurice Strong on 12 January 1995, is still relevant to ongoing discussions to reform the UN.

Making the UN more businesslike

by Maurice Strong

While it is useful to bear in mind that the cost of running the UN system represents but a very modest proportion of the total cost of global governance, this is really not the point of issue in making the case for better management of the UN.
photo: UN photo
The UN is, of course. not a business, in the sense that its purposes are commercial or profit-seeking. But in the broader sense the UN is the centrepiece of the most important business of all - that of ensuring that our global community provides hospitable, peaceful and equitable conditions of life for all of its people. It is surely, therefore important, indeed imperative, that the UN draw upon the best of business practices and expertise in fulfilling its global mission. This is especially so at a time when that mission is becoming increasingly complex and the resources available to the UN to fulfil it ever more difficult to obtain.

Much has been said about the need to reform the United Nations and to effect changes in its charter. Indeed, the approach of the 50th Anniversary of the United Nations has given rise to a plethora of books, studies, seminars and learned papers focusing on the future of the UN and the reforms required to prepare it for that future. Particularly valuable and timely is the report of the Commission on Global Governance chaired by Prime Minister Ingvar Carlsson of Sweden and former Commonwealth Secretary-General Sir Shridath Ramphal.

This process has produced some thoughtful and innovative proposals, which will give governments a rich body of analysis and broad range of ideas from which to draw in taking the decisions concerning the future of the UN which can only be taken by its member states. It has concentrated largely on issues of structure, of process, and of charter change. There has been some, but I would contend too little attention paid to the management dimension of these changes. Yet my own experience in the UN persuades me that the greatest and most immediate need is for improvements in its management. This is not in any way to detract from the importance of the structural and constitutional changes that must be made to enable the UN to function effectively m a world very different from that which gave rise to its creation a half century ago. In the meantime, improvements in management and the introduction of relevant practices and methods developed in the business world need not await structural and constitutional change.

Many, perhaps most, of the necessary management improvements can be carried out within the existing mandate and authorities of the United Nations Secretary-General, although it would be important for him have the broad support of member states if these authorities are to be invoked fully and vigorously. At the same time, improvement of management and cost effectiveness of the UN would serve to strengthen political support for the kind of extended mandate and accompanying structural and constitutional changes that will be needed for the UN of the 21st century. The current financial crisis provides strong impetus to greater cost efficiency which can only be accomplished through major improvements in management. The need for such changes is likely to become more acute as a US Congress less sympathetic to the UN and the budgetary constraints faced by virtually all member states presage even greater pressures on the UN's finances and much tougher requirements by governments for more efficient use of UN resources.

I am convinced that a great deal can be done to make the UN much more efficient in the use of its existing resources without impairing its overall effectiveness. Indeed, a well managed process of internal change would, I am confident serve to enhance the UN's effectiveness in the areas in which its services to the world community are most needed and most valued. The permanent staff of the United Nations is not excessive by the standards of government or other organizations, both pnvate and public, many of which have purposes that are a good deal less important to society. According to the UN Document A/49/527 "Human Resources Management: Composition of the Secretariat", the permanent staff of the United Nations is now at a level of some 10,609 permanent staff and a total of approximately 33,967 if the specialized agencies, excepting the World Bank and the International Monetary Fund, are included. In the aggregate, the costs of the United Nations and its agencies amount to less than $2 for each of the world's people as compared with $50 per person for military expenditures. It represents 0.0005 percent of the world's gross domestic product.

Cost of global governance

While it is useful to bear in mind that the cost of running the UN system represents but a very modest proportion of the total cost of global governance, this is really not the point of issue in making the case for better management of the UN. The case really rests on what governments actually get from their investment in the United Nations and what value they place on it in relation to alternative uses of their resources. Today, all governments are facing severe budgetary pressures that are requiring them to re-examine their own priorities and provide much more rigorous and cost-effective management of their finances. It would be illusory to believe that the UN can be exempt from this process. It would be much more realistic to recognize the reality that in few, if any, nations does the UN have the kind of strong political constituency that can support its claim on the national budget against the competing claims of domestic constituencies.

Over the past fifty years, the UN Secretariat has grown in response to the evolving priorities of the community of nations it serves, as reflected in the agendas and the resolutions of the General Assembly and other UN deliberative bodies. But priorities have changed and new issues have emerged. These have been reflected to only a very limited degree by corresponding changes in the deployment of Secretariat resources. New secretariat units have been created, while existing units have been retained to perform functions overlapping those of other units and often no longer accorded the level of priority that gave rise to their creation.

All organizations require periodic change, and in today's rapidly changing world the process of change must be a continuing one, but although the world has changed radically in the fifty years since the United Nations was established, changes within the United Nations have been minimal, certainly not radical. The time has clearly come for radical change. This change can and should begin at the management level. Many of the needs for change which drive the growing pressures for structural and constitutional reform can be met to a large extent through improvements in management. And while basic structural and constitutional change is indispensable. It will not come quickly or easily, and would not in any event be effective without accompanying management changes.
My basic premise is that such changes can and should precede and would help prepare the way for basic structural and constitutional change.

A radical process of change

Secretary-General Boutros-Boutros Ghali is to be commended for initiating a more radical process of change within the Secretariat than that undertaken by any of his predecessors. In consolidating the departmental structure of the Secretariat, reducing the number of officials reporting directly to the Secretary-General and rationalizing the country level representation of the UN, he has made a good start, but it is only a start.

The process of management change must be guided by an up-to-date evaluation of what each unit within the Secretariat actually does, what it produces, to what extent this overlaps with what others produce, how its products are actually used, how they are valued by those who use them and how this relates to their cost. This is something quite normal in business and other organizations that are fun in a businesslike manner.

Some will argue that it is not feasible or appropriate to quantify the output of the UN Secretariat, dealing as it does with major world issues which simply cannot be measured by the kind of quantitative standard which business applies. True, but only to a degree. It is entirely feasible to make a reasonably accurate assessment of the output of each unit in the Secretariat to determine its cost and to ascertain from those who actually use its products how much they value them.

I have no doubt whatsoever that such a process would reveal that much of the Secretariat's work involving perhaps half, or even more, of its staff members is devoted to areas and issues that are now accorded marginal priority by member states, or can be done better by others either inside or outside of the United Nations. I would suggest that a very large proportion of the UN Secretariat, probably well over half, is now engaged in activities that would fall into these categories. And this in most cases would not be a reflection on the quality or performance of tile people performing these tasks. In so many cases a very small, underfunded Secretariat unit is expected to do meaningful work in areas in which other organizations with much larger budgets and capacities and stronger mandates are the prime actors.

The comparative advantage

The UN need not and cannot do everything. Its uniqueness and its comparative advantage lies in the fact that it is global in its mandate and is universal in its membership. Its resources should be concentrated in those areas in which these distinctive qualities enable it to perform functions for the international community other organizations are not geared to perform. But in doing so it should draw on and utilize to a much greater extent than it now does, the capacities and contributions of other organizations, intergovernmental and nongovernmental, which have the specialized knowledge, experience and constituencies which the UN does not and cannot have to the same extent. Often the primary role of the UN will be to provide a global framework or context for actions that must be taken on other levels, regional, national or sectoral. It need not and cannot have in the Secretariat, the capacities to deal with these issues in their totality. Yet in all too many instances the UN purports to do so, maintaining Secretariat units to deal with issues which it simply does not have the capacity to deal with effectively. The result is a dispersion of UN resources and a dilution of its effectiveness that has contributed significantly to the unsatisfactory performance of the UN in so many areas and the reduction of confidence in it.

A young girl draws during art class, Shatial Refugee camp
photo credit: Alan Gignoux/UN
The experience of the UN's first fifty years surely points to the main areas in which the UN is at its best. There is no substitute for it as the global forum for leadership In identifying and legitimizing new issues for the international agenda - as it did in respect of international development cooperation, human rights, the environment, population and women's issues, to name but a few. It is also unique in its capacity to mobilize the international response to major peacekeeping, peacemaking and humanitarian needs and to provide the forum for the development of international law and the negotiation and administration of treaties and conventions. Virtually all of these areas have in common that the number of permanent secretariat members involved is relatively small and their principal task is to orchestrate and to service processes involving specialized representatives of member states, and representatives and experts from other organizations, intergovernmental and nongovernmental.

I cite three examples from my own experience, not to suggest that they are best examples, but the ones with which I am most familiar personally. They are the UN Conference on the Human Environment held in Stockholm in 1972, which placed the environment on the international agenda; the Office for Emergency Operations in Africa, which led and coordinated the international response to the great African famine emergency of 1984-86 and the UN Conference on Environment and Development in Rio de Janeiro in 1992, which provided a broad global sanction for the concept of sustainable development and agreement on basic principles and actions to give effect to it. In each case, the central UN Secretariat unit was very small in relation to the magnitude of the task it was given - numbering from 20 to 30 persons drawn from the permanent Secretariat. But in all cases, too, it engaged the active support and involvement of all pans of the United Nations system and a multiplicity of other actors and sources of expertise, national and international, governmental and nongovernmental. What the UN provided was the leadership, the capacity for mobilization and orchestration or the contributions of other participants and the framework within which they could operate in a collaborative manner towards common goals and objectives.

Adhoc responses

An important feature of each of these examples is that the organizations responsible were ad hoc in nature and each was phased out after the task for which they were set up was completed.

All of the UN's peacekeeping operations are by their nature ad hoc responses to particular crises situations. And all are managed and orchestrated by a permanent UN headquarters staff that has never exceeded more than 314 professionals, even now that the UN is managing an unprecedented number of some 18 peacekeeping and peacemaking operations involving a total of approximately 74,625 temporary personnel in the field (UN Department of Peacekeeping Operations -- Summary of Contributions to Peacekeeping Operations by Countries, as of November 30, 1994). The same has been true of virtually all humanitarian operations global conferences and treaty negotiations. The point here is that many of the UN's most important and successful value-added activities have involved relatively small numbers of its permanent staff and correspondingly modest contributions from regular budgetary resources. At the same time, the successful launching and management of such initiatives requires a permanent secretariat cadre with special qualities of leadership and management and the capacity to identify and command the respect and cooperation of the principal actors concerned both within and outside of the United Nations systems. Yet it is a quality that it is not sufficiently valued, nurtured and supported by present UN personnel policies and practices.

The kind of management improvements the UN so dearly needs at this juncture will require significant changes in personnel policies, particularly through reduced politicization and improved professionalization of the staff appointments process. Recruitment, career development and training practices should be oriented towards producing, within the Secretariat, professionals with the integrative mobilizing and orchestrating skills required to deal with issues that are increasingly complex and systemic in nature and involve a multiplicity of actors, disciplines and sectors. Again my own experience tells me that it is entirely feasible to do this while respecting the important principle of equitable geographical representation. One way of improving the leadership capacities of the UN secretariat would be to have an independent board review the professional qualifications of those being considered for senior appointments. The Secretary-General would of course, retain final decision making in respect of such appointments, but his selections would be made frorn amongst those whose professional qualifications met certain objectively applied standards.

Principal challenges


One of the principal challenges the UN faced in its early years was that of facilitating the transition of former colonies in the developing world to independence, supporting the establishment of their governments and launching them on the pathway to national development. The technical assistance offered by the UN and the development assistance it mobilized and helped to deploy made a critically important contribution to the emergence of these newly independent nations as full and influential participants in the community of nations. But the situation and the needs of developing countries have changed immensely during the past several decades. Developing countries, which comprise some three-quarters of the world's population, now represent a similar proportion of the membership of the United Nations. It has become their principal international forum, the place where their voices can be most heard and heeded and their influence most fully brought to bear.

Yet the resources of the UN Secretariat have not been redeployed sufficiently to take account of the major changes in the needs and interests of developing countries while the proportion of their external funding requirements provided by the UN has been reduced substantially. Economic and social development is and must be one of the highest priority tasks of the UN. Yet it is one in which the UN is a great deal less effective than it could be and should be, despite the large proportion of the Secretariat ostensibly devoted to it.

In a global economy in which knowledge is the principal source of added-value and competitiveness, developing countries, and particularly the least developed, are disadvantaged by lack of the resources required to develop their scientific and technological capabilities. their institutional infrastructure and educational systems. Many of them lack the policy research capabilities required to assert and protect their own interests in a rapidly changing international policy and negotiating environment. Supporting developing countries in development and strengthening of their capacities in these areas is for most of them, their most critical need and highest priority. The United Nations Development Program, through its Capacity 21 and Sustainable Development Network initiatives is giving special attention to mobilizing resources for these purposes. But so far the response has been disappointing.

Hard to get

Funding for the UN's development programs is increasingly hard to get, and is likely to be even harder to come by in future, At the same time, the proportion of funds made available for emergency assistance has been growing, much of it at the expense of development funding. The recent experience of UNICEF is a case in point. The proportion of its budget devoted to emergency, as distinct from development programs has grown from just over 5% to 28% in the past 10 years (UNICEF Management Study, December 30, 1994, Booz Allen & Hamilton Incorporated). No one would argue with the need to meet humanitarian needs, which are usually of a highly urgent and critical nature in terms of the immediate need to relieve human suffering and save lives. But when this is done at the expense of long term development which is the best means of ensuring against future humanitarian crises, it becomes a vicious circle in which the lack of adequate funding for development sets the stage for even greater humanitarian needs in the future.

Against this background, it is imperative that the UN make the best possible use of its financial and human resources in responding to both the humanitarian and development priorities of developing countries. There is, I submit, a great potential for doing this through improved management practices and greater cost efficiency. And in doing this, the UN will also restore the confidence of both donors and developing countries that it provides the most efficient and effective system for channelling resources to developing countries for both humanitarian and development purposes.

Th UN must gear itself to become to a much greater extent a mobilizer and not just a dispenser of resources in the development field, as it has done so successfully in the humanitarian field. During the 1984-86 famine in Sub-Saharan Africa, the UN took the lead in mobilizing and deploying over $4 billion of humanitarian assistance, only a modest portion of which was actually dispensed directly by the UN. Yet the UN was not nearly so effective in meeting the process of mobilizing the increased resources required for rehabilitation and long term development in Africa following the famine. This is in part explained by the fact that during emergencies public and political pressures drive a degree of coordination and focus of the combined efforts of the UN system in a way which has not been possible to effect the same degree in respect of development.

The recent initiative of the Secretary-General in creating a closer link between the policy and the funding functions of the UN and the broad responsibilities he has given to UN Administrator, James Gustave Speth for development and coordination represent a promising step in the right direction. It would be important to the effectiveness of, and confidence in, this new framework for coordination that policies and priorities set by members governments drive and guide funding, rather than the reverse. The time has come to bring all of the UN funding functions within a common administrative framework, which would logically be provided by the UNDP. This would produce significant savings in personnel and administrative costs. And in consolidating the administration of funds in the UNDP, the distinctiveness required to maintain the support of specialized constituencies can be preserved by maintaining separate "windows". Thus, for example, the fund of the United Nations Environment Program would, for administrative purposes, become part of the UNDP, while a separate window would be maintained at UNEP headquarters in Nairobi to respond to the specialized funding needs or UNEP's program. This would have the further benefit of ensuing the close coordination of UNEP's programs with the growing amount of UNDP's development funding which has an environment dimension and can benefit from a UNEP input.

There is a great potential for cost effectiveness in rationalizing the UN's administrative and budgetary processes and developing a much more coherent system of program-budgeting. Substantial savings and improved effectiveness could also tie achieved through a greater degree of rationalization of Secretariat and administrative resources as between the headquarters, the regional commissions and country level missions, This three-tier administrative structure is one of the reasons for the high overhead cost of the UN in the economic and social development field in relation to the amount of funding It dispenses to developing countries.

Civil society

The UN needs to adapt to the sea-change that has taken place In the flow of resources to developing countries.
photo: UN photo
Virtually all governments are at or near the limits of what they can do to meet the needs and expectations of their people, and what their people are prepared to pay in taxes. Thus, the multiplicity of nongovernmental actors that make up civil society are inevitably playing a much larger role, both in developing social policy directions and in mobilizing and deploying resources to meet particular societal needs and interests. In many areas their capacities today exceed those of governments. The same is true at the international level in which more humanitarian and development resources are today channelled to developing countries through nongovernmental organizations than through the United Nations. Thus the role of the United Nations in providing credible. objective and well-informed leadership and a coherent framework for mobilization and deployment of international resources from a variety of sources around particular objectives is a primary one, and one it must learn to play much more effectively.

The UN needs to adapt to the sea-change that has taken place In the flow of resources to developing countries. Private investment has become by far the principal source of external financing for the rapidly growing economies of Asia and Latin America which are also generating substantially growing earnings from their export trade. While these rapidly developing countries continue to require external support in meeting their social needs, their capacity to do this from their own resources is improving. Meanwhile the least developed countries, particularly those of Sub-Saharan Africa, remain highly dependent on Official Development Assistance. And the countries in transition in Eastern Europe and the former Soviet Union require specialized technical policy support as well as infusions of private and public capital to help them rebuild and restructure their economies. The UN must therefore be in a position to provide a more diverse range of support targeted to the particular needs and interests of each of these categories of countries.

The UN itself is not likely to become a channel for substantially increased flows of funds to developing countries. But it has the unique capacity, which needs to be vastly strengthened, to provide a forum in which developing country interests can be defended and championed to mobilize support for development of their own institutional capabilities and to supplement them in the areas in which the individual capacities of developing countries for protecting and asserting their interests in the multiplicity of international negotiations in which their lack of adequate institutional, policy expertise puts them at a disadvantage. It is also in the best position to create the leadership and cooperative framework for mobilizing and deploying resources of the entire international community, including the nongovernmental actors, around particular needs and objectives. This would mean building the new United Nations around the best experiences of its past while shedding much of the costly and bureaucratic baggage that has developed over the years and is now more an impediment than a contributor to the UN's effectiveness.

An indispensable key to the UN's success in undertaking this role in leading and catalyzing action by the entire world community is for it to become the primary source of objective, credible Information on major global trends and issues. The spectacular advances made in recent years in information sciences and telecommunications combined with the confidence and respect that the Statistical Division of the UN's Department of Economic and Social Information & Policy Analysis as one of the UN's quietest, but most consistently valuable performers over the years, provide the basis and the tools for such leadership. But it will require strong leadership mandated directly by the Secretary General to rationalize the current hodge-podge of information services within the UN which, despite the high quality of some of them. has so far defied any attempt at coordination, consistency and common focus. I am convinced that here, too, the potential for improved cost effectiveness is so great as to make It likely that the kind of leadership and strategic purposes I foresee for the UN in this field could be achieved within existing budgets.

Information is key

As our experience in the Office for Emergency Operations In Africa demonstrated, information is the key to coordination. Nothing is more characteristic of calls for UN reform than exhortations for more "coordination". Yet, with some notable exceptions, principally of an ad hoc nature, the United Nations has a dismal record in effecting coordination. Nevertheless, as demonstrated by the experience of the Office for Emergency Operations in Africa, when the UN can dispense timely and reliable information that other actors find useful in their own decision making, it exercises de facto a coordinating role that most other actors would not accord to it in any formal sense. The OEOA had no formal mandate for coordination. Yet virtually all the major organizations - bilateral, intergovernmental and nongovernmental - providing humanitarian and relief assistance to Africa during the 1984-86 famine looked to the UN's OEOA for the information about needs and actions already underway or planned to meet these needs as the basis for decisions on deployment of their own assistance. This in turn enabled that assistance to be targeted to the people most in need. It was the key to the central role played by the UN in helping some 30 million people whose lives were at risk to survive the famine.

This chapter concentrates on management improvements that can be made at the secretariat level within the existing mandate of the Secretary-General. But even greater efficiencies could be achieved in the use and the effectiveness of Secretariat resources if governments were to agree on consolidating and rationalizing the work and meetings of the various committees, commissions, conferences and governing bodies which have proliferated over the years and contribute significantly to the dispersion of secretariat efforts. as well as those of governments themselves. A good deal of such rationalization could be accomplished by the decision of member states in the General Assembly and other UN bodies without charter change.

Introducing businesslike management principles and practices 1l1!O tile United Nations may seem somewhat mundane in light of tile broad global purposes the UN was established to serve and the ideals enshrined in its charter. But as the UN reaches tile Important milestone of its 50th Anniversary, it must prepare itself to make radical changes in the manner in which it manages its awesome responsibilities if it is to meet the challenges of the much more demanding, complex and interdependent world of the 21st century. Indeed, it is precisely because its task as the centrepiece of an effective global system of governance is so vitally important to the human future that it requires the very best of management and should settle for nothing less, After all, no business is more important than that with which it is entrusted.