What happens in Geneva?
5 min read
2024-11-14

topic

Trade Regulation

jurisdiction

Global
More questions on this topic? Email the Editorial Team.
Jan Walter
Senior Policy Advisor, Akin

executive summary

  • Geneva is a central hub for global policy and standard-setting, hosting over 40 international organizations that influence industries worldwide. Companies must stay informed about developments in Geneva to anticipate regulations like the Corporate Sustainability Due Diligence Directive (CSDDD) that can impact their global operations and supply chains.
  • Geopolitical shifts have led to increased legislative fragmentation, with major powers like the EU and U.S. pursuing unilateral or regional solutions when global consensus is lacking. This trend requires businesses to adapt to a complex landscape of differing regulations.
  • Thorough supply chain knowledge and early adaptation offer competitive advantages. Companies that deeply understand their supply chains and engage proactively with emerging regulations can turn compliance into a strategic benefit, while those that remain passive risk falling behind in a rapidly changing global environment.

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article

Sample

Geneva is a key hub for global policies and standards. Agreements “made in Geneva” can impact industries worldwide. 20Minds spoke with Jan Walter on how companies can stay informed about what happens in Geneva.

The role of Geneva

Why should companies pay attention to what happens in Geneva?

Jan Walter: Geneva is one of the biggest global policy hubs, home to over 40 international organizations covering everything from trade to human rights.

Key International Organization in Geneva that are Relevant to Global Businesses

There are two key reasons companies should focus on Geneva:  

  • First, the intersection of policy and geopolitics. Global powers come together in Geneva to negotiate on key issues such as trade, health, and digital transformation. The outcomes here often shape national policies. Leaders return from Geneva with new perspectives that influence decisions they must make domestically.
  • Second, Geneva is where global standards are set. Multinationals, especially those with supply chains in developing countries, need to keep track of these standards. For example, the Human Rights Council is currently working on business conduct standards, which influence laws like the Corporate Sustainability Due Diligence Directive (CSDDD).

The CSDDD requires companies to screen their global supply chains for human rights abuses and environmental impact. When laws with global impact like this are being made, at what point in the process does Geneva become relevant?  

Jan Walter: Geneva comes into play at two junctures:

  • First, when countries discuss global issues multilaterally. If little or no convergence is present, they move to unilateral or regional solutions, like the CSDDD, or the EU’s deforestation law.
  • Later, Geneva is key when testing whether new rules comply with international laws, like those under the WTO.

Geneva also has an indirect influence. For example, during EU talks on plastic packaging, WTO rules were raised, affecting decisions even if the WTO was not directly involved. Similarly, Geneva’s discussions on health policy, like medicine pricing, influence laws in the U.S. and the EU.

Geneva and geopolitical shifts

How have recent geopolitical shifts affected the position of Geneva as an international policy hub?

Jan Walter: Ten to fifteen years ago, Brussels and Washington preferred a multilateral approach. Policymakers aimed for broad global consensus, even if not all details were settled.  

Today, things are different. Domestic legislators are going alone earlier, faster, and more resolutely, and legislation is becoming more fragmented globally.

Take the CSDDD, for example. The EU raised environmental and human rights issues in Geneva, but countries in the international organizations hesitated to engage. So the EU acted alone. Without multilateral consensus, countries pursue their policies independently or with like-minded countries.

Geneva is a great place for cross-pollination of ideas, but when global agreements are hard to reach, jurisdictions like the U.S. and the EU take the lead domestically, which has an inevitable, and often intended, impact internationally.

The future of the WTO

The WTO used to be one of the most impactful organisations in Geneva. Is it still operational, or has it become more symbolic at this point?

Jan Walter: The WTO is still operational, though its dispute settlement mechanism has, of course, become less effective.  

The WTO remains important in areas like sanitary measures, technical barriers, and anti-dumping.  

There are still clear signs of life. For example, the WTO recently agreed on guidelines for conformity assessments, helping regulators avoid unnecessary trade barriers and improving predictability for businesses. This has been a major achievement in the current environment because it required consensus. Imagine you are a garment producer. When a national regulator approves your garment products’ label as meeting local rules based on certain guidelines, other WTO members’ regulators use the same guidelines and are likely to accept them too. This consistency allows you as a producer to confidently plan and sell your garments across borders, without worrying about unexpected trade barriers.

Confirming Assessment Procedures | Explainer Box

Do you see a future for the WTO?  

Jan Walter: Yes.

I believe the WTO can and will be reformed. It is not perfect, but it is fixable.

Frankly, if the U.S. were truly unhappy with the WTO, they would have left by now. Instead, like others, they want to reform it.

Are all countries equally reliant on the WTO?

Jan Walter: No, they are not. I believe you can distinguish between two types of WTO members:

  • Large markets like China, the U.S., and the EU can act unilaterally on tariffs, subsidies or dumping. For them, going alone can be effective, at least in the short term. We are talking about a few major powers with these abilities due to the size and importance of their markets.
  • For everyone else, the WTO framework is essential. I have spoken with representatives from smaller countries who emphasize how vital the WTO is for them. Without it, there is no real alternative. It may not be perfect, but it remains their only option.

Achieving success in Geneva

You worked in policy in Prague and at the EU level in Brussels before moving to Geneva. Is it harder to succeed here?

Jan Walter: It depends on how one defines success. Multilateralism is slow and it is not about quick wins. It is mainly about staying informed. Having eyes and ears in Geneva keeps you ahead.

Should companies have a presence here? For companies with leaner budgets who need to prioritise, how can they keep an eye on Geneva without overextending themselves?

Jan Walter: Large companies with global operations, or at least global competition, cannot ignore what is happening in Geneva. Active monitoring of what is happening in Geneva is almost mandatory. To influence global policies, you need a presence. Geneva might not always be where the big ribbon-cutting events happen, but the behind-the-scenes discussions, the groundwork, and the under-the-surface processes often take place here. Microsoft realized this early and set up an office here.

Smaller companies, however, should focus on specific issues that directly affect them. For example, if you manufacture generics, follow debates on fair pricing, tariffs, and patent rights at the WHO, WIPO and WTO. These discussions can impact your market access, pricing, and production costs, as well as your business model in the long run.  

Of course, you need to prioritise and there is no one-size-fits-all. If you produce plastics, you may need to track negotiations happening worldwide, and may need to move with the circus from place to place. For example, the next major meeting to discuss plastic pollution will take place in Busan, South Korea. But if your business manufactures garments and just wraps them in plastic for sale, it might not be worth the effort and Geneva may be the better place to be for you.

There is also a common thread among people who have been in Geneva for some time: they are generally open to talking. Geneva has been an international negotiations hub for decades and the ecosystem is present. In my experience, when I have reached out to someone, they are willing to have a conversation, which is unique compared to other places.

What type of people do governments send to Geneva?

Jan Walter: It’s a mix, and that’s what makes it interesting.  

Some countries send subject matter experts, who tend to stay for a long time. For example, a WTO ambassador might have been in Geneva for 25 years, knowing every detail of their field.

Others send political appointees. They may lack technical expertise but have direct access to high-level decision-makers at home, like prime ministers or ministers. Their ability to pick up the phone and speak directly to the higher echelons of domestic politics makes them very effective.

Creating a global level playing field

The EU and the U.S. are pushing for legislation that establishes a “level-playing-field” for their companies. Who will benefit, and who will end up on the losing side?

Jan Walter: In general, the goal of level-playing field laws is to ensure that domestic companies can compete on a fair basis and at the same time pushing for higher standards for all.  

Historically, large jurisdictions have always attempted to ensure international competitors have to meet similar standards in their home countries. But this did not always work. Different countries created different rules, and enforcing this type of equivalence was challenging. Businesses often found themselves on the wrong side of the border or dealing with uncertainty.

This is why the EU and the US adopted level-playing field regulations in recent years via focusing on the supply chains of individual companies. This is a big change.

How can companies adapt?

Jan Walter: My advice for any business is: know your supply chain inside and out—whether it is your corn supplier or biodiesel producer.  

Going back to the CSDDD (Corporate Sustainability Due Diligence Directive), such rules are pushing companies to have full visibility into every part of their supply chain anyways. But knowledge of your supply chain is also key to making the right strategic decisions.

Who will ultimately benefit from level-playing field legislation?

Jan Walter: These laws are designed to benefit domestic suppliers. However, that strategy can sometimes backfire. The EU's packaging and plastic waste directive, as written, could actually harm some domestic businesses, despite its intent.

International businesses that innovate and adapt stand to gain the most. Take the deforestation regulation—some companies and governments complain now, but this has been in development for over a decade. Those who invested early in sustainable practices are now ahead, while others who ignored the signals are scrambling to catch up.

Recently, a client supported a new regulation because they had developed a product that is less harmful than the substances being regulated. If the law passes, it would give them a competitive advantage.

So, companies coming to Geneva do not always oppose new regulations?

Jan Walter: When I first started, I expected most clients would want to fight new regulations and maintain the status quo. But I have been pleasantly surprised. It is more about shaping better regulations—clarifying language, avoiding unintended consequences—rather than resisting change. It is rewarding to work with forward-thinking clients.

Key takeaway

What is your most important advice to clients looking to stay ahead in this dynamic global environment?

Jan Walter: The key takeaway is simple: stay informed and proactive. Whether you are a large multinational or a smaller company, understanding how global regulations affect your supply chain is critical.

Adapting early can turn new laws into a competitive advantage, while staying passive can leave you scrambling to catch up.

Jan Walter is a Senior Policy Advisor at Akin based in Geneva.

Sources