Over the last decade, international flows of capital have skyrocketed and now total over $6 trillion per day , or more than the total annual amount of U.S. exports and imports of goods and services. These flows are the prime mover behind exchange rates and global flows of goods and services. One part of these flows is foreign direct investment, or investment in businesses and real estate. On a cumulative basis, direct investment in 2011 totaled over $20 trillion world-wide, about 20% of which is associated with the overseas investment of U.S. firms, the largest share held by the firms of any nation. Preliminary data for 2012 indicate that foreign investment flows both into and out of the United States slowed in 2012, reflecting a similar trend in world-wide investment data. In addition to foreign direct investment in which firms take a direct equity stake in an investment project, multinational corporations are engaging in a broad array of activities, referred to as non-equity modes (NEM) of investment, that include partial ownership, joint ventures, contract manufacturing, services outsourcing, contract farming, franchising and licensing, and other forms of contractual relationships through which firms coordinate and control the activities of partner firms. The United Nations estimates that NEM investment generated $2 trillion in sales in 2010. While NEM investments can enhance the productive capacities of developing countries through integration into global value chains, employment in the affected industries can be highly cyclical and easily displaced. Foreign investment spans all countries, industrial sectors, industries, and economic activities and has become a major conduit for goods, capital, and technology between the developed and the developing economies. Foreign direct investment has become a much-needed source of funds for capital formation in developing countries and foreign investment accounts for important shares of employment, sales, income, and R&D spending in developing countries. The United States is the largest recipient of foreign direct investment and is the largest overseas investor in the world, owning about $4.5 trillion in direct investment abroad, or more than twice as much abroad as British investors, the next-most active overseas investors. This international expansion of business activity and overseas presence, however, often leads to a clash of cultures and values. In addition, conflicts are rising within the United States and within other developed countries over what role these global corporations should play in their respective home countries and over whose interests the corporations should serve. Traditionally, corporations have served the economic interests of a narrow group of shareholders by maximizing the return to the shareholders, or by maximizing the overall profits of the firm. Now, a broader group of "stakeholders," including customers, employees, financiers, suppliers, communities, and society at large, is pressing for comprehensive codes of conduct that recognize their interests. Defining codes of conduct is difficult, because such codes encompass a broad range of issues and myriad types of official and corporate activities that have defied attempts to reach a common agreement on the composition and nature of the codes. One way to view codes of conduct is by grouping them into three main categories: (1) externally generated codes of conduct that are developed by governments or international organizations, (2) corporate codes of conduct that represent individual companies' ethical standards, and (3) industry-specific codes. These categories often overlap and some codes that initially were adopted voluntarily by companies or industries have been incorporated into law by governments. In other areas, there are notable gaps in the coverage of codes of conduct. Since congressional activities relate most specifically to the first type of codes, or externally generated codes of conduct, they receive the greatest emphasis in this report. Congress has periodically considered issues related to corporate codes of conduct. In the 106 th Congress, for instance, the House considered a measure ( H.R. 4596 ) that would have required U.S. firms to adopt a Corporate Code of Conduct that covered a wide range of workers' rights and environmental issues, similar to the set of "model business practices" the Clinton Administration proposed in March 1995. Similarly, the Senate approved and the President signed on December 2, 1999, the Convention on Child Labor, which addresses various issues related to children in the workforce. The 106 th Congress also considered a number of measures that addressed issues of child labor and the importation of goods produced with child, sweatshop, and prison labor. In the 108 th , 109 th and 110 th Congresses, Congress considered various measures to protect children affected by poverty and natural disasters from trafficking, to protect children and minors from abusive labor practices, and to advance women's rights in developing countries. In the 111 th Congress, Representative Maloney and Senator Boxer introduced companion pieces of legislation ( H.R. 606 and S. 230 , respectively) that would have promoted the international protection of women's rights. In the 112 th Congress, Representative Maloney introduced H.R. 418 to promote the international protection of women's rights. Since the 1970s, public and private expectations of multinational corporate behavior have grown commensurate with the boom in foreign investment. This change in expectations, however, has not resulted in a clear-cut set of directions for governments or businesses to follow in developing codes of conduct. At times, purely voluntary codes evolved into codes that subsequently were adopted as national legislation. For instance, in 1977, the United States adopted the Sullivan Principles and the Foreign Corrupt Practices Act (FCPA). Initially, the Sullivan Principles provided a voluntary set of standards for firms to follow to pressure the apartheid government of South Africa to improve the living conditions of black workers, their families, and their communities. In 1986, Congress adopted the Sullivan Principles as law. The FCPA followed a series of congressional hearings and legal actions against numerous U.S. corporations, and specified legal standards and penalties that were meant to prevent U.S. firms from bribing foreign officials in order to gain economic advantages. Following the financial crisis of 2008-2009, the United States adopted the Dodd-Frank Wall Street Reform and Consumer Protection Act to address issues of governance and regulation of the financial sector, and the European Union has similarly adopted wide-ranging directives to improve oversight of the financial sector and to provide guidance on executive compensation. Also, as the United Nations has noted, "codes of conduct have become increasingly significant for international investment, since they typically focus on the operations of large multinational corporations which, through their foreign investment and global value chains, can influence the social and environmental practices of businesses worldwide." While there appears to be a general consensus in the United States and abroad that favors international standards governing corporate business practices, attempts to reach an agreement on specific standards have proven to be less promising. In some cases, these efforts have fostered competition among countries for investment projects, have highlighted the remaining differences in national policies regarding foreign investment, and have created differences in the goals and objectives of negotiations between the developed and the developing nations. Most developed economies favor international rules, or codes of conduct, that could promote a "level playing field," or an environment in which investment decisions are based solely on competitive market factors. Developing economies, however, often view such efforts as attempts by the developed countries to promote rules and codes of conduct that effectively allow them to hoard foreign investments for themselves and to deny the developing countries the means to compete internationally for new investment projects. These and other differences have spurred nations and international organizations to adopt various approaches in order to promote international rules on foreign investment. One approach has been to negotiate legally binding agreements, whether they are narrowly or broadly cast, that impose a set of standards on multinational firms and that bring a large number of countries into compliance simultaneously. For example, after the United States adopted the FCPA, it supported efforts within the OECD to adopt the Convention on Combatting Bribery of Foreign Public Officials in International Business Transactions (Convention on Bribery), which focuses on a narrow set of issues related to bribing public officials. Since the convention entered into force on February 15, 1999, 40 countries, including the United States, have passed national legislation implementing the convention. A similar approach that failed to gain agreement was a comprehensive agreement on foreign investment, known as the Multilateral Agreement on Investment (MAI). The MAI was expected to be a broad, legally binding, multi-faceted agreement that would have established an international set of rules on a wide range of foreign investment issues. Support for the agreement eroded over the course of the negotiations, which focused on provisions that proved to be too divisive to resolve. In addition, citizen and consumer groups opposed the proposed agreement, in part because they viewed it as too favorable to multinational corporations, and because of their concerns regarding what they believed would be the social, economic, and political impact of the agreement. In lieu of negotiating comprehensive multilateral agreements, many countries have resorted to adopting narrowly focused bilateral investment treaties that contain codes of conduct. Often, these codes resemble a general set of investment-related provisions and corporate "best practices," rather than a legally binding agreement. According to the United Nations, by year-end 2011, 174 countries had concluded 3,164 investment treaties and 2,833 bilateral investment treaties (ITs). Bilateral agreements dominate the number of new and existing investment agreements, but regional agreements are becoming more significant in terms of economic impact. Often these treaties are accompanied by some form of codes of conduct that are negotiated to cover a particular investment project or sector and tend to be highly specific to a company, project, or location. Some nations have used other types of multilateral treaties to promote codes of conduct for multinational firms. One type of agreement attempts to bring greater conformity in the treatment of foreign investment by prescribing changes in national laws governing foreign investment as one component of a broader arrangement that is geared toward economic cooperation and integration, such as the treaties that established the European Community and the North American Free Trade Agreement.