Corporate Social Responsibility: Business Ethics In A Global Context

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Corporate social responsibility among multinational corporations is an ever-growing concern in today’s society. Feinberg defines a right as “justified entitlement to something from someone”[footnoteRef:1]. Shue defines a positive right as “one that requires persons to act positively to do something”[footnoteRef:2] and a negative right as “one that requires only that people not deprive directly”[footnoteRef:3]. Libertarian theories can be viewed from two main angles, weak-side – constraints and strong–side constraints. Double standards between home and host countries help us to analyze the views of the firm along with the role non – governmental organizations play in regulating multinational corporations. Shue proposes ten fundamental international rights which help multinational corporations maintain a level of moral responsibility. By looking at the double standards multinational corporations face along with the role of NGOs, libertarian theories and fundamental international rights, we can examine why multinational corporations and never truly free from moral responsibilities when operating in the global context. [1: Donaldson, Thomas J. ‘Rights in the Global Market.’ Ruffin, 1991, 139-62. doi:10.5840/ruffinoup199128.] [2: Donaldson, Thomas J. ‘Rights in the Global Market.’ Ruffin, 1991, 139-62. doi:10.5840/ruffinoup199128.] [3: Donaldson, Thomas J. ‘Rights in the Global Market.’ Ruffin, 1991, 139-62. doi:10.5840/ruffinoup199128.]

In the recent past, many multinational corporations have been accused of unethical practices by the media along with NGOs. Although this has created accountability for multinational corporations, there are factors that make it difficult for these organizations to maintain certain ethical standards between the multinational corporations’ home and host country. Falkenberg tells us “while operating in an economy with less than adequate background institutions, it is tempting to apply the same kind of cost/ benefit reasoning as is practiced in developing countries”[footnoteRef:4]. This is due to several factors including the legality of certain actions in host countries, lack of a reaction from the government of host countries as well as actions that are in accordance with local values. Unfortunately, many multinational corporations have chosen to partake in unethical actions in the past. They have always been seen as “uncontrollable economic powerhouses pursuing their own interests with little regard for the environment or for the well–being of people in developing countries”[footnoteRef:5]. There are many examples to support this view including the discrepancy surrounding Texaco in Ecuador. It is argued that Texaco violated “the right to a clean and healthy environment”[footnoteRef:6] for individuals living in Ecuador. Today, many multinational corporations “provide stakeholders with a triple bottom line reporting on its activities not only from the owner’s viewpoint but also from a corporate social responsibility standpoint and possible environmental implications of one’s operation”[footnoteRef:7]. This provides stakeholders as well as NGOs with peace of mind concerning any ethical violations as well as maintaining corporate social responsibility. [4: Falkenberg, Andreas Wyller. ‘When in Rome … Moral Maturity and Ethics for International Economic Organizations.’ Journal of Business Ethics 54, no. 1 (2004): 17-32. doi:10.1023/b:busi.0000043498.33565.fa.] [5: Falkenberg, Andreas Wyller. ‘When in Rome … Moral Maturity and Ethics for International Economic Organizations.’ Journal of Business Ethics 54, no. 1 (2004): 17-32. doi:10.1023/b:busi.0000043498.33565.fa. ] [6: Arnold, Denis G. ‘Libertarian Theories of the Corporate and Global Capitalism.’ Journal of Business Ethics 48, no. 2 (2003): 155-73. doi:10.1023/b:busi.0000004595.77613.ec.] [7: Falkenberg, Andreas Wyller. ‘When in Rome … Moral Maturity and Ethics for International Economic Organizations.’ Journal of Business Ethics 54, no. 1 (2004): 17-32. doi:10.1023/b:busi.0000043498.33565.fa. ]

Although NGOs do their best to regulate multinational corporations, there are some challenges surrounding it. NGOs have made tremendous progress in terms of disincentivizing certain practices in part thanks to the media. Unfortunately, the media has a tendency to “exaggerate the bad news and not give an equal tendency to the good news”[footnoteRef:8]. This has drawbacks for multinational corporations as they are dependent on trust bestowed by key stakeholders. By exaggerating bad news, multinational corporations are at risk of losing their trust. [8: Falkenberg, Andreas Wyller. ‘When in Rome … Moral Maturity and Ethics for International Economic Organizations.’ Journal of Business Ethics 54, no. 1 (2004): 17-32. doi:10.1023/b:busi.0000043498.33565.fa. ]

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