Term Paper on "Global Commerce and Human Rights"

Term Paper 8 pages (2643 words) Sources: 5 Style: MLA

[EXCERPT] . . . .

Globalization

Corporate Responsibility in a Global Marketplace

When it comes to basic human rights, what role should corporations play in the new global marketplace? Certainly companies have an economic and marketing role to fulfill in terms of satisfying stakeholders' investments - but moreover, do they have an ethical obligation to the people whom they employ to produce products and the communities in which they operate? The answer to the first question will be fully addressed in the content of this paper. The answer to the second question is an emphatic "yes."

Corporations with a global reach should be accountable for all their actions, including the health and welfare of their employees and of those living in the communities in which companies operate. Today, numerous corporations are indeed taking responsibility for their behavior in the international marketplace, but too many companies are lax and even criminal in their failure to be accountable. There are some reasonable guidelines in place that provide a structure for a globally-involved company to adhere to, and have been endorsed by responsible people and groups within the international business community, yet some companies ignore or are ignorant about these guidelines. Other more stringent guidelines and codes of conduct may well be needed in the near future, according to some sources referenced in this paper.

LITERATURE REVIEW: Union Carbide: The behavior of Union Carbide is an outstanding example of how not to act when it comes to a corporation doing business in a foreign country. Corporations can "go to school" on this terrible situation created initially by a lack of safety procedures and followed by indifference to citizens in a foreign country.

Twenty years ago the Union Carbide Corporation (UCC) was responsible for a catastrophic gas leak from their pesticide plant in Bhopal, India, which killed more than 7,000 people in the first few days. Within the next few years, a total of 15,000 Indian people died due to the toxic chemicals that were accidentally released, according to Amnesty International's information (www.web.amnesty.org).As of 2004, over 100,000 people "...are suffering chronic and debilitating illnesses for which treatment is largely ineffective," Amnesty International reports.

And even after UCC was later bought out by Dow Chemicals in 2001, neither of them have lived up to the moral and fiduciary responsibilities in this matter; "...the survivors still await just compensation, adequate medical assistance and treatment, and comprehensive economic and social rehabilitation," Amnesty International asserts. Over 16,000 claims are still outstanding and Dow and UCC are taking the position that they are not responsible for the ongoing negative environmental impacts - or the ongoing illnesses - in the region.

LITERATURE REVIEW: United Nations' Global Compact. Recognizing that there was a need for some moral and social leadership when it comes to globalization, human rights and the involvement of corporations, the United Nations created the "U.N. Global Compact" in the year 2000. The Compact is almost the answer to question #1 in terms of what role a corporation should play in the human rights genre on the world stage. Indeed, by one measure, the Compact has been "a smashing success" (Engardio, 2004); it had 50 members at the beginning and within four years that number increased to "more than 1,700," Engardio writes in Business Week.

That having been said, the journalist goes on to point out that the U.N. project "...is falling far short of expectations." At a recent "annual Compact summit" in New York City, several groups - Amnesty International, Friends of the Earth, among others - complained that the Compact "has become little more than a corporate public-relations exercise," Engardio continued. The disillusionment articulated by these and other groups was based on their perception that the Compact had become "...little more than a corporate public-relations exercise," the article continued.

The U.N., it is charged, has spent more time focusing on "expanding membership" than on actually finding ways to ensure that the membership corporations "honor their commitments." The principal intention behind Compact's glossy goals is to convince companies to "halt practices that have given globalization a bad name," Engardio asserts. A few of those incidents include use of labor in a sweatshop environment, "toleration of atrocities by repressive regimes," and "rapacious mining and logging in poor nations." What Compact members agree to is ten "broad principles" including the recognition that unions have a right to collectively bargain in the workplace, that environmental protection is a vital part of doing business globally, and of course, human rights. Members also have an opportunity to tout their good deeds and positive human rights policies before the international body of nations, which affords those companies unprecedented public relations visibility.

The problem with Compact, as of this 2004 article, is that there are no "clear reporting or compliance standards." There are companies who have published "extensive corporate responsibility reports" - among them Nike, British Petroleum (BP) and PLC - but there is no transparency to these reports, and no agency within or outside of Compact can hold these companies' feet to the fire when it comes to the veracity of their "reports."

And while the intention of Compact was never to become a policing-type project, as U.N. Secretary-General Kofi Annan put it, "...we need to hold them to what they are saying," and if the U.N. doesn't demand accountability, "this may even discredit the U.N.," Annan explained. Some of the globalized companies, like Gap, have gone to great trouble to comply with the tenets of Compact. Gap in fact hired 90 staff members and outside agencies to "monitor thousands of garment factories from china to Guatemala," prior to even joining Compact. And Starbucks, the coffee colossus, was - prior to joining Compact - already underway with plans to hire environmental groups to become watchdogs and make sure coffee suppliers were paying fair prices to poor farmers, and treating farmers humanely. "The Compact principles don't require us to do anything differently," said Sandra Taylor, a senior vice-president for corporate responsibility for Starbucks.

Not all Compact companies are doing corporately responsible things; Royal Dutch Shell, for example, along with France's Total and Newmont face civil lawsuits in U.S. Courts on charges of "serious rights abuses" in Nigeria, Burma, and Indonesia, respectively.

LITERATURE REVIEW: UN Compact & Human Rights in Depth: Meanwhile, writing in Global Governance ("The Global Compact: Shifting the Politics of international Development?"), Jean-Philippe Therien and Vincent Pouliot assert that among the original objectives of the Compact was to give "...global markets a more human face." By the end of 2005, the number of companies that had joined Compact rose to 2,400, the authors report; their article mentions that an additional the goal of the Compact is to "promote UN values." Indeed the Compact involves six U.N. agencies:

The UN Development Programme (UNDP); International Labor Organization (ILO); UN Environment Programme (UNEP); Office of the High Commissioner for Human Rights (OHCHR); UN Industrial Development Organization (UNIDO); and UN Office on Drugs and Crime (UNODC). The Compact is known in international circles as a "network of networks," Therien writes, and as of 2006, the authors believe the Compact "seeks to promote dialogue on corporate social responsibility and development" and it "epitomizes" the present state of the politics of international development in three ways:

One, it attempts to nurture good chemistry between the Third World and the international business community - that "sustainable development on a global scale" is possible and that in itself reflects an "historic change in attitude" inside the UN bureaucracy regarding the role of "business and markets in the fight against world poverty"; two, whereas previous attempts at multilateralism have "clearly failed to bridge the gap between rich and poor countries," the new approach through Compact is a "striking manifestation" of a move toward a "nonhierarchical model of multilateral cooperation."

The third way in which Compact epitomizes emerging global trends is by offering an "assessment" of the various "worldviews" that are part of the debate on corporate responsibilities to developing nations and the humans that live and work for global corporations in those countries.

Meanwhile, in a speech at Michigan State University ("Responsibility in a Common World") Clifton R. Wharton, Jr., the Chairman / CEO of TIAA-CREF (Teachers Insurance and Annuity Association / College Retirement Equities Fund) acknowledges that the term "globalization" has unfortunately become a synonym for a "new colonialism." Wharton agrees that there are "genuine reasons for concern" about the "darker side" of globalization. Because nearly one-half of all humans on the planet live on "less than $2 a day," Wharton continues, and one-fifth get by on a dollar a day, it seems pertinent to note that the most "critical challenge of the negative consequences" is dealing with human rights, e.g., "human dislocations and inequalities."

How does Wharton propose that society deal with those human rights issues in a global economy? He has no specific measures other than to "keep our focus on economic growth" while at the same time urging corporate interests to "respect and observe tolerance for different values and beliefs" in America and… READ MORE

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