copyright © 2008 mcgraw-hill ryerson ltd. 1 chapter fifteen globalization and business...

Copyright © 2008 McGraw-Hill Ryerson Ltd.

1

ChapterFifteen

Globalization and Business Responsibilities

Canadian Business and Society: Canadian Business and Society: Ethics & ResponsibilitiesEthics & Responsibilities

Chapter 15 Copyright © 2008 McGraw-Hill Ryerson Ltd.

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Chapter Outline

Globalization and Implications for BusinessThe Debate over GlobalizationInternational Non-governmental

OrganizationsInstitutions of GlobalizationGlobalization and Canadian Business and

SocietyStandards of Conduct for Global BusinessSpecial Challenges of Global BusinessThe Acceptance of Global Capitalism


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Globalization

Not a new phenomenon: goods have been traded between regions since ancient times

Corporations now seen as more efficient than governments in distributing goods and services needed by citizens

Today, new view toward trade and market systems is referred to as globalization


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Defining Globalization

Globalization: a process of decreasing constraints on the interactions among the nations and peoples of the world.


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Defining Globalization

Economic globalization: the integration of fragmented markets into a global economy.

Political globalization: the process by which world power relationships change, and there is a loss of sovereignty by the states.

Social or cultural globalization: the emergence of a worldwide cultural system.


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The United Nations Global Compact

Human Rights:1. Respect internationally proclaimed

human rights2. Not be complicit in human rights abuses Labour Standards:3. Uphold the right to collective bargaining 4. Eliminate all forms of forced and

compulsory labour 5. Effective abolition of child labour 6. Eliminate employment discrimination


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The United Nations Global Compact

Environment:7. Precautionary approach to

environmental challenges 8. Promote greater environmental

responsibility 9. Use environmentally friendly

technologiesAnti-Corruption:10. Avoid corruption (e.g., extortion and

bribery)http://www.unglobalcompact.org/


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Globalization and the Implications for Business

Damage to environmentSupport for oppressive regimesCriticism of marketing practices (e.g.,

tobacco, pharmaceutical, baby formula, etc.)Arms tradeTreatment of employees (e.g., sweatshops)Treatment of indigenous peoplesGenetic modification of plants and animalsCorruption and bribery


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The Debate

Pro globalizationJohan Norberg

Anti globalizationNoLogo by Naomi KleinThe Pinky Show (Globalization and

the metaphysics of control)The Pinky Show (Defending

Globalization)


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The Debate Over Globalization: Supporters

Trade leads to more efficient production of better goods and services

Better opportunities for employment and higher incomes

Transfer of capital, technology, intellectual property, skilled labour


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The Debate Over Globalization: Opponents

Benefits received by only a few Creates unemployment Increased poverty and inequality Causes periodic financial crises Destroys local environment Destroys cultures Violates human rights Questionable payments made Disrespect of intellectual property

The Debate Over Globalization

Broadening the Debate: The Pros and Cons of GlobalizationBy Joyce S. Osland

Discussion – What stood out to you?


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Broadening the Debate: The Pros and Cons of

GlobalizationThe Impact of Globalization on EqualityThe Impact of Globalization on Labor

ConditionsThe Impact of Globalization on

GovernmentsThe Impact of Globalization on Culture

and CommunityThe Impact of Globalization on

Environmental SustainabilityChapter 15 Copyright © 2008 McGraw-

Hill Ryerson Ltd. 13


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Globalization and International Non-governmental Organizations

(INGOs) International Non-government Organizations

(INGOs): groups that hold shared values and attitudes about the issues relating to globalization and advocate for changes to improve conditions in developing countries

INGOs put pressure on corporations and governments

INGOs are also referred to as transnational non-government actors (TNGOs) or transnational social movement organization (TSMOs)

Example: Amnesty International


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Institutions of Globalization

Supranational Institution: an international organization that transcends national boundaries where the member states share in decision making on particular issues pertaining to the members


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The World Bank: Provides financial and technological

assistance to developing countries.The International Monetary Fund (IMF):

Fosters financial stability, international trade, employment, and reduction of poverty.

Controversy: negative & positive


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International Labour Organization (ILO): UN agency that seeks to promote social

justice and internationally recognized human and labour rights.

World Trade Organization (WTO):Coordinates agreements reducing trade

barriers.Controversy


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Globalization and Canadian Business and Society

Pressure to forge international linksMust meet challenges of global

restructuring (e.g., R&D, education, competition policy, cost of capital, etc.)

Attract more investment in natural resource plants

More direct investment abroad


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International Code of Ethics for Canadian Business Principles

Community participation and environmental protection

Human rightsBusiness conduct (e.g., bribery and

compliance with the law)Employee rights and health and

safety


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Standards of Conduct and Accountability for Global

Business Political factors Socio-cultural

objectives and values

Disclosure of information

Competition Financing Employment and

human resources

Science and technology

Corrupt practices Environmental

protection Stakeholder

consideration Corporate

governance


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Global Standards of Conduct

Caux Round Table: “Caux Principles”OECD “Guidelines for Multinational

Enterprises”“Principles for Global Corporate

Responsibility” (Interfaith organizations)

United Nations Global CompactGlobal Reporting Initiative (GRI)


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Special Challenges of Global Business

Corruption: The abuse of entrusted power for private gain (e.g., bribery)

Human rights: The fundamental rights and freedoms to which all individuals, groups, and societies are entitled (e.g., sweatshops).


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The Acceptance of Global Capitalism

Fair trade: Trading partnership which aims at sustainable development for excluded and disadvantaged producers (e.g., Fairtrade Foundation, Oxfam, and Traidcraft)

Microfinance: Provision of financial products such as micro-credit or micro-insurance to people living in poverty (e.g., Grameen Bank in Bangladesh)

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