What can Post-Democracy tell us about TNCs and Extraterritorial Violations of Human Rights?
In Colin Crouch’s Post-Democracy (2004), we are presented with the prospect of a society in which the global firm is the central institution, government policy is increasingly captured by elite and corporate interests, and the middle class has but a tenuous grasp on its sense of political identity. The trappings of democracy - in the form of free elections - are in place, yet the state is increasingly hollowed out as political power shifts to the corporate sphere. Crouch’s explanatory framework considers a range of political institutions in detail, but this article focuses on just one: the transnational corporation (TNC). I specifically consider the
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Furthermore, corporations have largely succeeded to date in their lobbying efforts to remain free of any direct obligations under international law.
The term ‘corporation’ encompasses a range of corporate structures including subsidiaries, holding companies, and joint ventures. ‘Transnational corporations’ are those corporations (and their related entities) that have operations in more than one state. Such entities are able to operate across national borders, sell products and source labour in multiple markets, and shift production, resources and expertise as and when required. There is no doubt that global firms are engines of prosperity and growth across many areas of the world. Corporations generate valuable employment and educational opportunities, revive living conditions in flagging communities with much-needed investment and new technologies, and enhance the prosperity of those states able to ride the globalization wave.
Yet this capacity to do great good is matched by an ability to inflict or be complicit in great harm. Merely by operating in certain areas of the world, corporations can give economic support and moral sanction to governments implicated in highly oppressive or corrupt activities. Even in developed countries, the Starbucks and Amazons of the world
The transnational model was developed to support the needs of large, multinational companies. This model consists of multinational corporations-experienced in international markets with facilities in several foreign countries that simultaneously utilize technological advances, innovation, global learning and efficiency to be successful. These multinational organizations adopt organic structures, similar to the learning organization, that are flexible, unified and coordinated through corporate culture and shared visions and values of its employees (Daft,
Transnational Corporations (TNC’s) play a large role in the development of the global economy, through the sharing of research, trade and technological advances between the different countries. They also play a big part in increasing the interconnection in the world’s economic, cultural and political systems, otherwise known as globalisation. Nevertheless there are both positive and negative impacts that TNC’s bring to the global economy, socially, economically, politically and culturally.
Multinational Corporations (or MNC’s) are businesses with operations placed in various countries other than the home country where all functions are managed. Traditionally, it is up to the federal government to prevent these entities from abusing their power and violating International Law by implementing regulations. However, because of their transnational status, MNC’s are separate from the government, the state, and society; giving them the ability to act outside of public standards. This has caused problems in the international realm as it frees up opportunity for corporations to abuse their power due to a serious
The perception that corporations are villainous and evil entities that want to rule, control and destroy the world had been in movies for quite some time, however this doesn’t necessarily carry over to real life. In the
A TNC (transnational corporation) is a company that operates in no less than two countries and has a global outlook. TNCs have a long history going back to the 16th Century in terms of trade such as spices, but it’s not until C. 1945 that companies started to form acquisitions and mergers. The one key reason why these businesses have been so successful in their area of expertise globally is because they can take advantage of spatial differences in the factors of production worldwide. They are able to exploit differences in the availability of capital, labour costs and land cost, which we as a world have seen, especially in far-east
It is interesting to say that one of the earliest roots of transnational corporations can be traced backed to the major colonizing and imperialist ventures from Western Europe, notably England and Holland (Greer and Singh, 2000). However, the structure of transnational corporations we know today did not really begin until the early 19th century. It is around this time that the development of factories, more capital intensive manufacturing processes; better storage techniques; and faster means of transportation were developed. Also the search of natural resources such as gold, diamond, sliver, petroleum, and even some foodstuffs as well, brought about the need to increase markets and this drove transnational expansion by companies almost exclusively from the United States and a handful of Western European nations (Greer and Singh,
Trans-national corporations are companies that expand businesses or operations in various countries. Shaping the current global economy and structure, TNCs have the ability to completely change a nation. McDonalds, Ford, and Shell are used as common examples for such companies, but today “smaller companies” are seen using the ever changing economy to expand into global endeavors (Meyar,1996). The appeal of larger markets, greater returns on investment, and overall cheaper production, gives companies the incentive to enter the globalized world. What is not shown in the price these seemingly cheaper enterprises have on environment, political economies, and natural rights. These large companies impose the model of any means necessary, in order to continue expansion and profits. While TNC’s prevalence provides goods and services at a lower cost, the unsustainable, self-seeking, and immoral behaviors displayed bring more harm than good.
In this current economic Era, it has become more evident with time, that being someone who is ruthless and unmoral is more popular, moral, profitable and more essential to being successful. This is the known motto of many of the big cooperate heads, they do this so they can far exceed their goals. Goals of making the highest profit by any means. But not all Big corporations are like this. We now have companies like Starbucks that are setting a new standard towards being Socially Responsible and globally conscious. Starbucks has been known to make huge amounts of profits over something as simple but yet so complicate as a cup of coffee. Starbucks is hugely involved towards bring social justice into its supply chain and while doing so also want to have a positive impact in the communities they enter. Starbucks isn’t the only company that’s doing something different, then the set path of “success” all ready drawn out by others.
The rise of the corporation follows the path of the rise of Western capitalist society. When industrial societies expanded, the birth of many corporations formed to consolidate power, market share and ultimately, profit. In the last century, the emergence of large multinational corporations (MNC)* has brought both benefits and numerous problems to our global society. The documentary film The Corporation has left an indelible mark on my perception on how globalization has affected poor countries. The film provides a critical review on the rise of MNC and its current corporate practices. The study of multinational corporations have led to the emergence of several academic approaches that question the merits and consequences of globalization.
Corporations have a crucial role and responsibility in today’s society. As the power of the nation state is increasingly in decline, the influence of businesses is only expanding and intensifying. Companies and their decisions have a profound impact on communities, individuals and the environment. Therefore, these organisations must assume a significant responsibility in today’s globalised society. As Bryan Horrigan (2010) explains, businesses “not only must be engaged with their stakeholders but are themselves stakeholders alongside governments and civil society. International business leaders must fully commit to sustainable development and address paramount global challenges” (p.53).
David Korten, Master of Business Administration and PhD Stanford, was consistently researching how businesses globally outcome the world. With numerous years of experience perusing business, David Korten published When Corporations Rule the World in 1995. When Corporations Rule the World gave readers his perspective of anti-globalization, which was a passion for David Korten. His primary idea was that business enterprises were manipulating the conclusion of the world 's economic and social involvement from this process of globalization. His sentiment about globalization directs politics, society, and environment in a negative direction for the human involvement. Korten states that multinational corporations acquired considerably amount power in determining the fate of the state.
Transnational corporations are companies who’s business activities have an influence on economic, social, and environmental outcomes in more than one country. There are some similarities in principles, expectations, and motives between countries regarding these matters, however there are also some differences too. This makes it vital for companies to consider these issues, in order to be socially responsible on an international scale as well as a national scale. (Boddy 2012) states that corporate social responsibility “refers to the awareness, acceptance and management of the wider responsibilities of organisations”. Producers and suppliers to transnational corporations are in some cases regarded as a wider responsibility of transnational corporations, as it is the dealings between the two parties that lights up a variety of topics to review. The aim of this piece of work is to talk about the main factors that transnational corporations need to consider when dealing with producers and suppliers, and their respective communities, in order to be socially responsible, by reviewing previous literature of accredited scholars and researchers. This involves the fairness of how transnational corporations deal with producers and suppliers, and also, the thoughts towards exploitation of labour by suppliers in poor countries.
The field of Global Ethics has recently emerged as its own independent field of study that engages with many of humanities most pressing ethical questions. One of the most important subsets of this field of study is arguably how the role of international corporations will fit into the process of addressing many of the planet’s most pressing issues over the coming generations. The globalization trend has led to the ability for international corporations to influence the international relations of nations on a scale never before imagined. For example, if Walmart were a country it would rank 28th in the world in GDP compared to other nations.
Numerous debates have been waging over the past few years among business elites about the whether or not a corporate entity has a responsibility to society. It’s an extremely interesting topic with real and global ramifications that impact nearly every person and animal on this planet in one form or another. Anyone who owns public shares in a company has invested hard-earned money into a corporation based upon their perception that the company will be profitable and sustainable. The corporation’s board of directors are then responsible to manage the company in such a way as to increase their share-holders’ investment. For hundreds of years, this attempt to increase a corporation’s worth was done with little or no interest in social responsibility. Until very recently this topic was not very much in the public eye. However, at the moment the global economy is rapidly changing and business transparency is increasing through the accessibility of information across the world. Social and global change is moving faster than ever and progressing through this century any business will undoubtedly need to keep up to remain profitable. More mature business students will certainly recall being bombarded with the idea that the only responsibility of a corporation was to increase the value of the company and maximize long-term shareholder wealth without regard to ethics or social obligations. Is there a correlation that occurs between large multinational corporations and their
Current legal mechanisms of accountability fail to account for the fluid nature and power of influence that transnational corporations possess. Transnational Corporations are not static in nature and have tremendous economic and political influence over government policies. These factors result in a lack of due diligence for transnational corporations to uphold human rights. TNCs are economic and legal entities. In theory, TNCs are subject to the law of a country, to the jurisdiction of its courts, but often this is abandoned by the government of countries. TNCs have tremendous influence