Exam 5: Corporate Social Responsibility

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While there is no consensus on the meaning and extent of corporate social responsibility (CSR)from nation to nation,the idea has taken on new and novel international dimensions in response to economic globalization.As governments deregulated markets and lowered trade barriers in the 1980s,cross-border trade and investment began a steep rise.Dominant corporations grew larger and more active.As they did,critics and observers perceived the exercise of too much power and too little restraint,particularly of Western corporations in developing nations.
The perception that transnational corporations elude proper controls is rooted in a group of observations.First,international law,as found in treaties,conventions,and trade agreements,is weak in addressing social impacts of business.It strongly protects commercial rights,but norms protecting labor,human rights,nature,indigenous cultures,and other social resources are little codified.Second,transnational corporations are subject to uneven regulation in developing nations,where institutions may be rudimentary and enforcement feeble.Some
governments have overly bureaucratic agencies riddled with corruption.And some are undemocratic,run by elites that siphon off the economic benefits of foreign investment and neglect public needs.Third,in adapting to global economic growth,corporations use strategies of joint venture,outsourcing,and supply chain extension that create efficiencies,but sometimes also distance them from direct accountability for social harms.And fourth,significantly more government regulation of transnational firms is unlikely.No global government exists and no nation-state has the power to regulate international commerce.Developing nations fear,correctly,that stricter rules will deter foreign investment.