Abstract A critical literature on multinational corporate social responsibility has developed in recent years. Many authors addressed the issue in the Third World countries. This paper reviews the literature, focusing on the relationship between the multinational corporations (MNCs) and Third World governments in fulfilling the social responsibility, based on the underlying ethical imperative. There is a growing consensus that both corporations and governments should accept moral responsibility for social welfare and individual interests in their economic transactions. A collaborative relationship is proposed where the MNCs share information based on global experiences and offer input into host government developmental policies, and aid their implementation. The government, in turn, provides a reasonable regulatory environment. This calls for ongoing interactions among officials at all levels of the two institutions, with the local corporate subsidiary playing a pivotal role. The desired conduct of the parties is reinforced by international organizations and other constituents, representing common human concerns across cultures. These relationships are examined and an agenda for policy and action by the MNCs and the Third World governments is developed. The accelerated growth in the number of multinational corporations (MNCs) and their worldwide scope, with concentration of economic and political power draws attention to corporate social responsibility. Furthermore, a meeting of the United Nations Conference on Trade and Development (UNCTAD) in 1987, with delegates from 141 developed and developing countries concluded with a major agreement. Journal Information The Journal of Business Ethics publishes original articles from a wide variety of methodological and disciplinary perspectives concerning ethical issues related to business. Since its initiation in 1980, the editors have encouraged the broadest possible scope. The term 'business' is understood in a wide sense to include all systems involved in the exchange of goods and services, while 'ethics' is circumscribed as all human action aimed at securing a good life. Systems of production, consumption, marketing, advertising, social and economic accounting, labour relations, public relations and organisational behaviour are analysed from a moral viewpoint. The style and level of dialogue involve all who are interested in business ethics – the business community, universities, government agencies and consumer groups. Speculative philosophy as well as reports of empirical research are welcomed. In order to promote a dialogue between the various interested groups as much as possible, papers are presented in a style relatively free of specialist jargon. Publisher Information Springer is one of the leading international scientific publishing companies, publishing over 1,200 journals and more than 3,000 new books annually, covering a wide range of subjects including biomedicine and the life sciences, clinical medicine, physics, engineering, mathematics, computer sciences, and economics. Rights & Usage This item is part of a
JSTOR Collection. 1) In recent years, which of the following has lessened the criticisms of MNCs? B) greater emphasis on social responsibility by MNCs 2) Which of the following concepts includes the expectation that MNCs should be concerned with the social and economic effects of their decisions? B) international social responsibility 3) Which of the following significantly increases the complexity of social responsibility and ethical behavior of MNCs? C) additional stakeholders associated with the firm's activities 4) Sundew, an American soda company, opened a number of manufacturing units in a developing country. It employed people from the host country to work in the new units. This move radically lowered the poverty rate in the developing country. In this scenario, Sundew is ________. C) making a foreign investment 5) Which of the following is a business benefit from corporate social responsibility? C) increase in brand value 6) Which of the following terms refers to an integration of the business environments in which firms currently operate, resulting from a dissolution of traditional boundaries and from increasing links among MNCs? B) global corporate culture 7) Moral universalism is the need for a moral standard that is accepted by all ________. 8) With an ethnocentric approach, a company applies the morality used in its ________. 9) McDonald's, a fast food chain headquartered in the United States, applies the morality it practices in the United States to all foreign countries in which it operates. McDonald's is adhering to ________. 10) A company subscribing to ethical relativism would implement the morality of the ________. 11) Which of the following often forces the MNC to act in accordance with ethnocentric value systems? C) public pressure in the home country 12) Creating Shared Value(CSV) creates ________. C) economic value by creating social value 13) Which of the following creates shared value? C) reconceiving products and markets 14) The Anti-Sweatshop Code of Conduct requires companies to provide a healthy and safe work environment and ________. B) to pay the prevailing local minimum wage 15) Which of the following is a policy of the Electronic Industry Code of Conduct (EICC)? C) Contract manufacturers should follow some basic environmental requirements. 16)Which of the following, if true, would best support a decision by Primo to remain in China? A) Primo becomes SA8000 certified. 17) Which of the following is one of the standards of SA8000? B) providing a safe work environment 18) According to the international codes of conduct, the MNE behavior toward the host government is related to ________. A) economic and developmental policies, laws and regulations, and political involvement 19) According to the international codes of conduct, MNEs should ________. D) conduct research and development activities in developing countries 20) According to the international codes of conduct, the MNE behavior toward the public is related to ________. A) technology transfer and environmental protection 21) According to international codes of conduct, which of the following is related to the MNE behavior toward persons? 22) According to international codes of conduct, which of the following is related to the MNE behavior toward persons? 23) According to international codes of conduct, which of the following is related to the MNE behavior toward persons? 24) ________ refers to the business conduct or morals of MNCs in their relationships with individuals and entities. D) International business ethics 25) According to Robertson and Crittenden, which of the following has made integrating an ethical component into international strategic decisions, challenging? 26) Transparency International is best described as a(n) ________. B) nongovernmental organization that fights corruption 27) Which of the following is a primary focus of the research that is carried out by Transparency International? A) relative prevalence of bribery in various spheres of people's lives 28) Which of the following is considered the primary problem for MNCs attempting to define their corporate-wide ethics? B) variations in ethical standards around the world 29) Which of the following is dedicated to monitoring issues of data privacy in Europe? C) the EU Directive of Data Protection 30) Payments to expedite routine transactions are often referred to as ________. 31) Tokens of appreciation and grease money are considered ________. 32) The Foreign Corrupt Practices Act of 1977 was primarily established to ________. A) distinguish between harmless customs and actual bribery 33) Which of the following prohibits U.S. companies from making illegal payments or other gifts or political contributions to foreign government officials for the purposes of influencing them in business transactions? D) Foreign Corrupt Practices Act 34) Which of the following was the primary purpose of the Organization for Economic Cooperation and Development Convention on Bribery? C) to combat corporate corruption 35) One of the primary complaints about the Foreign Corrupt Practices Act is that the legislation ________. A) puts U.S. firms at a competitive disadvantage 36) Which of the following shows that employees have understood, and signed off on, the legal obligations regarding bribery and corruption in the countries where they do business? B) having a global compliance system 37) The FCPA allows "grease" payments to facilitate business in a foreign country, if ________. C) those payments are lawful in that country 38) Which of the following is the first step of making an ethical decision? D) consulting the laws of both the host and the home countries 39) Which of the following is the last step of making an ethical decision? B) following your own conscience and moral code 40) John, an American national, works as a manager at his firm's subsidiary in Indonesia. A local government official tells John that materials could be delivered to the firm's facility more quickly if John pays an extra fee to the port supervisor. What should be John's first action? D) consult both American and Indonesian laws 41) The profitability of individual companies depends on a cooperative and constructive attitude toward ________. C) global interdependence 42) Which of the following MNC subsidiary activities is blamed for rising interest rates in host countries? C) raising capital from local sources 43) Which of the following best defines the concept of managing interdependence? A) the effective management of a long-term, MNC subsidiary–host-country relationship through cooperation and consideration for host concerns 44) Which of the following terms refers to the practice by a country of rallying public opinion in favor of national goals and against foreign influences? 45) Which of the following terms refers to a country's use of tariff and nontariff barriers to partially or completely close its borders to various imported products that would compete with domestic products? 46) Under governmentalism, the government uses its policy-setting role to favor the interests of ________. 47) Which of the following is most likely a benefit to host countries with MNC operations? B) export diversification 48) Which of the following is MOST relevant to the decision by Primo to remain in China? C) the benefits that the local Chinese community might have 49) Under governmentalism, the government uses its policy-setting role to favor national interests, rather than relying on ________. 50) Which of the following is a potential benefit to the host country of MNC operation?
D) infrastructure development and support 51) ________ lies at the intersection of financial, social, and environmental health––sometimes described as the "triple bottom line." 52) Which of the following terms refers to adopting business strategies and activities that meet the needs of the enterprise and its stakeholders today, while protecting, maintaining, and enhancing the human and natural resources that will be needed in the future? 53) In recent years, the export of hazardous wastes from developed countries to less developed ones has ________. C) increased significantly 54) Which of the following is the main reason why companies dispose hazardous wastes in less developed countries? B) weak regulations and low costs 55) If MNCs want to take the lead in dealing with ecological interdependence, then they most likely need to ________. B) incorporate sustainability goals into strategic planning 56) Which of the following concepts requires that an industrial system be viewed not in isolation from its surrounding systems, but in concert with them? 57) ________ is a systems view in which one seeks to optimize the total materials cycle from virgin material, to finished material, to component, to product, to obsolete product, and to ultimate disposal. 58) ________ model provides a system for examining, measuring, and managing the drivers of corporate sustainability. 59) Social responsibility, ethical behavior, and interdependence are important concerns to be built into ________. 60) Global interdependence creates demands on international managers to take a positive stance on issues of social responsibility and ethical behavior. 61) The difference between social responsibility and ethical behavior is a matter of scope and degree. 62) Social responsibility deals with decisions and interactions mostly on an individual level. 63) Decisions about ethics tend to be made at a higher level, affect more people, and reflect a general stance taken by a company or a number of decision makers. 64) The sales, debts, and resources of some of the largest multinational firms exceed the gross national product, the public and private debt, and the resources, respectively, of some nations. 65) The increased complexity regarding the social responsibility and ethical behavior of firms across borders is brought about by the distance between the headquarters and its subsidiaries. 66) Improved customer attraction and retention; improved reputation; and improved employee recruitment, motivation, and retention are business benefits of corporate social responsibility. 67) Ethnocentric culture is an integration of the business environments in which firms currently operate. 68) The term "moral idealism" is used to address the need for a moral standard that is accepted by all cultures. 69) Ethical relativism adopts the local moral code of the country in which it is operating. 70) In a globalized market economy, CSR has to be part of modern business. 71) Creating Shared Value (CSV) leverages the unique resources and expertise of the company to create social value by creating economic value. 72) Globalization has reduced the ethical problems facing organizations. 73) Global corporate culture refers to the business conduct or morals of MNCs in their relationships with individuals and entities. 74) The biggest single problem for MNCs in their attempt to define a corporate-wide ethical posture is the great variation of ethical standards around the world. 75) The Foreign Corrupt Practices Act (FCPA) prohibits U.S. companies from making illegal payments, other gifts, or political contributions to foreign government officials for the purpose of influencing them in business transactions. 76) When managing interdependence, international managers must go beyond general issues of social responsibility and deal with the specific concerns of the MNC subsidiary––host country relationship. 77) Under nationalism, the host institutes a partial or complete closing of borders to withstand competitive foreign products, using tariff and nontariff barriers. 78) Under governmentalism, the government uses its policy-setting role to favor national interests, rather than relying on market forces. 79) Under protectionism, public opinion is rallied in favor of national goals and against foreign influences. |
Which of the following concepts includes the expectation that MNCs should be concerned with the social and economic effects of their decision?
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