Corporate Responsibility in the Globalized World

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Corporate Responsibility in the Globalized World

Table of Contents

Introduction
Factors Influencing Corporate Responsibility
Examples of Proper and Improper Business Conduct
Conclusion
Works Cited

Introduction

Globalization is defined as the increasing movement of products, services, and capital across national borders. Owing to the rapid technological development and a significant decline in communicational costs, larger corporations have found it efficient to move working assets abroad. With the rise of globalization, companies around the world have started to pay maximum attention to the increase in production volumes. However, as the example of Foxconn in China shows, little focus is sometimes made on the responsibility of the management staff and the proper arrangements of working conditions (Chandler and Werther Jr. 38). Current research investigates corporate responsibility from the perspective of changes it faces at present. As a matter of fact, the responsibilities of businesses in a market society have been discussed by scholars and economists for decades now. Today, with the occurrence of a new concept, i.e., globalization, the issue has turned into a topic of sharp debate.

Factors Influencing Corporate Responsibility

It is obvious that business organizations have to obey the law; this norm has been accepted as a minimum social responsibility of every company on the market. However, as long as there are gaps in the system of law, a whole variety of violations can be tracked throughout business practices (Sethi 19). One of the outcomes of globalization is that a lot of corporations try to merge with companies from other countries in order to avoid taxation. As an attempt to gain more free space and invest less, the organizations establish plants on foreign territories and hire less expensive labor force (Haque and Azmat 171). Once this goal is achieved, reconsideration of moral, social, and ethical principles starts to occur. This phase often serves as a starting point of a new business course; the level of corporate responsibility may either rise or fall significantly at this very stage. In its turn, it may lead to either improvement or decline in working conditions depending on a chosen strategy.

Examples of Proper and Improper Business Conduct

PepsiCo appears to be a bright example of how one uses working assets and corporate resources to build an effective business environment. PepsiCos Global Compliance and Ethics Department, which is responsible for the promotion of the companys code, monitors for its major principles to be fully observed. The organization adheres to the concepts of respect and devotion in the workplace. Moreover, it ensures ethics in business relationships and encourages open discussion of possible concerns. The overall companys cost currently exceeds $140 billion (Sethi 183).

Supposedly, guided by the principle that social responsibility of business is to increase its profits, the known corporation Foxconn showed the bottom side of the notion of corporate responsibility back in 2012 (Lim 35). One of the largest investigations of a US companys operation abroad uncovered peculiar details about its activity. As occurred, Foxconns employees had to work more than 60 hours a week, and sometimes they were not even provided a day off. The company, however, was not intending to pay workers overtime. The situation changed when Apple requested a thorough investigation of the corporations activity. In the end, Foxconn was forced to raise salaries by 25%.

Conclusion

In closing, one needs to admit that with the streaming growth of globalization such notion as corporate responsibility has acquired a new meaning carrying much higher value in terms of business conduct. The impact of globalization on companies social responsibility tends to have a double nature. As the examples demonstrate, respectful attitude towards employees and establishing proper working conditions leads to a significant rise in revenues on a global scale. In the meantime, neglecting the norms of labor-management results in a serious decline in production, a whole variety of sanctions, and might even cause the termination of operations.

Works Cited

Chandler, David, and William B. Werther Jr. Strategic Corporate Social Responsibility: Stakeholders, Globalization, and Sustainable Value Creation. Sage Publications, 2013.

Haque, Mohammed Ziaul, and Fara Azmat. Corporate Social Responsibility, Economic Globalization and Developing Countries: A Case Study of the Ready Made Garments Industry in Bangladesh. Sustainability Accounting, Management and Policy Journal, vol. 6, no. 2, 2015, pp. 166-189.

Lim, Alwyn. Global Corporate Responsibility in Domestic Context: Lateral Decoupling and Organizational Responses to Globalization. Economy and Society, vol. 46, no. 2, 2017, pp. 229-254.

Sethi, S. Globalization and Self-regulation: The Crucial Role that Corporate Codes of Conduct Play in Global Business. Springer, 2016.

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