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dian Business and Society:

Ethics & Responsibilities


Chapter
Fifteen
Globalization and Business
Responsibilities

Copyright 2008 McGraw-Hill


Ryerson Ltd.

Chapter Outline
Globalization and Implications for Business
The Debate over Globalization
International Non-governmental Organizations
Institutions of Globalization
Globalization and Canadian Business and

Society
Standards of Conduct for Global Business
Special Challenges of Global Business
The Acceptance of Global Capitalism
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Copyright 2008 McGraw-Hill


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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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Copyright 2008 McGraw-Hill


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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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Copyright 2008 McGraw-Hill


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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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Copyright 2008 McGraw-Hill


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The United Nations Global Compact


Human Rights:
1. Respect internationally proclaimed human
rights
2. 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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Copyright 2008 McGraw-Hill


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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 technologies
Anti-Corruption:
10. Avoid corruption (e.g., extortion and
bribery)
http://www.unglobalcompact.org/
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Copyright 2008 McGraw-Hill


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Globalization and the


Implications for Business
Damage to environment
Support for oppressive regimes
Criticism of marketing practices (e.g., tobacco,

pharmaceutical, baby formula, etc.)


Arms trade
Treatment of employees (e.g., sweatshops)
Treatment of indigenous peoples
Genetic modification of plants and animals
Corruption and bribery
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Copyright 2008 McGraw-Hill


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The Debate
Pro globalization
Johan Norberg
Anti globalization
NoLogo by Naomi Klein
The 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
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The Debate Over


Globalization
Broadening the Debate: The Pros and

Cons of Globalization
By Joyce S. Osland

Discussion What stood out to you?

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Broadening the Debate:


The Pros and Cons of Globalization
The Impact of Globalization on Equality
The Impact of Globalization on Labor

Conditions
The Impact of Globalization on Governments
The Impact of Globalization on Culture and
Community
The Impact of Globalization on
Environmental Sustainability
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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 nongovernment 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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Institutions of Globalization
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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Institutions of Globalization
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 links
Must 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 rights
Business 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

Science and technology


Corrupt practices

objectives and values


Disclosure of
information
Competition
Financing
Employment and human
resources

Environmental

Chapter 15

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 Compact
Global 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)

Chapter 15

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