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Mnc challenges ppt Mnc challenges ppt Presentation Transcript

  • 1) Some Ethical Issues Confronting MNCs Child and/or Forced Labor Safety and Security ConcernsDuration of Work Week
  • Child and/or Forced Labor "MNCs may directly employ children (legally or illegally) and theyare usually employed in labor-intensive low-skill jobs.Source of cheap, unskilled, and not-demanding labor.Companies may buy products from factories employing children.Eg. Nike
  • Safety and Security Concerns Major problem - because standards differ from country to country andin some countries there are no clearly written standards. However in the United States, there are strict laws for safety andsecurity and companies try to respect them. For instance, Ames Laboratory fosters an environment in whichemployees are encouraged to bring concerns to the attention oftheir immediate supervisor. Resolution of concerns should occur atthe lowest management level possible. However, if the issue cannot beresolved at this level, the employee has the opportunity to proceedwithin his/her management chain
  • Duration of Work Week MNCs have been accused of allowing or even forcing theiremployees, especially in less developed countries (LDCs), to workvery long hours. Lehmkuhl (1999) has explained that organizational culture cancontribute to long hours as this behavior is often valued andexpected in an MNC.
  • Solution Advisable that MNCs establish clear roles for ethical practices in theirhost countries. To do that, MNCs must first study the laws of both the domestic andhost countries. They must draft a moral code of conduct with a well-definedcompany’s standpoint in the event of certain ethics-related situations.
  • 2) Corporate social responsibility in a globalizingmarket. CSR can be defined as the duty of organizations to conduct theirbusiness in a manner that respects the rights of individuals andpromotes human welfare. Expectation is so high that it has become an issue/challenge in itselffor these MNCs. important decisions that often result in a major trade-off: increasedprofits or good corporate citizenship. MNCs have been found to be "chasing the buck" without sufficientregard for society.
  • 3)Competition as challenge to MNCs:- Indians are not Inferior (The Times of India, October 26, 1997):- false notions that Indian companies are incapable of standing up tocompetition from multinationals. For e.g. Kwality ice-cream has been bought by Hindustan Liver, Reliance is already among the top five producers in the world ofpolyester and chemicals like PTA. It is setting up a giant 22 milliontonne refinery, world’s biggest. The late Aditya Vikram Biria was once asked whether he was afraid ofmultinationals. "No" he replied, "they should be afraid of me".