Ethical Issues in Globalization
We have to choose between a global market driven only by calculations of short-term profit, and one which has a human face. — Kofi Annan
What is Globalization?
a process (or set of processes) which embodies a transformation in the spatial organization of social relations and transactions, expressed in transcontinental or interregional flows and networks of activity, interaction and power.
Globalization Brings Four Types of Change
• a stretching of social, political and economic activities across frontiers, regions and continents. • intensification of interconnectedness and flows of trade, investment, finance, migration, culture, etc. • a speeding up of global interactions and processes, the diffusion of ideas, goods, information, capital and people. • deepening impact such that the effects of distant events can be highly significant elsewhere and specific local developments can come to have considerable global consequences.
Globalization, in short, can be thought of as the widening, intensifying, speeding up, and growing impact of world-wide interconnectedness.
Some Big-Ticket Issues
Very personal: the meaning of work? Organizational: who‟s in charge, and of what? Supply chain ethics? National: do nations matter any more? Supranational: what does it mean that some areas are „developing‟? Global: systems change? Justice?
U.S. – more jobs overall, but many industries in decline. A shift in skills and education required for higher-paying jobs. Loss of economic viability for many communities. Increasing competition among polities for job-providing ventures.
In the developing world:
The opposite is true … more jobs and industry growth, rising wealth, etc…. BUT … there are major issues of human rights and environmental protection at stake.
“a shop or factory in which employees work for long hours at low wages and under unhealthy conditions.” --Merriam-Webster OnLine Dictionary
Child labor, sometimes children as young as 5 or 6, Piece rates instead of wages, requiring long hours to earn an income that does not come close to raising the worker out of poverty, Mandatory overtime, sometimes 24-hour shifts, Dangerous, unhealthy workplaces; no protective equipment to guard against toxic exposures, Verbal intimidation, harassment, and bullying,
Forced pregnancy tests and firing of pregnant women, Physical and sexual abuse by supervisors, managers, and armed guards, No breaks during the work day, even to go to the bathroom, Lock-ins to prevent workers from stealing or leaving the factory, creating fire hazards, Violent ends for those who try to organize unions.
Global Exchange on Retail and Sweatshops
“Separate forces meet in a shameful mix: A footloose industry scours the world for the cheapest wages; countries eager for any kind of investment auction off their workers to the lowest bidder; government regulators deliberately look the other way when abuses occur in order to keep foreign investors happy. It's that combination of desperate profit-seeking and equally desperate investment pursuit which has created the race to the bottom that is at the root of the sweatshop resurgence.”
Addressing Sweatshop Problems
Supplier codes of conduct specify how supplier relations are to be handled and what suppliers must do in order to get and keep contracts with the company.
Factory monitoring, often by independent NGOs, to check for prevailing wage rates, underage workers, workplace hazards, or human rights violations.
Reporting to interested stakeholders is often done through annual or biennial social reports. Image and reputation management might seem to be a phony concern when you‟re talking about human lives at stake, but for companies that are really trying to do the hard work of supplier monitoring, their image and reputation should match up with their actual performance.
UDHR Article 26: “Everyone has the right to education. Education shall be free, at least in the elementary and fundamental stages. Elementary education shall be compulsory.” ILO estimates 250 million children aged 5-14 are working worldwide. Agriculture, domestic service, family businesses, services and trade, manufacturing, construction.
Some Examples from Human Rights Watch
Children working on farms “frequently work for long hours in scorching heat, haul heavy loads of produce, are exposed to toxic pesticides, and suffer high rates of injury from sharp knives and other dangerous tools.” Children in bonded labor – allegedly paying off a family debt, but actually surviving in a form of slavery – weave rugs and fabrics, sew soccer balls, and endure beatings, long hours, lock-ins, little food, and no medical care.
Children in domestic service care for a household‟s children, clean, cook, and are on call constantly. They are especially vulnerable to physical and sexual abuse. In at least a dozen nations, children are forced into service as soldiers. Children serve as prostitutes and as models and actors for pornography worldwide. Check out http://www.ilo.org/
ILO Convention 29 definition: “all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily,” excluding mandatory military service, normal duties of citizens, supervised work as part of a criminal sentence, or services rendered in a serious emergency.
ILO estimates 12.3 million worldwide in forced labor. Most are privately exploited, including 2.3 million in slavery. UC-Berkeley Human Rights Center estimates 10,000 slaves in the U.S. Underground economy, organized crime, bonded labor, political prisoners….
36.5 million workers worldwide infected with HIV/AIDS (ILO data). Health care not widely available. Disease is poorly understood and often subject to prejudice. Sufferers can‟t afford drugs. Families can‟t afford to lose their productive workers.
AngloGold Ashanti Ltd.
Global gold-mining Co. estimates 30% of its southern African workers are HIV-positive. Established voluntary testing & counseling centers. Rolling out drug treatment for employees, 934 in 2005. Chronic disease management expenses subsidized by the co.
Other health threats:
Malaria Cholera Dysentery, Malnutrition Measles Tuberculosis Yellow fever
Dengue fever Schistosomiasis caused by parasitic flatworms Trypanosomiasis or sleeping sickness Typhoid fever
Lack of health care and related infrastructure Very limited access to vaccines, antiparasitics, and other pharmaceuticals Lack of clean water
“RACE TO THE BOTTOM”
Global price pressures lead to search for lower regulatory standards as well as labor costs. This affects worker treatment and benefits, human rights, consumer & investor protection, environmental protection.
Some evidence that companies are seeking voluntary regulatory standards to level the playing field.
ENVIRONMENTAL ISSUES: The BBC’s “Eco Top Ten”
Agriculture – use of rural lands and development of sustainable farming; pesticide/herbicide use; bioengineering and genetically modified organisms. Atmosphere – climate change/global warming, acid rain, smog, ozone depletion. Biodiversity – “types of biodiversity and the plight of endangered species.” Energy – the use of fossil fuels (oil, coal); the need to develop alternative energy sources. Forests – deforestation and regrowth; forest ecologies.
Fresh water – changing patterns, desalination, declining supplies of fresh water. Habitat loss – threats to species survival, causes, solutions. Industry – the environmental impacts of industrial globalization. Marine – life and ecology – threats to the seas and the living things therein. Population – growth, pressure, geographic patterns.
Financial crashes tend to be immediate and the consequences are readily seen. However, environmental disasters tend to develop over a longer period of time, and the consequences are not so easy to discern. Industries are not so eager to establish international environmental regulation, and the temptations are great to find lowest-cost solutions to pesky developed-world environmental problems.
Rising consumption and declining supply of petroleum Businesses that specialize in environmental testing, protection, remediation Labor force effects of environmentrelated health problems Market-leader voluntary standards NGO and stakeholder activism
INTELLECTUAL PROPERTY RIGHTS
Intellectual property can be defined as the products of human creativity. covers works of art, music, writing, or invention, ideas, terms and concepts, the language that corporations use to identify their products and to describe their unique technologies and processes, graphic images, conceptual frameworks, data tables, movies and television programs, poetry, software, popular songs.
What‟s the big deal? U.S. Dept. of State: “safeguarding these property rights fosters economic growth, provides incentives for technological innovation, and attracts investment that will create new jobs and opportunities.”
“Intellectually or artistically gifted people have the right to prevent the unauthorized use or sale of their creations, just the same as owners of physical property, such as cars, buildings, and stores. Yet, compared to makers of chairs, refrigerators, and other tangible goods, people whose work is essentially intangible face more difficulties in earning a living if their claim to their creations is not respected. Artists, authors, inventors, and others unable to rely on locks and fences to protect their work turn to IP rights to keep others from harvesting the fruits of their labor.” (U.S. Dept. of State)
Types of IP Protections
Copyrights grant the owner the right to benefit economically from the copyrighted work. Protections include the sale, reproduction, and public presentation of such works. Copyrights generally cover literary, artistic, and musical works, and also include maps, video productions, and software.
Patents protect the economic rights of inventors while releasing the technical details of the invention to the public. This form of IP is crucial both for serving the needs of inventors and for encouraging technological progress; one invention may spin off many others, but this will not happen unless the details of the first invention are known.
Trademarks protect the names, symbols, or other unique identifiers of specific products, processes, or services. Products‟ brand names have trademark protection, as do symbols (like McDonald Corporation‟s famous clown, Ronald, or its Golden Arches logo) and marketing/advertising phrases (staying with McDonalds: “I‟m lovin‟ it”).
Trade secrets offer somewhat less stringent protections for economically valuable processes, formulas, technologies, ingredients, etc., that are not readily subject to any of the other IP protections. Companies have more responsibility for guarding their own trade secrets, but theft of such secrets can be prosecuted as a crime.
BRIBERY & CORRUPTION
Transparency International (Ti) defines corruption as “the misuse of entrusted power for private gain.” TI‟s annual “Global Corruption Barometer”
“In the past 12 months, have you or anyone in your household paid a bribe in any form?” (Yes answers)
Albania, 66% Morocco, 60% Cameroon, 57% Congo, 40% Nigeria, 39% Mexico, 28% Ukraine, 23% Kenya, Peru, Venezuela, 22%
Switzerland, Finland, Singapore, Sweden, 1% USA, United Kingdom, Turkey, South Korea, Austria, Taiwan, France, Germany, Iceland, the Netherlands, Portugal, Spain, Denmark, 2% Canada, 3% Israel, 4%
Possible consequences of corruption:
Democratic elections Government contracting Victims of fraud Overpayment Lack of accountability Supporting the incompetent Government legitimacy Business predictability and economic development
Are not expressions of love or fondness, as gifts are. Are not simple expressions of thanks to low-level employees for a job well done, as tips are. Are intended to make the bribee do what the briber wants, generally in conflict with what the bribee should do. Create more pressure to perform, the larger they are. Are accompanied by lies and deceit. Are necessarily secret; are damaging and shameful to the bribee if they become known. Public knowledge of the payment prevents the bribee from meeting the briber‟s expectations.
“We must ensure that the global market is embedded in broadly shared values and practices that reflect global social needs, and that all the world's people share the benefits of globalization.” -- Kofi Annan