Transcript Corruption Child labor

Welcome
Corruption, Child labor
and International Business
 Dr. Satyendra Singh
Director, Centre for Emerging Markets
Professor, Marketing and International Business
Editor, International Journal of Business and Emerging Markets
University of Winnipeg
CANADA
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Outline
The ethical issues
The premise
The moral philosophies
Corruption and Child labor
How to deal with these issues
Macro, micro and personal levels
Q & A
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The Ethical Issues
Corruption
Child labor
Human rights
Environment
Hiring practices
Globalization
…
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The Basic Premise
Corruption
Child labor
f (Poverty, Lack of education,…)
Symptoms vs. problem (Einstein)
Morally wrong
Unethical
Philosophically
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The Moral Philosophies…
Ethics  moral principles or values
Ethical Fundamentalism
Search outside source ethical rules, but
Cannot decide right/wrong themselves
Eg. drining alcohol
Utalitarianism
Maximum good to society, but
What is good
E.g. Governments – left vs right
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The Moral Philosophies
Kantian Ethics – duty, deontological
Rule – consistency & reversibility
What is rule if exception becomes rule!
Rawls’s Social Justice Theory
Fairness, peace and harmony
Social contract – a bit ideal -- Bhutan
Ethical Relativism – feelings, no rule
Individual moral standard – debatable
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Corruption
Pay to get work done
Caused by usually poverty, greed…
Salary lasts for 3 weeks only…?
Survival vs. meeting basic needs
For  Tax, commission, compensation
Against  morally wrong and illegal
 Compromise personal beliefs
 Promotes and creates dependence on it
 Benefits recipients; deceives stakeholders
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Kinds of Corruption
Corrupt Individual
Individual primary beneficiary at the
cost of organization
Corrupt organization – even country!
Selection
Socialization
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Child Labor (300m)
Poverty—survival  urbanization
If outlaw (Harkin Bill) short- and long-term
 ↓ Family income  ↓labor supply
↑ Adult wage  children go to school
↑ skills  ↑ productive  ↑ wages
↑ family welfare if demand persists
But, ↑ wages  ↓ # of jobs
Effective only if children go to school
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How to deal with these issues
Corruption
Child labor
Acceptable child work
Vs. objectionable child labor
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Trends Against Corruption and Child Labor
Transparency International
Foreign Corrupt Practices Act (US)
Corruption of Foreign Public officials (Canada)
OECD Anti-bribery Initiatives
Harkin Bill – Trade Ban
ILO Convention on Minimum Age138
UN Global Compact (UNGC 2007)
 HR(2), Labor (4), Environment (3), Anticorruption (1)
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UN Global Compact…
1.Support, respect and protect HR
2.No HR abuses in businesses
3.Freedom of association and right to
collective bargaining
4. No forced/compulsory labor
5. No child labor
6.No discrimination in employment
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UN Global Compact
7.Support precautionary approach to
environment challenges
8.Promote environmental responsibility
9.Development
and
diffusion
of
environmentally friendly technologies
10.Work against all forms of corruption
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UN Global Compact -- 5
• Abolition of child labor
– ILO conventions  Minimum Age Convention No. 138
– Minimum age for admission to employment or work
•
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Developed countries
Light Work 13 Years
Regular Work 15 Years
Hazardous Work 18 Years
Developing countries
Light Work 12 Years
Regular Work 14 Years
Hazardous Work 18 Years
– Children have distinct rights
• Child labour is damaging to a child’s physical, social,
mental, psychological and spiritual development
• Deprives them of childhood, dignity; separates from families
• ILO Convention 182 worst form of child labor – no ratification
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UN Global Compact -- 10
• Work against all forms of corruption
– Corruption
• the abuse of entrusted power for private gain
– Extortion
• When asking or demand is accompanied by threats that
endanger the personal integrity or the life of the person
– Bribery, Transparency International
• gift, loan, fee, reward… from a person to do something
dishonest, illegal or a breach of trust
– Steps to fight corruption
• Internal:
• External:
• Collective:
Anti-corruption policies within organizations
Report corruption in the annual Communication
Join forces with industry peers, stakeholders…
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At Macro Level
Education – compulsory- national strategy
E.g., India, Ghana, Kenya
Ethics - required course – must
Awareness – landmines – Pr. Diana
Experiential, application-oriented education
E.g., build capability
Governments enforce moral guidelines
Government policies for fair trade
 E.g., GM Food, Subsidies, Cocoa price…
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At Micro Level
Strategic — MNCs (Mobil/GM/WalMart/Toyota) have power -- >$200B-300B
School and day care for children
UN Global Compact implementation
Contribution to country’s development
Mode of entry
IJV vs. Wholly-owned subsidiary
Ethics Officer
Pay fair taxes, reduce transfer pricing
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At Personal Level…
Personal moral compass
Organizational Culture
Whistle-blower legislation
(Un)realistic performance goals
Volunteer for social cause
E.g., Scotia Bank  Winnipeg Public
Library Board
Win-win situation
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Conclusion
MNCs have power, and thus can
↑ Education
↓ Poverty
↓ Corruption
↓ Child labor
Trade ban only may not work
Treat problems, not symptoms
Fair trade is needed, so is political will
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References
 Bachman, S.L. (2000), “The political economy of child labor and its
impacts on international business,” Business Economics, July: 30-41
 Pinto, J., Leana C.R. and Pil F.K. (2008), “Corrupt organization or
organizations of corrupt individuals?” Academy of Management Review,
33(3): 685-709.
 UNGC (2007),
http://www.unglobalcompact.org/AboutTheGC/Global_Compact_Logo/GC
_Logo_Policy.html
 Singh (2010), UNGC slides
www.uwinnipeg.ca/~ssingh5/Em/em-human-rights.ppt
Questions?
Thank you
for gracing the talk