According to the (united nations,2018 lobalcompact.com (get the reports), the United Nations Global Compact (UNGC) is a volunteer initiative based on commitments of to implement universal sustainability principles to take steps to support UN goals. The former late UN Secretary Kofi Annan proposed UNGC initiative in the 1990 at the World Economic Forum in Switzerland and launched in July 2000(Michel Coulmont, Kamille Lambert, Sylvie Berthelot, (2018) “. It calls companies to follow responsible business practices on human rights, labor standards, environment and anti-corruption (Cubie L.L. Lau, Cliff D. Fisher, John F. Hulpke, William Aidan Kelly, Susanna Taylor, (2017).
It is the world’s largest corporate sustainability initiative with more 8000 business participants, in both developing and developed countries, with signatories in 170 countries and nearly 100 country networks. https://www.un.org/sg/en/content/sg/statement/2015-06-25/secretary-generals-remarks-global-compact15-business-force-good. (introduce)
BENEFITS Furthermore, a large number of companies have joined the initiative and are benefiting tremendously from it the benefits of engagement include the following; it offers private sector involvement with multilateral system of the UN, it enhances corporate citizenship, leads to better network opportunities and inspires participants to open a dialogue and share learning as well as operationalize the ten universal principles (Arevalo ; Aravind, 2010). The (UN,) went on to say that it improves the company reputation, helps understand the financial needs and promotes access to capital.
CRITICS OF THE UNITED GLOBAL COMPACT
Most businesses in US have not signed up for the initiative due to fear of having their dirty laundry aired for public scrutiny, instead of becoming a part of the UNGC they start their own charities. (Bryd,2009). Another possibility as to why many US based companies have not contracted is enclosed by the subject of how to exactly measure accountability standards (Bry,2009).
According to Arevalo and Aravind, 2010, companies have not joined due to critics of the initiative, as it was revealed that many companies join the association in order improve their corporate image, so that they can be distinguished from other companies and to also be good citizens. Arevalo and Aravind, 2010 went on to say that the Global Compact does not develop new Corporate Social Responsibility strategies. Critics of the initiative are worried that the compact is more beneficial to developed countries rather than aiding the countries that need them the most (Bryd,2009).
The Un Declaration of human rights (2018), states that “all humans are born free and equal in dignity and rights” they are universal and every person around the world must be treated with respect and equality. Human rights are basic rights and freedoms that “transcend national, cultural, religious or ideological boundaries” (Quelchand and Laidler,2003). Basic human rights include; freedom of speech, privacy, health, life, liberty and security as well as an adequate standard of living (UN,2018).
Demenchonok, E. (2009) went on to say the universal concept of human rights is considered as a regulative principle for the possible critique of any state, including a democratic one. Furthermore, different countries different aspects of human rights CITATION Shi97 l 1033 (Shirk, 1997). Human rights are without a doubt the most critical rights that not every single individual ought to have the capacity to appreciate. In the meantime, human rights are likewise the absolute most effortlessly mishandled ones as pursuing them does not necessarily bring any direct financial advantage, especially to Multinational Companies (Shaomin Li, Ajai Gaur, (2014). Truth be told, it is often in the interest of firms to comply with or even be an accessory to, human rights infringements by the host governments, as a result for economic favors
Consequently, even though human rights are very essential, they do not necessarily have the similar importance for MNCs (Shaomin Li, Ajai Gaur, (2014).
Although researchers and countries continue to criticize the definition of human rights the UN provides a guideline for responsive behavior on human rights.
There are two contrasting views on the relationship between MNCs and Human rights in host societies. MNCs as engines of development and supporters of Human rights or MNCs as exploiters and violators of human rights (Brown et,al 2004).
Human rights approaches to development are based on the central idea of the obligations of states and the international community to ensure that citizens of developing countries can claim their economic, social and cultural rights, together with their civil and political rights, and that all of these are fulfilled CITATION Kil15 l 1033 (Kilby, 2015).
Progressively the activities of the Multinational corporations operating both in developed and developing countries significantly influence the individual rights and freedom of the general population where they operate CITATION Maj11 l 1033 (Majinge, 2011).
As most developed countries have high human rights standards. In such countries, governments and non-governmental agencies are both extremely active to ensure that certain rights are viewed as inalienable and universally recognized and protected in the society and in the workplace CITATION Sha14 l 1033 (Shaomin Li, 2014). However, when MNCs operate in countries with low human standards they face the dilemma of whether to uphold human standards due to pressure.
Companies can make voluntary, positive contributions to support human rights. For example, they can create diverse and inclusive workplaces, invest in communities and public policy advocacy, and engage employees and communities to promote collective action. While these types of actions to support human rights are encouraged, they do not substitute basic respect for human right (UN,2018).
It is criticized that human rights do not represent an absolute truth, they would represent ideology, which is contradictory to the basic idea of human rights itself and hence, there is a need for redefinition of the main presuppositions of modern conception of human rights represented in the Universal Declaration of Human Rights (Sanja Ivic, 2010). Cultural relativist rejects rights because they feel they are not compatible with their culture, others also feel that human rights should be differentiated between formal and real human rights as they are culture in other countries but also a method of intervention in other countries (Birden Güngören Bulgan,2015). Many authors reason that the Universal Declaration of Human Rights is Western-imperialist unlike Rawls’s idea which would be acceptable to different societies hence making human rights more familiar to different cultures and peoples, which would lead to better implementation of human rights (Birden Güngören Bulgan,2015). Your freedom is not my freedom, says the press to a trade. As you obey the laws of your sphere, so will I obey the laws of my sphere (Henry Gao, 2011 page 349). The above statement is reflected well in the case of Yahoo & China.
Yahoo is an organisation that gives Internet services around the world. The company’s purpose, as expressed on its site, is: “powering communities to create indispensable experiences; built on trust” (Yahoo website,2008). In the organisation’s very own words, Yahoo! Is “built on and fueled by trust” (Yahoo websute,2008).
In 2002 and 2004, Chinese citizens, Wang Xiaoning and Shi Tao, were captured, and sentenced to prison for 10 years for e-mailing pro-democracy views from data given by Yahoo (Venezia and Venezia, 2010). Yahoo!’s compliance with the Chinese authorities received a lot of critics back home in the USA for violating human rights. Yahoo got sued in the US court by Wang Xiaoning’s wife for violating human rights (the sydney morning herald,2007). A major concern arises for all businesses that chooses to take part in the global economy and stay competitive in the worldwide field- the conflict of culture and legitimate and social qualities (Venezia and Venezia, 2010).
My opinion on the above case is that I do not find Yahoo at fault because it is operating in a country where the government is overly involved and overly protective on its reputation, Yahoo had to abide by the rules of China for the company to continue operating in China. The people whom went over board and shared china’s private information should have thought twice about it, as they know best how the Chinese government is protective over the country’s reputation. However, Yahoo failed to obey human rights principle 1 as it did not support and respect the protection of internationally proclaimed human rights.
Furthermore, Yahoo was left with no choice they had to adapt to the host country’s practices and to do so they had to lower their human rights standards. It is important for MNCs to be able to adapt and follow host countries policies and human rights standards; another example is the Royal Dutch Shell in Nigeria being sued for violation of human rights (cite)
The emergence of UN guiding principles on human rights was justified mainly on the grounds of MNCs variable responses to human rights and the weak bargaining power of the state, especially in poorer countries (Gray and Gray, 2011). The UN’s Global Compact attempts to protect human rights in business through national legal systems and other initiatives largely failed, leading to what Ruggie describes as “global governance gaps and governance failures” (Whelan et al., 2009).
However, promoters of the Un Global Compact initiative on human rights states that by following the global compact human rights guidelines you are entitled to a healthy bottom line and it is good corporate citizenship. Many companies find strength in their human rights record and it is the major key performance indicator all over the world (Mary Robinson,
Unilever went on to say that business can only flourish in societies where human rights are protected and respected. They also recognize that business has the responsibility to respect human rights and the ability to contribute to positive human rights impacts (UNILEVER’S HUMAN RIGHTS POLICY STATEMENT,2018).
An increasing number of companies are recognizing the link between good business and respecting human right, which is in relation to putting the human rights, principle 1 into practice ( Agnes Portalewska 2015) https://www.culturalsurvival.org/publications/cultural-survival-quarterly/changing-way-business-done-un-global-compact
This is reflected well by Marriott International, which have brought and implemented practices and policy on commitment to support and uphold the elimination of discriminatory practices with respect to all aspects of employment and promotes and embraces diversity and inclusion within its business operations. The company does not support child labor, allows employees to be members of trade unions and they provide associate training on human trafficking awareness and prevention (Marriot International Inc Human Rights Policy Statement 2017).
Marriot’s information is transparent, and everyone can view it, unlike countries like China whom do not want their information to be transparent.
The partnership between Merck, Bill and Melinda Gates and the government of Botswana to tackle HIV/AIDS and distribute ARVS in 2001, is a good example of multinational companies having the ability to influence other organisations in contributing towards human rights (Ilavenil Ramiah and Michael R. Reich, 2005)
I personally believe that the involvement of the Gates has raised awareness for MNCs to join the Global Compact initiative and help eliminate human rights abuses, as companies like Unilever joined the initiative after being influence by the Partnership between the Gates and Botswana, hence the more famous and well known companies take part in the initiative the more most companies see the need to participate. However, the United Global Compact should not be a voluntary initiative, all MNCs it should be compulsory, that way it will be easier to reduce the violations of human rights and those that do not follow he guidelines should be fined or suspended from taking part in the market for a certain period.
The United Global Compact Initiative gives a strategy states that one of its aim is to assist companies to achieve human rights and not violate them, however I feel that this is only good on paper, the initiative does not follow up on companies, to check how they are contributing to the society and how they are practicing human rights in their organisations, instead they want companies to report their progress to them every 2 years, my question is how will they know if the information given by the company is correct, because of corruption on the other hand, companies may ask for favors in return for money, so the UN will never know how legit the information on the paper is, I recommend that the UN assign every company that has signed on the initiative a representative whom will be constantly reporting back to the UN on the progress of the company. The UN Global Compact should also become a compulsory initiative for all companies that wish to operate in other countries, as companies with power and money may opt to operate in a developing country with little or no government interference.
The UN should also take into consideration of changing the definition of human rights or broaden the definition, because as it states that everyone has universal rights but attempt to suicide, abortion and prostitution in most countries is considered a crime, how is it a crime? When the body belongs to the owner? The body does not belong to the state. Also looking at freedom of speech, why allow individuals to tarnish a companies’ name what about the rights of the stakeholders.
Furthermore, a lot of scholars and authors have criticized that the UN Global Compact is more of a western culture, hence I suggest that the UN should look deeply into this and make a way to make other cultures feel accepted.