Threat or Opportunity?
Studies in International Investment series
Edited by Karl P. Sauvant
Chapter 11: Are Emerging-Market TNCs Sensitive to Corporate Responsibility Issues?
Carrie Hall INTRODUCTION The past decade has seen a rapid increase in the number, size and scope of transnational corporations (TNCs) based in emerging markets – growing from 3000 in 1990 to 13 000 within 10 years (UNCTAD 2006). Only a small number of these TNCs have become global competitors able to square oﬀ with traditional Western business leaders. Yet this limited occurrence, combined with the notion that multitudes of lesser-known emerging-market TNCs are expanding into foreign markets, has been enough to garner signiﬁcant attention from almost every constituency – government, business, civil society, media and investors. For the United Nations Global Compact, the world’s largest voluntary corporate citizenship initiative, questions abound related to the business practices of emerging-market TNCs, practices that have been cultivated in areas renowned for deﬁcient economic, political and social frameworks that often lead to low thresholds of ethical behavior and accountability for business. Currently, there is no clear indication of the prevalence of basic corporate citizenship tenets – human rights, labor rights, environmental protection, anti-corruption – within emerging-market TNCs. On the one hand, the corporate responsibility actions of leading emerging-market TNCs can be as sophisticated as those taken by the most advanced Western companies, and there are signs that corporate citizenship is becoming a global phenomenon. The Global Compact (through its participants and local networks) can be found in approximately 100 countries, a majority of them in the developing world. From Chile to China and South Africa to Sri Lanka, corporate responsibility seminars and summits are teeming...
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