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Reputation Risk and Globalisation Exploring the Idea of a Self-Regulating Corporation

Terry O’Callaghan

Recently, multinational corporations have begun to reinvent themselves as socially responsible actors. This is largely in response to activist pressure. These activists have perceptively understood the link between corporate success and corporate behaviour. Corporate self-regulation has emerged as an important mechanism to counter this activist pressure. The author argues that corporations have a capacity for self-regulation because their reputation is critical to their success. As such, reputation is beginning to discipline corporate behaviour. The book first explores the link between corporate reputation, corporate behaviour and self-regulation. The author then compares and contrasts various studies of multinational corporations that have sought to self-regulate.
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Index

Terry O’Callaghan

Afghanistan War 27–8

agenda setting theory 40

A.H. Robins 55, 67

Alien Torts Law 81

Alsop, Ronald 34, 58

Allende, Salvador 15–16

American Automobile Manufacturers Association 16

Anderson, Ray C. 151–60, 163–6, 168–74, 178, 180, 181

environmental vision 158

foundation 174

publications 159

anti-Americanism 38

anti-corporate activists 8, 11–12

critique of multinational corporations (MNCs) 14–23

culture 21–3

solution to excessive corporate power 81–4

transformative potential of 86–8

Bakan, Joel 12, 16, 83

Bechtel Corporation 37

Benson, Robert 81–2

Broken Hill Propriety Company Limited (BHP) 1–8, 58

Billiton 1, 179

class action 3

environmental problems 2–4

Gag Island 4

history of 8

International Water Tribunal 3

Irian Jaya 4

Ok Tedi Mining Limited (OTML) 1–4

Fly River, The 2

Gulf of Papua, The 2

United Nations Educational, Scientific and Cultural Organization (UNESCO) 4

Black Swan Events 127, 146–7, 149

blowback 27

Brundtland Report, The 4, 179

business integrity thesis 11

Carpet America Recovery Effort (CARE) 156

Carson, Rachel 39

Central Intelligence Agency (CIA) 15

Chapter 11 47, 68

charter revocation laws 81

Chemical Manufacturers Association (CMA) 75, 96

Chiquita 47–8

China National Offshore Oil Corporation (CNOOC) 16

Chomsky, Noam 12, 26, 27, 36, 88

Clarke, Tony 83

Coalition of the Willing 39–40

Coca-Cola 38, 66–67

continuous improvement 130

corporate

average fuel economy standards 133–4

citizenship 68

codes of conduct 32–4

crises 53

malfeasance 70–71

reputation 11, 41–2

at risk 54–9

attributes of 43–5

authenticity and 45–7

ideational change 59–67

business case for 63–7

measuring 68

politicisation of 34–7

role of corporate social responsibility 48–50

social amplification of risk framework (SARF) 35–7, 124

sources of risk 57

globalisation 58, 176

stakeholders 43

value of 50–54

self-regulation 7, 37, 77–81, 176

in defence of 84–99

social responsibility (CSR) 5, 30, 47, 92, 93–5, 127–8

criticism of 49–50

culture 21–3

crisis management 68

Culpepper, Pepper 59

Ellis, Tania 5–6

Enron, collapse of 28, 53, 54–5, 58, 67, 91, 120

environment

climate change 18–19

multinational corporations 19–21

Monsanto 20

Etzioni, Amatai 75

Extractive Industries Transparency Initiative (EITI) 128

Exxon Mobil 14, 53

Exxon Valdez oil spill 102–4

Fombrun, Charles 40, 42, 45–6, 52, 122

Friedman, Milton 9, 134

Garnaut, Ross 19

globalisation 5, 97, 142

effect on corporate behaviour 62, 67

legitimacy of 33

main drivers of 85

opposition to 11, 12, 13, 23, 26–7

reputation risk 58, 176

support of 43, 66, 89, 97

Toyota 126–50, see Toyota Motor Corporation

Global Climate Coalition 20

Global Financial Crisis 28

Godin, Seth 46–7

governmentality 60–61

Greenpeace 29, 56, 108–9

Hardcastle, Nate 12

Hawken, Paul 21, 156–7, 160

Hayward, Tony 56, 137

Henderson, David 49–50

criticism of corporate social responsibility (CSR) 49

human rights 17–18

industry regulation 74–7

Interface Inc. 151–174

background 154–5

Interface Europe 166–7

Interface model 151

InterfaceRAISE 152–3

locations 155

Mission Zero 164, 169

Net-Works 168, 179

progress 165

Quality Utilizing Employees’ Suggestions and Teamwork (QUEST) 152

self-regulation 171

sustainability 169–70

International Council on Mining and Metals (ICMM) 39

international institutions 31–4

Millennium Development Goals (MDGs) 32

multinational corporations 31–4

United Nations Global Compact (UNGC) 32–3

International Telephone and Telegraph (ITT) 15

Iraq War 27–8

Jackson, Kevin 11

Jackson, Ira 80

Johnson, Chalmers 27

Kaizen 127, 131, 150

Kennecott Copper 15

Kennedy, Sherrill 43–4

King, Debra 35

Klein, Naomi 25–6

Korten, David 12, 84, 87–8, 97, 161

LaHood, Ray 136–7

Larkin, Judy 51, 53

Lewis, C.S. 181

Liker, Jeffrey 129, 130, 144

Maun, Alex 8

Maxwell, Robert 64

Mikler, John 80

Mining, Minerals and Sustainable Development (MMSD) 8, 39

multinational corporations (MNCs) 6–8, 9–10, 13, 62

Monsanto 36, 39

Moore, Michael 23

Morley, Michael 53

Natural Step, The 173

Neef, Dale 92–3

Nelson, Jane 80

neoliberalism 60–61, 97

Nestlé 46–7

Nike Foundation 10

Girl Declaration 10–11

sweatshops 17–18

non-governmental organisations (NGOs) 6

night parrot 7, 179–81

obsolescing bargain 38

Occupy Wall Street (OWS) 26, 28

Office of Regulation Review 72–3, 75

Ogden, Timothy 144

Ohno, Taiichi 128

Ok Tedi Mining Limited (OTML) 1–4, 58

Olins, Wally 44

Omarova, Saule 78

Papua New Guinea (PNG) 1–4, 8

Parker, Christine 93–5

open corporation 94

corporate strategies 94

particle pollution 19

People for the Ethical Treatment of Animals (PETA) 34–5

political risk insurance 15

pollution havens 20

Prometheanism 162–4, 174

Ratner, Gerald 56

regulation 71–4

capital 40

command and control 73–4

quotient 51

Responsible Care programme 75, 96

Roszak, Theodore 23–4

Royal Dutch Shell 6, 101–24

Brent Spar 107–9

charge of greenwash 115–21

Execution of the Ogoni Nine 109–11, 124

Friends of the Earth International (FOEI) 118

history 101–2

in South Africa 105–6

limits to Shell's approach to self-regulation 121–3

Neptune Strategy 106–7

Profits and Principles 112

public relations (PR) strategy 121–3

rejuvenation of the brand 104–5, 111–15

Safety Research and Strategy 135

Seattle riots 23–5

Black Bloc anarchists 24–5

euphoria after the Seattle riots 24–5

impact of the riots on future World Trade Organization (WTO) talks 25

Self-regulatory organisations (SROs) 74

September 11, 2001 26–7

Spar, Debra 49

stakeholder theory 68

Stern, Nicolas 19

survivalism 160–62, 174

terrorism studies 53–4

Toyoda, Akio 137–8, 139, 140

Toyota Motor Corporation 126–50

capacity for self-regulation 143–8

globalisation of Toyota 127, 142

opposition to New Fuel Economy Standards in the US 133–4

recalls 136

reputation 132–3

road deaths and recalls 134

Toyota Global Vision 2020 143

Toyota Production System 129–31

Toyota Way, The 131–2

understanding the Toyota crisis 137–43

Trade Related Aspects of Intellectual Property Rights (TRIPS) 38

Turnbull Guidance, The 65

UK Corporate Governance Code 64

Union of Concerned Scientists 134

United Nations Centre on Transnational Corporations (UNCTCs) 31

United Nations International Children’s Fund (UNICEF) 46

Unocal 16–18, 81–2, 96

Doe v. Unocal 39

Vietnam War 23

Vogel, David 50

Walmart 7

Willis, Craig 12

World Health Organization (WHO) 19, 126

motor accidents 19

World Social Forum (WSF) 26

World Trade Organization (WTO) 23–25, 29, 84

Zyglidopoulous, Stelios 67