Multinational corporations are expected to treat their employees and the surrounding community with respect. It is unfortunate that even in this era, basic human rights are still ignored especially in the developing countries. It is the responsibility of the corporations to ensure they respect the human rights of those people. This, however, has not always been the case. Various corporations have been accused of subjecting their employees to hard working conditions, especially in the developing countries. It has been shown that most corporations would like to take their operations to the developing countries where the cost of labor is low. Violation of human rights will tarnish the name of the respective corporation, producing an adverse impact on that particular corporation. Human right principles relate either directly or indirectly to the actions of private sector players. National constitutions of different countries require them to uphold human rights standards both nationally and internationally. Nations that are serious about human right concepts should desist from transacting with countries that have poor records on human rights (Ma & Lu, 2011). A nation like U.S should prohibit trade within countries that do not value human rights. This will help in improvement of the economy as well as the improvement of morality for developing countries. By advocating for respect of human rights, the U.S will significantly influence international rights through setting standards for business overseas.
International law binds corporations operating in overseas markets. Such companies are subject to both bilateral and multilateral treaties as set by the nations participating in global trade, meaning that they are subject to the laws of the countries in which they operate. Likewise, the corporations are also required to obey the laws of their home countries. For instance, multinational corporations based in the U.S are bound by laws such as anti-trust, equal employment opportunity and anti-bribery. The same laws also apply to their activities abroad.
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Laws of various countries may, however, vary depending on the areas they apply. For instance, the U.S has found laws of some countries to be very lenient. Examples of such laws include laws on protection of the environment, health and safety and labor standards. Finding such lenient laws in the host country may prompt managers of multinational corporations to be lenient. However, failure to adhere to the set laws may put the MNCs at a risk of criminal prosecution, either in the host country or the home country (Kumar, 2008).
Respecting the human rights of the employees and the society is the first step towards succeeding in business. There can still be fair competition and good governance without infringing on the human rights of people. A good business requires well-enforced rules of competition. Good business means a business that sticks to business ethics in its operations. An ethical business enterprise will not take advantage of the people by violating their rights.
Businesses are required to take a special notice of the human rights of the people they transact businesses with, whether in production or supply. The United Nations, for instance, requires its member nations to observe the set international human rights agreements which include the Universal Declaration of Human Rights and the Convention on the Rights of the Child. Additionally, several companies have also adopted voluntary codes of conduct for countries transacting in developing countries. Even without such conventions, it would still be important for corporations to respect human rights as a way of protecting investments in overseas markets.
To operate in the developing world, a corporation requires a social license, which is the good will of the people in the host country. A corporation can obtain a legal license from the government, but it must consider and respect the rights of the people in the area of operation. Corporations must also be careful in ensuring that they do not collude with the government of the host country to abuse the rights of the locals. Such an action would make the locals turn against the corporation, and the community may as well ask the intervention of NGOs to help in the eviction of the corporation from the country (Ma & Lu, 2011). This would not only lead to losses but will also tarnish the reputation of the corporation, adversely affecting its operation even in other countries.
The U.S courts take legal actions on corporations that engage in a violation of human rights. The U.S Alien Tort Statute requires corporations to respect rights of people in host countries. Besides, people have known their rights and will not allow them to be violated by MNCs. The role and power of NGOs have also increased significantly, making it hard for any corporation to take advantage of the locals and walk free. The NGOs now have more influence as a result of the changing social expectations about ho business should be conducted. They have become advocates for the victims of human rights abuse.NGOs also have the power to pressure investors to exit the market. Such campaigns usually have negative effects on the corporations (Lucas, 2014).
Abuse of human rights in the form of child labor and forced labor has been given a lot of focus by the international community in the twenty-first century. For instance, the International Labor organization addresses the problem of child labor through conventions. A lot of energy has been dedicated to the vice of human mistreatment. This can be seen by the enactment of the U.S Victims of Trafficking and Protection Act as signed in 2000 (Ma & Lu, 2011). The UNHCR is also keen on contemporary slavery. Intergovernmental organizations and NGOs have also joined the fight to address issues of forced labor and child labor (Douglas, 2014).
To avoid abuse of human rights, multinational corporations should endeavor to carry out human rights diagnostic. The first step in this process will involve assessment of how the operations of the company impact on human rights. The performance of a diagnostic may include reviewing the human rights practices in the regions in which the corporation operates. The corporation should also take into consideration the types of human rights principles that are relevant to its operations or those of its partners.
It is also important for corporations to establish solid policies on human rights. Corporations should ensure that they help in the promotion of respect for human rights through the establishment of human rights standards and principles. The policies may vary depending on the type of business and the countries in which the corporation operates. Human rights policies may be in the form of codes of conduct, ensuring that human rights conditions are put into consideration in the entire decision-making process. The policy may as well include a commitment to discipline people who fail to follow the guidelines as indicated in the policy (Baetens, 2013).
Conclusion
The issue of abuse of human rights has been so rampant especially in the third world countries. It is unfair for the multinational corporations to take advantage of the situation of the locals in host countries to exploit them through giving them low wages or subjecting them to long working hours. Using cheap labor to increase productivity at low cost may raise the profit margins, but the reputation of such a corporation will be tarnished when NGOs intervene. The U.S believes in respect of human rights as stipulated in the treaties of the UN. As such, it requires its corporations to respect the rights of the locals in the overseas markets.
References
Baetens, F. (2013). Investment law within international law: integrationist perspectives . Cambridge University Press.
Douglas, Z. (2014). Foundations of International Investment Law: Bringing Theory into Practice. Oxford: Oxford Scholarship Online.
In Lucas, R. E. B. (2014 ). International handbook on migration and economic development. New York: Harper.
Kumar, R. (2008). International economics. New Delhi: Excel Books.
Ma, J. and Lu, Y. (2011). and Free Trade or Protection: A Literature Review on Trade Barriers. Research in World Economy 2 , (1), 69-76.
