The UN Global Compact is a voluntary initiative designed to help fashion a more humane world by enlisting business to follow ten principles concerning human rights, labor, the environment, and corruption. Although the four-year-old Compact is a relatively successful initiative, having signed up over eleven hundred companies and more than two hundred of the large multinationals, and having begun some important projects on globalization issues, there is a serious problem in that very few of the major U.S. companies have joined. (...) While the premier U.S. companies are interested in meeting the legitimate expectations of society, there is concerncentering around accountability issues. The accountability issues are in four major areas: 1. Accountability showing that the globalization of the economy actually helps the poor. 2. Accountability showing the corporate performance matches rhetoric. 3. Accountability that provides legitimacy to a two-tier pricing system and other measures that are designed to assist the poor in developing countries. 4. Accountability in the human rights area; what societal expectations are multinational companies accountablefor? The article outlines the problems that the Compact brings to the fore and offers some insight from the ethical literature that may address U.S. company concerns or provide new ways of thinking about the issues. It further argues that the forum provided by the Compact may be the most effective means to gain consensus of the role of business in society. (shrink)

In an effort to reduce risk and uncertainty, we hypothesize that investors avoid countries where high corruption exists. We investigate this issue by examining the relationship of levels of perceived corruption on Japanese Foreign Direct Investment (FDI) in both industrialized and emerging economies. The analysis presented utilizes a sample of 29,546 investments in 59 countries. Results suggest that in emerging nations, where comprehensive legal and regulatory frameworks do not exist to effectively curtail fraudulent activity, corruption serves to reduce FDI. Managers (...) need to consider the level of perceived corruption in their assessment of any market prior to potential investment. (shrink)

This paper reviews the development of socially responsible investment (SRI) over recent years and highlights the prospects for an increasingly strong connection with the practice of corporate social responsibility. The paper argues that not only has SRI grown significantly, it has also matured. In particular, it has become an investment philosophy adopted by a growing proportion of large investment institutions. This shift in SRI from margin to mainstream and the position in which institutional investors find themselves is leading to a (...) new form of SRI shareholder pressure. Although this bears some resemblance to lobbying campaigns which might take advantage of shareholder rights, we seek to distinguish it as an important phenomenon in its own right — one to which corporate executives are likely to be paying increasing attention in the years to come. We further argue that this approach potentially meets some of the earlier ethical criticisms of certain forms of SRI but, ironically, probably owes its existence to those pioneering approaches. We conclude with some suggestions for further research to inform discussion of the issues highlighted in the paper. (shrink)

This investigation is motivated by the lack of scholarship examining the content of what firms are communicating to various stakeholders about their commitment to socially responsible behaviors. To address this query, a qualitative study of the legal, ethical and moral statements available on the websites of Forbes Magazine''s top 50 U.S. and top 50 multinational firms of non-U.S. origin were analyzed within the context of stakeholder theory. The results are presented thematically, and the close provides implications for social responsibility among (...) managers of global organizations as well as researchers interested in business ethics. (shrink)

Today’s international business environment is complicated by human rights abuses and social and economic repression in variouscountries. This paper introduces controversies with foreign investment in Burma to develop and describe alternative terms of global business engagement in ethically challenging settings. Two forms of engagement—unrestricted and constructive—and two forms of non-engagement—principled and sanctioned—are discussed. All four alternatives are examined for their ethical, social change, andcultural foundations. Additional considerations are posed in respect to constructive engagement, moral leadership by global businessexecutives, needs for (...) model building and evaluative research, and realities in the ethical context of global business. (shrink)

There appears to be an implicit assumption by those connected with the ethical investment movement (e.g., ethical investment firms, individual investors, social investment organizations, academia, and the media), that ethical investment is in fact ethical. This paper will attempt to challenge the notion that the ethical mutual fund industry, as currently taking place, is acting in an ethical manner. Ethical issues such as the transparency of the funds and advertising are discussed. Ethical mutual fund screens such as tobacco, alcohol, gambling, (...) and the military are preliminarily examined to better determine whether they can actually be defined as "ethical" screens as opposed to merely social, political, or religious screens. A code of ethics for ethical investment is constructed by which ethical mutual fund firms can be audited for ethical compliance. (shrink)

Socially responsible investing (SRI) has emerged in recent years as a dynamic and quickly growing segment of the U.S. financial services industry involving over $2 trillion in professionally managed assets. Its conceptual origins can be found in the early history of civilization, with it's modern roots in the 1960s. This paper provides an overview of the breadth and depth of the concept and practice of socially and environmentally responsible investing, describes the investment strategies that together define SRI as currently practiced (...) in the U.S., offers several observations about some of the factors fueling its dramatic growth, and presents data showing that investors who choose to invest in a socially and environmentally responsible manner can do so without giving up investment returns. SRI has matured to a point where virtually any investment need can be met through portfolio design that integrates an investor's personal values, institutional mission, and/or social priorities. The socially responsible investment industry in the United States is a young phenomenon. Even referring to it as an "industry" ten years ago may have been a bit of a stretch. While it has grown dramatically in recent years, it is an area of work, of study and of practical application that continues to evolve in many significant ways. One intriguing example of the ongoing development of the field can be found in the analysis of the language used to describe it. The terms social investing, socially responsible investing, ethical investing, socially aware investing, socially conscious investing, green investing, values-based investing, and mission-based or mission-related investing all refer to the same general process and are often used interchangeably. (shrink)

Business codes are an oft-cited management instrument. But how common are codes among multinationals? And what is their content? In an unprecedented study, the codes of the largest corporations in the world have been collected and thoroughly analyzed. This paper presents the results of that study. Of the two hundred largest companies in the world, 52.5% have a code. More than half of these codes describe company responsibilities regarding quality of products and services (67%), adherence to local laws and regulations (...) (57%) and the protection of the natural environment (56%). Many codes make reference to principles governing stakeholder relations (e.g. transparency (55%), honesty (50%) and fairness (45%)), corporate core values (e.g. teamwork (43%)), appropriate conduct among employees (e.g. discrimination (44%) and intimidation (43%)) and treatment of company property by employees (e.g. conflict of interests (52%), corruption (46%) and fraud (45%)). Monitoring compliance with the code is addressed in 52% of the codes. Based on this content study, three types of codes are distinguished: the stakeholder statute (72%), the values statement (49%) and the code of conduct (46%). The results of this inquiry present a benchmark for the evaluation and development of both individual and international business codes. (shrink)

Building on John Rawls’s account of the Law of Peoples, this paper examines the grounds and scope of the obligations of transnational corporations (TNCs) that are owned by members of developed economies and operate in developing economies. The paper advances two broad claims. First, the paper argues that there are conditions under which TNCs have obligations to fulfill a limited duty of assistance toward those living in developing economies, even though the duty is normally understood to fall on the governments (...) of developed economies. Second, by extending Rawls’s account to include a right to protection against arbitrary interference, the paper argues that TNCs can be said to have negative and positive obligations in the areas of human rights, labor standards, and environmental protection, as outlined in the U.N. Global Compact. More generally, the paper aims to further our understanding of the implications of Rawls’s account of justice. (shrink)

Building on John Rawls’s account of the Law of Peoples, this paper examines the grounds and scope of the obligations of transnational corporations (TNCs) that are owned by members of developed economies and operate in developing economies. The paper advances two broad claims. First, the paper argues that there are conditions under which TNCs have obligations to fulfill a limited duty of assistance toward those living in developing economies, even though the duty is normally understood to fall on the governments (...) of developed economies. Second, by extending Rawls’s account to include a right to protection against arbitrary interference, the paper argues that TNCs can be said to have negative and positive obligations in the areas of human rights, labor standards, and environmental protection, as outlined in the U.N. Global Compact. More generally, the paper aims to further our understanding of the implications of Rawls’s account of justice. (shrink)

:Building on John Rawls’s account of the Law of Peoples, this paper examines the grounds and scope of the obligations of transnational corporations that are owned by members of developed economies and operate in developing economies. The paper advances two broad claims. First, the paper argues that there are conditions under which TNCs have obligations to fulfill a limited duty of assistance toward those living in developing economies, even though the duty is normally understood to fall on the governments of (...) developed economies. Second, by extending Rawls’s account to include a right to protection against arbitrary interference, the paper argues that TNCs can be said to have negative and positive obligations in the areas of human rights, labor standards, and environmental protection, as outlined in the U.N. Global Compact. More generally, the paper aims to further our understanding of the implications of Rawls’s account of justice. (shrink)

In this theoretical paper, motives for CSR are considered. An underlying assumption is that the commercial imperative is not the sole driver of CSR decision-making in private sector companies, but that the formal adoption and implementation of CSR by corporations could be associated with the changing personal values of individual managers. These values may find expression through the opportunity to exercise discretion, which may arise in various ways. It is suggested that in so far as CSR initiatives represent individuals' values, (...) so the responsibility in evidence is less obviously corporate. Our emphasis on personal initiative is intended to counter a tendency to view the corporation as the agent, and may serve to remind us that individuals can, indeed, make a difference. (shrink)

:Three strategies for developing just and consistent global business practices are examined: 1) international treaties and agreements, 2) global codes of business conduct, and 3) voluntary self-restraint. International agreements investigated are: NAFTA, Global Warming Treaty, OECD Anti-Bribery Treaty and Infant Formula Agreement. The codes examined are the Caux Round Table’sPrinciples for Business, The Global Sullivan Principlesand The United NationsGlobal Compact with Business. Each of these three strategies is probed for its relative strengths and weaknesses, and its prospects for developing ethical (...) business practices—especially in the areas of improving the environment, human rights and working conditions. (shrink)

Three strategies for developing just and consistent global business practices are examined: 1) international treaties and agreements, 2) global codes of business conduct, and 3) voluntary self-restraint. International agreements investigated are: NAFTA, Global Warming Treaty, OECD Anti-Bribery Treaty and Infant Formula Agreement. The codes examined are the Caux Round Table’s Principles for Business, The Global Sullivan Principles and The United Nations Global Compact with Business. Each of these three strategies is probed for its relative strengths and weaknesses, and its prospects (...) for developing ethical business practices—especially in the areas of improving the environment, human rights and working conditions. (shrink)

Three strategies for developing just and consistent global business practices are examined: 1) international treaties and agreements, 2) global codes of business conduct, and 3) voluntary self-restraint. International agreements investigated are: NAFTA, Global Warming Treaty, OECD Anti-Bribery Treaty and Infant Formula Agreement. The codes examined are the Caux Round Table’s Principles for Business, The Global Sullivan Principles and The United Nations Global Compact with Business. Each of these three strategies is probed for its relative strengths and weaknesses, and its prospects (...) for developing ethical business practices—especially in the areas of improving the environment, human rights and working conditions. (shrink)

Kyosei, a traditional Japanese concept, has been applied to a variety subjects, from biology to business. It has more recently become synonymous with the concepts of corporate responsibility, ethical decision making, stakeholder maximization, and responsible reciprocity. The purpose of this paper is to trace kyosei's modern business application back to ancient Confucian thought. The ideals associated with Confucianism were instrumental in the creation of Japanese business codes of ethics during the early part of the seventeenth century. A short history of (...) this period is presented to provide a contextual framework for understanding these codes. A specific code of ethics, called the shuchu kiyaku, is presented for the first time in English and shown to have direct roots in Confucian writings. Statements from modern company codes and from modern Japanese and American businessmen are presented to reflect the philosophy of business embodied in that ancient code of ethics. (shrink)