Roskilde University Corporate Social Responsibility & Business Ethics Autumn 2011 Anders Buch Nielsen
Table of content
ABSTRACT INTRODUCTION PROBLEM AREA PROBLEM FORMULATION METHODOLOGY DELIMITATIONS THEORETICAL PART A. P. MOELLER MAERSK GROUP CASES AGAINST MAERSK CONCLUSION REFERENCES 3 4 5 5 5 6 7 10 11 15 17
Corporate Social Responsibility (CSR) has become the new buzzword and a key differentiator which companies can no longer ignore. CSR is about companies being able to take up role of corporate citizens and ensuring that business values and behaviors are positioned in such a manner that they create a perfect balance between improving and developing the wealth of businesses, while simultaneously bringing a positive change in society. This paper examines the evolving self-regulatory and politically engaged role of multinational corporations in the global governance vacuum, drawing in particular from the article presented by Scherer, Palazzo & Baumann. It also discusses the conditions of democracy and legitimacy that are needed for a global governance framework for corporate social responsibility to overcome the constraints imposed by corporate rationality.
Key words: Globalization, corporate social responsibility, corporate citizenship, global governance, multinational corporations, non-governmental organizations, legitimacy and transparency.
Globalization is a term which has been used to describe and explain many worldwide phenomena with an emphasis on the development of a new market economy. The advancements made over the last 30 years in computer hardware, software, and telecommunications have caused widespread improvements in access to information and economic potential which have led to a reshaping of the national economies and social lives of many countries around the world. Information technology provides the communication network that facilitates the expansion of products, ideas, and resources creating efficient and effective channels to exchange information. In other words, IT has been a catalyst for global integration. Liberals advocate that globalization increases economic integration allowing for the movement of goods, finance, capital, production, investment, and to a lesser extent labor, across national borders. Globalization by this definition implies that the integration approaches a singular market system world-wide. However, others have fiercely criticized globalization as a threat to social cohesion and as the advancement of unfettered capitalism, which in turn undermines the Welfare State [Rendtarff 2009:32-35]. German sociologist Zygmunt Bauman has persistently been criticizing the globalization of the world. He argues that with the growing influence of profit driven multinational corporations (MNC), fueled by the nation-states loss of power and control, the end result will be an increased global disorder. Economic activities of the multinational corporations inevitably cross the territorybound validity of state regulation and bureaucracy. Companies are now able to split their valuechain processes and distribute their production sites worldwide and in their search for cost advantages they arbitrate among alterative regulations, choosing locations according to their economic requirements. Bauman believes that globalization has given the company less social responsibility and because it is free to relocate, it is also free to avoid consequences since corporations are no longer subject to the rules defined by a specific nation state. Although multinational corporations are not new economic actors, what has dramatically changed is the way they operate around the world and their increased level of economic power [Rendtarff 2009].
The decreased control of the nation-states combined with the eroding of established mechanisms of democratic governance, processes of...