CORPORATE RESPONSIBILITY PAPER.
Question: Does Walmart have a corporate responsibility to avoid doing business in countries that are undemocratic, violate human rights, or permit exploitative work conditions even if it benefits those employed by Walmart in that country.
In order to understand the reasons why Walmart should care about doing business in undemocratic countries where human rights are constantly being violated, several factors must be taken into consideration. Firstly, the definition of corporate and social responsibility must be clearly realized. Next, there should be thorough comprehension of corporate law and international corporate law in relation to human rights. Another point to identify to realize Wal-Mart’s responsibility is the efforts that have been made by the corporation in the issues of humanitarianism; in this we will identify cases, which will illustrate the corporation’s record when it comes to human rights. As a corporation founded in one of the democratic countries in the world as well as a major player in international organizations such as the United Nations, Wal-Mart as an entity has a moral responsibility to adhere to human rights law and protecting the citizens of so called “undemocratic countries.”,
Corporate responsibility is defined as “duty and rational conduct expected of a corporation; accountability of a corporation to a code of ethics and to established laws” (Dictionary.com.) but in this case, the definition of Corporate Social Responsibility will be addressed. According to the Business Dictionary, Corporate Social Responsibility (CSR) is defined as “A company’s sense of responsibility towards the community and environment (both ecological and social) in which it operates.” (businessdictionary.com) An important thing to note is that different organizations define social responsibility in different ways but a broad definition as illustrated by (Baker, 2004) who also defined the CSR as “the continuing commitment by business to behave ethically and contribute to economic development while improving the quality of life of the workforce and their families as well as of the local community and society at large”.
In an article on Forbes.com “Is Corporate Social Responsibility responsible?” the author writes that although it is correct to expect a corporation to create quality product and marketing them in an ethical manner, it is also irresponsible to expect the corporation and in this case Wal-Mart to apply its assets for a social purposes when its main goal is to provide a profit for its investors. Soundly, it is clear in the article that the author believes that it the right of the investors to decide in which ways they would like to address social and human rights interests, but we are talking about Wal-Mart, which is widely synonymous to the United States.
John Ruggie of the United Nations outlined in his recommendations to the council on the issue of due diligence and human rights (which it was concluded that an international body such as the United Nations did not have policies and legislations to address this specific issue) he lists important components in due diligence “a statement of policy articulating the company’s commitment to respect human rights; periodic assessments of actual and potential human rights impacts of company activities and relationships; integrating these commitments and assessments into internal control and oversight systems; and tracking as well as reporting performance” Ruggie believes in the long run will benefit corporations in aiding them in lowering their risks. It is also important to know that the United States Department of State is also a strong advocate of CSR and has an office dedicated to the mobilization of these practices of corporations founded in the U.S that may be expanding to other nations. One thing to note is that the law mostly protects those of U.S citizenship and foundation which is well illustrated in Chiquita Brands International Inc – A U.S based company which won a dismissal of a lawsuit by Colombian who claimed the corporations donations to militia caused the death of several Colombians – the dismissal of the case as described by the company’s spokesperson Ed Lloyd “The decision reinforces what Chiquita has maintained from the beginning -- that Chiquita is not responsible for the tragic violence that has plagued Colombia,” This only goes on to prove that the law really does not hold these U.S corporations responsible for human rights violations which may be contributed by these corporations.
With the law not holding these corporations responsible, does Wal-Mart then have a responsibility to avoid businesses with these countries? Ethically? Yes and we can see efforts slowly being made to promote CSR. But several cases have shown and proven that this corporation is in it more for the profits than human comfortability. It is good to note on the Wal-Mart website that they do make charitable donations, but donations does not stop the abuses
Wal-Mart’s legal history shows several lawsuits and complaints filed not only by their consumers but by their employees with issues ranging from religious, sex and pay discrimination to unsafe and unreasonable working conditions. However, it is almost impossible to hear a litigation brought against the world’s leading retailer in undemocratic countries like China. One notable suit is that listed in an article by John Sifton “Wal-Mart’s Human Trafficking problem” in Thailand where the issue of labor rights where workers are provided with poor living conditions, little to no wages and essentially locked out of the factory Phatthana which supplies to Wal-Mart. The article cites two responses from Wal-Mart. One as delving into an investigation and not tolerating such acts in accordance to their Standards for Suppliers in April but later that same year “Walmart “International Corporate Affairs Manager” named Megan Murphy sent local journalists in Cambodia an email on May 10 claiming that Walmart “has never sourced products from Phatthana Seafood.” It is evident to note that the latter response is one that has remained constant, that of denial. It can only be concluded that profits trump that human rights to the Wal-Mart Corporation. Not only does culture play a role in employees silence but fear of losing their source of income also plays a role.
Since globalization has made the integration of international entities much closer, it is easier for companies like Walmart to establish stores and take advantage of cheap labor around the world at the expense of impoverish people. I believe everyone deserves to be treated fairly including overseas factory workers and Walmart should treat its foreign workers like their American counterpart regardless of the country’s political views. However, the revolution must come from within. Corporate America simply cannot take responsibility for injustice taking place in these places even if their businesses are located there.