Sustainability and Transnational Business Ethics - Coursework Example

?Sustainability and Transnational Business Ethics Introduction This paper attempts to have an understanding of what sustainability is, and how it hasbecome an integral part of modern business ethics related to globalization. For the purpose of gaining a thorough knowledge of the topic, the paper would be briefly elaborating on several books on the subject written by experts toiling in the avenue. Before going into all those details, it would be of immense help in briefly focusing on the concept of sustainability. Sustainability It was about four decades back that the term “sustainable development” started gaining prominence. The World Commission on Environment and Development defined sustainable development as “development that meets the needs of the present without compromising the ability of future generations to meet their needs.” To elaborate further, it (sustainable development) emphasizes on the importance of achieving development in an environmentally friendly manner. As a matter of fact, it is as a direct result of global concern over enhanced pollution that this term is becoming more and more relevant. (1) In fact, it was the US and the UK, with their norms of environmentalism, who were the pioneers, with regard to adherence to principles of sustainable development. This term (sustainable development) emphatically states that issues of environment are a highly important part of all cultural, social and economic interactions. The all-important aspect of sustainable development maintains that, manner of production and consumption needs to be modified. This is to make sure that environmental norms are not compromised upon. Likewise, it is equally essential that there is a change in the pattern of all cultural, social and economic relationships, lest the requirements of sustainable development are unmet. (1) From the perspective of sustainability, there is no hesitation in stating that commercial entities are responsible for carrying out operations that are eco-friendly. It is not just that. Organizations are also necessitated to ensure that they offer sustainable employment, in the sense that, employees are allotted quality work. Also, firms have to run the extra mile for making sure that the both their workplaces and also products conform to norms of sustainable development. (1) Globalization and sustainability – Review of Literature and Other Studies It would now very much be appropriate to be succinctly reviewing some literature and researches, which emphasize on the fact that sustainability is indeed a vital element in the contemporary business ethics. In the book “Business Ethics: Managing Corporate Citizenship and Sustainability in the age of Globalization” the authors Andrew Crane and Dirk Matten elaborate on the vital aspects of sustainability, corporate citizenship and globalization. The book comprehensively enumerates on business ethics, from the point of view of globalization. Using some real instances as the basis, the authors argue that the modern-day business ethics do have sustainability as their integral feature. By highlighting things such as Middle East military companies and the UK’s sector of Islamic Finance, the authors stress that present-day business ethics are strongly linked with globalization. In fact, this book provides details of several key topics like water, climate change and social enterprise, to cite a few. Crane and Matten also speak about the necessity of being an ideal corporate citizen, as well as the pattern in which this can be achieved. (2) The work “The Oxford Handbook of Corporate Social Responsibility”, which has been penned down by Andrew Crane, Abagail McWilliams, Dirk Matten, Jeremy Moon and Donald S. Siegel, includes several essays on the crucial topic of corporate social responsibility. These essays throw light on the fact that the definition of this term (corporate social responsibility) has undergone a drastic change, on account of globalization. Corporate organizations are now entailed to aptly address several social obligations. Concepts such as sustainability, globalization and consumer activism, among others, have now become more important than ever. It is only by meticulously adhering to all these that the companies can fulfill their social responsibility. (3) Here, it won’t be out of place in adding some more points to the definition of sustainability. As a matter of fact, it has to be noted that, on a global basis, there are countless definitions of the concept of sustainable development, apart from the one that has been mentioned in the second section of this paper. Ideally speaking, sustainable development, along with conforming to environmental norms, should also address the all-important aspects of economic growth and social justice. In fact, if it can be said that sustainable development is indeed taking place, it is imperative that people are being provided with good education. It needs to be understood that, the primary purpose of sustainable development can be fulfilled only when the development can be sustained for a substantial time span. (4) While speaking about corporate social responsibility, Palazzo and Scherer emphasize that in the era of globalization, it is indispensable that the term CSR (corporate social responsibility) is viewed from a broader perspective. Here, it is but obvious that the aspect of sustainability focused upon in the preceding paragraph is an integral part of the term CSR. Corporate organizations can be considered to be socially responsible, only when they adhere to principles of sustainability, along with other crucial aspects. Scherer and Palazzo also maintain that because of rapid globalization, the political power of various national governments is getting weakened. (5) In his book “Corporate Social Responsibility: The Good, the Bad and the Ugly” the author Subhabrata Bobby Banerjee elaborates on the term CSR in a radically different manner. He strongly states that it is just not possible for corporate conglomerates to be socially responsible, when their priority is to function as per the interests of shareholders. In fact, the author has no hesitation whatsoever in labeling the term CSR as being nothing more than a hoax! Banerjee forcefully argues that the concept of corporate social responsibility is presently being popularized only for the purpose of adding further strength to the already strong business houses. He states that powerful corporate groups are fully indifferent to the communities that are victimized by their business practices, and thus endangering the environment as well as the social fabric of society. (6) At this point, it needs to be highlighted that the business entities mentioned in the preceding paragraph operate in a way that is totally contradictory to the norms of sustainability. Despite the fact that they proclaim sustainable development to be a vital component of their business ethics, yet, their actions do suggest that sustainability is not in their agenda! However, from a positive perspective, it has to be stressed that a substantial chunk of multinational conglomerates are addressing the vital aspect of sustainable development. And, the firms not adhering to sustainable practices are fortunately fairly less in number. Here, it would be worthwhile in shifting the focus on to a research that has been carried out by five researchers, who carried out extensive studies in the developing zone of the Globe. They state that when the term corporate social responsibility is defined from only the viewpoint of the businesses, it is fully against the interests of the financially weaker groups of the society. They argue that, the right understanding of CSR is possible only when a proper relationship is established amongst poverty alleviation and business. The researchers state that initiatives of CSR should be propelled by the primary objective of bringing about betterment in living conditions of weaker communities and the working class. Here, it needs to be specified that such initiatives, along with rendering yeomen service to the poorer sections, would also meet the requirements of sustainability. (7) In his article “Globalization, Corporate Social Responsibility and poverty” the writer RHYS Jenkins speaks about how the concept of CSR has evolved since the past three decades. He also gives a detailed account of the manner in which the United Nations and various international development agencies are stressing on the relevance of this concept. Jenkins says that in terms of benefiting the financially weaker sections, there is a limit beyond which CSR would not be of much help. Simultaneously, he also maintains that, overall, proper adherence to the norms of CSR would surely exercise a positive impact on the lives of the sections of less economic strength. This is even more applicable when the corresponding scenario of the developing regions of the World is taken into consideration. Here again, it is but obvious that aptly conforming to the demands of CSR also encompasses the key issue of sustainability. (8) In the book “The Triple Bottom Line – Does it All Add Up”, which is a collection edited by Julie Richardson and Adrian Henriques, the focus is on the term “triple bottom line”. As a matter of fact, this term, which has been used since the past twenty years, conveys that social, environmental and commercial advantages can simultaneously be provided by business operations. (9) The book throws light on the point that several business entities are now scrupulously adhering to the principles of CSR, which is also inclusive of operating in an eco-friendly manner. The fact that this can also be termed as sustainability warrants no special mention. Julie and Adrian state that, the triple bottom line approach towards business activities is not without some limitations, when viewed from a pragmatic perspective. They also stress on the important fact that, notwithstanding those limitations, there are now countless businesses spread across the Globe, and which are not driven solely by the profit motive. These business groups give utmost importance even to the concepts of corporate social responsibility and sustainability. (9) “Cannibals with forks: the triple bottom line of 21st century business” is a highly interesting book that has been penned down by J. Elkington. Just because cannibals start using the fork does not mean that they can be considered to have become civilized. Likewise, capitalists use concepts, which by themselves are noble, to mask their unscrupulous operations that are directed towards both furthering their profits and also for eliminating competing businesses. (10) Elkington presents an argument in a highly convincing manner that, in the contemporary era, no company can survive for long duration, if it adopts the approach of a cannibal! He states that, it is now imperative for all businesses that, along with their commercial motives, they also address the crucial aspects of sustainability and corporate social responsibility. He highlights that, in the present-day scenario, shareholders, customers and employees of any business are not contented just with the commercial success of the organization. In fact, all of them have high expectations from the corresponding business houses, in terms of meticulously abiding by the norms of sustainability and corporate social responsibility. And it is an irrefutable fact that, if these expectations are not met by the business firms, their long-term survival in the markets would gravely be jeopardized. (10) Analysis From the review of all the above literature and studies, it has been observed that in the contemporary times, the concepts of corporate social responsibility and sustainability are more or less synonymous with each other. It also has been noted that, there are some firms that function in way that is detrimental to the objectives of sustainability. But in this context, the pleasant fact is that, such firms are being outnumbered by multinational business groups operating in a fully responsible manner, in terms of sustainability. At this juncture, it would be apt in once again briefly focusing on the book “Cannibals with forks: the triple bottom line of 21st century business”. In this book, Elkington convinces even the most skeptical that there is simply no way in which any business can thrive by being indifferent to CSR and Sustainability. This indeed is very much heartening for all the people and businesses who are staunch adherents to the concepts of sustainability and corporate social responsibility. Gone are the days when businesses used their economic power to act in ways that jeopardizes other businesses, communities and environment, to name a few. In that bygone era, owing to the immense power wielded by the concerned conglomerates, their (conglomerates) unscrupulous actions were seldom questioned and challenged. But all that is now nothing but just things of the unpleasant past. To put it in other words, if at all a business firm has to successfully survive in the modern World, it cannot afford to ignore aspects like CSR and Sustainability. Businesses are now answerable to several groups, communities, agencies, etc, in terms of adherence or non- adherence to sustainable practices. Here, it has to be specifically mentioned that this element of accountability of business houses was hitherto conspicuous by its absence. Now, the paper would go on to succinctly elaborate on some real examples that emphasize on the fact that sustainability has now become an indispensable part of all business activities. Examples Globally, manufacturers of carpets have brought about a substantial drop in consumption of energy and water, not to mention the decline in the quantity of wastes resulting from the manufacturing process. Similarly, the redesigned windows have made sure that both the daylight increased by six hundred percent, and also penetration of solar heat got reduced by four hundred percent. (11) Dupont has revised its mission statement in a manner so as to make sure that the aspect of sustainability is addressed. It (Dupont) is striving to minimize the pounds of total quantity of material used on an annual basis, while simultaneously enhancing the value for every pound, for shareholders. Likewise, Collins, Interface and Aikens, the globally leading makers of carpets have modified their manufacturing process in a specific manner. This is to ensure that the total quantity of virgin material going into the making of carpets is reduced by about forty percent. Worldwide, the techniques of electric smelting are increasingly being used in the manufacture of steel. The consumption of both energy and also materials is significantly low, when these techniques are followed. (11) The above examples are a vivid reflection of the fact that, on a global basis, more and more companies are now abiding by sustainable business practices. And it need not be specifically mentioned that conformity with norms of sustainability is an essential element of the term corporate social responsibility. Here, it has to be stated that the above are just few of the countless examples that can now be seen in the Global markets. The number of business houses that are modifying their policies just for meeting the requirements of sustainability is rapidly rising, worldwide. Conclusion This paper can be concluded on a positive note that, barring some exceptions, otherwise, the majority of businesses in the global markets have made sustainability an integral part of business ethics. With this consistently rising adherence to CSR and sustainability, it can be hoped that in the near future, the planet would become a much better place for all life forms, and not just humans. The topic of this paper is an exhaustive one and it is just not possible to cover all its aspects in a brief paper such as this one. Yet, a sincere attempt has been made to encompass the most salient of all the points. 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