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Compare and contrast ANY TWO of the following approaches to the governance of transnational corporations (TNCs) - Essay Example

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It is not only easier to communicate with people from all over the world, it is also possible to carry out business operations from any corner of the globe. This is all possible due to improved technology…
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Compare and contrast ANY TWO of the following approaches to the governance of transnational corporations (TNCs)

Download file to see previous pages... Governing international corporations ensures that business runs as it is supposed to. It also ensures that the corporations do not take advantage of prevailing situations to enrich themselves at the expense of other people in society. In other words, global business governance ensures that everyone gains from the operations of international business (Zadek, 2001).
There are many theories that can be used to analyze the governance of global business. For the purposes of this paper, I will examine global business governance using the Neoliberal Approach and the Social Democratic Approach. These two approaches have been used to propagate the idea of prosperity through international commerce (Epstein, 1999).
The Neoliberal approach to global business governance can be described as the theory that supports economic freedom, which is an important factor in international business policy discussions. The neoliberal approach gained popularity after being adopted by the World Trade Organization in 1970. The main objective of this perspective is to remove all the barriers to international commerce and the privatization of services and resources.
Reduced restrictions on all or some economic activities means that the governments of the involved countries do not have the mandate to interfere with how the multinational corporations run their businesses. The neoliberal model’s support for free market methods also means that there should as little restriction on business operations as possible. The multinational corporations are also are entitled to full property rights in their areas of operations (Hill, 2008).
In this approach there is limited government intervention in international corporate governance. Instead, it supports the multilateral political influence from such bodies as the World Bank and the WTO. Privatization is a major component of neoliberalism. This means ...Download file to see next pagesRead More
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