Ethical Issues in
Globalization
We have to choose between a
global market driven only by
calculations of short-term profit,
and one which has a human face.
— Kofi Annan
What is Globalization?


a process (or set of processes) which
embodies a transformation in the
spatial organization of social
relations and transactions, expressed
in transcontinental or interregional
flows and networks of activity,
interaction and power.
SOURCE: http://www.polity.co.uk/global/globocp.htm
Globalization Brings
Four Types of Change
• a stretching of social, political and economic activities
across frontiers, regions and continents.
• intensification of interconnectedness and flows of trade,
investment, finance, migration, culture, etc.
• a speeding up of global interactions and processes, the
diffusion of ideas, goods, information, capital and
people.
• deepening impact such that the effects of distant events
can be highly significant elsewhere and specific local
developments can come to have considerable global
consequences.
SOURCE: http://www.polity.co.uk/global/globocp.htm
Globalization, in short, can be
thought of as the widening,
intensifying, speeding up, and
growing impact of world-wide
interconnectedness.
SOURCE: http://www.polity.co.uk/global/globocp.htm
Some Big-Ticket Issues





Very personal: the meaning of
work?
Organizational: who’s in charge, and
of what? Supply chain ethics?
National: do nations matter any
more?
Supranational: what does it mean
that some areas are ‘developing’?
Global: systems change? Justice?
JOB DISPLACEMENT




U.S. – more jobs overall, but many
industries in decline.
A shift in skills and education
required for higher-paying jobs.
Loss of economic viability for many
communities.
Increasing competition among
polities for job-providing ventures.



In the developing world:
The opposite is true … more jobs and
industry growth, rising wealth, etc….
BUT … there are major issues of
human rights and environmental
protection at stake.
SWEATSHOPS

“a shop or factory in which
employees work for long hours at low
wages and under unhealthy
conditions.”
--Merriam-Webster OnLine
Dictionary
Sweatshop abuses





Child labor, sometimes children as young
as 5 or 6,
Piece rates instead of wages, requiring
long hours to earn an income that does
not come close to raising the worker out
of poverty,
Mandatory overtime, sometimes 24-hour
shifts,
Dangerous, unhealthy workplaces; no
protective equipment to guard against
toxic exposures,
Verbal intimidation, harassment, and
bullying,





Forced pregnancy tests and firing of
pregnant women,
Physical and sexual abuse by supervisors,
managers, and armed guards,
No breaks during the work day, even to go
to the bathroom,
Lock-ins to prevent workers from stealing
or leaving the factory, creating fire
hazards,
Violent ends for those who try to organize
unions.
Global Exchange on Retail and
Sweatshops
“Separate forces meet in a shameful mix: A
footloose industry scours the world for the
cheapest wages; countries eager for any
kind of investment auction off their
workers to the lowest bidder; government
regulators deliberately look the other way
when abuses occur in order to keep
foreign investors happy. It's that
combination of desperate profit-seeking
and equally desperate investment pursuit
which has created the race to the bottom
that is at the root of the sweatshop
resurgence.”
Addressing Sweatshop Problems


Supplier codes of conduct specify how
supplier relations are to be handled and
what suppliers must do in order to get and
keep contracts with the company.
Factory monitoring, often by
independent NGOs, to check for prevailing
wage rates, underage workers, workplace
hazards, or human rights violations.


Reporting to interested stakeholders is
often done through annual or biennial
social reports.
Image and reputation management
might seem to be a phony concern when
you’re talking about human lives at stake,
but for companies that are really trying to
do the hard work of supplier monitoring,
their image and reputation should match
up with their actual performance.
CHILD LABOR



UDHR Article 26: “Everyone has the
right to education. Education shall be
free, at least in the elementary and
fundamental stages. Elementary
education shall be compulsory.”
ILO estimates 250 million children
aged 5-14 are working worldwide.
Agriculture, domestic service, family
businesses, services and trade,
manufacturing, construction.
Some Examples from
Human Rights Watch


Children working on farms “frequently
work for long hours in scorching heat,
haul heavy loads of produce, are exposed
to toxic pesticides, and suffer high rates of
injury from sharp knives and other
dangerous tools.”
Children in bonded labor – allegedly
paying off a family debt, but actually
surviving in a form of slavery – weave
rugs and fabrics, sew soccer balls, and
endure beatings, long hours, lock-ins, little
food, and no medical care.




Children in domestic service care for a
household’s children, clean, cook, and are
on call constantly. They are especially
vulnerable to physical and sexual abuse.
In at least a dozen nations, children are
forced into service as soldiers.
Children serve as prostitutes and as
models and actors for pornography
worldwide.
Check out http://www.ilo.org/
FORCED LABOR

ILO Convention 29 definition: “all
work or service which is exacted
from any person under the menace
of any penalty and for which the said
person has not offered himself
voluntarily,” excluding mandatory
military service, normal duties of
citizens, supervised work as part of a
criminal sentence, or services
rendered in a serious emergency.




ILO estimates 12.3 million worldwide
in forced labor.
Most are privately exploited,
including 2.3 million in slavery.
UC-Berkeley Human Rights Center
estimates 10,000 slaves in the U.S.
Underground economy, organized
crime, bonded labor, political
prisoners….
HEALTH THREATS





36.5 million workers worldwide
infected with HIV/AIDS (ILO data).
Health care not widely available.
Disease is poorly understood and
often subject to prejudice.
Sufferers can’t afford drugs.
Families can’t afford to lose their
productive workers.
AngloGold Ashanti Ltd.





Global gold-mining
Co. estimates 30% of its southern
African workers are HIV-positive.
Established voluntary testing &
counseling centers.
Rolling out drug treatment for
employees, 934 in 2005.
Chronic disease management
expenses subsidized by the co.
Other health threats:







Malaria
Cholera
Dysentery,
Malnutrition
Measles
Tuberculosis
Yellow fever




Dengue fever
Schistosomiasis
caused by parasitic
flatworms
Trypanosomiasis or
sleeping sickness
Typhoid fever
Underlying problems:



Lack of health care and related
infrastructure
Very limited access to vaccines, antiparasitics, and other pharmaceuticals
Lack of clean water
“RACE TO THE BOTTOM”


Global price pressures lead to search
for lower regulatory standards as
well as labor costs.
This affects worker treatment and
benefits, human rights, consumer &
investor protection, environmental
protection.

Some evidence that companies are
seeking voluntary regulatory
standards to level the playing field.
ENVIRONMENTAL ISSUES:
The BBC’s “Eco Top Ten”





Agriculture – use of rural lands and development
of sustainable farming; pesticide/herbicide use;
bioengineering and genetically modified
organisms.
Atmosphere – climate change/global warming,
acid rain, smog, ozone depletion.
Biodiversity – “types of biodiversity and the plight
of endangered species.”
Energy – the use of fossil fuels (oil, coal); the
need to develop alternative energy sources.
Forests – deforestation and regrowth; forest
ecologies.





Fresh water – changing patterns,
desalination, declining supplies of fresh
water.
Habitat loss – threats to species survival,
causes, solutions.
Industry – the environmental impacts of
industrial globalization.
Marine – life and ecology – threats to the
seas and the living things therein.
Population – growth, pressure, geographic
patterns.
Financial crashes tend to be immediate
and the consequences are readily seen.
However, environmental disasters tend to
develop over a longer period of time, and
the consequences are not so easy to
discern. Industries are not so eager to
establish international environmental
regulation, and the temptations are great
to find lowest-cost solutions to pesky
developed-world environmental problems.
Countervailing pressures:





Rising consumption and declining
supply of petroleum
Businesses that specialize in
environmental testing, protection,
remediation
Labor force effects of environmentrelated health problems
Market-leader voluntary standards
NGO and stakeholder activism
INTELLECTUAL PROPERTY RIGHTS


Intellectual property can be defined as the
products of human creativity.
covers works of art, music, writing, or
invention, ideas, terms and concepts, the
language that corporations use to identify
their products and to describe their unique
technologies and processes, graphic
images, conceptual frameworks, data
tables, movies and television programs,
poetry, software, popular songs.
What’s the big deal?
U.S. Dept. of State: “safeguarding
these property rights fosters
economic growth, provides incentives
for technological innovation, and
attracts investment that will create
new jobs and opportunities.”
“Intellectually or artistically gifted people
have the right to prevent the unauthorized
use or sale of their creations, just the
same as owners of physical property, such
as cars, buildings, and stores. Yet,
compared to makers of chairs,
refrigerators, and other tangible goods,
people whose work is essentially
intangible face more difficulties in earning
a living if their claim to their creations is
not respected. Artists, authors, inventors,
and others unable to rely on locks and
fences to protect their work turn to IP
rights to keep others from harvesting the
fruits of their labor.” (U.S. Dept. of State)
Types of IP Protections

Copyrights grant the owner the
right to benefit economically from
the copyrighted work. Protections
include the sale, reproduction, and
public presentation of such works.
Copyrights generally cover literary,
artistic, and musical works, and also
include maps, video productions, and
software.

Patents protect the economic rights
of inventors while releasing the
technical details of the invention to
the public. This form of IP is crucial
both for serving the needs of
inventors and for encouraging
technological progress; one invention
may spin off many others, but this
will not happen unless the details of
the first invention are known.

Trademarks protect the names, symbols,
or other unique identifiers of specific
products, processes, or services.
Products’ brand names have trademark
protection, as do symbols (like McDonald
Corporation’s famous clown, Ronald, or its
Golden Arches logo) and
marketing/advertising phrases (staying
with McDonalds: “I’m lovin’ it”).

Trade secrets offer somewhat less
stringent protections for
economically valuable processes,
formulas, technologies, ingredients,
etc., that are not readily subject to
any of the other IP protections.
Companies have more responsibility
for guarding their own trade secrets,
but theft of such secrets can be
prosecuted as a crime.
BRIBERY & CORRUPTION


Transparency International (Ti)
defines corruption as “the misuse of
entrusted power for private gain.”
TI’s annual “Global Corruption
Barometer”
http://www.transparency.org
“In the past 12 months, have you or anyone in your
household paid a bribe in any form?” (Yes answers)








Albania, 66%
Morocco, 60%
Cameroon, 57%
Congo, 40%
Nigeria, 39%
Mexico, 28%
Ukraine, 23%
Kenya, Peru,
Venezuela, 22%




Switzerland, Finland,
Singapore, Sweden, 1%
USA, United Kingdom,
Turkey, South Korea,
Austria, Taiwan, France,
Germany, Iceland, the
Netherlands, Portugal,
Spain, Denmark, 2%
Canada, 3%
Israel, 4%
Possible consequences of corruption:








Democratic elections
Government contracting
Victims of fraud
Overpayment
Lack of accountability
Supporting the incompetent
Government legitimacy
Business predictability and economic
development
Bribes (Noonan)







Are not expressions of love or fondness, as gifts
are.
Are not simple expressions of thanks to low-level
employees for a job well done, as tips are.
Are intended to make the bribee do what the
briber wants, generally in conflict with what the
bribee should do.
Create more pressure to perform, the larger they
are.
Are accompanied by lies and deceit.
Are necessarily secret; are damaging and
shameful to the bribee if they become known.
Public knowledge of the payment prevents the
bribee from meeting the briber’s expectations.
“We must ensure that the global
market is embedded in broadly
shared values and practices that
reflect global social needs, and that
all the world's people share the
benefits of globalization.”
-- Kofi Annan