Are MNC to blame for terrible working conditions? or Under regulation?

By Robert Caderas

Pulling an entire country out of poverty and into the first world doesn’t happen with a lifetime supply of grants and charity; that’s a pipe dream. It happens when a country aligns itself with the world economy, automatically flooding it with capital. This perception that MNCs and big businesses are the enemy is not accurate. They are the savior for poor nations, but they are not saints. If uncontrolled, they follow the path of best profits, which leads to the mistreatment of employees, the environment and much more.

The first world looks in through the glass window at developing countries and turns up their nose at terrible working conditions, overworked laborers, and numerous impeded environmental regulations. But, they forget that this is how we started as a nation, as did so many others. The biggest misconception here is that big corporations like, Nike, Apple, Walmart are the enemy attacking these developing countries. They are not, they offer jobs, money and wealth to these developing nations who need it most. The problem is lack of regulations. Most of the these developing nations do not have any laws focused on working conditions and regulations, or they simply cannot/do not enforce them. They are not ready to manage so much business and development, but all of the sudden they have to. It’s like getting on a two-wheeler for the fist time as a kid, they either fall or adapt/learn. The world needs a system to help these countries learn so they no longer feel threatened by big business and can use it to their advantage.

The delayed reaction of developing governments to implement and enforce regulations leaves holes in which MNCs exploit to make more money. You can blame big business for hunting profits all you want, but it’s the nature of it; the issue we can work to fix is the lack of laws. Most MNCs hate bad media coverage, which generally is enough of an incentive for them to abide by the regulations, if there are any.

So…Why do we see a delay in regulation enforcement?

Often times, a flood of investors and rapid economic growth overwhelms these countries leaving them venerable to the harsh nature of big company’s. We’ve seen so many economy’s across the world experience some level of under regulation during its “industrial revolution.” The US, China (still effected), Japan, Germany and so many others have experienced this problem, which took years and years to fix. Even today the most developed countries work to balance the correct level of regulation that wont imped on business. Overall the impact of MNC can be extremely positive to developing countries. It pumps millions of dollars into the economy and often updates infrastructure, but it’s important that the growth is well regulated and laws are monitored/enforced. If not, a developing countries greatest asset, the MNC, can become its worst enemy very quickly.

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4 responses to “Are MNC to blame for terrible working conditions? or Under regulation?

  1. I agree with you that the reason why developing countries aren’t improving as fast as they should is because they don’t have proper regulations and such. It is impossible for a developing nation to receive a life time supply of funds in order to become a better nation and you have suggested some excellent solutions to this problem. Great job on writing this essay/blog/forum. It gave me an insight to the developing nations.

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  2. ahmedalagil

    I totally agree with you! especially when you brought up the under-regulation issue, “Most of the these developing nations do not have any laws focused on working conditions and regulations, or they simply cannot/do not enforce them. They are not ready to manage so much business and development, but all of the sudden they have to. It’s like getting on a two-wheeler for the fist time as a kid, they either fall or adapt/learn”
    Unfortunately, this is what is happening in such developed countries nowadays. There must be laws and regulations that can protect workers! Otherwise, as you said, companies such as MNC can become a country’s biggest enemy instead of a great asset.

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  3. I agree that MNCs have a lot to contribute to economic development. I also agree that their main objective is to maximize profit. However, insufficient regulation does not mean that it’s ok for firms to do whatever they please to make money at the expense of their workers. Your argument is like saying that it’s ok to do bad things as long as no one is looking. Firms should respect human rights because it is inherently their responsibility as a business. It’s pathetic that companies such as Foxconn are able to get away with such atrocities because there is a lack of regulation.

    Companies shouldn’t need to be babysat by governments in order to do the right thing.

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  4. Dear Robert,
    There are some who may blame MNCs for being counterproductive to development, or preventing poor people from escaping poverty. But there is much more to the picture. The type of environment, laws, regulations, social, cultural, political factors and many other interrelated factors influence the potential impact of MNCs are able to make on the countries they are located in. If we truly want to truly improve the quality of development around the world, we must focus our energies on finding tools that can work together to create lasting solutions.

    ~Professor Myra Chaudhary

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