Poverty and Pollution
Any environmental damage definitely and immediately threatens the present and future welfare of human beings, of plants, animals and entire ecosystem. Threats to the environment can come from two sources, namely pollution and resource depletion. Both can increase exponentially as industrialization expands. In the Third World, environmental mathematics works like this: the more factories we run the more pollution and resource depletion we have.
Pollution refers to the unintended and undesirable contamination of the environment by the producer or use of commodities like fossil fuels, plastics, chemicals and other materials organic or synthetic. Pollution seems to be the child of industrialization process. Pollution is born where industrial labor and capital make more money. This environmental contamination can be air pollution or water pollution and, in most cases, they go hand in hand like Siamese twins. According to Michalos (1997), most of the world’s waste is produced in and by First World consumer societies, many of the world’s remaining natural resources are in the Third World countries, and most of the producers of the products creating the waste, pollution and resource depletion are transnational businesses.
In this paper, I present my analysis of the ethical issues pertaining to the business operations of foreign companies in a Third World country.
Doing Business in Third World Country: Pollution and Ethical Implication
The ethical dilemma being faced by an MNC is choosing between its business interests and the common good of the community where it operates. That is, a dilemma involving the long-term gain of environmental protection versus a short-term profit of exploiting land and resources. Businesses in general and transnational corporations in particular, are morally responsible to the environment because they are important part of a larger picture, that of the macro-ecological system. The businesses’ general obligations towards the environment include the fact that business establishments cannot use with impunity the different categories of resources. Next, businesses must realize that the natural resources are limited. As it has already been proven on a number of occasions, most of our natural resources are simply not renewable. Exploiting the environment compromises not only the present generation but also the future generation. Finally, businesses must comprehend the consequences on the quality of life by particular type of development as observed in the industrialized zones. The most obvious implication of industrialization, direct or indirect is the pollution of the environment which have also implications to people’s health and safety.
While business depends upon the natural environment for its energy, material resources and waste disposal, the natural environment in turn is adversely affected by the industrial and agricultural activities of business. It is immoral for business to destroy the very resources it is dependent on. MNCs cannot just use the elements of nature simply as they desire, that they are equally obligated to work hard for the renewability of resources after touching them, and that the possible consequences of the haphazard and irresponsible exploitation of the nature is irreversibly damaging for all. Economic development indeed has an ethical dimension. When businesses treat the beautiful garden merely as a source of economic exploitation, then it becomes an abandoned and lifeless desert in due time.
Reasons of Transnational Businesses to Conduct Business Operations in Third World Country
In line with the cold-blooded capitalist goal of profit-maximization and sustainability, MNCs have established a network of satellite operations around the globe especially in the developing and less developed countries which offer abundant sources of raw materials at the lowest possible cost, comparably less expensive labor, and cheapest cost of production. MNCs seek overseas markets because of the unlimited potential for growth compared to the limited operations within their home country.
Also, part of the logical explanation why multinationals operate in the Third World, particularly in underdeveloped countries is the “underdeveloped” justice system. Added to these reasons is the favorable treatment by the government in the form of tax shelters, less stringent laws, and the high probability of a limitless exploitation of the natural resources. In exchange MNCs express their willingness to offer the following: plant operations and administration that require high skill, taxes and fiscal obligations, foreign investments, employment opportunities, and technology transfer.
This fact that an MNC operates in more than one nation may create some ethical problems along the way. For one, the company policies may differ from the government policies of the various host countries. It may also encounter differences in the aspect of socio-cultural norms. Oftentimes, an MNC is challenged with the ethical dilemma of choosing between its business interests and the common good of the community where it operates.
Economic Progress and Development; Pollution Controls and Environment Protection
The connection between economic progress (or growth) and development is that the economic progress is a necessary but not sufficient condition for the latter. Economic progress refers to the increase in a country's real level of national product can be due to increase in the quantity of resources, rise in the resources’ quality (through education, training, etc), improvement in technology, or increase in the value of goods and services produced by different sector of the economy. Meanwhile, economic development is the increase in living standards, greater choice, freedom from oppression and improvement in self-esteem needs. The Human Development index (HDI) takes into account the life expectancy and literacy rates whuch affect productivity of population in a country and lead to economic progress; is the most accurate method of measuring development. Moreover, development involves the development and availability of more opportunities in the sectors of employment, healthcare, education, and the conservation of the environment. The most direct implication of development is the rise in in the per capita income of every citizen. Development alleviates people from low standards of living into proper employment with suitable shelter. Also, it is concerned with sustainability which means meeting the needs of the present generation without sacrificing the needs of future generation.
A moral right to a livable environment regardless of the country they live in.
Eweje (2006) posited in his paper that businesses must protect their stakeholders from environmental impact of their activities and the desire for an environment that is sound, clean and safe. The right of an individual to a liveable environment was developed by Blackstone where he argued in his article Ethics and Ecology, that it is the right of every human to live in an environment that is safe and clean because such condition is necessary for each individual to fulfill his/her human capacities. Guerrette (1986) supported the argument and asserted that people cannot flourish in an area that is chemically toxicated. People cannot also experience freedom in an environment that is industrially polluted or be happy while worrying about the quality of air they breathe. Moreover, the constitution of many countries have define life, liberty and the pursuit of happiness; this only implies that every himan being has a right for a a liveable environment and it must be an inalienable right (Eweje, 2006).
Rich Countries have the Obligation to Help the Third World Countries to Develop Greener Industries and Sources of Energy
Most developing countries do not have strong human rights, labor, and environmental laws (Aaronson, 2005). Though many multinationals have adopted voluntary corporate responsibility initiatives to regulate their overseas social and environmental practices, Aaronson asserted that the developed countries like the United States can do more to ensure that its multinationals act responsibly everywhere they operate than just by relying on voluntary actions. Voluntary corporate responsibility initiatives are insufficient to address the magnitude of problems companies confront as they operate in developing countries where governance is often inadequate (Aaronson, 2005). In this light, I argue that wealthy nations have the obligation to or help poorer nations to develop greener industries and sources of energy. This is to say that a transnational or multinational company has a responsibility to the society and physical environment to which it operates (Eweje, 2006). Embracing such responsibility will not only benefit the Third World country but the business as well through sustainable operation in the future.
Moreover, as mentioned earlier, most of the producers of the products creating the waste, pollution and resource depletion in Third World Countries are transnational businesses. Principles of environmental ethics tells us that business, in general, have the following duties, namely: the duty to conserve the natural resources, the duty to install pollution-control devices and the duty to compensate those affected. The first one is conservation, the second is prevention, and the third is compensation.
Likewise, Chilton (1999) mentioned in his speech the global policy objective which is: “Poor, small, developing countries need both growth and development; therefore rich countries which are responsible for most of today’s global environmental damage, and whose material well-being can sustain halting or even reversing throughtput growth must take the lead” this implies that wealthy nations should take the lead in promoting environmental sustainability especially in poorer countries.
Uniform Global Pollution Control Plan
According to Brandon (1994), efficient policies would provide the right incentives for a uniform global pollution control standards.
It is the duty of the businesses to install pollution-control devices. If and when possible, an absolute ban on pollution should be implemented. The second best is for the polluting agent to stop pollution at its very root by installing pollution-control devices. The installation of these devices can help lessen, if not avoid, the catastrophic effects of pollution.
As suggested by Brandon (1994), a variety of policy approaches cab be used to foster pollution abatement, ranging from command-and-control measures which dictate actual technologies and acceptable levels, to market based instruments which provide economic incentives for compliance with standards but also allow for greater flexibility and economic efficiency. Developing countries, according to Brandon (1994) would be better served by more cost-effective, market oriented policies.
References
Aaronson, Susan Ariel (2005). ““Minding our business”: what the United States Government has done and can do to ensure that U.S. multinationals act responsibly in foreign markets”. Journal of Business Ethics, vol. 59, pp. 175-198.
Brandon, Carter (1994). “Reversing pollution trends in Asia”, Finance & Development, vol, 31 (2), pp. 21-23.
Chilton, Kenneth (1999). “Economic growth versus the environment”, Vital Speeches of the Day. ProQuest Central, p. 501.
Michalos, Alex G. (1997). “Issues for business ethics in the nineties and beyond”, Journal of Business EthicsI, vol. 16 (3), pp. 219-230.
Eweje, , Gabriel (2006). “Environmental costs and responsibilities resulting from oil exploitation in developing countries: the case of the Niger delta of Nigeria”, Journal of Business Ethics, vol. 69, pp. 27-56.
