The purpose of this report is to discussing challenges and benefits in operations of Multi- National Companies facing in adopting United Nations global compact principle. It gives special attention global compact role in sustainable developments across different communities. This research paper also provides investigation or understanding of the multinationals around the globe, and aims to contribute to attempts by other scholars to develop an in-depth using Apple and other Multinational corporations to demonstrate importance of the n of business in adopting the labor principle in developed and developing countries highlighting the issues on labor of not complying with United Nations labor principle in apple supply chain (Kathrine,2012). Lastly it will give recommendations on how governments and Multinational should plan their long term strategy in tackling the issue of labor.
THE UNITED NATIONS GLOBAL COMPACT
According to (Berliner, 2012) global compact operations first started in the year 2000 and it is a gathering world’s largest network-based voluntary corporate citizenship Initiative in which its first meeting former chairperson Mr. Kofi Annan exclaimed “you, the business leaders gathered in Davos, and we, the United Nations, initiate a global compact of shared values and principles, which will give a human face to the global market”.(ILO, 2017) Global Compact engages the private sectors (MNCS) to work in partnership with the United Nations, NGOs, and academia to encourage practice of good corporate practices in of human rights protection, sustainable use of the environment, and anticorruption, sustainable business practices that also benefit communities business operate in.
BENEFITS OF MULTINATIONALS CORPORATIONS ADOPTING GLOBAL COMPACT PRINCIPLE
Birkinshaw (2017) states that domestic companies get to learn productivity and better management practices from multinational corporations. They are also involved in charitable invents for instance during disasters they donate tents to making sure victims basic human rights to shelter are taken care of.
FREEDOM OF ASSOCIATION AND EFFECTIVE RECOGNITION OF THE RIGHT TO COLLECTIVE BARGAININ
Locke (2013), Globalization plays a major role in assisting Multi-National Corporations from moving their operations from competitive host nation to developing and low currency nations. This movement which is mostly investment purposes across different sectors has resulted in deterioration of social, political, economic-well-being and human rights. Universal Declaration on Human Rights sets out fundamental human rights and recognizes the right to join trade unions and the right to collective bargaining It is essential for business (MNCS) and workers to familiarize and acknowledge concept of collective bargaining and freedom of association encompassed within United Nations Global compact principles with purpose of representing and uniting both parties during negations terms and conditions of work making sure that proper are followed in terms of proper-living condition, wages and contracts are severed to workers.
Rim (2017) Asserts that Collective bargaining is important as it protects workers them from situation which are said to be happening in Asia whereby North Korea workers are forced to enter into contracts under “duty to work”, also findings shows that workers’ salaries are recollected by the state also working long hours under hazardous weather conditions in North Korean MNCS manufacturing company in Russia and Czech Republic taking away the right to work in safe and healthy environment, reasonable working hours. (Akiwumi, 2017) vulnerable, cheap labor forces are valued by MNCS for profit maximization and also to deal with less labor issues as most of them are desperate and in need of work. Union with global compact initiative members are required to commit and deepen the interdependencies between both spheres by aligning their business strategies and operations with ten universal principles, making them rectify and answerable to their stakeholders for their actions
PRINCIPLE 4- ELIMINATION OF ALL FORMS OF FORCED LABOR AND COMPULSORY LABOR
Ireland (2018)MNC Operations rapidly evolving, the legal framework on governing MNCs has trailed behind creating a ‘governance gap’. A number of soft law instruments have emerged to address this gap within United Nations Guiding Principles on Business and Human Rights (‘UNGPs’).The ‘governance gap’, have facilitated the expansion of corporate power, facilitated the growth of modern slavery in the form of forced labor in economic activities. The right to be free from slavery is a fundamental human right protected in numerous international instruments. (ILO, 2017) predicts that out of the 20.9 million victims of modern slavery globally. Forced labor ‘refers to situations in which persons are coerced to work through the use of violence or intimidation, or by more subtle means’, for the purpose of economic exploitation and production.
COCA COLA ON FORCED LABOUR
Jackson (2017) Coca cola alleged had a case of forced labor in their supply chain in Thailand, workers identification documents were being taken away from them to prevent them from free movement or leaving the farms and also there was cases of workers who had no identification documents to be identified with in research carried out in Thailand farms which lead to a conclusion of them being involved in human trafficking. Coca cola as Mncs are answerable have because they are encouraging forced labor by doing business with Thailand sugar canes suppliers who are manipulating labors by offering them advances with high interest rates aiming to keep labors through debt According to (Dutta, 2017) Locke theory requires that all human beings must be entitled to human rights despite of circumstances such as eye color; language etc. (Ireland, 2015) insists that it is important for developing countries to understand that they are well-positioned to apply pressure on MNCs within their jurisdiction to restrict forced labor. There is no consensus that permits international human rights law obligations of states extend to the extraterritorial activities of corporate nationals.
PRINCIPLE 5-THE EFFETIVE ABOLITION OF LABOR
ILO conventions (Minimum Age Convention No. 138 and the Worst Forms of Child Labor Convention No. 182) provides framework guiding national law stating minimum age for light work in less developed countries in terms of economic and education status 12-14 on the other hand minimum age for a child to work in a hazardous environment is 18 years of age. (Irelnad, 2018) Apple reports shows and acknowledge participation of in Child labor due to the availability of persons under the age students from Age of 16-18 forced long hours to work for a period of two years assembling up to 1500 iPhone X camera forced by school and government to work at Foxconn industries while the work had nothing to do with their studies. (Rahman, 2012) Argues that child labor and child work can be doing light chores like housekeeping for educational purpose but it can also be acceptable through different cultures or circumstances e.g. when the 15 year old child is the oldest in poverty stricken home it might not be allowed by the law but in this circumstances the law is compromised.
APPLE ADDRESSING CHILD LABOUR
Katherine (2012) Apple is said to releasing in the effects of its suppliers’ failures in human rights and labor protection and it is working toward resolving them through evaluation of workers hours of work and also making sure that they eliminate child labor in their supply chain
PRICIPLE 6- THE ELIMINATION OF DESCRIMINATION IN RESPECT OF EMPLOYMENT
(Sunday standard, 2018) allegedly states that choppies a Botswana Based Multination national corporation experienced strikes due to what is said to be unfair or discrimination in positions (low numbers of females in managing roles) payments of their workers being paid less than minimum wage and also lesser than other choppies workers in within same region doing the same work as them. (Motsomi Ndala marobela, Gosekwang Setiti, Nancy Mabote, 2016) Choppies are generally not interested in welfare of their workers but rather they see them as money making machines used for wealth accumulation. (Sandrine Cazes, 2012) argues that all employees should be acknowledged and be treated the same especially in operations issues such as health and safety, protection of basic human should be rights equally relevant to all the workers. Further explains that it remains the case that while someone is involved with work of an organization the firm has ethical responsibilities to them and from them for instance a voluntary workers are still entitled to be communicated with honestly and still has the right to be treated fairly. (Dutta, 2017) Utilitarianism theory of justices criticize Choppies conduct towards employees deems it unfair based on this alleged events, based the principle of welfarism choppies failed to meet welfare demand of its employers but instead they focused on making profits. (Motsomi Ndala marobela, Gosekwang Setiti, Nancy Mabote, 2016) states that Choppies HR (human Resource)function is intended to ensure that an organization has sufficient people working for it, using their skills appropriately to achieve the organizations goals and ensuring that sufficient is provided for workers’ needs that the make an appropriately valuable contribution to the work of the organization but not exploiting them , people working for the organization feel sufficiently rewarded to work with a reasonable degree of motivation and commitment-this include financial rewards, tangible and non-tangible rewards psychological, Intangible rewards such as feeling of recognition.
Conclusion and recommendation
Every nation must come up with penalties and laws which will protect them against exploitation by Multinational through foreign Direct invest, because this will not protect citizen from inhuman activities which are currently experienced by countries which are heavily reliant of FDI being forced into contract that go against value and their cultures.
Governments should give establish governmental departments that deal with human rights and labor issues, this will help in making decisions which serves people right by putting their needs first. This department should established to help to assess long term effects of contracting with MNCS in the country resources, people and environment and also be given right to object offers made by MNCS