Mncs Pollute Environment of Host Country, Employ Child Labor and Ignore Workplace Safety

In the age of globalization of production and markets, Multinational companies face the fierce need of gaining cost-efficiency by shifting their production process to least developed countries. The most apparent reason behind this is the availability of cheap labor in the least developed countries. There are other factors too that contribute to gaining cost-efficiency for the multinational companies. For instance, the rules of environmental standards, labor code and workplace policies are much stricter in developed countries than those of the least developed countries. As a result, cost of production in the least developed countries is way less than that in the developed countries. Consequently, Multinational companies take advantage of these lax and lenient standards and policies and pollute the environment of the host countries, employ child labor and ignore workplace safety. This general statement can be reinforced with some practical examples as follows.

Environmental pollution by MNCs:

Pollution refers to the introduction of containments into the natural environment that cause adverse change. Industrial corporations have abundant resources in terms of technological innovations and investment capital in boosting their production. In a period of globalization, privatization and market liberalization, they are seen as one of the most important factors to shape the future of the world. However, those factors have brought not only an increase in wealth but also a detrimental effect on environment of host countries caused by the commercial activities of multinational corporations.

Multinational companies are responsible for many environmental problems as they take advantage of lax environmental regulations of host LDCs. In a recently published research, it was stated that nearly 63 percent of the industrial carbon pollution released into the atmosphere since 1854 can be directly traced to 90 multinational companies – 83 producers of coal, oil and natural gas and 7 cement manufacturers.

BP, an US-Based multinational company, is one of the world’s leading integrated oil and gas companies. BP’s deep-water horizon oil spill scandal in 2010 is a significant example of environmental pollution my multinational companies.  Within days of the explosion and sinking of the deep-water horizon oil rig in the Gulf of Mexico that killed 11 people, underwater cameras revealed the BP pipe was leaking oil and gas on the ocean floor about 42 miles off the coast of Lousiana. By the time the well was caped, an estimated 3.19 million barrels of oil had leaked into the Gulf. This oil spill had and still has an adverse effect on the marine life near the Gulf and BP was fined $18.7 billion which is the largest corporate settlement in U.S. history.

Employment of child labor by MNCs:

According to UNICEF, child labor is defined as “Work that exceeds a minimum number of hours depending on the age of the child and type of the work. Such work is considered harmful to the child and should therefore be eliminated”. In the quest of exploiting cheap labor, children represent a cheap and flexible workforce that can be easily controlled and manipulated and are very appealing to multinational companies. Many renowned multinational companies worldwide are associated with employment of child labor such as, Adidas, Nike, Apple, Samsung, Sony, Disney, Coca Cola, Nestle, Wal-Mart, Nokia, McDonald’s etc.

Among the multinational companies listed above, child labor scandal hit Apple, Samsung and Sony very recently. These mobile phone manufacturers came under the limelight when human rights organization Amnesty accused them of failing to do basic checks to ensure minerals used in their products are not mined by children. This accusation was further bolstered when a BBC report into cobalt mining in the Democratic Republic of the Congo (DRC) found children as young as seven working in dangerous conditions. Cobalt is a vital component of lithium-ion batteries that these mobile phone manufactures use. It also collected the testimonies of children who allegedly worked in the mines. Paul, a 14 years old orphan, stated mining when he was 12 and told researchers, “I would spend 24 hours down in the tunnels. I arrived in the morning and would leave the following morning”. To portray the bigger picture here it must be mentioned that UNICEF estimates that there are approximately 40,000 children working in mines across southern DRC.

Ignoring of workplace safety by MNCs:

Workplace safety refers to a multidisciplinary field concerned with safety, health and welfare of people at work. Workplace safety policies are very lenient in the least developed countries and multinational companies shift their production process to these countries to take advantage of cutting costs of ensuring a safe and sound workplace for the employees. Among the multinational companies associated with violation of workplace safety, Walt Disney came under the limelight for violating workplace code of conduct and workplace deaths.