lec 1 globalization, sustainable development
TRANSCRIPT
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Corporate Social
Responsibility
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Important Websites www.bsr.org Business Social
Responsibility
www.wbcsd.org World Business Council
for Sustainable Development www.worldbank.org The World Bank
www.undp.org United Nations
Development Programme
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Power of Corporations
Corporations have farmore power than the nation-states across whose borders they operate.
The combined revenues of just
General Motors and Ford -- thetwo largest automobile
corporations in the world --
exceed the combined Gross
Domestic Product (GDP) for all
of sub-Saharan Africa
The combined sales of
Mitsubishi, Mitsui,ITOCHU, Sumitomo,
Marubeni, and Nissho
Iwai. are nearly
equivalent to the
combined GDP of all of
South America
The United Nations has justly described these corporations
as the productive core of the globalizing world econom
y.
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What is a Corporate?
What is the role of corporates in a
globalized economy?
To whom are corporates/ businesses
responsible???
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Globalization
Globalization is a process of
Interaction andintegration among the
people, companies, and
governments of different
nations
A process driven by
international tradeand investment and
aided by information
technology
It impacts environment, culture, political systems,economic development and prosperity, and humanphysical well-being in societies around the world.
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What is the impact
of Globalization?
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Impact of Globalization
New job creation
Globalization ofInformationand
Communication system :
Global village
Globalization of science
leads to the fusion of
scientific data and
rules to
form a uniform
network of database
Increase in global awareness
about various
economic, legal, political,
technical and
cultural aspects
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Self-employment increased in all
developingregions except East and
South-east AsiaFigure 15: Non-agriculturalself-employment, 1980-89 and 1990-2000
(in percentof total non-agricultural employment)
26
13
44
29
26
32
12
44
32
48
0
10
20
30
40
50
World Developed Regions Africa Latin America Asia
Source: ILO, Women and men in the informal economy, 2002.
1980/1989
1990/2000
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What are the current
trends inGlobalization?
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Current Trends in GlobalizationCurrent Trends in Globalization
IMBALANCEIMBALANCE North-South imbalance - unfair rules in Trade and FDI
Trade: Despite liberalization, expansion did not occur uniformly
Barriers to market entry for certain products of poor countries
FDI highly concentrated in about 10 developing countries despite
efforts by many to attract FDI
Capital & goods move more freely than labour & knowledge
Disparities in enterprise competitiveness and labour markets
More than 2 billion people particularly in sub-Saharan Africa, the
Middle East, and the former Soviet Union live in countries that are
being left behind.
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China, India,
Bangladesh,Philippines, Brazil,Costa Rica, Thailand,
Source: World Bank 2006
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Is this growth affecting
business and in what way?
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Impact on the Global Markets
More choice but can result in
Unhealthy lifestyles lack of activity, risky sexual
behaviour, breakdown in traditional values Promotion of processed tobacco, alcohol and
processed food with high salt sugar and fat content
Unrealised expectations resulting in depression Increased tourism brings risks to health of tourists and
communities
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Impact on Global Health
Health conditions affecting people across
boundaries, culture & generations
Infectious diseases: HIV/AIDS, TB, Influenza,SARS,
Lifestyle diseases and conditions: obesity, lungcancer, heart disease, STDs, Type 2 Diabetes
Threats to global stability and economy: HIV/AIDS,
SARS. The vectors of these diseases may betravel or work place
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Impact of Globalization:
Environment
Threats to the Globe
Global warming
Agricultural development and food security
Water stress and water insecurity
Rising sea levels and exposure to climate
disasters
Environmental pollution
Loss of bio diversity
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Impact of Globalization on
Women Gender imbalance
Trade liberalization has wiped out
livelihood sources of women producers
Migrants particularly women driven to
illegal economy( trafficking) leaving them
vulnerable to exploitation.
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Impact of Globalization (Wider
Effects) Global revolution has impacted culture &
identity---- Values, norms
Illicit cross border activities-increased taxevasion, rise in multinational crime syndicatesmoney laundering
Trafficking of human beings
Rural & Informal economies remain on themargins resulting in persistent poverty
Loss of jobs due to industrial restructuring
Migration leading to brain-drain
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World increasinglyshapedby
Sustainable Development issues
A carbon constrained worldA water constrained world
Issues of sustainable production
Poverty
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CORRECTING THE
IMBALANCE
How to build a fair globalization to reducepoverty and inequality
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Millennium Development Goals
Eradicate extreme poverty and hunger
Achieve universal primary education
Promote genderequality and empowerwomen
Reduce child mortality
Improve maternal health
Combat HIV/AIDS malaria andother
diseases Ensure environmental sustainability
Develop a global partnership fordevelopment
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Adverse Effects of Globalization Can be Controlled
Principlesofdemocracy social equity
Human Rights
Respect the Law
Smart
Partnerships
between State
and
Businesses
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Hum
an Developm
entI
ndex Composite measure of three dimensions of humandevelopment:
a) Life Expectancy
B) Being educated (measured by adult literacy and
enrolment at the primary, secondary and tertiary level) C) Having a decent standard of living (measured by
purchasing power parity
India ranks 128th out of 177 countries ( Bottom 50)
Brazil-70/177
China- 81/177
Pakistan 136/177
Bangladesh-140/177
Iceland-
orway-
Australia-
Canada-
Ireland-
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Com
parisons El Salvador, which saw a civil war for over a
decade from the 1980s, ranks 25 places aheadof us at 103.
Bolivia, often called South Americas poorestnation, is 11 steps above us at 117.
Guatemala, nearly half of whose citizens arepoor indigenous people, saw the longest civilwar in Central America. Guatemala ranks 10places above us at 118.
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In Africa, Botswana ranked below us in the 2006 HDIat 131 climbed four places above us at 124 this time.
In Asia, countries like Vietnam victim of the conflictssince World WarII rose further in the charts, to rank105 this year.
Sri Lanka, is way ahead of us at 99. So are nations likeKazakhstan and Mongolia. They too have risen in theranks. The former from 79 to 73 and the latter from 116to 114.
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Disparity India rose in the dollar billionaire rankings. From rank 8
in 2006 to number 4 in the Forbes list this year.
The TOI reports, Mukesh Ambani alone increased hiswealth by roughly Rs.40 lakh every single minute.
It is doubtful if the wages of agricultural labourers went
up by just Rs.40 (just 40, not lakhs) in years, let alone bythe minute.
We rank fourth in super-rich and 128th in humandevelopment !!!!!
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What is the role of
business in
Sustainabledevelopment?
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Need for Intervention of Business for
Sustainable Development
If business has to be developed, the societyneeds to be developed, business sector cannot
flourish in any country, if the environm
entrequired by business is not conducive.
Increasing social issues impacts the entire
society in general and business in particular because to a large extent business is dependenton the society for its growth and prosperity.
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Need for Intervention of Business for
Sustainable Development The most fundamental impact on society is fromtechnological and social change.
Creation of new cultural and social attitudes
New set of relationships between the business firm andthe surrounding society.
Stakeholders, who have long remained dormant, have
stirred awake and are now proving themselves as majorforces to be reckoned with.
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Need for Intervention of Business for
Sustainable Development
Challenges in the 21st Century cannot be tackled
by yesterdays rule of governance.
There is a need to develop new ways of thinkingand new approaches to governance at every
level of society.
It is an accepted fact, that, there are crucial
linkages between economic growth, human
development, social cohesion and
environmental sustainability.