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Social Responsibility of multinational companies in China

Author: HuHong ShiMing From: www.yourpaper.net Posted: 2010-02-28 13:52:29 Read:
Abstract: In the context of globalization, multinational corporations in China's political, economic and social life plays an increasingly important role China has become an important area in the global strategy of multinational companies. Explore the social responsibility of multinational companies in China, the weakening of the problems and their causes, and put forward some views and recommendations.
Keywords: multinational companies in China; social responsibility; weakening; reasons; governance

social responsibility of multinational companies

The so-called social responsibility is the business to create profits, while the shareholders' interests, the initiative to undertake the responsibilities of employees, consumers, the environment and community.
From the historical point of view of enterprise development, social responsibility is not a business whose mission, the existence of the enterprise is to maximize profits in order to obtain economic benefits, which is a Nobel laureate in economics Milton? Friedman adhere believe in free and fair competition conditions to achieve profit maximization is the most important corporate social responsibility. However, with the development of the times, as an organization, is no longer independent entities responsible only to shareholders, whose existence is being in the community as a whole system, It should also establish and maintain their more socially responsible. If companies refuse to shoulder social responsibility, the same will be socially rejected, so that as a business, to undertake the necessary social responsibility is inevitable. The social responsibility of multinational companies recognize from two aspects:
(1) From a macro point of view, multinational corporations are duty-bound to those responsible economic globalization. Multinational companies as a form of organization that can effectively integrate global resources, role in world economic activity continue to enhance the proportion of multinational corporations in the world's total output value, the volume of international trade and international direct investment in the world's key economic indicators continued to increase.
(2) from the microscopic point of view, the interests of multinational corporations mechanism change. Multinational companies, in order to ensure its practical benefits, not only consider their own factors, but must take into account the aspirations of the stakeholders. Multinational companies take the lead in attention to corporate social responsibility to accommodate this interest is the change in the mechanism.

2 of the weakening of the social responsibility of multinational corporations in China because

2.1 from multinationals itself
(1) The characteristics of multinational global management and as a business in order to obtain economic benefits, the nature of the maximization of profits, the multinational companies willing to take the risk of sacrificing social responsibility.
Business process of globalization, multinational corporations actively committed to social responsibility in the short term, usually due to the lag effect is difficult to see the direct benefits to pay the cost of social responsibility. Therefore, although some multinational companies knowing that overlooked the impact of social responsibility reputation may bring, but the face of the actual cost pressures or the nature of the corporate profit-making companies still may make business behavior contrary to corporate social responsibility. In addition, multinational companies in order to achieve the operating efficiency of its size, the need to continue to expand, so some multinational companies may have thousands of branches and subsidiaries, such a large system may also monitoring failure in the case of asymmetric information subsidiaries of multinational companies may be out of the completion of its own business objectives and to take against the practice of corporate social responsibility.
(2) the existence of differences in the level of awareness and moral level managers of multinational companies.
The lack of a long-term perspective, some managers can not see the bear a social responsibility to bring the long-term interests. There are some managers of multinational companies including China's economic development and people's level of education is relatively backward psychological discrimination in developing countries, these multinational companies tend to adopt a double standard, that is, in the raw material selection, product use and service issues high-quality products are sold to Europe and the United States and other developed countries, inferior products are sold in China and other developing countries. 2.2
from our point of view
(1) China's legal system is not perfect, and differences with the international standards, market supervision system immaturity, lax enforcement and illegal punishment enough.
The laws and regulations of China for corporate social responsibility is fragmented, Legal policy and guidance, lack of practicality and operability. Five new "Company Law" clear the company must take social responsibility, but this is only a matter of principle the terms. These laws and regulations of the dispersion of regulating and supervising multinational companies conscientiously fulfill the social responsibility side, while still flawed, you can not really play its due role. In addition, weak law enforcement and supervision, violation of the law has not been severely punished, break the law to get the benefits far outweigh the cost of illegal role for multinationals constraints.
(2) of multinational companies in China, lack of stakeholder interests checks and balances also contributed to some multinational companies to weaken the social responsibility of the important reasons.
In Western countries, in addition to the sound legal environment, there are many business interests of the business activities of enterprises play a regulatory role, as many institutional investors, trade associations, labor organizations, environmental organizations. Consumer protection organizations, and human rights organizations. And in our country, corporate social responsibility mechanism is not yet mature, people asked groups, the small force of industry associations, the role is very limited} consumers multinational companies for breach of the moral and legal behavior is often resisted in a fight on their own way, and the fundamental light on checks and balances with the duty to oversee the interests of multinational corporations.
(3) The social environment with multinational companies in China, despite repeated prohibitions weakening of social responsibility are closely linked.
Chinese government to attract foreign investment for economic development of the super-national treatment practiced by multinational companies in China, multinational companies that frequently appear in violations of the law, and related to the understanding of individual local governments to multinational companies and preferential treatment. Second, the business environment in China has created a business strategy of the Company Localization, some multinational companies to follow the example of domestic enterprises on the way for the government to take special communication, some multinational companies have formed a set of mature Localization strategy to adapt to the Chinese market. Moreover, Chinese consumers idolatrous prominent famous brands and foreign brands.

Improve the social responsibility of multinational corporations in China proposed

Adversely affect the weakening of social responsibility be our country's economic development and social multinational companies in China, it is necessary to take measures to strengthen the social responsibility of multinational corporations, prompted multinational companies to actively fulfill its social responsibility, from government to private efforts to create a fair and law-abiding, attention to the environment is essential for corporate social responsibility, the following few suggestions are proposed for the governance of the social responsibility of multinational corporations in China:
(1) to formulate and improve relevant laws, strengthen law enforcement, constraints, the behavior of the social responsibility of multinational companies in China.
Strengthen supervision, environmental protection, labor legislation, the law should be as detailed as possible, operational, and meet international standards, so as much as possible into the legal areas of social responsibility. To improve labor law, trade union law, "the Environmental Protection Act and other laws and regulations, improve and perfect the relevant laws and regulations of various professional and technical fields, which is to strengthen the supervision of the behavior of all kinds of enterprises, including transnational corporations, urging them to take the initiative to undertake the basis of social responsibility.
Also increase the penalties for damage to the interests of the community behavior, will become the social responsibility of multinational corporations, the last the inverse barrier and most effective line of defense. Can design heavier liability legislation, by raising the cost of illegal multinational companies should bear the violation of the due social responsibility to prevent or reduce the occurrence of violations.
(2) the establishment of multinational corporations social responsibility standards suited to China's national conditions.
The vast majority of corporate social responsibility standards currently multinationals based on the existence of a larger conflict developed legal framework and social expectations built up with China's social, economic, political, cultural, and legal system cable, system level perspective, we must first establish the identity of the official system, by the authority of the State to come forward with multinational corporations and interests groups consultation in the responsibility of the international community to follow the existing regulations, standards-based reference content develop multinational companies in China, the social responsibility standards and codes of conduct.
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