4.4.2 Ethics

Question 1

Stakeholder conflicts

Answer 1

Shareholders - seek greatest return on investment
Customers - increasingly conscious of where products r coming from, sustainability/ethical sourcing
Communities - MNC’s may bring externalities such as pollution and congestion

Question 2

Pay and working conditions

Answer 2

Acceptable pay levels of workers - living wage is paid
Provision of suitable working conditions such as ventilation
Human rights - no inhumane treatment or excessive working hours

Question 3

Environmental considerations

Answer 3

Legislation on how busi disposes of and manage waste may also not be enforced in some countries
Managing neg externalities incurs costs + this can conflict with the profit motive for some MNC’s

Question 4

Supply chain considerations

Answer 4

-global sourcing issues - child labour
Exploition of workers
Components of raw materials may come from a a wide variety of countries
Difficult for governments and consumers to track where with what + how products from MNC’s have been produced

Question 5

Marketing considerations

Answer 5

Unethical practises may involve neg promotion
-misleading labelling
-false claims in ads
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