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Map of MNC’s power and influence. Adapted from stakeholder relationship map by IIED (2005)

Map of MNC’s power and influence. Adapted from stakeholder relationship map by IIED (2005)

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This paper examines the question of how to determine the extent of a multinational corporation (MNC)’s corporate social responsibility for actions by its suppliers. Drawing on three theories of power and influence from the organization and management literature—resource-dependence theory, social exchange theory and social network theory, this paper...

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... A notable power imbalance exists between corporations and their stakeholders, particularly between large corporations and small suppliers or consumers. This imbalance makes it difficult to achieve the equal negotiation and mutual consent presupposed in social contract theory [12]. ...
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Amidst the accelerating pace of economic globalization, many corporations increasingly grapple with the challenge of effectively balancing economic gains against their broader social and ethical responsibilities. This research paper delves deep into the applicability of social contract theory within the corporate sphere, analyzing its foundational principles in conjunction with Plato's Theory of Ideal Forms. The comprehensive study posits that modern corporations can be integral and proactive actors within the broader social contract, bearing significant societal responsibilities and moral obligations. It thoroughly explores the theoretical grounding for corporate adherence to social ethics and proposes practical and actionable implementations of social contract theory in corporate management. Emphasis is strongly placed on the moral role and the weighty societal responsibilities of corporations in today's ever-changing world. The compelling findings indicate that social contract theory offers a robust theoretical basis for corporations to adhere to social ethics voluntarily. Additionally, it assists corporate managers in developing decision-making models that align closely with these ethics. This alignment helps harmonize the pursuit of economic objectives with broader societal responsibilities.
... 16 Whereas trade was historically conducted on the basis of a make-here, sell-there model, today a great deal of trade is organised within complex supply-chain networks that often span many countries before a finished good is ready to sell on the market. 17 As a result, the power of MNCs, who operate as the central nodes that coordinate activity within these complex supply-chain networks, has been greatly augmented (Chen, 2018). This doesn't just affect the myriad producers within MNCs' supply-chains; countries seeking to enhance their trade performance must be increasingly cognisant of the interests of MNCs when formulating their economic policies (see e.g. ...
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When it comes to fulfilling our basic duties to distant others, we in the affluent world face a motivation gap; we consistently fall short of bearing even moderate costs for the sake of helping others secure basic minimums to which they are entitled. One response to the motivation gap is to cultivate in affluent populations a greater concern for distant others; cultivating such concern is the goal of ‘sentimental cosmopolitanism’. Two approaches to sentimental cosmopolitanism currently dominate the literature, a compassion-based and a complicity-based approach, respectively. In this paper, I argue for the promise of reciprocity as an alternative motivator of cosmopolitan concern. I further argue that a sense of obligation to distant others, grounded in our participation in an ongoing system of reciprocal exchange, can be cultivated within a thus-far overlooked sphere of cosmopolitan sensitization, namely the market. I make the case for the market as an appropriate site for cosmopolitan sensitization, and further argue that multinational corporations are, for several reasons, well-positioned to bear the political responsibility of sensitizing affluent populations to the significance of their participation in a cooperative economic scheme shared with distant others. This paper, then, makes a novel contribution to debates on cosmopolitan sentiment, as well as to the emerging literature on corporations’ political responsibilities. Keywords: multinational corporations; political responsibility; reciprocity; sentimental cosmopolitanism; trade
... 5 For instance, some authors show that the power of suppliers (Ş ener et al., 2016) remains limited. This is particularly evident in the case of multinational corporations (MNCs) with long supply chains, which have been perceived as more powerful than their suppliers and accused of exerting undue pressure on them (Chen, 2018). Similarly, a low level of salience was also revealed concerning employees, who often "find themselves disadvantaged in negotiating with a powerful and sometimes uncompromising employer" (Koku et al., 1997 p. 15, see also Pruitt et al., 1988). ...
... Organizations are increasingly positioning themselves, and are being seen as, mediating links between individuals and society (Hatch, 2018). This shift has occurred to such an extent that corporations (e.g., Facebook and Apple) are considered to be important components of the social structure of humanity (Chen, 2018). As a result, increasing demands are being placed on organizations regarding the possible roles and responsibilities they might reasonably assume. ...
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... Organizations are increasingly positioning themselves, and are being seen as, mediating links between individuals and society (Hatch, 2018). This shift has occurred to such an extent that corporations (e.g., Facebook and Apple) are considered to be important components of the social structure of humanity (Chen, 2018). As a result, increasing demands are being placed on organizations regarding the possible roles and responsibilities they might reasonably assume. ...
... Business owners are important leaders for society mainly because they create employment, feed communities, and can be the driver of social priorities for the people (Dollinger 2008;Chen 2018). These are all significant elements, especially toward SDGs (Timms et al. 2019). ...
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The United Nations (UN) Sustainable Development Goal (SDG), Goal 16: Peace, justice, and strong institutions can drive positive environmental, social, and economic changes in sub-Saharan Africa while transforming informal sectors. Peer-reviewed English language publications on Google Scholar were explored based on a systematic literature review using loop analysis modelling, mapping out currently underdeveloped gaps such as the intersection of circular economy and the ASM sector in African countries. By identifying the significance of circular economy adoption within the realm of sub-Saharan Africa, which is rightly rich in quarried natural resources, this chapter laid the groundwork for the significance of strong institutions for the adoption of a circular approach and environmental management. Thereby, the problem of mining waste was highlighted, and the state of institutions was identified as the main facilitator of a circular economy for the ASM sector. Countries with institutional voids, weak policies, and marginal international collaboration are instructed by this chapter to carry out formalization that can enable stakeholder participation as well as institutional and policy changes, which support targets and indicators of SDG16. Given the blurred margins of functioning systems in emerging economies such as the case of developing sub-Saharan African countries, often the indicators for implementation, monitoring, and distribution data may be inadequate. Therefore, stronger regard for further research is encouraged to target more refined versions of clearer circular economy approaches, which would offer clearer and supportive adoption guidelines, i.e., easier to implement in poor or informal communities. The chapter is aligned with the need of formalizing the ASM sector toward efficiency and the decarbonization of the global economy at all levels of production, starting with the sourcing of raw materials – “mining.”KeywordsSDG16Strong institutionsCircular economyASM
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... Whilst, however, there are intensive needs at stake, and we can argue that corporations are the agents best-placed to meet LDC inhabitants' trade-related needs in their role as coordinators of the supply chains linking rich consumers to poor workers (see e.g. Chen, 2018;Danielsen, 2019), 26 it remains the case that locating in an LDC will very often be far too risky, and insufficiently cost-competitive to generate any sort of duty on the part of companies to locate there. In part, this is simply because LDCs are so badly off; such countries will tend to have poor material, social, and legal infrastructure, each of which will make it difficult to keep costs low and operation smooth. ...
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Many corporations are large, powerful, and wealthy. There are massive shortfalls of global justice, with hundreds of millions of people in the world living below the threshold of extreme poverty, and billions more living not far above that threshold. Where injustice and needs shortfalls must be remediated, we often look towards agents’ capabilities to determine who ought to bear the costs of rectifying the situation. The combination of these three claims grounds what I call a ‘linkage-based’ account of why corporations have demanding positive duties to the global poor. In this paper, I put forward a distinctive linkage-based account of corporations’ positive duties centred on the idea of dependence and the importance of meeting agents’ core needs. In addition to outlining and defending this account, I will show that we can utilise its basic conceptual components to make headway on questions that have received insufficient attention in the business ethics literature; specifically, we can say something substantive about the weighting of needy agents’ competing claims to assistance, and about the limits to the demands that can be lodged against corporations on the basis of others' unmet needs. Having integrated considerations of duties' grounding, their comparative weight, and the limits of their demandingness into a single account of corporate positive duty, I conclude by discussing a challenge to attributing to corporations duties owed to the worst-off amongst the global poor.
... Firms' dependence on resources is a key source of relationship power, since the unique resources that firms need are often held by other firms [69]. Therefore, resource dependence theory provides an overview of the formation of power in relationships, and assists in the development of ways to access and exploit unique resources [14,69]. ...
... Firms' dependence on resources is a key source of relationship power, since the unique resources that firms need are often held by other firms [69]. Therefore, resource dependence theory provides an overview of the formation of power in relationships, and assists in the development of ways to access and exploit unique resources [14,69]. According to Gelderman and Van Weele [10], three factors affect how dependence between firms increases: first, the dependence of one firm on another increases once the importance of a resource increases; second, the dependence of one firm on another firm increases once the discretion over resource acquisition increases; and third, when the concentration of resource control increases, the dependence of one firm upon another for that resource increases accordingly. ...
... The cooperation between buyers and suppliers increases the focal firm's ability to implement supply chain sustainability practices [43]. Firms are held responsible not only for their own actions, but also for the actions of those with whom they are connected in their buyer-supplier relationships [69]. Therefore, firms exercise power over the members in their buyer-supplier relationship to ensure that they behave ethically and adhere to sustainability standards [69]. ...
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... Third, there are no effective governance institutions in place that can decide on what constitutes norm-deviant behavior, enforce sanctions on transgressors, or regulate the redressing of damages. Some consumer countries have started to experiment with domestic regulations that have extraterritorial effects, most notably France's due diligence law to sanction companies that have assets in French territory and cause human rights or environmental violations abroad, but the effectiveness of these efforts has not yet been sufficiently assessed (Chen, 2018). The EU has been preparing regulatory action to reduce imports of embodied deforestation, yet the most politically feasible options so far are of voluntary nature (e.g., certification or multistakeholder forums) and fall short of full accountability (Bager et al., 2020). ...
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