4.4.2 Ethics Flashcards
What ethical issues can MNCs cause?
- low wages
- poor working conditions
- environmental impacts
Why do some MNCs use child labour?
Because profits can be increased as children can be paid lower wages and they are less aware of their rights.
Define ethics
Rules and principles that state which behaviours are acceptable for society.
Why do MNCs have conflicts with their stakeholders?
Stakeholders want high profits which means keeping wages low. This can create ethical issues between stakeholder groups as workers are being unpaid and have poor working conditions.
How can consumer knowledge of ethical issues affect MNCs?
Consumers have become increasingly aware of labour exploitation and may think it is unethical.
Consumers may protest / refuse to buy / boycott an MNCs product.
This creates a large amount of public pressure which may force the MNC to take control of the working conditions.
What environmental effects can MNCs have?
- greenhouse gas emissions
- waste disposal
How can emissions cause unethical issues?
Most MEDCs have legislation on emissions and how they’re reported, but LEDCs are less strict. Following strict legislation could be expensive for an MNC or restrict its operations, so they might locate production in LEDCs.
How can waste disposal cause unethical issues?
Most MEDCs have legislation for waste disposal, but this can be very expensive. LEDCs may not have the legislation or infrastructure to deal with waste so MNCs may locate production there. However, this can mean that they’re disposing their waste unsafely.
Why might MNCs need to adapt their marketing to remain ethical?
In order to avoid inappropriate promotional activities
