The Negative Impact of Multinational Corporations on Lesser-Developed Countries (LDCs)

A corporation is a form of business organization where the firm is a legal entity separate from its owners. As corporations grow and become multinational, their interests and influence extend accordingly. The decisions made by these corporations are always made with a primary goal of increasing profits. Needless to say, the decisions taken by corporations often regard public interests as inferior to their own, so many of their decisions have a calamitous impression on the public. The multinational corporations, Wal-Mart, Nike, and Gap, had negative impact on the world through human rights violations, through their control of the media, and by putting smaller local companies out of business.

Corporations are often major violators of human rights. "As human rights advocates begin to address corporate crime, they often do so in the absence of any serious government support. As a result, they are tempted to fall back on voluntary codes of conduct adopted by the corporations themselves. At best, this self-monitoring represents "enlightened self-interest" by companies looking for a stable investment climate. At worst, it is nothing more than a public relations ploy which can set back human rights by providing corporations with cover from public scrutiny. In either case, companies are usually more motivated by their bottom lines, than humanitarian interests. And that makes the free market and its corporate agents rather dubious guarantors of human rights." (Light 1999) Large companies often use or lobby for conditions that result in manipulated international trade pacts and agreements, in order to maximize profits, via things such as cheap labour. (Vander Stichele 1998) This can be seen in the form of sweat shops or child labour in th...

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...d to be tighter and the scope of their influence needs to be reduced.

References

Anderson, Sarah, and John Cavanagh. Top 200: the Rise of Corporate Global Power. Institute for Policy Studies. 2000. 3 June 2006 .

Bagdikian, Ben H. The Media Monopoly. 6th ed. Beacon P, 2000. xxxvi.

Light, Julie. "Repression, Inc: the Assault on Human Rights." Corpwatch. 4 Feb. 1999. 2 June 2006 .

McCann, Lucy, comp. Catalogue of the Archive of the Anti-Apartheid Movement, 1956-98. 2002. Bodleian Library, University of Oxford. 5 June 2006 .

McChesney, Robert W. "The New Global Media: It's a Small World of Big Conglomerates." The Nation 11 Nov. 1999. 4 June 2006 .

Shaw, Arthur H. The Lincoln Encyclopedia. New York: Macmillan, 1950.

Vander Stichele, Myriam. "Towards a World Transnationals Organisation?" WTO Booklet Series Volume 3, Transnational Issue. 30 April 1998.