Implications of a Planetary Bargain for the Developing Countries

Abstract

This chapter focuses on two main questions about corporate social responsibility in developing countries that must be answered if a planetary bargain is to be implemented. The first is to do with how a large transnational corporation (TNC), based in the richer world, operates in a developing country. Should such a TNC and its subsidiaries be more socially responsible than local companies? The second is what should be the response of these local companies — would it, for instance, injure their competitivity domestically or even internationally? Neither of these issues is a new topic for developing countries. As far back as 1982, the Asian Productivity Organisation (APO) organised a conference on the issue of social responsibility in Asia; six developing countries (India, Hong Kong, Indonesia, South Korea, Philippines, Thailand) took part and presented papers¹ along with Japan. Indeed, one of the key questions was whether the level of social responsibility in TNCs should be higher than that of an indigenous firm in a developing country. It was observed that often a TNC would generally provide better pay and conditions than local enterprises, but not much better than a socially responsible indigenous enterprise (SRIE).