The Role of Multinational Corporations Essay

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The Role of Multinational Corporations

Literature and discourse relating to Multinational Corporations (MNCs) and human rights is ubiquitous with theoretical contestation on the merits and demerits of the potential harmonious existence of the two. Some argue that by virtue of the consequential results of their business operations, MNC’s have the potential to alleviate human suffering. For others, they are the cause of it.

Advocates of both perspectives draw on a mixture of factual experiences and theoretical propositions to substantiate their positions. Empirical analysis is often used to differing degrees, and with differing levels of success, to further authenticate these dichotomised positions. Diverging standpoints, when empirically endorsed, however, ensure that no coherent theory can be extrapolated and applied to specific location and circumstance. With competing views, respectively backed up by statistical data, no overarching determination can be made as to the potential effects of the economic operations of these entities.

It is suggested therefore that the trajectory of discourse should be altered so as to assess this relationship from a business perspective first, and a human rights perspective second. That is, in altering positional focus to whether or not human rights is good for business, theoretical suggestions may be legitimately substantiated in the absence of unequivocal empirical data by assessing the extent to which MNCs are in fact likely to respect human rights.


In 1996 William Meyer’s work, which supported theories that MNCs have an overall beneficial impact on both first and second generation rights in developing countries, appeared in Human Rights Quarterly. Using Data from Freedom House and the Commerce Department, and while acknowledging that MNCs have at times had a detrimental effect on human rights, Meyer argued that civil and political rights, and economic, social and cultural rights, correlate positively with Direct Foreign Investment (DFI).

In contradistinction to Meyers claims, however, and using data from Amnesty International, the State Department and the World Bank, Smith et al. responded that MNC’s have in fact a negative impact on human rights.

Both positions derive from a determination to substantiate theoretical claims relating to diverging positions on, not only existing relationships, but equally of the potential results of that mutual existence. Both constitute therefore, empirical evidence on previously enunciated theoretical claims relating to the relationship of business and human rights generally. The intention of this paper is to alter positional focus on theoretical positions relating to the pros and cons of business for human rights, and subsequent empirical investigations, to a position which questions.

Yet as Meyer, responding to Smith et al. concedes, ‘[n]either study can be used to support a claim that MNCs are always positive, or always negative, in relation to human rights’. This is largely a result of the fact that ‘[t]he fundamental problem with Meyer’s approach [or smith et al.s] is that …[they]… cannot distinguish between MNCs that do, in fact, promote human rights and those which, in fact, do not.

’Therefore, when scholars such as Jack Donnelly assert that ‘[i]f business involvement is justified in part because it helps human rights, we can legitimately ask for concrete evidence of that help,’what is likely to surface is not in fact unequivocal evidence relating to the realities of this co-existence, but rather the selective inclusion of data which supports one’s particular position: Empiricism is in fact an illusion.

Engines of Development Thesis

[ 1 ]. Meyer, W.H. 1996. ‘Human Rights and MNCs: Theory Versus Quantitative Analysis’, Human Rights Quarterly 18(2), 368-397. [ 2 ]. Smith, J., Bolyard, M., and Ippolito, A. 1999. ‘Human Rights and the Global Economy: A Response to Meyer’, 21 Human Rights Quarterly 207. [ 3 ]. Meyer, W.H. 1999. ‘Confirming, Infirming, and ‘Falsifying’ Theories of Human Rights: Reflections on Smith, Bolyard, and Ippolito Through the Lens of Lakatos’,Human Rights Quarterly 21(1), 220-228. [ 4 ].

Winston, M.E. ‘Multinational Corporations and Human Rights’, Address at the Mobil Corporation World Affairs Meeting (6 June 1996) cited in Meyer note 25. [ 5 ]. Donnelly, J. International Human Rights (2nd ed. 1998).

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