Compass Can Only Show The Correct Way In Countries Where The Route Is Correct With CSR
In today's world, borders have become transparent as a result of globalization and a large commercial flow has started. The foundations of this flow are based on the opportunities offered by the division of labour and geographical conditions, according to Adam Smith. In The Wealth of Nations, if a single man produced needles alone, he could only produce 10 needles per day, as a result of which only 10 people in a village of 100 people could receive them. This also raises the price of the needle because supply is less than demand. This time, Smith divided the production stages of the needle and considered the work of one person for each stage. As a result, the production of needles in a day was more than 100. In addition, mastering has begun as a single stage is made. From now on, the needle is cheaper for 100 people of village people because the supply is more and more efficient with the same performance. The smallest scale example of globalization started when the excess needles were started to be sold to other peasant peoples after the needle was sold to the village people. In other villages, as a result of the division of labour, another good and service was produced and trade started. This is the case with globalization for today's big firms. Supply surplus, together with efficient and more costly production, has been presented to other countries. At the end of all this accumulation, globalization has reached its current efficiency.
Another issue that reveals globalization is geographical resources. Resources in our world are not distributed equally to every country so resource control is the most critical goal for nested production operations. This leads companies to an aggressive attitude. Consequently there are cases that we can evaluate in terms of CSR.
This is where the problem between Shell and Nigerian ethnic groups arises. Considering that Shell's position in Nigeria is the business institution, we will evaluate CSR-based transparency, human rights, ethics, government, sustainability and economic system in general. We will look at the suggestions for solving these problems from different angles.
Before our evaluations, Shell is an international business where the operational processes are managed to obtain energy resources and as a result of all this, it is an international business that aims to gain profit. In addition, Shell is a company located in Nigeria since 1937. We should include Shell's purpose of earning profit as a variable in our evaluations. As a result of these processes, we reach a fairer evaluation.
Let us consider the targeting of Shell Company by Ogoni in its activities in Nigeria in terms of transparency, which is the responsibility of companies. Although Shell has been in Nigeria since 1937, it has not been able to analyse the environment well. If Shell had done the PESTEL analysis after Nigeria gained its independence, this problem would probably not have happened right now. At first, Shell moved forward by thinking that it made sense not to be transparent in this case for interests of its company. Despite the reactions from many organizations around the world, these have been rejected. As a result of this, years later it had to offer much more costly solutions and could not achieve the desired result. For example; Shell's desire to protect its production facilities by not acting transparently, ignoring the damage. It causes to the fields of the people in the region every day, the disturbance it causes to the climate of the region and the life of the people, and the effort to ensure the confidentiality of the protection methods applied in this process is a violation of the CSR transparency principle. The desire to protect the production facilities has prompted Shell to respond strongly to protesters by encouraging the regional government. In 1990, 80 villagers were killed and 494 houses were destroyed. At the time of all this, the reactions of civil organizations were very weak and all of them were rejected by Shell. If the transparency principle had been applied by Shell at first, the event would not have reached these dire dimensions and the Shell brand would not have been damaged. Also, it will not have to incur large costs to protect its brand's reputation in the future. In short, Shell did not follow the transparency principle. As a result, a very heavy bill was paid.
Another company that we can compare in terms of transparency with the result of globalization is American Apparel. It is one of the rare companies that strangely does not move in this direction, despite the maximum earning goal of the American Apparel business philosophy. American Apparel makes its production in America, thinking that it is not correct and sustainable to manufacture production processes cheaper in developing countries. American Apparel, which adopts this strategy, performs all production operations under one roof, thinking that this is an advantage in terms of cost. A slightly more flexible working understanding is dominant compared to other companies. It offers its employees comfort in the working environment with a high salary. For example, unlike many corporate companies, it is free to have relationships between employees. CEO Charney, the founder of this environment, was accused of sexual harassment within the organization and was dismissed as a result. As a result, the American Apparel complied with the CSR principle and avoided further growth of the problem by acting transparently.
Another aspect of our evaluation is the consideration of human rights for the activities of Shell and American Apparel. Shell firm violated the UN Human Rights. If the company limits the rights of the people of the region for its own interests, it is a crime. For example; during Shell production, oils mixed into the waters of the region and there were fires that never stopped day and night.[1] As a result of these fires and oil leaking into the water, agriculture ended in the region and the soil was unproductive. People who rebelled against it were killed by the Nigerian army. For instance, Saro Wiva, who objected to this, was found guilty and executed by a military court. Shell has here violated every person's right to life, the right to freedom of thought and the right to social security. The people of the region lost their income and paid a great price. If we look at human rights from the angle of the American Apparel, we must evaluate their attitude towards immigrants, the gay population and homosexuals. American Apparel has fulfilled people's rights to equality by recruiting and funding their workers from immigrants. He presented t shirts for gay people and respected the freedom of thought of individuals by advertising for gay people. To summarize them briefly, Shell did not take human rights into account, while American Apparel did take human rights into account.
It is to follow the ethical principle which is the most difficult and most important principle of CSR. Going ethically right is like walking on a thin rope. Besides legal responsibilities, there are many unwritten rules that must be adopted. In the case of Shell, it is possible to say that Shell did not act ethically, because people lost their lives with the encouragement of the government. Moreover, Shell could not make an economic gain in this regard, and turned out to be harmful. Both its economic obligations and social obligations have not been ethically fulfilled. In the example of American Apparel, all legal ethical responsibilities have been fulfilled. Employees were offered high wages and comfortable environments. The only thing we can criticize about American Apparel about ethics is the use of sexist and nude content as a marketing element in its advertisements and campaigns. It may be legal to have sexist and nude content to sell more, so many companies participate in the race like this, but it may not be ethically appropriate because instead of addressing the logical needs of people, a sales strategy is adopted by stimulating their sexual urges. It is difficult to make an ethical judgment here because there are companies that use this strategy in the race within the sector and its environment. To put our assessment briefly, Shell may seem legitimate to protect its factory, but the factory it wants to protect violates the rights of other people. Therefore, Shell has not fulfilled its ethical and legal responsibilities. American Apparel, on the other hand, has fulfilled many responsibilities in ethical and legal matters.
Let's approach all these processes from the perspective of the government. Government systems are intertwined with economic factors. Governments can be influenced by companies. At the same time governments can affect to companies. The critical point here is related to the government's commitment to constitutional rights, its attitude to democracy and human rights. For example, why did Shell run into trouble in Nigeria? Was it a coincidence that Shell, which manufactures in many countries, encountered such a process in Nigeria? Of course it wasn't, if you look at all of our above evaluations, American Apparel is a company that fulfils all its responsibilities but Shell is in a position not to do so. Then we have to compare the American government and the Nigerian government. Could Shell cause something like this in America? It could never have been because the capitalist system in America is run better by the government than in Nigeria. In terms of democratic and human rights commitment, the American government is far ahead of the Nigerian government. For example, Shell took advantage of this vacuum of the Nigerian government, causing a disservice. If the Nigerian government had implemented the necessary rules for human rights, not for their own interests, the people in their country could survive. We will consider economically why the Nigerian government is acting for its interests. Hereby, the government element included within 5 Forces is critical to fulfilling responsibilities for CSR. The Nigerian government, on the other hand, acted not like a government but as a group ruled for its benefit.
Another important point of view is sustainability. Companies have to consider sustainability while performing their operational activities. This provides a positive return both ethically and in terms of gain. If the decisions made are about saving the day, we cannot use a solid idea as a basis. For example, Shell is far from sustainability in this case. The damage it has done to give the people of the region has caused much greater damage. The projects he sponsored both in terms of image and to forgive themselves to the world resulted with great cost. In addition, the principle of environmental sustainability has not been followed. The fires that broke out in the region resulted in the destruction of other resources, the damage to the soil was made using economic resources. While evaluating sustainability in terms of American Apparel, I will use perspective from Bilgi University Prof. Dr. Beyza Oba.[2] She says that cost is the most important issue for a business. It may sound very nice that American Apparel produces with high salaries in its own country, it is also ethically acceptable, but the goal of a business is to make maximum profit[3]. If American Apparel had made its production in developing countries like its competitors[4], it would have made more profit. Last of all, it fell into a crisis economically because the strategy it adopted is very costly. With this strategy, it cannot gain a competitive advantage over its competitors. In addition, it is not unethical to carry out its production activity in a developing country if the supplier company takes human rights into consideration. In short, both companies did not fulfil their responsibilities in terms of sustainability.
Finally, we must criticize the system economically. At first, we gave an example of Globalization. In today's world, globalization is the route of all commercial activities, but there is something missing here. Compass does not show correct in all countries. It must be thoroughly analysed before any operational or commercial action is taken in a country. PESTEL, SWOT and 5 Forces analysis[5] must be done. At the same time, the compatibility of service with the development level of that country should be evaluated. Shell would not have these problems if Nigeria was a player like England in the capitalist system, because it would have an adequate infrastructure for its production and many options for people's welfare. Therefore, the probability of having problems in countries that are adapted to the capitalist system is slightly less. At least the cause of the problem would only be company executives who acted incorrectly in terms of CSR. As I finish my economic evaluation, my suggestion is the fact that the compass will only show the route correctly in the right countries. If I build a nuclear facility to meet Nigeria's energy needs for free in good faith, I will probably meet with a great disaster because the necessary infrastructure for this facility and operation is not available.
As a result of all our assessments, we need to know that our environment provides us with the necessary conditions, while taking into account the responsibilities for CSR. Otherwise, we will make a mistake after error and deviate to a path that is difficult to return. Hoping to consider CSR principles for a better world, more efficient and more beneficial operations.
Her hakkı saklıdır. İzinsiz çoğaltılamaz, dağıtılamaz ve amacı dışında kullanılamaz.
Copyright © 2021 Mert Çetin
[1] Guardian, Shell shuts down pipeline in Ogoniland after fire, 2016 by AFP
https://guardian.ng/news/shell-shuts-down-pipeline-in-ogoniland-after-fire/
[2] Bilgi University, BUS 401 Lecture by Beyza Oba
[3] Lumen, What is a Business, https://courses.lumenlearning.com/boundless-business/chapter/what-is-a-business/#:~:text=Profit%20Maximization,the%20stockholders%20are%20its%20owners.
[4] Investopedia, Nike Suppliers, 2019 by J.William https://www.investopedia.com/articles/markets/051416/nike-stock-analyzing-5-key-suppliers-nke.asp
[5] Ivory Research, Bloomberg Business, https://www.ivoryresearch.com/wp-content/uploads/2015/09/Bloomberg-Business-sample1.pdf
Yorumlar
Yorum Gönder