The role of multinationals and the environment

A traditional corporation that operates within the bounds of a sovereign area is required to comply with the legal and social institutions of that particular area. In the case of multinational corporations however, the rules are slightly different. This is, in part, because the same economic and political institutions that allow a corporation to operate across trans-national boundaries also require it to play the difficult game of adhering to a multitude of social and environmental responsibilities. Such responsibilities are further complicated by the laws, customs and business practices of the many countries in which the multinational corporation operates. Indeed, the echelons of power behind big business are faced with no easy task in outsourcing the production of goods and services across distant frontiers, especially when the issue of climate change is involved.

In recent literature, critics of multinational business practices have been quick to place the blame of environmental degradation squarely on the lap of the corporation. However, the reality of the situation is something far less transparent, as issues related to the environment comprise a host of variables, which do include, but are not limited to the actions of multinational corporations. Inevitably, any meaningful discussion of factors relating to the protection of our environment will include the role of the multinational corporation; however it is important to remember that many other factors also contribute to the tensions and contradictions that exist in any discussion pertaining to the protection of our global ecosystem.