FELIPE, CINDY S.

BSBA 1B-FM

Controversial Impact of Global Corporation

Global corporations can cause harm to the environment. Most developing countries do not have the
same level of regulation and oversight that the developed world maintains to protect the environment.
When these firms decide to do business in the international market, they are subject to local laws – not
the ones that govern their domestic headquarters – when working to obtain raw materials. Smaller, less
developed governments often trade an increase in revenues for access to their natural resources. The
lower standards create better pricing structures for each customer, but it also creates environmental
damage that could have future generations paying the price for today’s decisions. Some nations even
trade in recycled materials and trash, which can place even more stress on local resources.

Political corruption typically rises with the influence of a global corporation. The global corporations
are developing budgets that are often bigger than medium-sizes countries. These live in a global space
which is largely unregulated, not subject to the rule of law, and in which people may act free of
constraint. When you add in the under-the-table deals that happen internationally, corruption occurs
because companies have the power of the purse.

It also remove raw materials from the local economy. Although infrastructure benefits do occur when
a global corporation moves into a developing country, the construction efforts are usually meant to
benefit the business and not the local market. Roads and bridges are built to access raw materials,
distribute goods, and manage processes more than they are to improve the livelihood of those living in
the region. Once all of the goods are removed, then the agency might decide to abandon the project,
leaving the government with no way to manage the situation.

Profits often go back to the global company instead of staying in the local market.Global corporations
might provide job opportunities in each local market, but they also funnel out many of the profits back
to their centralized office. Some might see this as a return on their infrastructure and educational
investments, but it can also be a decision that further weakens an already underperforming government
or economy. When you compare how much goes into foreign markets with what comes out of them, the
difference is usually minimal and can sometimes be a negative return.