ENVIRONMENTAL

POLLUTION
 “Environmental pollution is defined as “the
contamination of the physical and biological
components of the earth/atmosphere system to
such an extent that normal environmental
processes are adversely affected”.
 Ethical issues arise when environmental regulations in host
nations are inferior to those in the home nation.
 Many developed nations have substantial regulations
governing the emissions of Pollutants, the dumping of toxic
chemicals, the use of toxic materials in the workplace and
so on.
 For Example, the case of the foreign oil companies in
Nigeria. This 1992 report prepare by international activist
in the Niger Delta region of Nigeria.
 It implicates that foreign companies in Nigeria where more
lax than those applied in a developed nations.
WHAT IS THE RIGHT AND MORAL THING TO DO IN
SUCH CIRCUMSTANCES - POLLUTE TO GAIN AN
ECONOMIC ADVANTAGE, OR MAKE SURE THAT
FOREIGN SUDSIDARIES ADHERE TO COMMON
STANDARDS REGARDING POLLUTION CONTROLS?
 Some parts of the environment are a public
good that no ones owns, but anyone can
despoil.
 Noone owns the atmosphere or the oceans,
but polluting both, no matter where the
pollutions originates, harms all.
THE TRAGEDY OF COMMONS

 Thetragedy of commons occur when individuals

overuse a resource held in common by all, but
owns by no one, resulting in degradation.
• Published in 1968, the essay
“The Tragedy of the
Commons,” by ecologist
Garrett James Hardin, argues
that human overpopulation will
stress ecosystems beyond their
limits and cause a resource
catastrophe.
• The idea of the tragedy of the
commons was made popular by
the American ecologist Garrett
Hardin, who used the analogy
of ranchers grazing their
animals on a common field.
When the field is not over
capacity, ranchers may graze
their animals with few
limitations.
Nowadays, corporations can contribute to the global tragedy of the
commons by moving production to locations where they are free to
pump pollutants into the atmosphere or dump them in the oceans or
rivers, thereby harming these valuable global commons
 Nowadays, corporations can contribute to the global tragedy of the commons by
moving production to locations where they are free to pump pollutants into the
atmosphere or dump them in the oceans or rivers, thereby harming these valuable
global commons.
 Below you can find the 10 countries that produce the most emissions, measured in
millions of tons of CO2 in 2019.
1. China, with more than 10,065 million tons of CO2 released.
2. United States, with 5,416 million tons of CO2
3. India, with 2,654 million tons of CO2
4. Russia, with 1,711 million tons of CO2
5. Japan, 1,162 million tons of CO2
6. Germany, 759 million tons of CO2
7. Iran, 720 million tons of CO2
8. South Korea, 659 million tons of CO2
9. Saudi Arabia, 621 million tons of CO2
10. Indonesia, 615 million tons of CO2
CORRUPTION
CORRUPTION
 Corruption is a form of dishonesty or a criminal
offense which is undertaken by a person or an
organization which is entrusted in a position of
authority, in order to acquire illicit benefits or abuse
power for one's personal gain
 Corruption has been a problem in almost every
society in history and it continues to be one day.
 There always have been and always will be
corrupt government officials.
 International business can and have gained
economic advantages by making payments to
those officials.
 Oneclassic example of well publicized incident of corruption is
the bribing of Carl Kotchain, the president of Lockheed to the
Japanese agents and government officials.
 Kotchain
paid $ 12 million to secure a large order for
Lockheed’s Tristar Jet from Nippon Air.
 These payments where supposed to be an accepted business
practice in Japan.
 Thegovernment ministers in question were criminally charge,
one committed suicide, the government fell in disgrace and the
Japanese people where outraged.
 TheLockheed case was the impetus for the passage of the
Foreign Corrupt Practices Act in the United States.
Archibald Carlisle Kotchian (July 17, 1914 –
December 14, 2008), known as Carl or A.C., was
an American business executive who served as
the president of Lockheed Corporation. His
admission of paying millions of dollars in bribes to
foreign government officials led to the jailing of
Japan's prime minister and political upheaval in
several countries in the 1970s.
 Foreign Corrupt Practices Act of 1977
 The Foreign Corrupt Practices Act of 1977, as amended, 15 U.S.C. §§ 78dd-1,
et seq. ("FCPA"), was enacted for the purpose of making it unlawful for
certain classes of persons and entities to make payments to foreign
government officials to assist in obtaining or retaining business. Specifically,
the anti-bribery provisions of the FCPA prohibit the willful use of the mails or
any means of instrumentality of interstate commerce corruptly in furtherance
of any offer, payment, promise to pay, or authorization of the payment of
money or anything of value to any person, while knowing that all or a portion
of such money or thing of value will be offered, given or promised, directly or
indirectly, to a foreign official to influence the foreign official in his or her
official capacity, induce the foreign official to do or omit to do an act in
violation of his or her lawful duty, or to secure any improper advantage in
order to assist in obtaining or retaining business for or with, or directing
business to, any person.
 Theact was subsequently amended to allow for
“facilitating payments”.
 Sometimes known as speed money or grease
payment, facilitating are not payments to secure
contracts that would not otherwise be secured,
nor they are payments to obtain exclusive
preferential treatment.
 Convention on Combating Bribery of
Foreign Public Officials in
International Business Transactions
(1997)
• Adopted at Paris on November 21, 1997, by a conference held under the
auspices of the Organization for Economic Cooperation and Development
(OECD).
• Obliges the member states and other signatories to make the bribery of
foreign public officials a criminal offense.
• At present, 36 countries have signed the convention, 36 of whom are not
OECD members.
In many country, payoffs of government officials
in the form of speed money are part of life.
One can argue that not investing because
government officials demand speed money
ignores the fact that such investment can bring
substantial benefits to the local populace in
terms of income and jobs.
 “Giving bribes, although a little evil,
might be the price that must be paid to
do a greater good”

“Corruption may improve efficiency and

Growth”
 “Corruption reduces the returns on business
investment and leads to low economic growth”

 Unproductive bureaucrats who demanded side

payments for granting the enterprise permission
to operate may siphon off the profits from a
business activity.
 Thisreduces businesses’ incentive to invest and
may retard a country’s economic growth rate.
 Although corruption is bad and may affect the country’s
economic development, there are also cases where side
payments to government officials can remove the
bureaucratic barriers to investment that create jobs
 This instance ignores the fact that corruption tends to
corruption tends to corrupt the giver and taker.
 Corruption feeds on itself, and once an individual starts
down the road of corruption, pulling back may be difficult
if not impossible.
 Code of Conduct – Dow Corporate
Bribery and corruption
 We are committed to maintaining the highest
ethical and legal standards in our relationships
around the world. This includes our relationships
with governments, government officials and other
businesses. We do not participate in or tolerate
bribery or corruption in any form.
THANK YOU