A political/economic idea of mine regarding the future of multinational companies.
Disclaimer: The ideas are still in development, and it isn’t as detailed yet, but in the future I’m planning to elaborate on them. It could be in a few weeks, months, or even take one year or more. Constructive criticism is welcome.
Changing the Goals & Perspectives
As past events have shown, ethics and environmental protection are not a priority in the current economic system which is shaped by neoliberalism. That’s why, in this article, I talk about the future of companies and what needs to be done to smooth the way to a sustainable system.
First of all; corporations’ mustn’t focus on profit as a primary goal. Now some would say that this mindset is the complete opposite of the sole principle of capitalism and they are right in some ways. However, it is a necessary sacrifice to abandon the concept of maximum profit to build a sustainable system. The task is not to completely relinquish profit; in fact that’s not the case at all. They’d just have to consider environmental concerns and human rights regulations before making decisions.
These new objectives are from social and environmental nature. Whereas the adherence to human rights should be more than an issue that needs consideration (not as the last sentence of paragraph above may imply). Moreover, during the education on economy as a subject of study or in schools which teach economics, ethics should play a role as well. As a student of an economy school, I have experienced it firsthand that ethics are not something that is considered to be that important.
And, according to my substitue ethic teacher of my school, ethics isn’t a fixed subject in German schools (e.g. like math or religion). I don’t know how other countries do it, but the overall school system [in Germany] is also in dire need of reforms. But that’s a topic for another time.
A page in my school book „Betriebswirtschaftliches Handeln international – International Business Managament“, the 3rd edition from the publisher „Europa Lehrmittel“, explains the ecological objectives and social objectives:
Of course, in order to develope the potential fully of these new objectives, the social awareness and environmental awareness have to rise as well in the society. And, as it was observable during the Friday for Future protests, we may be on a good way.
Note: the core message, at least as I interpreted it, is to shift the focus on climate change as an environmental issue and demand from the economy and politics to act more determined and quicker on the problem.
Since the world of today is through and through connected, from trade routes to production lines, this was a more general approach that can not only be applied to large multinational companies, but also smaller ones which only operate within the country or in a region. However, and I want to make it clear: the smaller ones may need more time than the international ones, and sometimes assistance from the government.
After all, they do not have as much capital at hand as companies like Apple.
Next to that, they also aren’t responsible for the reckless acts of larger companies. Neglecting them would result in a siginificant increase of unemployment (as well as a variety of other problems, such as the extinction of small businesses in small towns/villages).
And now to the second point, my idea for international companies.
International Companies in the Future- Holistic and Pro-Labour
In the future as I have imagined it, all international companies must have a control council which consists of the workers who are employed there. They get informed about the decisions in a company and also have say in the matter. A democratization of the workplace, if you will.
Along with the control council, there’s an institution outside which supports the workers internationally, and as the names gives away, it ensures that the workers are treated ethically (e.g. no hazardous environment or lack of protection) and that the companies do not undermine the function of the control council. The IEFRW also stays in contact with the government and acts as an advisor, and for the representatives as a source of information. The red arrow (control) is meant to indicate that they are constantly observing the company but do not interfere directly.
For the employer, the tasks stay pretty much the same: he still owns and/or manages the company. However, monthly or quarterly meeting with the control councils are required to stay informed how the employees do and to discuss strategies. Internal issues can also be the subject of this discussions.
As it is with the IEFRW institution, the employer(s)/owner(s) also stay in contact with the government and, in case of a disagreement, a government agency may act as the mediator to solve the conflict.
As for the government: its tasks have expanded as well, and now they can also advise the company if there’s a need to. Regulations work as they did before (no change yet).
The regular contact to employers/owners and the institution have already been explained. Regarding the IEFRW, it may be the best choice to sent both workers and representatives of the institution to ensure a faire representation.
There’s also space for closer cooperation between multinational companies and governments, e.g. research for green technologies or environmentally friendly production. However, transparency and the involvement of the workers must be guaranteed.
And, ideally, the results are shared to some extent or another with smaller companies. After all, the cooperation of the government will very likely cost money and isn’t just an advisory function. Since money doesn’t grow on trees, and small and middle-sized companies have to pay for it as well, they deserve to gain from the knowledge as well.
As mentioned in my introduction, my English skills are far from perfect, so I want to apologize beforehand if a section is hard to understand or if grammar mistakes occur.