Date: 19/12/2022

Relevance: GS-3: Effects of liberalization on the world economy, changes in industrial policy and their effects on industrial growth.

Relevance:  GS-4: Ethical issues in international relations and funding; Ethical concerns , laws, rules, regulations and conscience as sources of ethical guidance

Key Phrases: Conflict of Values, Antyodaya Principle, Business values, Conservatism, Neoliberalism, Conflicts among businesses, Labour rights, Human rights, Capital rights, Workers’ general labour rights, Global economic cooperation, International Labour Organization (ILO).

Context:

• Recently, the ongoing FIFA World Cup witnessed instances which show that there is an evolving clash between fundamental values of conservatism and neoliberalism across countries, regions and religions.
• One of the notable examples is– Ban on Liquor by the host country Qatar and high demand for such beverages by spectators coming from the western countries in the showpiece event.
• Similar practices are also infecting trade between developed and developing countries and creating divisions within Western nations and ethical dilemmas for business leaders.

Increased cases of ethical dilemmas for business leaders

• Pending negotiations on labour rights
  • Negotiations on labour standards are stalled in the ILO due to the conflicting stands where European nations want trade agreements to specify the standards of labour rights their trade partners must adopt including the enforcement of LGBTQ rights.
  • The labour representatives of developing countries demand basic human rights of workers for minimum wages, and rights to form unions to strengthen their bargaining power.
• Double standards of the West
  • Western negotiators are reluctant to support general workers’ rights because they are influenced by corporate lobbies in their countries.
  • Also, the neo-liberal economic ideology wants them to negotiate for labour markets to be freed from the socialist ideology of fundamental human rights of all workers while demanding enforcement of LGBTQ rights.
• Conservatives want cultural safeguards
  • Conservatives across the globe want preservation of their own cultures safeguarded and their own boundaries protected.
  • In fact, conservatives in Western countries see immigrants from other cultures as pollutants of their values and as encroachers in their economies.
• Misuse of dominating position by the developed nations
  • Developing countries allege that the Western nations have forced open other countries’ economies for their own businesses, often with brute force.
  • This has led to changes in the societies of the developing countries, also the root cause of colonialism.

Conflict of values is pervasive

• Neo-liberals vs conservatives conflict is pervasive even within nations.
  • In the most advanced countries like the USA this conflict goes on.
  • The US party system of Republicans and the Democrats expound “Family Values” but both have very different concepts of the roles of family members and relationships amongst them.
• Conservatives envision families with differentiated roles for women as nurturing mothers and men as protective fathers, and with children respecting the authority of their parents to discipline them.
• The liberals envision families in which all men, women, and children have liberties to “be themselves” and “do their own thing”.
  • People identify with people who look like them, who think like them, and who have the same histories and cultures.

Why is there a conflict between the values and the business?

• Values are expected to be more idealistic and based on ethical principles.
  • Ethical principles expect one to do things only in a way which can be reciprocated to him/her.
  • Judgments about who is right and who is wrong cannot be based only on one’s own version of human rights; they must include others’ perspectives also.
  • All humans, rich or poor, formally educated or illiterate, old or young, men or women, want their dignity safe-guarded.
  • They want the right to be themselves so long as they are not harming others.
• Business focuses on making profits and ignores the responsibilities.
  • The purpose of a business is to make profits for investors makes it difficult for business leaders to take responsibility for the environmental and social harms their businesses cause.
  • Therefore, regulations for protecting the environment and safe-guarding worker’s rights are impediments to the ease of doing business.
• These two conflicting dimensions create an atmosphere of conflict which can be enforced with a regulation only.

Issue of Capital rights vs human rights

• Capital rights are trumping human rights everywhere
  • Powerful countries and wealthy corporations are setting the rules of global trade and finance.
  • It is believed that the human rights campaigns in the Middle East countries are sponsored by the Western petroleum companies, defence industries, and financiers for their own benefits.
• Destabilizing regimes for the benefits of capitalists
  • There have been instances of toppling of elected governments for monarchies (Iran) and vice versa (Iraq) which shows that there is no consistent policy of western countries and they support the regimes based on the interests of capitalists.
  • Similarly European settlers, supported by Western powers, are forcefully displacing Palestinians shows the hypocrisy of western countries with regard to human rights.
• The Big corporates are calling the shots
  • Big businesses sponsor the World Cup and global meetings like the UN COP for climate change.
  • They also influence policies by lobbying governments and presenting ideas developed by think-tanks supported by them.
• Biased rules for the benefit of the powerful have been a global phenomenon wherein the rich Western countries have imposed such policies and regulations for their own benefits and undermined the human rights greatly in the poorer nations.
• Human rights can be secured only through global cooperation and efforts of civil societies, NGOs, governments and not the big capitalists.

Way forward

• Developing countries should take the lead
  • To combat the influence and dominance of western nations, evolving economies should take a lead.
  • The G20 presidency is an opportunity for India to bring governments, civil society, and business organizations of the world together to develop more equitable global solutions to problems of climate change, increasing inequalities, health pandemics, and persistent poverty that affect the poorest people of the world the most.
• Need of a new breed of more compassionate and rational businesses
  • There needs to be a new breed of upstarts in business who have compassion for the downtrodden and financially poor.
  • These businesses need to have the courage to demand change in business ethics within their own business and financial community.
• Policy making should be centered on the downtrodden
  • Courageous business leaders must lobby for policies that will first benefit people who have the least, instead of policies that will make rich people and large corporations even wealthier.

Conclusion

• There is a limited time window before the socio-economic divide coupled with environmental hazards reaches to a point of not going back.
• Thus, time has come for global policymakers to apply the principle of Antyodaya and work on changing the societal structure where the poor can be given a dignified life.
• Every policy making needs to be given a rethinking about impacts on the lives of the poorest and least powerful people otherwise the time is not far when we may see the clash of civilizations and sections.

Source: The Hindu BL

Mains Question:

Q. The increased socio-economic inequalities call for the businesses to serve the interests of the poor and not just that of the investors. Comment. (150 words)