Financial giants and moral pygmies? Multinational corporations and human rights in emerging markets

Abstract

Purpose

How should a multinational corporation (MNC) from a mature democracy deal with the human rights issues in a country with a poor human rights standard? The paper aims to discuss these issues.

Design/methodology/approach

The authors develop a mathematical model to depict MNC's behavior in response to human rights violations in the host country.

Findings

The authors show that, first, in a country with a high level of human rights abuses, a firm will have to lower its human rights standards to survive; but, second, a collective effort by all firms is essential to improve the human rights conditions in the host environment; and third, a firm's human rights practices may have a multiplicative effect that can significantly affect the momentum of human rights development in a host country.

Originality/value

This study is one of the first attempts to provide a theoretical framework on the issue of MNCs and human rights in host countries.

Citation

Li, S. and Gaur, A. (2014), "Financial giants and moral pygmies? Multinational corporations and human rights in emerging markets", International Journal of Emerging Markets, Vol. 9 No. 1, pp. 11-32. https://doi.org/10.1108/IJoEM-09-2013-0143