ABSTRACT
Glass, china and reputation are easily crack’d and never well mended. Benjamin Franklin (1706-1790), statesman, scientist and writer
Issues of corporate social responsibility (CSR) and business ethics are engaging business more and more – both domestically and internationally. This trend has been accentuated by high-profile breaches of accepted standards of ethical behaviour such as the Enron case where inadequate checks and balances within the firm enabled unethical behaviour to occur, a development made easier by the failure of the external auditor to fulfil its role properly. The quickening of the globalization process has also highlighted CSR issues. For example, there is a time lag between rapid liberalization and the development and implementation of the appropriate regulatory framework. Moreover, international governance in social and environmental areas, both key CSR issues, is underdeveloped and contested, and there is often inadequate or even a complete absence of governance in these areas facing MNEs in developing countries. These examples highlight how rapid globalization can outpace the development of a legal framework to regulate the changing business environment. CSR initiatives can help fill this governance gap.
