Social Responsibility in Transnational Corporations. Is There a Conflict between Rentability and Social Welfare?

The growth & intensity of cross-border financial flows has fostered the influence & power of transnational corporations (TNCs) even vis-a-vis the capacities of the governments that host them. TNCs' activities are usually detrimental to the achievement of long-term sustainable development outcomes in developing countries as well. Because of that, the author argues that there is a need to make TNCs more socially responsible, going beyond mere compliance with the law & promoting a real "corporate social responsibility." In this respect, the influence of civil society groups has a key role not only in the emergence of new issues in the development agenda, but also in the enforcement of TNCs' codes of conduct. The case provided in section four about the anti-Nike campaign is a case in point. However, because such codes of conduct are voluntary & not really enforceable, as "soft law," the author argues that there is still the need to strengthen other actors on the national & international levels, strengthen the mechanisms that control TNC practices & reinforce the coordination of supranational institutions regarding this issue. Adapted from the source document.