Profits and Principles

After the Tiananmen Square massacre, a vigorous international debate erupted, not only about human rights in China, but also about the role of multinational firms. Should corporations do business in China at all? Should corporations take a stand on such issues? Revelations about serious and pervasive human rights violations in Chinese factories raised even more questions about the clash of profits and principles in China.Michael Santoro investigates these and other dilemmas, exploring the democratic values firms impart to their employees and the values firms often compromise in pursuit of profits. His interviews with foreign business executives, Chinese employees of foreign firms, human rights advocates, and foreign consular officials provide a range of perspectives. His examination of business responsibility for human rights in China also serves as a unique framework for assessing the broader social trends—both positive and negative—arising from globalization.Santoro discusses the implications of business activities for U.S. foreign policy and provides practical management advice for business executives operating in China and for those considering doing so. Surprisingly, he finds that President Clinton's program of "comprehensive engagement," which has drawn severe criticism, may in fact create a positive human rights "spin-off." Santoro's "fair-share" theory is a unique and thoughtful effort to draw the line between what moral principles do and do not require of businesses operating in China.

Santoro proposes a framework for understanding the extent and limits of corporate moral responsibility for human rights, focusing primarily on the case of U.S. business in China.... He constructs a fair-share theory of moral responsibility for human rights and applies the fair-share theory of human rights to the sweatshop problem and to the issue of corporate responsibility for government repression of political and religious dissidents., Santoro has made a first effort to address an intractable and increasingly salient cause of human rights violations in developing countries, including China—inhumane business practices—and on this account alone his work is to be appreciated., This book merits much credit for its even-handed, comprehensive approach. Santoro's theoretical investigation is matched and buttressed by his empirical analysis. While an urgent moral call, the book also considers what is and is not a realistic appeal. Finally, while focusing on MNCs, the author also delineates the larger moral web that connects all of human society—CEOs, workers, and consumers alike., The book's common-sense, pragmatic tone serves well to open up a complex and important topic for several communities of readers—policy makers, business people, and the nongovenrmental organization community. Even if few settle for his conclusions, he will have helped by setting out some terms for future debate., Lines have been drawn in the sand, with choices reduced to stark either-ors: human rights or expanded commerce, worker protection or globalization. But to anyone looking for reasoned discussion instead of rhetorical posturing, Santoro's book is a fine place to start. His solidly grounded analysis deserves a wide audience.

Michael Santoro is Assistant Professor in the International Business and Business Environment Department, Rutgers Graduate School of Management. His articles on Asian business have appeared in the International Herald Tribune, the Asian Wall Street Journal, and the South China Morning Post.