The role of multinational corporations in sustainable development

Transcription

1 UNITED NATIONS ASSOCIATION OF SERBIA BELGRADE INTERNATIONAL MODEL UNITED NATIONS BIMUN 2017 Simulation Guide ECONOMIC AND SOCIAL COUNCIL The role of multinational corporations in sustainable development Sustainable development is the pathway to the future we want for all. It offers a framework to generate economic growth, achieve social justice, exercise environmental stewardship and strengthen governance. Ban Ki-moon In a period of globalization, privatization and market liberalization, MNCs are seen as one of the most important factors to shape the future of the world. However, those factors have brought not only an increase in wealth but also a detrimental effect on the environment caused by the commercial activities of MNCs. According to the UN, to achieve sustainable development world needs to fulfil 17 UN Sustainable Development Goals (SDGs). Five of those goals, namely: 3) Good health and well-being, 6) Clean water and sanitation, 13) Climate action, 14) Life bellow water, and 15) Life on land are directly at risk because of the pollution created by MNCs in third world states. Since many MNCs are in a vast number of states, and use cheap labour in one state to make goods in order to sell the goods in other states, it has created a situation where many MNCs are wealthier than a majority of the world s nation-states. One example of these MNCs is Wal-Mart. Wal-Mart revolutionized the way that business is done and changed the standard business model. Before Wal-Mart, companies ordered from manufacturers and sold the product in their stores. Wal-Mart decided to start manufacturing a lot of their own products and paying other companies for the rights to put their product name on the products and goods that they sell. In doing this, it necessitated the need for manufacturers to lessen the cost of their products and to look for cheaper ways to manufacture their products; then created the demand to move their manufacturing plants into the developing world. Quite often, this has had a devastating effect on the environment and resources within the developing world, resulting in many naysayers against MNCs and globalization.

2 Third world states offer cheap labour because they desperately need jobs to generate economic development. But, along with the cheap labour, developing third world states also offer looser environmental regulations. Generally, the rules of developed states are much stricter than those of developing states. It has been persistently alleged that most MNCs of home developed states conduct their operations in host developing states because they offer lax environmental standards. Being legally accountable only to their shareholders, MNCs do not have any legal obligation in incorporating the host society s interests into their activities. This is why MNCs see pollution havens in developing states. Due to the high environmental standards in developed states, MNCs systematically shift their environmentally noxious operations to developing states. For example, they contribute greatly to the environmental degradation and deforestation in Asia-Pacific and Africa. In Indonesia, Sinar Mas and Raja Garuda Mas are examples of two of the largest pulp and mills producers. Both established holding companies, Asia Pulp and Paper Co. Ltd. (APP) and Asia Pacific Resources International, Ltd. (APRIL) respectively, and utilized Riau province as their main operation sites. It is estimated that some 170,000 hectares of natural forests in the province have been cleared for pulp and mills production. Ironically, this is continuing today, with elephant and tiger habitats being destroyed, and the land is left barren. In Nigeria, MNCs have taken highly toxic waste from European tanneries and pharmaceutical companies. This is done by workers who wear no more than shorts, and take the barrels of polychlorinated biphenyls and dumping them in residential areas. This has caused high cancer rates in this region. The Niger Delta has had over 6.4 million litres of oil spilled into it over the last 30 years. This delta region has rainforests, mangrove habitats, and fragile wetlands. Babies who are fed milk supplements from areas with polluted water are 14 times more likely to die from diarrhoea over an infant who is fed natural breast milk. Exploitation of natural resources leads to other problems as well. Deforestation can lead to soil erosion and desertification, as well as the pollution of water supplies. This can cause the soil to no longer be able to grow food crops. Also, this can lead to the loss of indigenous people s homeland as forests are over logged and flooded. This can be seen in the Amazon Basin.

3 In China today approximately 700 million people over half of the population consume drinking water contaminated with levels of animal and human excreta that exceed maximum permissible levels by as much as 86% in rural areas and 28% in urban areas. In a number of studies, pollutants released by township-village industrial enterprises (TVIE) have been linked to adverse health effects. In China, liver and stomach cancer deaths have doubled since the 1970s, and are now the leading causes of cancer mortality in rural China. China now has the highest liver cancer death rate in the world. When TVIEs in more polluted areas are examined, they show a general increase in cancer mortality. In short, in the process of developing nations trying to get out of poverty they have provided cheap labour and allowed many MNCs to come in and have lax regulations in return for providing jobs for their population. Many MNCs have not been responsible towards the resources and environment thus negatively impacting the achievement of sustainable development in the developing world. Does it make right for MNCs to take advantage from developing states just because they might not have the same environmental regulations like developed states? Do common international rules and regulations need to be established to prevent this from happening? Finally established in 2015, one of the Sustainable Development Goals determined by the United Nations was to reduce inequality, thus potentially reducing outcome inequalities, sustaining income growth and empowering social, economic and political inclusion of all. Moreover, evidence from developing countries showed that income inequality increased by 11 per cent in developing countries between 1990 and Thereby, one of the paramount issues in overcoming this problem was reducing income inequality. Nonetheless, statistics have shown that the richest 10% of the world s population were earning up to 40% of the total global income, whilst the poorest 10% were earning not more than 6%. Apart from that, another issue presented was finding the way to overcome sex, race and ethnicity discrimination, as well as provide coherent regulation and policies in order to monitor the path towards achieving greater equality. However, in order to meet the targets adopted within the goal, we must embrace and become aware of the defining challenge of our time: the role multinational corporations play when it comes to reducing inequality. Moreover, one of the greater challenges MNCs present upon discussing their battle against national companies is their indubitable grand power over the labour and market force. It has been causing even greater disparities among countries, with only three countries being ahead of the United States when it comes to inequality: Chile, Mexico and Turkey. Due to MNCs succeeding in reducing their taxes through using bribery as a method of obtaining support and strength from the government, they are succeeding in getting the easier end when it comes to getting out on the market. Not having to go through the same procedure as the national companies, they earn more profit and obtain more power primarily on a national level, thus resulting in the money influx going directly in the MNC investing countries. This directly deteriorates the power national and local companies are able to obtain, not being able to fight against the greater force on the market. Moreover, it is causing national companies to shut down their business, or keep reducing workers wages up until the point it becomes unbearable and the working force transfers into working for the MNC present in the country. Furthermore, the neoliberal economic policies of international institutions (e.g. IMF, World Bank, WTO) are being imposed on developing countries, making it impossible to fight back on the market and directly infringing on the national sovereignty. This gives

4 unprecedented access to resources, cheap land and labor force. Apart from that, often by holding power over national and local governments through a monopoly on intellectual and technological property, MNCs have a significant impact on government policy through the threat of market withdrawal. In spite of multinational corporations being possible allies of national companies and in the position to empower developing countries, it seems as though they are creating a contrary effect to their progress. The society has come to the time where a vibrant economy and the installed democratic system require social investment, healthy and educated workforce and self-centered communities, where MNCs are failing in promoting and involving lifelong knowledge, thus leaving the national industry in a fragile state. Apart from looking it from a national framework perspective, it goes without saying that this results in only a few of the country holding all of the power in the global economy, thus increasing the inequality rates and going against the international agreements made. Nevertheless, if the international community were to combat the negative influence of MNCs and transmit it into a positive effect, it would have to encourage development assistance and FDI to regions where it was most necessary through ensuring benefits to MNCs and them providing support to local and national companies. The question remains what benefit would the MNCs and its stakeholders need to have in order to contribute to strengthening and advocating for local and national institutions by providing them the necessary equipment as well as empower their labour and market force? As mentioned above, economic sustainability is a prerequisite for achieving sustainable development. The United Nations recognized that by setting Sustainable Development Goals such as: 1) No poverty, 2) Zero hunger, 8) Decent work and economic growth, and 12) Responsible consumption and production. Unfortunately, achievement of these goals is sometimes endangered by MNCs. Their actions in third world states are creating a lot of the current problems in this issue area because the fundamental role of business is to make a profit for its shareholders and not to sacrifice their wellbeing for social justice and wellbeing of the world population. Lack of Corporate Social Responsibility (CSR) within MNCs can be a main cause of their negative effects on economic issues. If the emphasis is placed on MNCs negative impact on poverty and economic development in general, issues that have been raised include the following. Foreign direct investment is highly concentrated in only a few developing states, usually in particular sectors, and establishes only limited linkages; it can even crowd out local competitors that cannot meet standards and/or for whom lending on local markets becomes more expensive. Often mentioned are also that MNCs merely create low-wage jobs, increase inequality in societies, and contribute to the so-called Americanization of lifestyles. MNCs often abuse their powerful political and economic position in the host state and internationally. It is sometimes also costly for host states to attract MNCs, money they could have spent otherwise. For instance, developing nation governments are required to open their economies to compete with each other and

5 with more powerful and established industrialized nations. To attract investment, poor states enter a spiraling race to the bottom to see who can provide lower standards, reduced wages and cheaper resources. This has increased poverty and inequality for most people. It also forms a backbone to what we today call globalization. As a result, it maintains the historic unequal rules of trade. In recent years developing states are increasingly trying to attract as much foreign direct investment as possible. FDI is dominated by MNCs. Developing states compete for foreign investors because their governments take for granted that FDI is a key instrument to foster growth and competitiveness which would eradicate poverty. However, even though the total amount of FDI flowing into developing states rose, the benefits have been distributed unevenly. This forms one of the main directions of critique concerning the contribution of FDI to poverty reduction. The United Nations acknowledge that poor developing states hardly benefited from rising FDI and that the central challenge is to attract FDI to these states. In terms of destinations for FDI over the past three decades, there only have been a few success stories. Since 1970, just ten developing states are responsible for the attraction of two thirds of the inflows of FDI into the developing world, namely Argentina, Brazil, China, Hong Kong, Indonesia, Malaysia, Mexico, Saudi Arabia, Singapore and Thailand. Moreover, these highly concentrated FDI flows occurred during a time when basically all developing states rapidly adopted liberal policies to attract as much FDI as possible. Why then did the flow of FDI limit itself to these few developing states? Foreign direct investors are predominantly attracted by market size, considering the fact that the shared characteristic of the mentioned states is the large domestic market. Furthermore, the poorest developing states have been largely ignored by MNCs, probably because of their small domestic markets and low per capita incomes. Research on FDI in least developed states shows that the level of FDI to the major oil-producing states continued to be high after a striking rise in The report shows that flows to Angola and Sudan even doubled. However, average developing states remain the smallest recipients of FDI, and their shares in world and developing-state FDI inflows are no more than 2% and 5% respectively. Even when FDI ends up in small developing state that does not necessarily mean economic development. The money that MNCs invest in developing states seems welcome, but the question is whether it results in a net gain for a state s economy. MNCs can't be relied on to stay in a state, as they tend to be less interested in long-term sustainable operations in any one state. They are more concerned about their own profit than with the welfare of a host country. This sometimes results in the closing down of an entire operation, an action which can have a devastating economic impact. The priorities of a MNC are unlikely to coincide with those of local people. MNCs have been powerful enough to lead industrialisation in some states but there is evidence that such MNC-led industrialisation in several Asian states has been achieved at a severe cost to agricultural and rural development. Governments have tended to keep farm-gate prices low, both to save money for industrialisation and to enable workers in new export-oriented factories to have cheap food and not demand high wages. People had to be attracted to work in industry. In Taiwan, for example, the government has intentionally held down peasants incomes so as to transfer these people into MNCs industries. The FDI inflows are fairly high for such states, but the enclave character of FDI in commodity-related activities renders it unlikely that FDI contributes significantly to economic growth and poverty alleviation. Low wages are one of the reasons why MNCs are attracted to developing states. The hope that they can create jobs is one of the reasons why governments try to attract the corporations. But the majority of jobs in such enterprises are low-skilled, low-paid production and assembly jobs. They tend to be highly specialised, with a greater division of labour. Advanced technology is used, on mass production lines. A worker will perform a

6 small, specialised task of a large operation. This may be good for profits, but such tasks are likely to be monotonous and effectively turn workers into little more than the arm of a machine. MNCs sometimes, but by no means always, pay higher wages than local firms. But for people who work for MNCs there is a serious downside. Their negotiating rights are likely to be more restricted. MNCs, unlike trade unions, can operate on a global basis so that each union in one piece of a MNC ends up negotiating with the whole MNC. For workers, the feeling of being a small cog in a large wheel is not unique to large corporations, but is shown in its extreme form by the large MNCs. 1 According to an International Labour Organisation (ILO) report, the role of TNCs in job creation is at best marginal. It points out that if MNC employment is growing at all, it is due to acquisitions and mergers rather than to new employment opportunities. A new MNCowned factory may create jobs but at the cost of existing jobs in locally owned factories because MNCs look for experienced workers. They look for experienced workers because they do not want to spend money on their trainings and education and a net gain of jobs may not result. While FDI has created some 12 million jobs in developing states, many of the newly created jobs have displaced workers in competing domestic industries. Also, MNCs avoid billions of dollars of tax through tax havens, transfer pricing and many other policies both legal and illegal. The much-needed money would have helped developing (and developed) states provide important social services for their populations. Some tax avoidance, regardless of how morally objectionable it may be to some people, is perfectly legal, and the MNCs are able to hide away trillions of dollars, resulting in massive losses of tax revenues for cash-strapped governments who then burden ordinary citizens further with austerity measures during economic crisis, for example. As the global financial crisis has affected many states, tackling tax avoidance would help target those more likely to have contributed to the problem while avoid many unnecessary austerity measures that hit the poorest so hard. But despite rhetoric stating otherwise, it does not seem to high on the agenda of many governments as one might think. According to dependency theory, MNCs are the organizational embodiment of international capital whose operations are seen as the quintessential example of capital domination by the centre (rich states) on the periphery and semi-periphery (poor and intermediate states, respectively). Proponents of dependency theory assert that these powerful enterprises cause distortions in the national economy by pushing domestic producers out of the local economy while absorbing local capital. Aside from perversely affecting developmental patterns, MNCs are also deemed responsible for undermining the national autonomy of underdeveloped states. If state leaders should decide to pursue nationalistic policies of market closure, MNCs would not only exert pressure from abroad but also from within domestic society. According to dependency theory, MNCs have specialized skills and resources that less developed countries may not possess. These multinational enterprises have at their disposal enormous organizational resources, capital and technology, and managerial expertise that they can deploy to pursue their interests after entering a host economy. In short, superior capabilities give MNCs greater bargaining leverage when dealing with host governments. As a consequence, underdeveloped states cannot negotiate on equal terms with these powerful multinational enterprises and ultimately become hostages to their interests. 1. Big Business, Poor Peoples: The Impact of Transnational Corporations on the World's Poor; John Madeley

7 All in all, MNCs are driven by the desire for profit and they often lack Corporate Social Responsibility (CSR). This results in spread of poverty and hunger and prevents decent work and economic growth and responsible consumption and production thus directly endangering the achievement of Sustainable Development Goals. Therefore, the task in front of the member states of the UN ECOSOC is to decide what role MNCs can have in achieving economic sustainability and sustainable development while still making profit and fulfilling its main purpose. Infrastructure is essential to the operation of the society enterprise, but due to the societies upbrought by these, it is frequently insufficient or suboptimal for industrial development. Moreover, many developing countries still lack the very basics of good infrastructure like roads, railways, communication technologies, etc. further limiting any prospects for successful economic growth with industrialization at its center. It is important to note that industrialization itself had been one of the major development goals of the UN since the 60; The first decade of development, where it was stated for the first time that industrialization is what drives economic growth. It continues to be of great importance today, when Foreign Direct investment made by MNC represent the most sought after resources for economic growth. FDI and MNCs are believed to be the source of industrial and economic growth as well as of employment and innovation. Their presence in a country is generally seen as positive. However, they rarely have the expected results. Many studies have shown that globalization represented trough FDI doesn t bring forward the expected growth in employment nor does the overall know-how in the country significantly raise due to the presence of the MNC. The expected outcomes are lacking for several reasons, the major one being that the advanced technologies and knowledge remain within the MNC, never to be used by the local companies. Local working force tends to only be employed at the technologically lower levels, where there is no significant need of higher education, thereby staying uneducated and doing simple, repetitive, manual jobs for extremely low pay. MNC brings into the country their own, already educated experts, keeping the companies know-how within itself and high-income countries. As such, the expected effect of spreading innovation and raising countries technological competences remains insignificant. Besides having negative impacts on sustainable development which are outlined above, MNCs can also help eradicate poverty and boost economic development thus directly fostering the achievement of sustainable development by helping third world states to

8 achieve some Sustainable Development Goals such as: 1) No poverty, 2) Zero hunger, 8) Decent work and economic growth, and 12) Responsible consumption and production. Due to the growth of globalization worldwide and a more liberal approach to international politics, MNCs have been able to go into developing nations and create jobs. A majority of jobs created in the developing world are manufacturing and service jobs from MNCs. 120 million jobs are created by MNCs in the developing world which is about 3% of the world s workforce. When manufacturing jobs are created, there also needs to be an infrastructure in the area of the company. Hospitals are needed in order to maintain a healthy workforce, also schools are needed as well as airports, freeways, railway systems, and water ports. All are essential in a developing or developed society. Quite often, states do not have the financial means to build this infrastructure so MNCs use FDI in order to finance these necessities. MNCs tend to be large institutions and, as a group, are a predominant force in worldwide economic development. For example, $2.6 trillion sales reported by the 100 largest MNCs in the world are larger than the $2.1 trillion Gross National Product of all of the non-oil exporting developing states. It is estimated that the leading 4,000 MNCs account for about 60 percent of total worldwide market production and are responsible for about half of world trade. As for job creation, various global estimates suggest that MNCs account for at least 25 percent of gross job creation throughout the world. MNCs are generally major corporations in their states of origin and even larger relative factors in third world states where they often dominate industrial and agricultural sectors. The contribution of MNCs to the economic growth of the third world is unquestioned. There is a number of areas important to economic development where MNCs have a greater capability than host governments. The MNCs' ability to develop and apply technology and to infuse managerial skills is superior. Their access to capital markets for third world operations, and ability to analyse economic potential, have all spilled over into the economies where these firms operate. In order to fully understand the relationship between FDI and host country development, one must consider various mechanisms through which MNCs can have an effect on development. In assessing the effects of FDI on economic development and poverty reduction it is important to draw a distinction between its direct and indirect impacts. It also should be distinguished between MNCs that strive passively and actively to contribute to sustainable development. Multinational investments can stimulate competition in developing states and improve the allocation of resources. Active effects are more connected to Corporate Social Responsibility. Direct active effects encompass the employment, health and safety, and environmental actions of a multinational at its subsidiaries. Indirect active effects function through philanthropy and community investments, or through obliging suppliers to adhere to social and environmental standards as well. There are two reasons why the involvement of MNCs in the poor world is crucial to poverty reduction. First, the reduction of poverty depends on the growth of business. In order to flourish, local business needs access to the world economy. MNCs facilitate the access to markets, credit, and technology. The second reason is more controversial. Poverty reduction requires systemic change, and MNCs are the world s most efficient and sustainable engines of change. Furthermore, MNCs enable lower average costs and prices for consumers. This is particularly important in industries with very high fixed costs, such as car manufacture and airlines. Also, large profits of MNCs can be used for research and development. For example, oil exploration is costly and risky; this could only be undertaken by a large firm with significant profit and resources. It is similar for drug manufacturers.

9 The economic role of MNCs is simply to channel physical and financial capital to states with capital shortages. As a consequence, wealth is created, which directly creates new jobs. New tax revenues from MNC generated income allow developing states to improve their infrastructures and to strengthen their human capital. By improving the efficiency of capital flows, MNCs reduce world poverty levels and provide a positive effect that is consistent with the United Nations mission to achieve sustainable development. It follows that a supporting role for the UN would be to motivate developing states to provide a suitable environment, both economic and physical, that would in turn attract FDI and MNCs. States lacking FDI, provided by the MNCs, have common characteristics: their economies are heavily dependent on government regulations, as well as being controlled by state owned monopolies over the market. As a consequence, these nations are experiencing extreme rates of poverty, repressed human rights, as well as excessive economic damage. So, question which is raised is how can positive effects of MNCs on achieving economic sustainability be maximised. MNCs have a key role to play in economic issues. Specifically, corporations can be most effective in helping the poor by investing in local and global communities on a long-term basis rather than by acting as charities or aid agencies. However, to do so, corporations must restore the public's trust. They must demonstrate that their presence, particularly in poorer states and the emerging market economies, is a source of human progress. They must demonstrate that globalisation is not a zero-sum game in which the rich get richer and the poor get poorer. In this regard, those who argue against globalisation are denying 1.5 billion people, who live in absolute poverty, the means of escape. To do nothing is morally unacceptable. The world is watching the corporate sector. This is a moment of great challenge, but also of great opportunity because if corporations can demonstrate that they are agents of progress, they can remove the doubts and renew the trust that is essential for both prosperity and economic security. The importance of research and innovation continues to grow in today s economy, but just as fast is the growth of the expenses necessary for such undertakings and very few companies have the required recourses for such high-risk business undertakings. As consequence to the growing importance of knowledge and its costs, MNC have taken the lead as sources of new ideas and technological development in the high-income countries, especially those like Japan who lack the high military involvement in science typical for USA. Although MNC and FDI have rarely brought forward the necessary technological improvement in developing countries and also lacked in positive effects on education and innovation, there had been a couple of bright examples of great positive impact of those in the countries development, which further establishes MNC as source of economic growth. One such example is South Korea which has in only 20 years become one of the world s most influential and relevant economies. This country had modeled its own development after that of Japan, but with considerably higher importance of FDI. In only 20 years, this country has gone from the majorly agricultural economy with barely any hints of industry present, to one of the

10 strongest economies in the world and as such should be noted as a good example for industrial and economic strategies for the rest of the developing world. Their carefully planned policies for industrial development had helped them reap the benefits of the globalization and its representatives, the MNC. Trough strict and closely followed rules, this country had managed to raise the education level of the population and bring in major FDI which had helped raise the technological level in its industry. Their success is attributed to successful control of the flow of the FDI and, more importantly, to the enforced joint venture strategy that required from most of foreign companies to invest together with a local one in order to operate in the country. This policy has allowed local companies access to know-how of MNC, which lead to its expansion through the entire economy. The MNC can also have a major effect on the educational levels of a population. In today's economy, continues improvement in knowledge and skills is a necessity and many companies have programs meant to improve the skill set of their employees. If such resources were to be as present in the subsidiaries present in developing countries as they are in developed countries where MNC are present, the overall educational level would raise significantly in those countries. This would also raise the possibilities of innovation and research facilities in these countries producing a significant product which would then further encourage such investments. With geder equality being one of the most important topics of the era, it is inevitable to say that the enhancement and improvement towards achieving gender equality helps drive economic growth and development in every single sphere across the globe. Significant progress has been made over the years within this topic in 2016, more girls are in schools, gender parity in primary education in most parts of the region has been achieved, but also 41% of paid workers outside of agriculture are women. However, despite finally acknowledging and undertaking measures on the matter, there is still along way ahead of the international community in order to achieve this goal, with inequalities in the labour market, sexual violence and exploitation, as well as unequal division of unpaid care and domestic work undergoing. Nonetheless, although not currently being active, grand potential lies in multinational corporations and their capacity to influence the international community on this topic. Either upon talking about employment, international trade, environmental sustainability, stability and growth of domestic production, or even transfer of knowledge, MNCs acquire potential to influence women s empowerment in developing and emerging countries. The reason behind this potential influence is the wide audience on a multicultural level every single multinational corporation endorses. Nonetheless, by setting an example on earnings, labour-force participation, wage differentials as well as asset accumulation, MNCs would serve as a perfect advocate and role-

11 model for the regional, national and local companies behavior in terms of achieving gender equality through economic empowerment. The ground indicator showing that change within the field is possible is more presence of women within textile and footwear industries, horticulture, as well as consumer goods industries. Nonetheless, by reaching equal rights to economic resources (e.g. land, property), as well as universal access to sexual and reproductive health with having MNCs as the drivers of change, not only would they contribute to achieving one of the 17 Sustainable Development Goals, but the perception of their influence would swiftly and adequately change. With mere changes in the policies of MNCs actions and structures and, for example, incorporating maternity and paternity leave within their working force, MNCs would succeed in encouraging women leaders to help strengthen policies for greater gender equality. Nonetheless, with women in the labour market still earning 24% less than men globally, it is necessary to undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws. In order to tackle this issue adequately, the meeting of the high-level political forum on sustainable development in 2017 with the theme "Eradicating poverty and promoting prosperity in a changing world" convened under the auspices of the Economic and Social Council, held in between July th will be finding a way to combat the matter of ending all forms of discrimination against all women and girls everywhere. According to various scholars, MNC have contributed and can continue to contribute to the development of the SDGs. The way these corporations may contribute to economic development differs from the provision of affordable products and creating jobs to fostering economic and trade growth, to promoting gender equality rights. While there are certainly positive aspect the introduction of MNCs brings to countries, the concerning questions still remain. What can be done in order to assure that developing states do not need to choose between economic development created by MNCs and environmental protection endangered by MNCs? How can ECOSOC help in protecting UN SDGs from negative influence by MNCs? Should there be a consistency in regards to environmental practices around the world? Copyright BIMUN UNA-Serbia, 2016