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Global Corporation

Let me briefly describe to you a situation that is ongoing in Central America, particularly in Honduras, Costa Rica, and Guatemala. It has to do with a large American Fortune 500 company called H.B. Fuller. They usually make it into the 100 best companies to work for in America, and are spread out all over the world. Fuller makes adhesives, coatings, mastics, glues ... all kinds of sticky stuff.

Many years ago, Fuller wanted to get into Latin America. They first went to Central America and purchased a well-known and highly respected paint company called Tintas Kativo. Kativo had all the same types of equipment needed to make different types of glue, there was a market there for Fuller products, and the match was quite good. Kativo began in Costa Rica and then branched out to the whole of Central America.

The problem came some fifteen or so years ago when, because of poverty, lack of education, war, and other factors, a large number of homeless children seemed to band together in small "families." These street children, lacking in just about every common necessity known to modern man, needed a way to assuage their hunger, to make themselves feel good, and to withstand the crushing poverty that was their lot in life.

So, they turned to huffing. Fuller, the dominant adhesive manufacturer in the area has a product that seems to be the kids' drug of choice. The original formula was very simple. It is a shoe adhesive made with synthetic rubber, a couple of stabilizers, and the highly toxic solvent Toluene to act as the "carrier." The toluene keeps the rubber in liquid form. When it is applied, the solvent flashes off and the other ingredients allow the shoes to stick together. It's a rubber cement. And it smells good. And, it's addictive.

The name of the product in question is Resistol. The kids sniffing this glue are known through the area as Los Resistoleros. Their brains are shot, their lives are gone, they live from day to day by sniffing this glue.

Why do I bring this up? It's because the "global corporation" in question here, for years completely denied that its glue was the one being abused. Here they were, the largest group in the whole area, their good name was tied to this awful situation, and, because of the tax base they provide for the whole area, the good solid jobs they have available, and because the company is politically active or at least was, they have impacted the culture of the area. And, they still don't believe that their product is the one to blame.

I won't go into all the details, but it is clear that there is no good solution to the problem. Fuller did not act well when it was first brought to their attention, they grudgingly made a formula change, and have not admitted any culpability or complicity in the availability of the product to children. The kids still huff glue, their futures are still gone, and the government does not have the funds to help them. It's a bad situation all around.

Question : First, what is the "global corporation?" Should the so-called global corporation be regulated across national borders? Give an example of why or why not, how and by whom.

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Global Corporations or multinational corporations can be defined as companies which expand their operations outside their domestic countries, either to procure raw material and manufacture products at offhore locations offering significant comparative advantage, or set up operations abroad to explore new markets and territories for their products and services. The operations of the global companies span in many countries and are often of a very large scale.

In the recent years, more and more companies are becoming global corporations to take advantage of new emerging markets as well as achieve significant comparative advantage to face the extreme competition which is inevitable in all the industries.

Global Corporations such as Fuller should definately be regulated across their national borders. It is important to hold these companies responsible for their actions at their domestic as well ...

Solution Summary

Global Corporation