Business Ethics and Corporate Governance, Second Edition

THE LIMITS OF VOLUNTARY APPROACH

Kavaljit Singh¹³ lists several inherent weaknesses and operational difficulties in implementing the codes, even if these are framed by organizations such as United Nations, OECD and ILO: (i) These are purely voluntary, legally non-binding codes, the non-compliance of which will not attract any censure or penalty; (ii) In spite of these codes being there for a longtime, very few firms have adopted them and besides, they cover limited areas and sectors. A large number of them remain outside these; (iii) A firm, even while becoming a follower of the code, may choose to implement only one type say, the one on environment, while not complying with other important ones such as labour protection, health and safety; (iv) ...