I have been concerned about governance of international business standards. Here are my thoughts:
The article raised issues that will become increasingly significant in defining international commerce and related exchanges. I would dichotomize the issues into human disasters and financial disasters. The human tragedies are those related to life while the financials disasters are those that do not involve life but rather financial plundering, misrepresentation or other criminal activities. I believe that both of these ‘disasters’ will require international governance standards.
My experience has strongly indicated that the nature and complexity of financial and political contacts between nations has increased and will further exponentially increase. These transactions that began as simple import of foreign goods now involve the employment or outsourcing of large skilled labor pools engaged in handling of protected corporate data and private tax, financial and medical information. This evolution in international commerce will require governance in many areas not limited to trade secret protection and personal privacy currently not in place.
The impact on quality and loss of life as you rightly stated is not elevated until a ‘major incident’ occurs. The memory of the December 3, 1984 Bhopal, India disaster caused by Union Carbide that killed approximately 3,800 people and disabling 2,600 others is still etched in my memory. The Bhopal, India case was eventually sent back to India, after several appeals in Manhattan urging that the legal matter should be settled in US. The matter was subsequently not settled until 1989 almost a full five years later due to jurisdiction and other beaurocratic discussions. I can only wonder what became of those families in the interim after loosing their primary income providers without adequate disaster relief.
Nonetheless since I have whined about an issue, I do feel compelled at least to put forth a solution. I believe the International Court of Justice (World Court) with an expanded scope would be the ideal place for the establishing and enforcement of corporate governance. Through its relationship with the United Nations is equipped to deal with human disasters and by its makeup and nature neutral toward countries. The ICJ would collect fines, enforce laws and in doing so hopeful avert future tragedy. Relying on any one countries laws may be suspect as their politics climate changes such as United States and it current views toward the Middle East and Arab issues. Whatever the solution I believe one will need to be found as international trade continues to proliferate and in doing so become increasingly complex.
Sunil Bedi is the Chief Investment Officer of an international venture capital firm based in Silicon Valley California. He can be reached by e-mail at: email@example.com
For a first reaction from D. Navarra see: Making the point on the last post in the Blog “Innovation, Risk and Governance” in the Topics section.