Rajan Kamalnathan, Vice president of Wal-Mart Ethical standards department, very proudly announced that Wal-Mart has altruistically decided to grant 1.2 mn $ to the HOPE foundation to establish industrial centers for hope. These centers that will be brought up at Bangalore, Chennai, Moradabad, Mumbai and Panipat; are the areas where the large manufacturing base of Wal-Mart suppliers is expected.
The act of philanthropy which has been given the name of Corporate Social Responsibility, makes the lay man wonder why will Wal-Mart, notorious for cutting short on employee’s pay, health care, insurance, pensions and basic rights, do an act of selflessness? The question is why does a company driven by profits actually need to donate money, is it for the sheer concern for their image and are donations actually economically viable?
The answers are basic in nature, Wal-Mart viewsIndia as an untapped market, with easy to bend labour laws and less efficient labour especially in comparison to America. It needs to make an effort to increase the efficacy of future employees, so Wal-Mart has invested in their education and vocational training.Many economists have theorized that the role of the government for the profitable working of private sector is essentially to provide the initial fillip, which is usually by way of deficit financing.
This deficit finance i.e intentionally created excess money is used in public expenditure, and thereby results in better productivity and efficiency. The job of doing this expenditure was of the government as it was considered that no single company would have the resources or the inclination to invest in such social overheads. But what the economists did not foresee was that very soon multi national giants would find this investment easier than the government.
So a company like Wal-Mart, which does not give it’s employees the right to form unions, has over 500 cases of labour rights against it , over 57 wage related law suits, 1371 cases of minor employment, has paid the largest penalties for strom water violations in history ,for over $3.1 million , many other settlements , has paid over 500 mn $ in n the last 7 years(Arkansas Democrat Gazette,11/7/5) ,perhaps is not promoting education or vocational training as a part of HOPE foundation’s hope to see a brighter future.
It is only ensuring a better product out of the people of those specific manufacturing areas so that they can be used in the most effective manner by the unethical practices of Wal-Mart.
Bill Fletcher, director of International labour rights forum recently reported that Wal-Mart as a company has done nothing to improve it labour rights but has been forcing overtime, not giving access to drinking water, and curbing freedom to form association or union compensations. So when Mr. Mark Templer executive director of HOPE says that India enjoys a booming economy, but there is also another India where young people often never go to the school to support their families. And expresses his delight on Wal-Mart’s support to address the needs of inclusive development in India he does not realize that the donations are not a part of social responsibility but selfish realization