Globalisation in Industrial and Engineering Fields
Management Essentials for Health and Safety (U22223)
Assignment 1 Critical Essay
Stephen Glaister
Introduction:
Globalisation has steered traditional industries into operating global production networks in poor countries with undefined health and safety policy. During the past decades, these countries have seen rapid economic and industrial development due to the implementation of weak policies. This has made leading industries take advantage of less stringent health, safety and environmental controls and procedures. In general, most developing countries have undervalued health and safety regulation with the ultimate aim of attracting new investment (Raj-Reichert, 2013). There has been a growth in health and safety implications in Asian states such as India and China. This essay critically discusses legal, moral and ethical considerations for an organisation in a western economy when it contemplates outsourcing potentially highly hazardous activities to a developing nation where the legal and management controls may be of a lower standard (Chan, 2003). The essay starts with an analysis on the western and developing economies and industries. This is through analysing the composition of industries, industrialisation and globalisation and the economies. The second theme will be based on health and safety law in a national and international context. This is followed by moral and ethical aspects of health and safety management philosophy. Lastly, there is discussion on moral and ethical aspects health and safety development.
Western and developing economies and industries:
The development of industrialised nations started with the industrial revolution in the 1970s. The developed nations started with the heavy industries, engineering. For example, countries such as Britain were seen as the workshop of the world due to the growth of cotton and iron industries. Heavy industries have a high degree of mechanisation and are capital intensive. The industries have high pollution rates and have a negative impact on the environment. In addition, heavy industries have higher risks compared to the rest of the industries. Most of the traditional industries in the developed countries have moved to the developing countries through outsourcing. This includes the engineering and heavy industries which have a great negative health impact. Developing countries have taken hazardous industries with an aim of industrialisation which has led to negative environmental and health impacts (Raj-Reichert, 2013).
Industrialisation and globalisation
Globalisation refers to markets integration in the global economy. This is based on an increase in interconnections in the national economics. Globalisation is common in the commodity markets, financial, capital markets, sports and entertainments. Industrialisation is a term used to refer to the industrial revolution which was witnessed in the 19th century. It is one of the most fundamental transformations in the human history marked by the rise of industrial sector (Weiss, 2002). Countries started using machines in carrying out their work which had previously been done by people. Globalisation and industrialisation are interconnected. This is due to fact that the history of industrialisation shows a gradual globalisation process for the past four centuries. Industrialisation acted as the main impetus to globalisation. Through industrialisation, it was possible for social and political transformation which led to a capitalist society which globalisation is based on (Weiss, 2002).
Through the open door policy, china was able to take advantage of globalisation and become the best outsourcing centre. China has been able to come up with a strong global outsourcing sector. Most of the industries have outsourced their manufacturing to china due to low costs of labour and industrial interconnectedness (O’Rourke, 2003). China has acted as an opportunity for the western firms due to the country large population and expanding economy. The country has the fastest growing economy and has limitless low cost labour and competitive production rates. China plays a very important role in the global manufacturing sector with most of the manufactured products being exported (Lin et al., 2008). The country has gained the top position in the Foreign Direct Investment (FDI). Despite this, the high flow of FDI in the manufacturing sector has led to risks due to poor observance of Workplace Health and Safety (WHS) (Raj-Reichert, 2013).
Economies
Case: Garment manufacturing and silicon hazard in China
With the FDIs flowing to the developing countries, there has been a lot of compromise on health and safety environment. Occupational health and safety is the most vital aspect in the workplace. Most of the industries that have moved to the developing economies in Asia, Africa and South America are associated with health and safety problems. An example is the garment manufacturing in China which is outsourced by major MNCs (Fan, 2015). China has a poor Occupational Health and Safety (OHS) which is based on poor coordination between the ministry responsible, bureaus and departments. A report released from south China province of Guangdong showed that the area was being used to produce about half of the world denim. With the rising trend in the pre-worn look, the denim industry in China has been using the sandblasting technique. This is a process where the denim is distressed through firing of abrasive sand under high pressure. This can be done using a machine or a hose with an air gun. It has been proved that these processes are being done in Chinese denim factories without use of proper safety equipment (Akgun et al., 2008). The outcome can lead to lung diseases such as silicosis which is caused by inhalation of silica dust. In addition, workers in these factories works for long hours without protection hence are exposed to diseases. There are also poor medical check-ups which endangers the employees’ health (Carter, 2012). Sand blasting by multinationals in China is still in use despite the harmful side effects to the workers’ health. This leads to unsafe and unhealthy working environment brought about by international firms (Akgun et al., 2008).
Legal: Health and safety law in a national and international context
Health and safety responsibilities and requirements imposed by law
Based on the International Labour Organisation (ILO), there are set standards which an industry must uphold on occupational safety and health. The ILO conventions are aimed at guiding all countries in ensuring a safe workplace and ensuring that there is management of occupational health and safety programs. These conventions and recommendations on occupational health and safety are only legally binding if the member states ratify them. One of the most important ILO conventions on OHS has gained ratification from 37 out of all 175 member states. ILO employment injury benefits convention has been ratified by only 23 countries. This is a convention that lists the occupational diseases in which a worker is entitled to compensation. WHO has played a major role in OHS through provision of the technical aspects. Despite this, the limited funding has always been an impediment in the implementation of WHS laws by both ILO and WHO (International Labour Organisation, 2017). The high reliance on the international agencies to enforce OHS laws on the developing countries has been inadequate. This is due to fact that developing countries such as China have poor OHS laws and sees it as an exercise for the developed countries (Chan, 2003). Despite committing to several ILO conventions, China national WHS laws are weak and there have been poor enforcement. This is unlike the developed countries such as UK, Australia and USA which have strong domestic labour laws (International Labour Organisation, 2017).
Worldwide influence and impacts of health and safety law
Case: Toys outsourcing in China limitation, benefits and disparities
Despite having global health and safety laws by the ILO, there has been laxity in their implementation especially in the developing countries. An example is China, which has been ignoring workplace health and safety laws in their FDIs. It has been proved that Chinese workers have been losing their lives working in the FDIs due to lack of OHS. China agreed to many of the ILO standards which were enacted in 2002 and also came up with their own standards. China laws calls for employees to be safe in their workplace. Despite this, the laws have not been enforced where economic goals have been given a priority (Chan, 2003). A case in point is the Chinese toys factories which are outsourced from USA. The factories can be considered as sweatshops where workers are paid poorly in poor working conditions. Inside these sweatshops, workers make products for American multinationals such as McDonalds, Mattel and Disney (Barboza, 2008). This has been a result of industrial interconnectedness brought about by globalisation. The main limitations are the fact that developing countries are ready to forego employees’ safety for the sake of profits. These countries lack proper structures on enforcing WHS laws as proposed by ILO. The main benefits are the fact that they provide employment to the citizens and the country is able to gain FDI. In addition, the Americans market is able to gain cheap products from these sweatshops. All this happens at the expense of workers health. There have been death, amputations and illness in the toy factories. Workers are exposed to toxic chemicals hence life threatening diseases (Lin et al., 2008). This is a case that led to lawsuits in America due to workers exploitation and exposure to unsafe working environment.
National and international standards, policy and legislation
There are major differences between developed and developing countries health and ethics. In developing countries, most of the workers are not covered by occupational health and safety laws. Moreover they lack access to the occupational health services. While some of the developing countries have adopted the international labour standards, they do not enforce them. An example is china which despite adopting ILO standards, it have not been implementing them (Chan, 2003). On the other hand, developed countries have strong OHS and labour laws. An example is the UK and USA. In the UK, Health and Safety Executive (HSE) have been working with the international bodies and other nations to enhance OHS. This includes developing, reviewing and negotiation on the international labour laws, safety codes and OHS. The country is well represented in various labour forums internationally. Developed countries are able to fully implement ILO and WHO standards. Despite this, when developed countries outsource, there have been cases where morals and ethics are lost. This is through investing in countries such as China which have questionable labour relations and environmental laws.
Moral and Ethical: Health and safety management philosophy
Evolution and background to health and safety management
Case: China and Australia mining industry
The evolution of health and safety management over the past 60 years has been caused by the social, political, economic and technological changes. Since the creation of the ILO in 1919, the protection of workers against sickness and injury related to their workplaces has been a priority. In fact, over 80% of the ILO instruments are based on ensuring occupational health and safety (International Labour Organisation, 2017). The management of health and safety has been improving to cover the social security, women, children on the issues of health and safety. This is especially in the developed countries with the developing countries lagging behind. A comparison between China and Australia mining industries gives insight on the evolution and background to health and safety management in developing and developed countries. This is due to accidents which can lead to death, injury or loss of property. In China, mining related fatalities accounted for about 10% of workplace fatalities in 2006. This was 1000 times higher than developed countries such as Australia or USA. The main problem with Chinese health and safety at workplace is poor adoption of OHS laws (Wu et al., 2011). The country also suffers from inefficient management of workplace health and safety. Research shows that most of the workplace fatalities in china can be avoided through proper management of workplace health and safety. This is a sharp contrast to the developed countries where there is proper management of workplace health and safety. While Australia has been able to adopt and evolve with the WHS, China has been lagging behind (Lin et al., 2008). For example, Australia was able to adopt ILO conventions early and integrate them with their national health and safety laws. Australia has been more responsible in their workers’ health in the workplace compared to china (Donoghue, 2004).
Health and safety management control models- ISO 18001/45001, and Hazardous Installations Directorate (HID) regulatory model
Over the past 20 years, there have been increases in outsourcing activities. Research has shown that outsourcing in most cases leads to adverse impacts on the OHS (O’Rourke, 2003). This is especially due to fact that most of the outsourced countries have poor workplace health and safety laws exposing their workers to hazards. Hazardous waste management is risky due to financial, regulatory and safety requirements. This has led to most of the companies dealing with hazardous wastes to outsource in countries with less strict health and safety laws. Hazardous Installations Directorate (HID) has been dealing with regulation of major hazard industries which plays an essential role in everyday life. These are industries whose failure can lead to extensive damage to public and endanger workers and public health. The HID utilises a regulatory to regulate associated hazards and manage them (HSE, 2016b). OH&S 18001 became ISO 45001 in 2016. This helped in making it an international standard rather than a UK standard hence widening its scope. Based on the ISO/DIS 45001 Clause 8.3, it has become possible for the standard to control processes which are based on outsourcing. This ensures that outsourced processes which affect health and safety are well controlled. The firms are expected to minimise the health and safety impacts of their outsourced services (Batalas, 2014a). Companies outsourcing their services can no longer ignore health and safety of their outsourced processes. They must consider the risks involved and means to control them.
Health and safety implementation and communication
The world richest countries have been outsourcing hazardous materials, products and activities from the developing countries. This has led to a rising hazards in the developing countries. Most of the developing countries have been welcoming the move with disregard to the health and safety impacts. An example is China and India where hazardous industries have been set up with poor health and safety regulations (Chan, 2003). Despite this, the process of outsourcing to the developing countries has led to an improvement in social economic. There has been intense lobbying for MNCs outsourcing hazardous materials from the developing countries to observe health and safety. This has led to countries such as UK using the ISO 45001 and HID to ensure MNCs are responsible (HSE, 2016b). WHO have been advocating and communicating with the responsible governments to uphold health and safety when outsourcing hazardous materials.
Moral and Ethical: Health and safety development
Organisational Corporate Social Responsibility report
Case: Apple and Sinopec CSR comparisons
The concept of CSR, its meanings and practices varies based on the country cultural, political, social, economic and existing institutional framework. In China, companies have a different type of CSR reporting compared to western companies. This can be well illustrated by a comparison of CSR for Apple Computers of USA with Sinopec of China. Sinopec is a large integrated energy company in china. The corporation business ranges from oil exploration to producing and trading in gas and petroleum. Sinopec has always looked at CSR as a tool for business growth for the group. The company has worked to ensure that while looking for the profits, they do not compromise on the environment. The firm has worked hard to ensure that there is a reduction in harmful gas discharges. This is one of the most ethical Chinese organisations. Sinopec has a low carbon development strategy which has helped on reducing CO2 emissions. Despite this, the firm lags behind in OHS compared to Western countries counterparts (Pegg, 2012).
Apple success been attributed to their ability to meet stakeholders needs. Despite this, Apple strategy is different from Sinopec in some ways. For example, the level of stakeholders’ engagement in Apple is higher than for Sinopec. The company have prioritised their customers by coming up with quality products. Employees at apple are well catered for through appropriate compensation and safe working environment. The employees working conditions are safe and in most cases flexible. This leads to a work life balance that cannot be obtained in companies such as Sinopec. Through a supplier code of conduct, the company ensures that the supply chain is safe and free from OHS. Despite this, the company have in past faced criticism due to outsourcing in countries with poor workplace health and safety. This is especially due to child labour and sweatshops. A report filed showed that Apple had failed to protect their workers in China. The report showed that workers were standing for hours, underage workers and poor OHS at the Petagron factories in Shanghai (Chan, Pun & Selden, 2013).
Industrial and organisational health and safety climates and cultures (differences, benefits and downfalls)
Safety climate refers to the value given to safety in a given organisation. The health and safety climate involves values attitudes and patterns showed by an organisation in respect to health and safety. The 1986 Chernobyl disaster led to the rise of safety culture. In addition, organisation cultures have an impact on safety. This is where the existing safety culture determines the approach taken to ensure health and safety of workers. Safety culture refers to the organisation climate for safety and how it impacts behaviours in the organisation. Safety culture and climate have continued to evolve and at the moment, they both ensure safety in modern day organisations. Through the safety culture, individual values, attitudes, competencies and behaviour helps in determining the level of commitment in safety management. Safety climate is based on the existing policies, practices and procedures which help in safety. Organisation with good safety culture and climate are able to offer a safe work environment. This is through having a positive safety culture to enhance safety performance (Mearns & Flin, 1999).
Health and safety training, knowledge and initiatives (health and safety schemes introduced in developing countries)
With globalisation, the rise of FDI in the developing countries has led to a concern on health and safety. This is due to poor OHS in the developing countries and lack of health and safety laws. As the workplace become more complex and demanding there is need to learn on how to prevent injuries and illness. The developing countries have been lacking awareness, training and specialisation in occupational health and safety. WHO has been calling for occupational health for all to ensure a healthy workplace (Robson et al., 2007). Based on the WHO guidelines, people have rights to have the highest standard of health. There is need to improve on the occupational health and safety with an aim of protecting and promoting livelihoods and improvement of public health. The poorest are the most affected by poor occupational health and safety standards hence the need to improve them. Occupational injury and health increases poverty in developing countries. This calls for the need to train workers on the developing countries on OHS awareness, giving attention to work related health and poverty, regulations. There is need for international stakeholders to formulate new and innovative strategies that will lead to improve on health and safety initiatives (Lund & Marriott, 2011).
Conclusion:
To sum up, globalisation has led to traditional heavy industrial and engineering fields moving towards the developing countries. The traditional industries are at the moment found in most of developing countries located in Asia, South America and Africa. Despite the economic benefits, the move of organisations based in western countries to developing countries has led to occupational and health hazards. This is especially in cases of organisations which have been outsourcing potentially hazardous activities to developing nations where legal and management controls may be of lower standards. Countries such as china have been lowering their legal and management standards with an aim of attracting FDIs. This has negative impacts on employees’ health which is ignored at the expense of profits. ILO and WHO have been working to ensure that workers globally are in a safe work environment. Despite this, countries such as China have failed to implement ILO conventions despite ratifying them. Some of these countries lack national health and safety laws. An example is the case of Chinese toy factories which are owned by American multinationals. In these factories, workers were exposed to hazardous chemicals due to china lack of workplace health and safety laws. Through Hazardous Installations Directorate (HID), it was possible for UK to control the industries dealing with hazardous materials and ensure workers and public safety. This has been enhanced by the ISO 45001 which has catered for health of workers in firms outsourcing hazardous materials. This is through a international approach. There is a difference in CSR between the developing and developed countries. In developing countries, companies such as Apple have a strong CSR in accordance with international laws. This differs with countries such as China where CSR is still developing. There is need to have a safety culture and climate and also ensure that training is done in developing countries. This will ensure that everyone has access to health and safety especially in cases where hazardous materials are outsourced in developing countries.
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