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Assess whether legal controls are the most effective way of controlling the actions of multinational companies in countries, such as Brazil. - Edexcel - A-Level Business - Question 2 - 2022 - Paper 1
Question 2
Assess whether legal controls are the most effective way of controlling the actions of multinational companies in countries, such as Brazil.
Worked Solution & Example Answer:Assess whether legal controls are the most effective way of controlling the actions of multinational companies in countries, such as Brazil. - Edexcel - A-Level Business - Question 2 - 2022 - Paper 1
Step 1
Legal controls include the use of legislation and government policies.
Answer
Legal controls are vital for regulating multinational corporations (MNCs). They encompass laws and regulations that guide how businesses operate within a country. In Brazil, legislation can restrict advertisements of unhealthy products and set standards for food safety. Such controls help mitigate the negative impacts of unhealthy consumption patterns promoted by MNCs, like KFC and Pepsi, which are known to advertise sugary and fatty foods.
Step 2
The Brazilian government has used legal controls to its advantage.
Answer
By implementing stringent advertising regulations, the Brazilian government can influence how MNCs market their products. Such measures not only protect public health but also compel MNCs to reformulate their products to meet local health standards, ensuring consumer safety. This shows the potential effectiveness of legal controls when properly enforced.
Step 3
Potential counterbalance to legal controls.
Answer
While legal controls can be impactful, their effectiveness often hinges on enforcement. An economy like Brazil’s faces challenges, such as a lack of resources for proper enforcement, necessitating robust support systems. In instances where regulations are loosely applied, MNCs might exploit loopholes, thereby diminishing the intended effects of these controls.
Step 4
Legal controls alone may not be sufficient.
Answer
To truly impact MNC behavior, additional measures may be necessary. For instance, public pressure, aided by social media campaigns against unhealthy practices, can complement legal frameworks. This presents a multi-faceted approach to improving corporate responsibility, demonstrating that legal controls, while essential, may need support from civil society and consumer advocacy.
Step 5
Conclusion.
Answer
In conclusion, while legal controls are crucial in managing MNC actions, they should not be viewed as the sole solution. A combination of effective legislation, stringent enforcement, and societal engagement can lead to more comprehensive and meaningful outcomes in curbing harmful practices of multinational corporations in Brazil and beyond.