In his book The Ethics of Global Business (2023) Denis Arnold addresses highly important challenges of global business, with a focus on the relations of the powerful transnational corporations (TNCs) to the Base of the Pyramid (BoP)—that is, four billion people below $9.05 per day (107, Figure 7.1)—and the ethical assessment in terms of universal human rights. The author draws on decades of research and his familiarity as a five-year editor of BEQ with a vast part of literature of business ethics. He is also supported by the collaboration of Andrew Valentin and Laura Williams in the last two chapters (7 and 8).

The book is clearly structured and provides needed clarification of key concepts. It engages in a differentiated and balanced process that takes pro and con arguments seriously and elaborates action-oriented solutions for TNCs to respect “the basic human rights” of the people impacted at the BoP.

The first chapter defines the type of companies at stake, namely transnational corporations. It fairly presents and criticizes the shareholder primacy ideology and its instrumental theory of corporate responsibility, meaning that “the exclusive duty or obligation of managers is to promote shareholder, or financier, wealth, regardless of other ethical considerations” (6), while adhering to the law. It carefully describes faulty assumptions regarding institutional frameworks, democratic legitimacy, and regulatory and governance gaps and convincingly argues that the legitimacy of TNCs needs a well-grounded ethical foundation that will be developed in the following chapters.

The second chapter looks for a theoretical framework that is “best suited for determining the obligations TNCs and other business organizations have to those individuals with whom they interact in their global operations” (13). It examines and criticizes the Habermasian deliberative democracy perspective and “the Rawlsian perspective on corporate obligations regarding global justice” (19) and concludes that either perspective, although influential, fails to provide an adequate theoretical account. Instead, a “human rights cosmopolitanism” is proposed.

In the third chapter Arnold explains what human rights cosmopolitanism means. Human rights are understood as “claim rights” in line with Amartya Sen (Reference Sen2009), grounded in human agency and limited to “basic” human rights; this means only those rights that are “necessary for the attainment of other rights and without which it is not possible to live a decent human life” (Shue Reference Shue1996, 18–20). Moreover, he argues for the moral status of TNCs as duty bearers in addition to individuals and states. While an agentically grounded theory and a social contract theory can provide a moral grounding for corporate human rights obligations, political accounts of human rights cannot, because they rely on theoretical or actual agreements among nations and supranational organizations such as the United Nations and the International Labour Organization (cf. Chapter 4).

The fourth chapter is dedicated to the history and explanation of the work and publications of the United Nations regarding business and human rights. Kofi Anan, Secretary General of the United Nations (1997–2006), launched the “Global Compact” in 2000 to react to “the egregious human rights violations alleged by nongovernmental organizations (NGOs)” regarding “oil, gas and mining companies, followed by the food and beverage, apparel and footwear and information technology sector” (45). The Global Compact included nine principles (regarding human rights, labor standards, and environment) plus, one year later, the principle of anti-corruption. Coincidental with the introduction of the Global Compact, a Working Group of the UN elaborated the “Norms on the Responsibilities of Transnational Corporations.” The Norms were endorsed by scores of NGOs, but harshly criticized by leading business organizations. In 2003 the Norms were not promulgated but shelved because they failed to provide a plausible and defensible account. In 2005 Kofi Annan appointed John Ruggie as Special Representative to the Secretary General on the Issue of Human Rights and Transnational Corporations with the mandate to identify “standards of responsibility and accountability of TNCs with regard to human rights” (51). In a long consultation process Ruggie succeeded in elaborating the Tripartite Framework (2008) and the United Nations Guiding Principles on Business and Human Rights (2011). The fourth chapter presents and assesses in detail the Tripartite Framework and adds the text of the Norms in the Appendix, but not the UN Guidelines on Business and Human Rights.

In continuation of the third chapter, the fifth chapter discusses further the moral status of the TNCs as duty bearers and defends it against criticism that still advocates a dualist basic structure of the international system in which only states and individuals—not also corporations—have direct or indirect human rights obligations. Against this Westphalian model, Arnold argues that we live in the post-Westphalian International Order that consists of multiple types of morally responsible actors.

The next three chapters apply the cosmopolitan human rights framework (cf. Chapter 3) to practical problems in international business. The sixth chapter deals with the “sweatshop problem” that “concerns the working conditions and wages in the factories, especially in consumer goods industries, that are at the base of global supply chains” (85). Serious problems pertain to health and safety, disclosing workplace hazards and exploitative wages in countries with clear labor laws but violated by TNCs and in countries with weak or no labor laws. “Employers have the duty to ensure that minimal health and safety conditions are maintained in the workplace” (98). “Employees are entitled to be informed in the hiring process of the workplace hazards” (98). And “the respectful treatment of workers requires that they be paid a weekly wage consistent with basic human dignity” (98).

The seventh chapter, entitled “Corporate Social Responsibility at the Base of the Pyramid” needs two explanations: What is the BoP? And how to conceptualize corporate social responsibility (CSR)? While BoP can be defined in economic terms, CSR is a normative term that needs philosophical clarification and justification which will be provided later on in my critical remarks. As the chapter explains, the world population can be structured in five tiers (cf. Figure 7.1, 107): Tier 1 (on the top of the pyramid) includes 0.3 billion people with more than $60.36 per day. Tier 2 has 1.4 billion people with $9.05–60.36 per day. Tiers 3, 4, and 5 consist of 4 billion people below $9.05 per day and are the BoP. Tier 4 and 5 form “Moderate and Extreme Poverty (MEP)” with 2.6 billion people with less than $2.00 and $1.25 per day, respectively.

Business ventures facing MEP can be exploitation strategies or empowerment strategies. Only empowerment strategies that are also profitable and affordable are acceptable from the business, consumer, and ethical perspective. What that entails must be assessed in a multi-stage process of BoP opportunities, based on human rights, utility, and capabilities. If the assessment is positive, the empowerment strategy meets the requirement of “Ethical Corporate Social Responsibility.” If the criteria of profitability and/or affordability are met, but the criterion of empowerment of MEP is violated, the strategy is guided by “Instrumental Corporate Social Responsibility” and is ethically not acceptable.

Finally, in the eighth chapter, the paradox at the BoP is discussed which struggles for combining and integrating environmental sustainability and market-driven poverty alleviation.

As the succinct description of “The Ethics of Global Business” shows, there are many intriguing issues, results, and perspectives in international business ethics, which deserve to be further explored and discussed. To conclude, a few critical remarks might be made, which can serve as food for thought in the future.

First, in his pioneering studies on human rights, Alan Gewirth (Reference Gewirth1984) distinguishes five components of a claim-right and applies them to human rights: 1) Subject of human rights: all human beings without exception are subjects of these rights, including present and future generations; 2) Object: the content of human rights; 3) Respondent: Those individuals, corporations, states, and other entities who have to answer to the claims to fulfill human rights; 4) The binding nature of human rights: human rights as minimal requirements trump any other claims and do not allow for trade-offs. These requirements can take different forms of obligations: protect, respect, remedy, promote, fulfill; 5) Justification of human rights in contemporary pluralistic societies from different philosophical and theological perspectives. This distinction allows to identify more precisely the component(s) which might be difficult to substantiate and can point to differences and commonalities of scholarly interpretations (e.g, “basic” human rights, protecting distinct from respecting, division of obligations between states and corporations). See critical remarks below.

Second, responsibility is a key term in contemporary ethical thinking (cf. Enderle Reference Enderle2021, 163–77) and should be used as an ethical term with three aspects (i.e., who, for what, and towards whom is one responsible?). What does R mean in CSR? If it means an ethical obligation, it does not make sense to speak of “ethical” CSR. Since CSR can have a dozen different definitions and thus is confusing, it should be avoided and not be used anymore. The Tripartite Framework makes a clear distinction between the “duty” of the state and the “responsibility” of the corporation, which unfortunately is not upheld by Arnold, who defines TNCs as “Duty Bearers,” not as “Bearers of Responsibility.”

Third, my assessment of the Tripartite Framework is more favorable than Arnold’s (see Enderle Reference Enderle2021, 166–77). When a human right is said to express human dignity (as also stated by the Universal Declaration of Human Rights), its content points to an ethical qualification that is more than expressing a business strategy (see Gewirth’s distinction above). But the Framework does not provide a philosophical justification, which is the task of philosophers and business ethicists (not of the SRSG John Ruggie) (e.g., Tiedemann Reference Tiedemann2023). By the way, the long-term impact of the Framework can be noticed in the Corporate Sustainability Due Diligence Directive of the European Union in 2025.

Fourth, the cited literature comprises publications almost exclusively before 2013. It would be helpful to include relevant literature in more recent years.

My critical remarks do not reduce the outstanding quality of this book. It is an exceptional masterpiece in international business ethics that deserves to be widely used in teaching and research in academia as well as in training in TNCs.