With the intensification of global environmental crises and the escalating impact of climate change, many have grown to demand that industrial and business actors—increasingly endowed with immense power and influence—assume greater responsibility in mitigation efforts and sustainable practices. As globalization and interdependence within the global community soar to new heights, it has become increasingly evident that addressing issues of universal concern cannot rest solely on the shoulders of states and governments.
The Tragedy of the Commons: A Dive Into CPR
The common-pool resource (CPR) theory was developed as a counterpoint to the works of Olson (1965) and Hardin (1968), who both proposed that groups of individuals were unlikely to function well as a unit. Hardin, particularly, attributed resource deterioration to the “tragedy of the commons,” where users lack the capability to work together to reap mutually beneficial results. According to the projections made by this “tragedy” model, people would never put the interests of the group before their own, and cooperation, as a result, will not occur to find the needed solutions (Basurto, 2015).Within this context, the “tragedy” comes as a result of the interaction between two factors: an open-access property regime, where collective regulation of access and usage of resources is absent, and a resource type known as a common pool resource (CPR), which holds two key characteristics: non-excludability—it is difficult to physically exclude others from using the CPR—and rivalry—consumption is rivalrous as a rise in consumption by one suggests that there will be less for others(Fleischman et al., 2014; Adams et al., 2001).These two characteristics, put together, make CPR vulnerable to overconsumption and congestion.
Conflicting individual and collective interests drive users to disregard the social costs of their consumption choices, as the group would have to pay for managing the resources: ‘What’s the point of maintaining it if others can freely consume the resource and appropriate my investments?’ For that reason, everyone tries to get the most out of a particular resource, creating the tragedy that Hardin spoke of (Hayes, 2022). On the contrary, the CPR theory contends that individuals can cooperate to resolve the dilemmas with management and that the circumstances of collective actions can be utilized to prevent unrestricted access and management of CPR. When several appropriators rely on a single CPR to generate economic activity, virtually everything they do affects them contemporaneously. When making personal decisions, each individual must consider the choices of others. The underlying reality, therefore, is that the coappropriators live in a lattice of dependency as long as they share a single CPR. Physical dependency does not diminish when adequate institutional procedures are used to oversee and manage the CPR. The interpersonal relationship remains; what changes is the outcome that the appropriators achieve. When appropriators operate autonomously in regard to a CPR generating finite resource units, the overall net benefits they acquire are frequently lower than if their actions were coordinated in some way (Ostrom, 1990).
CPR has developed into a growingly pressing issue amidst the era of globalization, where economic crises challenge the traditional approaches to property management, and the environmental crisis forces the world to develop new approaches to managing natural resources that are depleting very quickly. The idea of CPR offers up new avenues that have only started to be explored in an era defined by rapid environmental depletion and climate crisis, the emergence of the information economy, and new models of governance and production (Jourdain, 2019).
How Industrial and Business Actors Fit in the Picture
The far-reaching consequences of globalization now prompt an increasing number of concerned voices. Multinational corporations (MNCs) are the subject of interest amongst those working to develop new ways to serve the global common good due to their vast economic power, capacity for influence, and the numerous economic repercussions of their activities. To illustrate the power and influence these actors hold presently, data from the UNDP and the World Bank reveal that companies now make up more than half of the top 100 economies in the world, with nation-states making up the remainder (Bettignies & Lepineux, 2005). For instance, if Microsoft were a country, it would rank among the richest globally, with a valuation greater than the GDPs of nations such as Canada, Russia, and Spain (Munnery, 2022). Additionally, by virtue of the great economic and social power gained as a result of globalization and the industrialization process, global firms are not restricted to a single nation, allowing them to avoid any restrictions on national regulations by moving their operations elsewhere. Although governments are still able to compel local businesses to support the common good, they have little power to dictate how MNCs behave ethically abroad. In summary, one may argue that the global common good is threatened by the immense influence of MNCs, combined with their capacity to circumvent state rules.
The unfortunate circumstance of actors utilizing their power to stray away from the responsibilities of attaining the common good is therefore evident. However, if globalization does not strengthen our feeling of global citizenship, it does increase our awareness of the reality that we live in a world with limited resources and that our ability to manage them is essential to the long-term survival of mankind. That being the case, pursuing the common good entails more than merely complying with the law; it also entails adopting a personal attitude, making voluntary commitments, and adopting a certain code of ethics. In this light, there are compelling arguments to support the notion that industrial and business actors’ growing understanding will serve as the primary incentive for them to play their part: today, new terms are increasingly used, like “triple bottom line,” “social and environmental reporting,” “corporate social responsibility,” and the new catchphrase of “sustainable development” to articulate the corporate response, although still somewhat timid in its effectiveness. This assumption is supported by the rapid growth of the CSR movement, as evidenced by the proliferation of business-led networks such as the Business for Social Responsibility (BSR) in the US, Business in the Community (BITC) in the UK, and CSR Europe (Bettignies & Lepineux, 2005).
In this regard, the traditional conception of nation-states being the guardians of the common good has been challenged by globalization; the waning governmental influence reveals a shift from a “social contract” where the state was primarily in charge of promoting the common good to one that is presently emerging, with multiple actors sharing the responsibility. Other social and economic players gradually recognize that they must do their part to advance the common good and have a role in resolving the global environmental issue. Global industrial and corporate players now hold a significant role, as the “global social contract” cannot be built without their active engagement and readiness to work with other actors, given the scope of their economic and social influence(Bettignies & Lepineux, 2009).
Ethical Industrial Practices: A Reality Still Far from Fruition?
It remains uncertain, however, whether true global collaboration to protect shared global resources can be achieved. Although many academics from various fields have argued that private companies have a moral imperative to contribute to CPR, there remain issues that impede efforts to actualize the common good at the local, national, and international levels. According to O’Brien (2009), at a moment in history when economic ties are becoming more global, the sheer complexity and scope of many business issues make it increasingly impossible to accurately predict the repercussions of individual decisions within this system. The common good, like other ethical principles, may be vague and unsatisfactory guidance in the increasingly complicated world of business decisions. Thus, because the common good does not afford the illusion of certainty associated with a calculable ethical formula, pursuing it in any particular context is sometimes a process laden with uncertainty. Moreover, in a competitive corporate environment where executives are conditioned to prioritize the firm’s bottom-line interests, convincing all stakeholders to prioritize the common good can prove difficult, if not unattainable.
