The Effect of New Technologies on the Structure and Decision Making Process of Multinational Enterprises and Their Liability for Human Rights and Environmental Breaches

Abstract

Multinational enterprises (MNEs) are at the centre of international business activities and play an important role in the world economy’s positive developments. However, they have long been accused of violating human rights and environmental regulations that harm people and societies. Several efforts have been made to solve the problems and make MNEs accountable and liable for their harmful actions. MNEs operate on a group-based managerial structure, while each constituent company within a group is subjected to local company laws and other regulations. This complicated internal structure has made it very difficult to establish the overall group liability for the torts of companies within the group. Although the legal structure based on company law has not changed for a long time, the internal structure decision-making processes within MNEs are undergoing a considerable transformation with the recent technological developments, such as big data, artificial intelligence, and distributed ledger technologies. Most recent case law and regulatory options regarding the liability of MNEs still consider them with their dated structure. This approach prevents victims of MNE adverse actions from reaching satisfactory solutions. The effects of new technologies must be considered while discussing any legal actions and introducing regulations towards accountability and liability of MNEs for their human rights and environmental breaches. This article provides an extensive analysis of the effects of new technologies on contemporary internal operations and the structure of MNEs, provides examples of current human rights and environmental violations, and discusses the suitability of current laws and regulations for solving liability problems.

Keywords

• Accountability
• environment
• human rights
• liability
• multinational enterprises
• new technologies

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