UNIT V GLOBAL ISSUES MULTINATIONAL CORPORATIONS A multinational corporation (MNC), also called a transnational corporation (TNC), or multinational enterprise

e (MNE), is a corporation or an enterprise that manages production or delivers services in more than one country. It can also be re erred to as an international corporation. The International !abour "rgani#ation (I!") has de ined$citation needed% an MNC as a corporation that has its management head&uarters in one country, 'no(n as the home country, and operates in several other countries, 'no(n as host countries. The )utch East India Company (as the irst multinational corporation in the (orld and the irst company to issue stoc'. It (as also arguably the (orld*s irst megacorporation, possessing &uasi+governmental po(ers, including the ability to (age (ar, negotiate treaties, coin money, and establish colonies. The irst modern multinational corporation is generally thought to be the East India Company. Many corporations have o ices, branches or manu acturing plants in di erent countries rom (here their original and main head&uarters is located. ,ome multinational corporations are very big, (ith budgets that e-ceed some nations* .)/s. Multinational corporations can have a po(er ul in luence in local economies, and even the (orld economy, and play an important role in international relations and globali#ation Multinational corporations have played an important role in globali#ation. Countries and sometimes subnational regions must compete against one another or the establishment o MNC acilities, and the subse&uent ta- revenue, employment, and economic activity. To compete, countries and regional political districts sometimes o er incentives to MNCs such as ta- brea's, pledges o governmental assistance or improved in rastructure, or la- environmental and labor standards en orcement. This process o becoming more attractive to oreign investment can be characteri#ed as a race to the bottom, a push to(ards greater autonomy or corporate bodies, or both. 0o(ever, some scholars or instance the Columbia economist 1agdish 2hag(ati, have argued that multinationals are engaged in a *race to the top.* 3hile multinationals certainly regard a lo( ta- burden or lo( labor costs as an element o comparative advantage, there is no evidence to suggest that MNCs deliberately avail themselves o la- environmental regulation or poor labour standards. As 2hag(ati has pointed out, MNC pro its are tied to operational e iciency, (hich includes a high degree o standardisation. Thus, MNCs are li'ely to tailor production processes in all o their operations in con ormity to those 4urisdictions (here they operate ((hich (ill almost al(ays include one or more o the 5,, 1apan or E5) that has the most rigorous standards. As or labor costs, (hile MNCs clearly pay (or'ers in, e.g. 6ietnam, much less than they (ould in the 5, (though it is (orth noting that higher American productivity7lin'ed to technology7means that any comparison is tric'y, since in America the same company (ould probably hire ar e(er people and automate (hatever process they per ormed in 6ietnam (ith manual labour), it is also the case that they tend to pay a premium o bet(een 89: and 899: on local labor rates.$89% ;inally, depending on the nature o the MNC, investment in any country re lects a desire or a longterm

return. Costs associated (ith establishing plant, training (or'ers, etc., can be very high< once established in a 4urisdiction, there ore, many MNCs are &uite vulnerable to predatory practices such as, e.g., e-propriation, sudden contract renegotiation, the arbitrary (ithdra(al or compulsory purchase o unnecessary *licenses,* etc. Thus, both the negotiating po(er o MNCs and the supposed *race to the bottom* may be overstated, (hile the substantial bene its that MNCs bring (ta- revenues aside) are o ten understated. Market withdrawal 2ecause o their si#e, multinationals can have a signi icant impact on government policy, primarily through the threat o mar'et (ithdra(al. ;or e-ample, in an e ort to reduce health care costs, some countries have tried to orce pharmaceutical companies to license their patented drugs to local competitors or a very lo( ee, thereby arti icially lo(ering the price. 3hen aced (ith that threat, multinational pharmaceutical irms have simply (ithdra(n rom the mar'et, (hich o ten leads to limited availability o advanced drugs. In these cases, governments have been orced to bac' do(n rom their e orts. ,imilar corporate and government con rontations have occurred (hen governments tried to orce MNCs to ma'e their intellectual property public in an e ort to gain technology or local entrepreneurs. 3hen companies are aced (ith the option o losing a core competitive technological advantage or (ithdra(ing rom a national mar'et, they may choose the latter. This (ithdra(al o ten causes governments to change policy. Countries that have been the most success ul in this type o con rontation (ith multinational corporations are large countries such as 5nited ,tates and 2ra#il$citation needed%, (hich have viable indigenous mar'et competitors. Lobbyi ! Multinational corporate lobbying is directed at a range o business concerns, rom tari structures to environmental regulations. There is no uni ied multinational perspective on any o these issues. Companies that have invested heavily in pollution control mechanisms may lobby or very tough environmental standards in an e ort to orce non+compliant competitors into a (ea'er position. Corporations lobby tari s to restrict competition o oreign industries. ;or every tari category that one multinational (ants to have reduced, there is another multinational that (ants the tari raised. Even (ithin the 5.,. auto industry, the raction o a company*s imported components (ill vary, so some irms avor tighter import restrictions, (hile others avor looser ones. ,ays Ely "liveira, Manager )irector o the MCT=I>? This is very serious and is very hard and ta'es a lot o (or' or the o(ner.p' Multinational corporations such as 3al+ mart and Mc)onald*s bene it rom government #oning la(s, to create barriers to entry. Many industries such as .eneral Electric and 2oeing lobby the government to receive subsidies to preserve their monopoly. Pate t" Many multinational corporations hold patents to prevent competitors rom arising. ;or e-ample, Adidas holds patents on shoe designs, ,iemens A... holds many patents on e&uipment and in rastructure and Microso t bene its rom so t(are patents. The pharmaceutical companies lobby international agreements to en orce patent la(s on others.

Go#er $e t %ower In addition to e orts by multinational corporations to a ect governments, there is much government action intended to a ect corporate behavior. The threat o nationali#ation ( orcing a company to sell its local assets to the government or to other local nationals) or changes in local business la(s and regulations can limit a multinational*s po(er. These issues become o increasing importance because o the emergence o MNCs in developing countries. Mi&ro'$(lti atio al" Enabled by Internet based communication tools, a ne( breed o multinational companies is gro(ing in numbers.(Copeland, Michael 6. (@99A+9A+@B). These multinationals start operating in di erent countries rom the very early stages. These companies are being called micro+ multinationals. 3hat di erentiates micro+multinationals rom the large MNCs is the act that they are small businesses. ,ome o these micro+multinationals, particularly so t(are development companies, have been hiring employees in multiple countries rom the beginning o the Internet era. 2ut more and more micro+multinationals are actively starting to mar'et their products and services in various countries. Internet tools li'e .oogle, Cahoo, M,N, Ebay and Ama#on ma'e it easier or the micro+multinationals to reach potential customers in other countries. ,ervice sector micro+multinationals, li'e ;aceboo', Alibaba etc. started as dispersed virtual businesses (ith employees, clients and resources located in various countries. Their rapid gro(th is a direct result o being able to use the internet, cheaper telephony and lo(ertraveling costs to create uni&ue business opportunities. !o( cost ,aa, (,o t(are As A ,ervice) suites ma'e it easier or these companies to operate (ithout a physical o ice. 0al 6arian, Chie Economist at .oogle and a pro essor o in ormation economics at 5.C.2er'eley, said in April @989, DImmigration today, than's to the 3eb, means something very di erent than it used to mean. There*s no longer a brain drain but brain circulation. /eople no( doing startups understand (hat opportunities are available to them around the (orld and (or' to harness it rom a distance rather than move people rom one place to another.D ENVIRONMENTAL ET)ICS Environmental ethics believes in the ethical relationship bet(een human beings and the natural environment. 0uman beings are a part o the society and so are the other living beings. 3hen (e tal' about the philosophical principle that guides our li e, (e o ten ignore the act that even plants and animals are a part o our lives. They are an integral part o the environment and hence have a right to be considered a part o the human li e. "n these lines, it is clear that they should also be associated (ith our guiding principles as (ell as our moral and ethical values. *hat i" E #iro $e tal Ethi&"+ 3e are cutting do(n orests or ma'ing our homes. 3e are continuing (ith an e-cessive consumption o natural resources. Their e-cessive use is resulting in their depletion, ris'ing the li e o our uture generations. Is this ethicalE This is the issue that environmental ethics ta'es up. ,cientists li'e >achel Carson and the environmentalists (ho led philosophers to consider the philosophical aspect o environmental problems, pioneered in the development o environmental ethics as a branch o environmental philosophy. The Earth )ay celebration o 8BF9 (as also one o the actors, (hich led to the development o environmental ethics as a separate ield o study.

This ield received impetus (hen it (as irst discussed in the academic 4ournals in North America and Canada. Around the same time, this ield also emerged in Australia and Nor(ay. Today, environmental ethics is one o the ma4or concerns o man'ind. 3hen industrial processes lead to destruction o resources, is it not the industry*s responsibility to restore the depleted resourcesE Moreover, can a restored environment ma'e up or the originally natural oneE Mining processes hamper the ecology o certain areas< they may result in the disruption o plant and animal li e in those areas. ,lash and burn techni&ues are used or clearing the land or agriculture. Most o the human activities lead to environmental pollution. The overly increasing human population is increasing the human demand or resources li'e ood and shelter. As the population is e-ceeding the carrying capacity o our planet, natural environments are being used or human inhabitation. Thus human beings are disturbing the balance in the nature. The harm (e, as human beings, are causing to the nature, is coming bac' to us by resulting in a polluted environment. The depletion o natural resources is endangering our uture generations. The imbalance in nature that (e have caused is going to disrupt our li e as (ell. 2ut environmental ethics brings about the act that all the li e orms on Earth have a right to live. 2y destroying the nature, (e are depriving these li e orms o their right to live. 3e are going against the true ethical and moral values by disturbing the balance in nature. 3e are being unethical in treating the plant and animal li e orms, (hich coe-ist in society. 0uman beings have certain duties to(ards their ello( beings. "n similar lines, (e have a set o duties to(ards our environment. Environmental ethics says that (e should base our behavior on a set o ethical values that guide our approach to(ards the other living beings in nature. Environmental ethics is about including the rights o non+human animals in our ethical and moral values. Even i the human race is considered the primary concern o society, animals and plants are in no (ay less important. They have a right to get their air share o e-istence. 3e, the human beings, along (ith the other orms o li e ma'e up our society. 3e all are a part o the ood chain and thus closely associated (ith each other. 3e, together orm our environment. The conservation o natural resources is not only the need o the day but also our prime duty. COMPUTER ET)ICS Ethics is a set o moral principles that govern the behavior o a group or individual. There ore, computer ethics is set o moral principles that regulate the use o computers. ,ome common issues o computer ethics include intellectual property rights (such as copyrighted electronic content), privacy concerns, and ho( computers a ect society. ;or e-ample, (hile it is easy to duplicate copyrighted electronic (or digital) content, computer ethics (ould suggest that it is (rong to do so (ithout the author*s approval. And (hile it may be possible to access someone*s personal in ormation on a computer system, computer ethics (ould advise that such an action is unethical. As technology advances, computers continue to have a greater impact on society. There ore, computer ethics promotes the discussion o ho( much in luence computers should have in areas such as arti icial intelligence and human communication. As the (orld o

computers evolves, computer ethics continues to create ethical standards that address ne( issues raised by ne( technologies. *EAPONS ,EVELOPMENT A (eapon is an instrument used or the purpose o causing harm or damage to people, animals or structures. 3eapons are used in hunting, attac', sel +de ense, or de ense in combat and range rom simple implements li'e clubs and spears to complicated modern machines such as intercontinental ballistic missiles. "ne (ho possesses or carries a (eapon is said to be armed. In a broader conte-t (eapons include anything used to gain an advantage over an adversary or to place them at a disadvantage. E-amples include the use o sieges, tactics, and psychological (eapons (hich reduce the morale o an enemy Classi ication 2y user - what person or unit uses the weapon G /ersonal (eapons (or small arms) + designed to be used by a single person. G 0unting (eapon + primarily or hunting game animals or ood or sport G In antry support (eapons + larger than personal (eapons, re&uiring t(o or more to operate correctly. G ;orti ication (eapons + mounted in a permanent installation, or used primarily (ithin a orti ication. G Mountain (eapons + or use by mountain orces or those operating in di icult terrain. G 6ehicle (eapons + to be mounted on any type o military vehicle. G >ail(ay (eapons + designed to be mounted on rail(ay cars, including armored trains. G Aircra t (eapons + carried on and used by some type o aircra t, helicopter, or other aerial vehicle. G Naval (eapons + mounted on ships and submarines. G ,pace (eapons + are designed to be used in or launched rom space. 2y unction - the construction of the weapon and principle of operation G Antimatter (eapons (theoretical) (ould combine matter and antimatter to cause a po(er ul e-plosion. G Archery (eapons operate by using a tensioned string to launch a pro4ectile. G Artillery are capable o launching heavy pro4ectiles over long distances. G 2iological (eapons spread biological agents, causing disease or in ection. G Chemical (eapons, poisoning and causing reactions. G Energy (eapons rely on concentrating orms o energy to attac', such as lasers or sonic attac'. G E-plosive (eapons use a physical e-plosion to create blast concussion or spread shrapnel. G ;irearms use a chemical charge to launch pro4ectiles. G Improvised (eapons are common ob4ects, reused as (eapons. G Incendiary (eapons cause damage by ire. G Non+lethal (eapons are designed to subdue (ithout 'illing. G Magnetic (eapons use magnetic ields to propel pro4ectiles, or to ocus particle beams. G Melee (eapons operate as physical e-tensions o the user*s body and directly impact their target.

G Missiles are roc'ets (hich are guided to their target a ter launch. (Also a general term or pro4ectile (eapons). G Nuclear (eapons use radioactive materials to create nuclear ission and=or nuclear usion detonations. G /rimitive (eapons ma'e little or no use o technological or industrial elements. G >anged (eapons (unli'e MHlIe (eapons), target a distant ob4ect or person. G >oc'ets use chemical propellant to accelerate a pro4ectile G ,uicide (eapons e-ploit the (illingness o their operator to not survive the attac'. G Tro4an (eapons appear on ace value to be gi ts, though the intent is to in some (ay to harm the recipient. 2y target - the type of target the weapon is designed to attack G Anti+aircra t (eapons target missiles and aerial vehicles in light. G Anti+ orti ication (eapons are designed to target enemy installations. G Anti+personnel (eapons are designed to attac' people, either individually or in numbers. G Anti+radiation (eapons target sources o electronic radiation, particularly radar emitters. G Anti+satellite (eapons target orbiting satellites. G Anti+ship (eapons target ships and vessels on (ater. G Anti+submarine (eapons target submarines and other under(ater targets. G Anti+tan' (eapons are designed to de eat armored targets. G Area denial (eapons target territory, ma'ing it unsa e or unsuitable or enemy use or travel. G 0unting (eapons are civilian (eapons used to hunt animals. G In antry support (eapons are designed to attac' various threats to in antry units CONSULTING ENGINEERS Consultants are individuals (ho typically (or' or themselves but may also be associated (ith a consulting irm. They, or a ee, gives advice or provides a service in a ield o speciali#ed'no(ledge or training. Most consultants carry their o(n li e and health insurance, pay their o(n ta-es, most have their o(n tools and e&uipment. The consultant can (or' alone or (ith the client*s sta . Consultants can play a multi+ aceted role. They can, or e-ample unction as advisors, i-ers, bosses, generalists, stabili#ers, listeners, advisors, specialists, catalysts, managers or &uasiemployees. The actual (or' that consultants per orm or one company to another may vary greatly, i.e. ta- account to o ice decoration. 0o(ever, the typical underlying reasons that a consultant is hired are universal. A problem e-ists and the o(ner or manager o the company has decided to see' the help o an e-pert. 2ringing in an e-pert can save time, e ort and money. It has been estimated that appro-imately o all companies call upon consultants at one time or another. Many companies claim that they receive a higher return or their invested dollars by using consultants or speci ic tas's. Most companies have e-perienced the problem o needing short+term technical e-pertise. /erhaps the company*s e-isting sta is already (or'ing to capacity. In many cases, the engineering s'ills re&uired or a pro4ect can be satis ied (ith a ull

time employee. 3hen they can not ully 4usti y bringing someone on board ull time, their ans(er is to hire a consultant. 2y doing so, the businessman solves his immediate problem (ithout permanently increasing his payroll and payroll ta-es. Consultants can be hired (hen the company may not have anyone on sta capable o solving the speci ic problem. At such times, a costly learning curve on the part o the engineering sta is associated (ith the pro4ect. "ne e-ample is using a consultant as a viable alternative during the development stages o ne( products. 0iring a consultant (ith e-perience in a given area can then cut days, (ee's or even months o a pro4ect schedule. In addition, he can help the sta avoid mista'es they may other(ise ma'e. 3hen the pro4ect reaches a certain point, the permanent sta can then ta'e over. Consultants can deal directly (ith o(ners and upper management. In this role, consultants can provide an ob4ective third+party vie( point. Critical ob4ectives can then be identi ied and advise given in con idence. Consultants are a viable alternative in assisting in easibility studies or in proposal preparation. /erhaps the manager cannot 4usti y shi ting the duties o e-isting sta members. Another time that consultants become use ul is (hen a company is 4ust starting a business. The development o the company*s ne( product can be begun by the consultant (hile a ull time permanent technical sta member is being hired. ;inding the right consultant can be di icult. Managers can rely on re errals rom their riends or hire the consultant (ho happens to call at the right time. "nce the decisions is made to hire a consultant, the need is immediate and one may not have the time to shop or a consultant. As a part o planning ahead, it is (ise to meet various consultants on an in ormal basis be ore the need to hire one arises. Then (hen the time comes, you (ill 'no( e-actly (ho to call or you have already established an in ormal relationship ET)ICS IN ASCE To preserve the high ethical standards o the civil engineering pro ession, the ,ociety*s ethics program includes? G Edict The ,ociety maintains a Code o Ethics. G En orcement The ,ociety en orces the Code by investigating potential violations o the Code and ta'ing disciplinary action i (arranted. G Education The ,ociety endeavors to educate its members and the public on ethics issues. IEEE &ode o- Ethi&" 8. to accept responsibility in ma'ing decisions consistent (ith the sa ety, health and (el are o the public, and to disclose promptly actors that might endanger the public or the environment< @. to avoid real or perceived con licts o interest (henever possible, and to disclose them to a ected parties (hen they do e-ist<

J. to be honest and realistic in stating claims or estimates based on available data< K. to re4ect bribery in all its orms< L. to improve the understanding o technology, its appropriate application, and potential conse&uences< A. to maintain and improve our technical competence and to underta'e technological tas's or others only i &uali ied by training or e-perience, or a ter ull disclosure o pertinent limitations< F. to see', accept, and o er honest criticism o technical (or', to ac'no(ledge and correct errors, and to credit properly the contributions o others< M. to treat airly all persons regardless o such actors as race, religion, gender, disability, age, or national origin< B. to avoid in4uring others, their property, reputation, or employment by alse or malicious action< 89. to assist colleagues and co+(or'ers in their pro essional development and to support them in ollo(ing this code o ethics Ethi&" i I dia I "tit(te o- Material" a d Ma a!e$e t G To consider irst, the T"TA! interest to oneNs organi#ation in all transactions (ithout impairing the dignity and responsibility to oneNs o ice< G To buy (ithout pre4udice, see'ing to obtain the ma-imum ultimate value or each >upee o E-penditure< G To subscribe and (or' or honesty and truth in buying and selling, to denounce all orms and mani estations o commercial bribery and to esche( anti+social practices< G To accord a prompt and courteous reception so ar as conditions (ill permit, to all (ho call upon a legitimate business mission< To respect oneNs obligations and those o oneNs organi#ation, consistent (ith good business practice Ethi&" i I "tit(te o- E !i eer" 8.8 Engineers serve all members o the community in enhancing their (el are, health and sa ety by a creative process utilising the engineersN 'no(ledge, e-pertise and e-perience. 8.@ /ursuant to the avo(ed ob4ectives o The Institution o Engineers (India) as enshrined in the presents o the >oyal Charter granted to the Institution, the Council o the Institution prescribed a set o D/ro essional Conduct >ulesD in the year 8BKK replacing the same (ith the DCode o Ethics or Corporate MembersD in the year 8BLK (hich (as revised in the year 8BBF. 8.J In vie( o globalisation, concern or the environment and the concept o sustainable development, it has been elt that the prevailing DCode o Ethics or Corporate MembersD needs revie( and revision in letter and spirit. The engineering organisations (orld over have updated their Code o Ethics. 8.K The Council o the Institution vested (ith the authority in terms o the /resent @(4) o

the >oyal Charter adopted at its A@Ath meeting held on @8.8@.@99J at !uc'no( the DCode o Ethics or Corporate MembersD as provided hereina ter. 8.L The Code o Ethics is based on broad principles o truth, honesty, 4ustice, trust(orthiness, respect and sa eguard o human li e and (el are, competence and accountability (hich constitute the moral values every Corporate Member o the Institution must recogni#e, uphold and abide by. 8.A This DCode o Ethics or Corporate MembersD shall be in orce till the same is revised by a decision o the Council o the Institution. CO,E O. ET)ICS .OR I "tit(te o- E !i eer" 8.9 /reamble 8.8 The Corporate Members o The Institution o Engineers (India) are committed to promote and practice the pro ession o engineering or the common good o the community bearing in mind the ollo(ing concerns ? 8.8.8 Concern or ethical standard< 8.8.@ Concern or social 4ustice, social order and human rights< 8.8.J Concern or protection o the environment< 8.8.K Concern or sustainable development< 8.8.L /ublic sa ety and tran&uility.

@.9 The Tenets o the Code o Ethics @.8 A Corporate Member shall utilise his 'no(ledge and e-pertise or the (el are, health and sa ety o the community (ithout any discrimination or sectional or private interests. @.@ A Corporate Member shall maintain the honour, integrity and dignity in all his pro essional actions to be (orthy o the trust o the community and the pro ession. @.J A Corporate Member shall act only in the domains o his competence and (ith diligence, care, sincerity and honesty. @.K A Corporate Member shall apply his 'no(ledge and e-pertise in the interest o his employer or the clients or (hom he shall (or' (ithout compromising (ith other obligations to these Tenets. @.L A Corporate Member shall not alsi y or misrepresent his o(n or his associates* &uali ications, e-perience, etc. @.A A Corporate Member, (herever necessary and relevant, shall ta'e all reasonable steps to in orm himsel , his employer or clients, o the environmental, economic, social and other possible conse&uences, (hich may arise out o his actions. @.F A Corporate Member shall maintain utmost honesty and airness in ma'ing statements or giving (itness and shall do so on the basis o ade&uate 'no(ledge. @.M A Corporate Member shall not directly or indirectly in4ure the pro essional reputation o another member. @.B A Corporate Member shall re4ect any 'ind o o er that may involve un air practice or

may cause avoidable damage to the ecosystem. @.89 A Corporate Member shall be concerned about and shall act in the best o his abilities or maintenance o sustainability o the process o development. @.88 A Corporate Member shall not act in any manner (hich may in4ure the reputation o the Institution or (hich may cause any damage to the Institution inancially or other(ise. J.9 .eneral .uidance The Tenets o the Code o Ethics are based on the recognition that O J.8 A common tie e-ists among the humanity and that The Institution o Engineers (India) derives its value rom the people, so that the actions o its Corporate Members should indicate the memberNs highest regard or e&uality o opportunity, social 4ustice and airness< J.@ The Corporate Members o the Institution hold a privileged position in the community so as to ma'e it a necessity or their not using the position or personal and sectional interests. K.9 And, as such, a Corporate Member O K.8 should 'eep his employer or client ully in ormed on all matters in respect o his assignment (hich are li'ely to lead to a con lict o interest or (hen, in his 4udgement, a pro4ect (ill not be viable on the basis o commercial, technical, environmental or any other ris's< K.@ should maintain con identiality o any in ormation (ith utmost sincerity unless e-pressly permitted to disclose such in ormation or unless such permission, i (ithheld, may adversely a ect the (el are, health and sa ety o the community< K.J should neither solicit nor accept inancial or other considerations rom anyone related to a pro4ect or assignment o (hich he is in the charge< K.K should neither pay nor o er direct or indirect inducements to secure (or'< K.L should compete on the basis o merit alone< K.A should re rain rom inducing a client to breach a contract entered into (ith another duly appointed engineer< K.F should, i as'ed by the employer or a client, to revie( the (or' o another person or organisation, discuss the revie( (ith the other person or organisation to arrive at a balanced opinion< K.M should ma'e statements or give evidence be ore a tribunal or a court o la( in an ob4ective and accurate manner and e-press any opinion on the basis o ade&uate 'no(ledge and competence< and K.B should reveal the e-istence o any interest O pecuniary or other(ise O (hich may a ect the 4udgement (hile giving an evidence or ma'ing a statement. L.9 Any decision o the Council as per provisions o the relevant 2ye+!a(s o the Institution shall be inal and binding on all Corporate Members ASME Code o- Ethi&" o- E !i eer" A,ME re&uires ethical practice by each o its members and has adopted the ollo(ing Code o Ethics o Engineers as re erenced in the A,ME Constitution, Article C@.8.8. C")E "; ET0IC, "; EN.INEE>,

The ;undamental /rinciples Engineers uphold and advance the integrity, honor and dignity o the engineering pro ession by? I. 5sing their 'no(ledge and s'ill or the enhancement o human (el are< II. 2eing honest and impartial, and serving (ith idelity the public, their employers and clients< and III. ,triving to increase the competence and prestige o the engineering pro ession. The ;undamental Canons 8. Engineers shall hold paramount the sa ety, health and (el are o the public in the per ormance o their pro essional duties. @. Engineers shall per orm services only in the areas o their competence. J. Engineers shall continue their pro essional development throughout their careers and shall provide opportunities or the pro essional and ethical development o those engineers under their supervision. K. Engineers shall act in pro essional matters or each employer or client as aith ul agents or trustees, and shall avoid con licts o interest or the appearance o con licts o interest. L. Engineers shall build their pro essional reputation on the merit o their services and shall not compete un airly (ith others. A. Engineers shall associate only (ith reputable persons or organi#ations. F. Engineers shall issue public statements only in an ob4ective and truth ul manner. M. Engineers shall consider environmental impact in the per ormance o their pro essional duties. The A,ME criteria or interpretation o the Canons are guidelines and represent the ob4ectives to(ard (hich members o the engineering pro ession should strive. They are principles (hich an engineer can re erence in speci ic situations. In addition, they provide interpretive guidance to the A,ME 2oard on /ro essional /ractice and Ethics on the Code o Ethics o Engineers. 8. Engineers shall hold paramount the sa ety, health and (el are o the public in the per ormance o their pro essional duties. a. Engineers shall recogni#e that the lives, sa ety, health and (el are o the general public are dependent upon engineering 4udgments, decisions and practices incorporated into structures, machines, products, processes and devices. b. Engineers shall not approve or seal plans and=or speci ications that are not o a design sa e to the public health and (el are and in con ormity (ith accepted engineering standards. c. 3henever the Engineers* pro essional 4udgments are over ruled under circumstances (here the sa ety, health, and (el are o the public are endangered, the Engineers shall in orm their clients and=or employers o the possible conse&uences. (8) Engineers shall endeavor to provide data such as published standards, test codes, and &uality control procedures that (ill enable the users to understand sa e use during li e e-pectancy associated (ith the designs, products, or systems or (hich they are responsible. (@) Engineers shall conduct revie(s o the sa ety and reliability o the designs, products, or

systems or (hich they are responsible be ore giving their approval to the plans or the design. (J) 3henever Engineers observe conditions, directly related to their employment, (hich they believe (ill endanger public sa ety or health, they shall in orm the proper authority o the situation. d. I engineers have 'no(ledge o or reason to believe that another person or irm may be in violation o any o the provisions o these Canons, they shall present such in ormation to the proper authority in (riting and shall cooperate (ith the proper authority in urnishing such urther in ormation or assistance as may be re&uired. @. Engineers shall per orm services only in areas o their competence. a. Engineers shall underta'e to per orm engineering assignments only (hen &uali ied by education and=or e-perience in the speci ic technical ield o engineering involved. b. Engineers may accept an assignment re&uiring education and=or e-perience outside o their o(n ields o competence, but their services shall be restricted to other phases o the pro4ect in (hich they are &uali ied. All other phases o such pro4ect shall be per ormed by &uali ied associates, consultants, or employees. J. Engineers shall continue their pro essional development throughout their careers, and should provide opportunities or the pro essional and ethical development o those engineers under their supervision. K. Engineers shall act in pro essional matters or each employer or client as aith ul agents or trustees, and shall avoid con licts o interest or the appearance o con licts o interest. a. Engineers shall avoid all 'no(n con licts o interest (ith their employers or clients and shall promptly in orm their employers or clients o any business association, interests, or circumstances (hich could in luence their 4udgment or the &uality o their services. b. Engineers shall not underta'e any assignments (hich (ould 'no(ingly create a potential con lict o interest bet(een themselves and their clients or their employers. c. Engineers shall not accept compensation, inancial or other(ise, rom more than one party or services on the same pro4ect, or or services pertaining to the same pro4ect, unless the circumstances are ully disclosed to, and agreed to, by all interested parties. d. Engineers shall not solicit or accept inancial or other valuable considerations, or speci ying products or material or e&uipment suppliers, (ithout disclosure to their clients or employers. e. Engineers shall not solicit or accept gratuities, directly or indirectly, rom contractors, their agents, or other parties dealing (ith their clients or employers in connection (ith (or' or (hich they are responsible. 3here o icial public policy or employers* policies tolerate acceptance o modest gratuities or gi ts, engineers shall avoid a con lict o interest by complying (ith appropriate policies and shall avoid the appearance o a con lict o interest. . 3hen in public service as members, advisors, or employees o a governmental body or department, Engineers shall not participate in considerations or actions (ith respect to services provided by them or their organi#ation(s) in private or product engineering practice. g. Engineers shall not solicit an engineering contract rom a governmental body or other

entity on (hich a principal, o icer, or employee o their organi#ation serves as a member (ithout disclosing their relationship and removing themselves rom any activity o the body (hich concerns their organi#ation. h. Engineers (or'ing on codes, standards or governmental sanctioned rules and speci ications shall e-ercise care ul 4udgment in their determinations to ensure a balanced vie(point, and avoid a con lict o interest. i. 3hen, as a result o their studies, Engineers believe a pro4ect(s) (ill not be success ul, they shall so advise their employer or client. 4. Engineers shall treat in ormation coming to them in the course o their assignments as con idential, and shall not use such in ormation as a means o ma'ing personal pro it i such action is adverse to the interests o their clients, their employers or the public. (8) They (ill not disclose con idential in ormation concerning the business a airs or technical processes o any present or ormer employer or client or bidder under evaluation, (ithout his consent, unless re&uired by la( or court order. (@) They shall not reveal con idential in ormation or inding o any commission or board o (hich they are members unless re&uired by la( or court order (J) )esigns supplied to Engineers by clients shall not be duplicated by the Engineers or others (ithout the e-press permission o the client(s). '. Engineers shall act (ith airness and 4ustice to all parties (hen administering a construction (or other) contract. l. 2e ore underta'ing (or' or others in (hich Engineers may ma'e improvements, plans, designs, inventions, or other records (hich may 4usti y see'ing copyrights, patents, or proprietary rights, Engineers shall enter into positive agreements regarding the rights o respective parties. m. Engineers shall admit their o(n errors (hen proven (rong and re rain rom distorting or altering the acts to 4usti y their mista'es or decisions. n. Engineers shall not accept pro essional employment or assignments outside o their regular (or' (ithout the 'no(ledge o their employers. o. Engineers shall not attempt to attract an employee rom other employers or rom the mar'et place by alse or misleading representations. L. Engineers shall build their pro essional reputation on the merit o their services and shall not compete un airly (ith others. a. Engineers shall negotiate contracts or pro essional services on the basis o demonstrated competence and &uali ications or the type o pro essional service re&uired. b. Engineers shall not re&uest, propose, or accept pro essional commissions on a contingent basis i , under the circumstances, their pro essional 4udgments may be compromised. c. Engineers shall not alsi y or permit misrepresentation o their, or their associates, academic or pro essional &uali ication. They shall not misrepresent or e-aggerate their degrees o responsibility in or or the sub4ect matter o prior assignments. 2rochures or other presentations used to solicit personal employment shall not misrepresent pertinent acts concerning employers, employees, associates, 4oint venturers, or their accomplishments.

d. Engineers shall prepare articles or the lay or technical press (hich are only actual. Technical Communications or publication (theses, articles, papers, reports,etc.) (hich are based on research involving more than one individual (including students and supervising aculty, industrial supervisor=researcher or other co+(or'ers) must recogni#e all signi icant contributors. /lagiarism, the act o substantially using another*s ideas or (ritten materials (ithout due credit, is unethical. (,ee Appendi-.) e. Engineers shall not maliciously or alsely, directly or indirectly, in4ure the pro essional reputation, prospects, practice or employment o another engineer, nor shall they indiscriminately critici#e another*s (or'. . Engineers shall not use e&uipment, supplies, laboratory or o ice acilities o their employers to carry on outside private practice (ithout consent. A. Engineers shall associate only (ith reputable persons or organi#ations. a. Engineers shall not 'no(ingly associate (ith or permit the use o their names or irm names in business ventures by any person or irm (hich they 'no(, or have reason to believe, are engaging in business or pro essional practices o a raudulent or dishonest nature. b. Engineers shall not use association (ith non+engineers, corporations, or partnerships to disguise unethical acts. F. Engineers shall issue public statements only in an ob4ective and truth ul manner. a. Engineers shall endeavor to e-tend public 'no(ledge, and to prevent misunderstandings o the achievements o engineering. b. Engineers shall be completely ob4ective and truth ul in all pro essional reports, statements or testimony. They shall include all relevant and pertinent in ormation in such reports, statements or testimony. c. Engineers, (hen serving as e-pert or technical (itnesses be ore any court, commission, or other tribunal, shall e-press an engineering opinion only (hen it is ounded on their ade&uate 'no(ledge o the acts in issue, their bac'ground o technical competence in the sub4ect matter, and their belie in the accuracy and propriety o their testimony. d. Engineers shall issue no statements, criticisms, or arguments on engineering matters (hich are inspired or paid or by an interested party, or parties, unless they pre ace their comments by identi ying themselves, by disclosing the identities o the party or parties on (hose behal they are spea'ing, and by revealing the e-istence o any inancial interest they may have in matters under discussion. e. Engineers shall be truth ul in e-plaining their (or' and merit, and shall avoid any act tending to promote their o(n interest at the e-pense o the integrity and honor o the pro ession or another individual. M. Engineers shall consider environmental impact in the per ormance o their pro essional duties. a. Engineers shall concern themselves (ith the impact o their plans and designs on the environment. 3hen the impact is a clear threat to health or sa ety o the public, then the guidelines or this Canon revert to those o Canon 8. B. Engineers accepting membership in The American ,ociety o Mechanical

Engineers by this action agree to abide by this ,ociety /olicy on Ethics and procedures or its implementation.

Moral Leader"hi% Moral !eadership brings together in one comprehensive volume essays rom leading scholars in la(, leadership, psychology, political science, and ethics to provide practical, theoretical policy guidance. The authors e-plore 'ey &uestions about moral leadership such as? G 0o( do leaders orm, sustain, and transmit moral commitmentsE G 5nder (hat conditions are those processes most e ectiveE G 3hat is the impact o ethics o icers, codes, training programs, and similar initiativesE G 0o( do standards and practices vary across conte-t and cultureE G 3hat can (e do at the individual, organi#ational, and societal level to oster moral leadershipE

ENGINEERS AS E/PERT *ITNESS AN, A,VISORS Engineering e-pert (itnesses are highly credentialed mechanical, sa ety P civil, geotechnical, chemical and electrical engineers speciali#ing in the areas o design, construction P structural engineering, ailure analysis, human actors, occupational sa ety, metallurgy and more. They provide litigation support through revie( and evaluation o distressed structures or land slide and erosion cases< per ormance o orensic studies on hydraulics, po(er plants, pipelines, boiler systems, tra ic, automotive, electrical ire involving electrical systems o machinery< site research and inspection, laboratory testings, report (riting, depositions and court testimony. Engineers shall endeavor to e-tend public 'no(ledge, and to prevent misunderstandings o the achievements o engineering. b. Engineers shall be completely ob4ective and truth ul in all pro essional reports, statements or testimony. They shall include all relevant and pertinent in ormation in such reports, statements or testimony. c. Engineers, (hen serving as e-pert or technical (itnesses be ore any court, commission, or other tribunal, shall e-press an engineering opinion only (hen it is ounded on their ade&uate 'no(ledge o the acts in issue, their bac'ground o technical competence in the sub4ect matter, and their belie in the accuracy and propriety o their testimony.