Despite globalisation reality we all live in we are all kidding ourselves that our national independence can somehow be preserved by our national laws.
Well, I am sorry to say, it is not so. At least not in business.
We all know big names of todays’ business world, all Coca Cola’s, Samsung’s, Apples etc. All of those companies are now multi nationals, using fully everything globalisation has to offer. Design at home, produce somewhere else, have a headquarter at home, pay taxes where those are lower, etc. As a result we end up locally with downsides of global possibilities, if any country tries to be protective, either the companies based in that country die or they move somewhere else, which, seen locally again, is equal to death. The issue is not that simple, the big four of the auditing companies have recognized this long time ago: how do you check a multinational company if it fantasizes in its books when you don’t know what happens in all places that company is located? When auditing such organisations, you need to look at the whole picture and that is impossible – due to stubborn local laws… which are all (or majority of them) different, even when it comes to accounting standards. There are no mechanisms allowing auditors to check globally (even through checking each separate entity locally).
Is there a solution? Yes. A set of laws, same for all multinational companies, which would function above local laws. Such laws would (or should) then allow for proper auditing and address proper tax, employment and other issues and could be based on existing international accounting standards. Without overreaching legal framework, globalisation may have, and definitely will, bad local impact.