Ethics in International Scenario

International Business ethics ?

International Business ethics helps companies to play a major role in Globalization. Businesses operating abroad adhere complying with variant regulations, managing staff distant from headquarters, serving clients and connecting to providers and partners in several jurisdictions.

Ethical Issues in International Business

Many ethical issues and dilemmas are rooted in differences in political systems, law, economic development, and culture Some 5 key ethical issues in international business :

Employment Practices Human Rights Environmental Pollution Corruption Social responsibility

Ethical Issues in International Business

Employment Practices :

When work conditions in a host nation are clearly inferior to those in a multinationals home nation, what standards should be applied ? How much difference is acceptable? Example: Work conditions:
Hot weather : Dubai Around toxic chemicals : Chemical Industry Long hours of working and pay low salaries : Drilling of Oil(Oilriggers).

Ethical Issues in International Business

Human Rights :

Basic rights are not respected in many nations Freedom of Speech Freedom of Assembly Freedom of Association Freedom from Political Repression What is the responsibility of a foreign firm in a country where human rights are trampled? Example : White rule in South Africa till 1994 known as "Apartheid:
Investment In Nigeria by Royal Dutch Shell PLC: In the beginning of 1996, several human rights groups brought cases to hold Shell accountable for alleged human rights violations in Nigeria, including summary execution, crimes against humanity, torture, inhumane treatment and arbitrary arrest and detention.

Ethical Issues in International Business

Environmental Pollution :
Environmental regulations (or enforcement) in host nations may be inferior to those at home
Multinationals can produce more pollution in host country than at home. Example : The tragedy of the commons occurs - The water in Mekong River. China is engaged in an extensive program of dam-building on the river itself: It has already completed three, the first called the Manwan dam, another twelve are under consideration.

Ethical Issues in International Business

Corruption :
International businesses can, and have, gained economic advantages by making payments to government officials. Example : US passed the Foreign Corrupt Practices Act Organization for Economic Cooperation and Development (OECD) adopted the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions . The convention was signed on 17 December 1997 and came into force on 15 February 1999. Countries that have signed the Convention are required to put in place legislation that criminalizes the act of bribing a foreign public official.

Ethical Issues in International Business

Social responsibility :
Moral philosophers argue that with power comes the responsibility to give something back to the societies that enable them to prosper. Example : Tyson Foods committed its brand to efforts to relieve and ultimately end childhood hunger, and in the past few years been integrating social media into its hunger relief efforts. Since 2000,Tyson Foods has given more than 78 million pounds of its products to hunger and disaster relief in the United States Haagen-Dazs decided to create a microsite to raise awareness about the issue.

Philosophical approaches to International Ethics

STRAW MAN Concept :

The Friedman Doctrine : the only social responsibility

of business is to increase profits, staying within the law.

Cultural Relativism : Ethics

are nothing more than the reflection of a culture (When in Rome, do as the Romans do)

The Righteous Moralist : claims that his or her own standards of ethics are the appropriate ones in all countries The Naive Immoralist: That if a manager sees that firms from other nations are not following ethical norms in a host country then they should not either.

UTILITARIAN AND KANTIAN ETHICS :

Utilitarian approaches to ethics: Any action or policies must be evaluated on benefit & cost associated with the society. Example : Cutting down of forest to build greenfield industry giving net benefit maximization as well as jobs to many. Kantian ethics are based on the philosophy of Immanuel Kant (17241804). Kantian ethics hold that people should be treated as ends and never purely as means to the ends of others. People are not instruments, like a machine. People have dignity and need to be respected.