Ethics in International Business

Chapter 4
Global Business
Environment
• Prepared for :
Professor Datuk Introduction
Dr. Mohamed • Ethics are the principles of humanity, to be
Padzil fair, law abiding and conscience to do good, to
• Prepared by be considerate for give and take.
− Mohamed • Ethics also varies logistically for one place to
Nahar,
another.
− Tehereh,
− Amar • Subject matter: its all about personal
background, location and organizational
culture. There are plenty of grey areas ethical
business conduct.
International ethical issues faced by
International businesses

Corruption Employment Human Rights Environmenta Moral

practices l pollution Obligation
Speed Money Discrimination
Bribery Annual audit Racism Dumping Social
Key pollution from responsibility
Conflict of developed to
Interest Performance Social
Index developing. contribution
Commercial
Breach of Trust Child Labor Noblesse
Favoritism oblige
Employee
welfare
 Ethical Philosophies

Utilitaria Rights Justice

Straw men Theories
n& theory
Kantian
Friedman Doctrine -resources
are for profit oriented, not
social contribution and obey -Maximization of
the law Veil of
good and the Recognize and
ignorance
Cultural Relativism – ethics minimization of protect
are the reflections of culture harm fundamental
‘When in Rome do as the -no discrimination rights of others
Romans do’- upbringing –
religion – family values –
similar to Righteous Moralist
Naive immoralist - follow
others behaviors in host nation,
even if it is wrong
 Determinants of Unethical Behavior
Ethical Dilemma :

Personal social corporations

Organization Ethics
Culture dilemma – ‘Everyone
does it, if I don’t do it
I will loose, if 1
Decision person does it he will
Root of Making
Process gain all, if everyone
Unethical
Behavior
does it, everyone will
gain their share, don’t
feel bad because
Unrealistic
everyone does it’.
performance Leadership
Goals
Etch a Sketch Ethics Case Studies
The Ohio Art company that produce a top Google in China
selling toys.
Faces ethical dilemma: lay off 100 staff & Mission: Organize the world`s accessible and
outsource production to Kin Ki Industrial useful information
in China in the year 2000 due to losses China market:100 million users , Google 30%
from financial crisis & sales drop. share
Tremendous cost pressure: unionized Google ethical dilemma: information
worker $1,500/m vs china labor $75/m. censorship by government which blocked some
sites
The main cost is the health benefits of US Solving problems: establish its own computer
unionized worker. servers and a Chinese homepage, self-
Bad news : naïve immoralist of long hours of censorship
child labor, poor welfare & working Human rights: access some information which
conditions, no benefits, discriminations, censored by government ,abandon its principles
greedy Kin ki. to make greater profit, the only search engine
in chain that let users to know if search results
had been censored (customer rights)
Conclusion:
Managers decision to incorporate ethical
consideration for decision making
• Ethics is a subjective matter due to plenty of Grey areas.
Critical factors in ethical business conduct :
Organization Control & Execution Strategy, Mindset
& Organization culture.