Beruflich Dokumente
Kultur Dokumente
K. Praveen Parboteeah
Objectives
What is ethics and social responsibility? How does national culture and social institutions affect ethics? Bribery and Foreign Corrupt Practices Act What can be done about it?
When in Rome, do as the Romans? Universal values
Ethics in Japan
Cigarettes in LDC contain more tar and harmful chemicals Should tobacco be cultivated?
Introduction
Multinational managers face complex ethical issues all the time With an understanding of key ethical problems in multinational management, managers can make more informed ethical judgments
Social Responsibility
The responsibility businesses have to society beyond making profits Often reflects the ethical values and decisions of the top management team Ethics and social responsibility- not easily distinguished in practice
Research Evidence
Cullen, Parboteeah & Hoegl (2004) shows that specific cultural/institutional variables are associated with justification of unethical behaviors
Universalism, Pecuniary Materialism lead to more unethical behavior Industrialization, Family Weakness and Education
Non-Marxist Critic
False needs and overproduction wasteful nature of the system The Military-Industrial complex Inequalities inherent in the system
In Defense of Capitalism
Great emphasis on the importance and value of human freedom Political freedom is only possible with economic freedom Enormous stride in the ability to produce goods and services very efficient Redistribution of wealth
Although Bill Gates has become the richest man in around 15-20 years, large number of other people have benefited from the Microsoft wealth
No system is perfect
Bribery
Making a payment to a foreign official for the purpose of influencing any act or decisions of such foreign official in his in his official capacity or of inducing such foreign official to do or omit to do any act in violation of the lawful duty of such official A bribe is made with the intention to corrupt Classic case of Lockheed Corporation paid Japanese officials $25million to win an aircraft contract
Exceptions:
Grease payments facilitating payments to expedite routine governmental action Reasonable expenditures to entertain a foreign official in the course of doing business Any laws that permits or requires payments in the country even if it is bribe
Key Issues
Some evidence that discontinuing bribes does not reduce sales of the firms products or services in that country Some evidence that firms from other countries continue to win business through corrupt practices such as bribery Recent formal agreement by many industrialized nations to outlaw the practice of bribing foreign government officials
Criticisms of Multinationals
Multinationals operate in LDC to seek cheap labor, available resources, tax shelters and relief and new markets Unfair competition of MNCS
Can borrow at great rates from local lenders and do not carry fair share of social development Increase in tax rate
DeGeorges 7 principles
Multinationals (MNCs) should do no harm MNCs should produce more good than bad for the host country MNCs should contribute by their activities to the host countrys development MNCs should respect the right of their employees MNCs should pay their fair share of taxes To the extent that the local culture does not violate moral norms, MNCs should respect these norms MNCs should cooperate with the local governments in the development and enforcement of background institutions
Ethics in Japan
Japanese cabinet member forced to resign for receiving over $2 million from Japanese corporations Failure of banking system to take corrective action regarding Japans recession Concealing customer complaints Failure to inform car owners about possible auto defects and maintenance of two sets of customer complaint records
Ethics in Japan
Hostile work environment
Cultural expectations
Traditional role of females and female employees Sexual harassment may not be considered a moral issue
Conclusions
Multinational managers face ethical challenges magnified by the international context Need to understand home ethical codes and impact on ethics of foreign culture/social institutions