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Chapter Twelve

International Business and Globalization

Ethical Relativism Revised
• Do not assume that diverse cultures have diverse
ethical values
• Principles that are held may not be practiced
because of circumstance not abandonment of the
principle (bribery)
• The preservation of one’s integrity is necessary
because integrity is the very core of one’s self
• Be clear about how ethical is defined (different
cultures may have a better view than the West)
International Rights
• Moral minimum - acknowledge the “negative
duty” to do no harm
• Moral maximum – the greater the power the
more the responsibility to provide positive
benefits and support to communities
• Donaldson
– United Nations “Universal Declaration of Human
• DeGeorge
– Ten shoulds for multinational corporations
Context of International Business
• Globalization defined “process of international
economic integration”
• Free Trade – pursuit of profit within social and
economic arrangements that secure free and
open competition.
– This will
• Allocate resources to their most highly valued use
• Distribution in this manner will produce the greatest good
for the greatest number of people
• Improve poverty
• Reduce conflict between nations
Counter view
• Create a “race to the bottom”
– Lowest wages, lowest environmental standards,
lowest health and safety, lowest equal rights and
lowest level of self-determination
Does creation of mobile jobs support
the poor
• As jobs are exported lower level jobs
disappear in one country but appear in
another because people will have to choose
between economic death or a low paying job
• Reduces people to an economic equation and
disregards theoretical benefits such as
Behavior in other countries
• Use of contract labor as a means of avoiding
Impact of Trade barriers
• Regulation bars access to markets (tuna,
hormones in beef)
Impact of Global Organizations
• World Trade Organization
• World Bank
• International Monetary fund
– Agenda - if you embrace western capitalism then you receive
• Defense
– Regulation seems to increase environmental, worker, and
consumer protection
– Thee organization were created by governments in the
countries regulated
– These organizations are courts or arbitrators trying to resolve
conflict. This is best done in private rather than in public forms.
Remember they are not legislative bodies