chp 4. be and lpg

8/2/2019 Chp 4. BE and LPG

1/19

Business Ethics and

Globalization


2/19

Intense competition for Capital, Resources andMarkets

MNCs operate extensively in more than onecountry so difficult to control them effectively

On international level it is difficult to keep

competition fair and protecting the interest ofworkers and consumer


3/19

The entry of MNC in less developedcountry

MNCs operate immorally by exploiting the natural

resources of the host country, workers andmaking exorbitant profit

They compete unfairly in the host countries totheir detriment


4/19

International issues

The search for universal values as a basis forinternational commercial behavior

Comparison of business ethical traditions indifferent countries, from various religiousperspectives

Ethical issues arising out of internationalbusiness transactions like the fair trademovement; transfer pricing


5/19

Sexual and racial discrimination

Corruption and Bribery

The way in which multinationals take advantageof international differences


6/19

International traders must abide by followingminimum moral guidelines:

The moral minimum must be obeyed and observed

MNCs activities must do good to the hostcountries which not only limited to selfish leaders


7/19

Respect human rights and dignity of workers,consumers and people of host countries

The MNCs must show respect to laws, culture andlocal values of host country as civilized guest.

Actively cooperate with host country to set upbackground institution for world trade


8/19

Ethics in Global Business

The Caux Principles


9/19

The Cuax Round Table consisted of a group ofinternational executive in Caux, switzerlanddeveloped their principles based in the convictionthat we can all live together and act for thecommon good


10/19

These are rooted in two basic ethical ideas:

Kyosei Japanese concept

living and working together for common good

Human dignity value of each person asends


11/19


12/19

Section 2- General principles

Principle 1: the responsibilities of businesses:beyond shareholders toward stakeholders

Principle 2: The economic and social impact ofbusinesses: towards innovation, justice and worldcommunity

Principle 3: Business behavior: beyond the letter oflaw toward a spirit of trust


13/19

Principle 4: Respect for rules

Principle 5: support for multilateral trade

Principle 6: Respect for the environment

Principle 7: Avoidance of illicit operations


14/19

Section 3. Stakeholders Principles

Customers

Employees

Owners/investors

Suppliers

Competitors

Communities


15/19

Cultural Differences

Cultural differences is the biggest challenge


16/19

Reducing such issues

Decrease employee turnover

Reduces hiring and training cost

Reputation of product brands and companyenhances

With diverse workforce company enjoysgoodwill and community support


17/19

Corporate transgression

Transgression is a violation of a law, command or duty

a major socio-political problem


18/19

Resolving

Laws play major role in regulation

Ingenuity applying ideas to solve problems/ meetchallenges

Corporate courage


19/19

Examples

Bhopal case

Enron

Boforce etc.

chp 4. be and lpg

Documents