Int B Module 4

Sustainability as a way of doing business is increasingly demanded by international customers. One approach to sustainable business practices is stakeholder theory. This exercise explores this theory in its practice by an international entrepreneur. Concerns about sustainability often accompany approaches to renewable power resources. Sustainability with regard to renewable power sources involves taking care of the present needs and future needs at the same time. Stakeholder theory rests on a set of assumptions about what business is that differs tremendously from the more traditional economic model. Read the case below and answer the questions that follow. Mark Anderson is about to make a decision about how to approach building a wind turbine to generate electricity on some property his surfboard manufacturing and repair business owns in Indonesia. Waves' HQ is on the Massachusetts coast, has been wind powered for years, has a small carbon footprint, and tries to follow sustainable practices. The Indonesian property is ideal for a wind turbine; it is isolated and receives significant wind. Its present power supply is unreliable and the manufacturing facility uses back-up propane generators. His wind power consultant suggests that excess power generation could result in reliable power to the local community, at lower rates. Waves' traditional business model has been an economic one, to focus on the bottom line, albeit somewhat loosely, since the margins in this area are pretty hefty and the competent competition thin, but recently Mark has been hearing and reading about a broader way to think of his business decisions, as an entity in a social context. Waves has always thought of the surrounding environment and the migrant surfing community it serves, but the bottom line has always been his focus for business decisions, with any social spending taken off the profitability side of the business. Mark estimates that this has been in the 10 - 15 % range over the years. If Mark were to follow a traditional model for this decision, which he has plenty of practice applying pretty successfully, it would involve an economic analysis of the costs, benefits, and payback period of the investment. He wonders how to apply the stakeholder model for this decision.

1. At what point would Waves' social context come into play, using the Stakeholder Model for the decision to build wind power generation capability in Indonesia? at the very beginning of the process, with discussions with all stakeholders about the pros and cons 2. In this consultation process, who would the stakeholders be? all internal constituencies and all identifiable external constituencies, including the present power supplier 3. The three characteristics of sustainable business that Waves would try to meet are _____. limits, interdependence, and equity 4. As Mark thinks about the Stakeholder Model, he decides that it is an optimistic vision for business. This is because stakeholder theory _____. assumes that the tensions among stakeholders can be balanced 5. Waves uses triple-bottom-line accounting. What does this reporting approach include? measures of social, environmental, and economic impacts of the business

Attitudes towards time - 2 aspects

1. Focus on past, present & future. 2. Actions sequential (linear) or synchronous (polychronic)

Kuwait began a development program in 2007 based on petroleum earnings. Here we consider the project in the light of what Chapter 4 covers on nonrenewable energy sources. Nonrenewable energy sources are essentially the fossil fuels, whose lifespan is limited. Chapter 4 covers the resources Kuwait holds in petroleum reserves.

According to the video, the oil boom in Kuwait has fueled a bull market. Kuwait's share of oil exports in 2007 amounted to $60,000 for each citizen This short video explores Kuwait's efforts to build a financial center

Culture include:

Aesthetics, religion, language and political structures

Individualism/ Collectivism

Ben

Pragmatism/Normative Behavior

Bill

Which member country is most interested in renegotiating NAFTA energy trade agreements?

Canada

Natural capital includes resources such as air, land, and water that provide us with the goods and services on which our survival depends. Natural capital is the basis for everything we do as humans. One way to understand natural capital is to look at it through the lens of geography and how location, topography, and climate influence the conduct of international business. Topography influences language patterns. Climate influences settlement patterns. Water availability influences settlement patterns and their density. Proximity leads to trade relationships. All of these relationships influence trade.

Central Asian Hindu Kush- Mountainous regions create barriers, accessibility issues. Austria and her neighbors- Proximity leads to trade relationships. China and Switzerland - Mountainous villages developed seperate languages Columbia - altitude differences create seperate markets Australia - Only continent without inland waterway

Material Culture

Classical Theatre & Cooking

Aesthetics

Color of mourning & music and folklore

Uncertainty Avoidance

Elena

Language Communication

Facial expressions & gestures

"Petroleum man" faces only possible inevitable extinction, as we currently understand resources.

False

ASEAN, whose initial goal was political, to foster peaceful relations among members, includes China as its core member.

False

Above-ground issues do not impact territories available for oil exploration.

False

All EU members use the euro, and thus have given up part of their national sovereignty to the EU.

False

Although the EU can influence the practices of businesses located in non-EU member countries, Microsoft has been able to maintain business in the EU much as it conducts business in the U.S.

False

Among trading blocs, the EU has the largest GDP per capita.

False

An important assumption that the IMF makes is that a strong organization with rules and penalties for their violation is necessary to support trade.

False

Anthropologist E. T. Hall suggests that you need to read a culture's history to learn it.

False

Business makes few costly mistakes in product introductions into foreign markets.

False

Climate differences explain differences in human and economic development, with Southern climates limiting human mental powers.

False

Cultural attitudes toward change do not affect the acceptance of new production methods.

False

Economic cooperation often begins with a common market as in the case of the EU.

False

Every coast between 20 and 30 degrees of the equator (north or south) is wet.

False

Formal institutions operate through laws and regulations. They require members to make a written commitment.

False

Hofstede describes his pragmatic versus normative dimension as dealing with Virtue only when it is coupled with Truth.

False

Hofstede's individualism-collectivism dimension measures the degree to which economic activity is socialist (communal) or capitalist (independent).

False

In low context cultures, people tend to form long-lasting relationships that endure over time.

False

International business managers need to be able to speak foreign languages.

False

Leadership traits build on the basic idea that all people want to be led and directed, regardless of the local culture.

False

Limits, interdependence, and equilibrium are characteristics of sustainable business practices.

False

Nuclear power is a leading contributor to the Canadian energy grid.

False

Recently, regional trade agreements have grown, a trend that may be seen to strengthen the World Trade Organization (WTO), according to the text.

False

The EU has been unsuccessful at harmonizing customs and tax formalities within their borders.

False

The EU is administered by the European Commission, a group composed of 27 commissioners, elected at the EU level.

False

The International Court of Justice (ICJ) handles all cases brought forward by any person or organization.

False

The UN General Assembly is the main staff organization responsible for the UN administration.

False

The following is an area in which the UN plays a significant role for international business: loaning seed money for entrepreneurial startups in developed nations.

False

Through 2035, coal is expected to remain the world's dominant energy source.

False

Trading blocs always bring cost savings to international firms.

False

Walmart discovered that it could not compete on price and build a sustainable business.

False

We are each born with a knowledge of our culture.

False

When operating in other cultures, if we realize that, underneath it all, we are all different, we will be fine.

False

When we use cultural frameworks to build our understanding of another culture, we enter a values-free zone.

False

Social Organizations

Family & Facebook

Examples of informal, normative institutions would include local town/city governments and the U.S. government.

Fasle

Masculinity/ Femininity

Jiro

Culture plays a significant role in the disciplines of:

Leadership, accounting, finance, marketing, human resource and production.

Environmental sustainability is about maintaining the environment, the economy, or people within the economy or the organization. It requires businesses to develop new approaches to the way they operate. Businesses that are committed to environmental sustainability accept their responsibility for caring for the environment and share several distinct characteristics.

Limits - Environmental resources are exaustible. Equity in Distribution - All stakeholders have to benefit. Interdependence - Complex relationships that sustainable practices create among ecological, social, and economic systems.

Power Distance

Ming

Culture includes everything but:

None of the above. Religion, politics, higher education & universal values

The main motivation behind the creation of The European Union was:

Security Concerns

Achievement v. Ascripton:

Status based on what a person does v. who a person is

A culture's aesthetics is the sense of beauty and good taste.

True

Although some business areas, such as accounting and finance, are quantitative, they are at the same time affected by culture.

True

An example of an informal, cognitive institution would be the celebration of Halloween in the U.S.

True

Because of Austria's location and neutrality in the Cold War, it became a favored location for offices of international firms servicing eastern European operations.

True

Biomass is a category of renewable energy fuels based on photosynthesis.

True

Cognitive institutions are important to the international manager because these institutions help the manager understand the schema operating in their international environments and are easily missed or misunderstood by the nonnative so can easily lead to misunderstandings.

True

Early business sustainability efforts focused on the internal aspects of conservation, such as resource use.

True

Even though it is a high polluter, coal is not on the decline as an energy source.

True

Feminine cultures in Hofstede's dimensions care about relationships and are also focused on business success. For them, it is quality of life, both work and private, that matters.

True

Geographic proximity is often a major reason for trade.

True

Greenpeace does not support extraction of shale oil from proven reserves.

True

Heavy oil includes oil sands, oil-bearing shale, natural gas, and coal.

True

Hofstede's framework is based on empirical data.

True

In Hall's use, context is relevant in a communication act.

True

In Human Resources, the American employee protection laws (Equal Employment Opportunity Commission [EEOC]) are in force for an American company in foreign labor markets.

True

In a customs union, common external tariffs are added to an existing FTA, as found in the Southern African Customs Union and Mercosur.

True

Institutions are constructed to provide meaning and stability to social life, regulate the relations of individuals to each other, and limit behavior of individuals and firms.

True

Life cycle assessment (LCA) is a concept that addresses the environmental impact of a product throughout its lifetime.

True

Nonrenewable energy sources include coal and fossil fuels.

True

Sustainability requires a totally new approach to business.

True

Sustainable approaches in business need not involve trade-offs such as lower profits.

True

The EU is a supranational body that has become, essentially, a regional government.

True

Trompenaars's achievement versus ascription dimension describes social status based on what one does or who one is. The United States is a culture in which people build who they are through work, so its social status tends to be based on achievement.

True

Trompenaars's dimension of individualism versus communitarianism and Hofstede's individualism-collectivism dimension are similar.

True

Trompenaars's dimension of universalism versus particularism measures whether universal rules or relationships regulate behaviors.

True

eBay profits from sustainability efforts.

True

It is important for businesses to state their commitment to environmental sustainability. It is also important to measure how successful they are at achieving their goals. The tools for measuring environmental sustainability with the description.

UN Global Compact - Addresses human rights, labor, the enviornment, and anti-competition. Global reporting initiative - Provides information on how to report, what to report, what performance indicators to use, and how to apply them. Carbon Disclosure Project- Provides reporting framework for sustainable water use and the reduction of greenhouse gas emissions. Footprinting - Attempts to measure the volume of greenhouse gas emissions caused by a product's manufacture and use.

Which of the following was not among the 6 founding members of European Union:

United Kingdom

Monochronic time is best illustrated by:

University scheduling patterns

European Commission:

administers the daily operations of the EU

Attitudes toward environment:

in harmony with nature or in control of nature

European Parliament:

represents the people of Europe and is elected from member-states