LESSON 5 Ethics PART 2

Ethical Strategy

A strategy, or course of action, that does not violate these accepted principles.

Rawls

Accourding to ?impartiality is guaranteed by the veil of ignorance (everyone is imagined to be ignorant of all his or her particular characteristics).

Environmental regulations

Ethical issues arise when ? in host nations are far inferior to those in the home nation.

Employment practices

If the work conditions in a host nation are clearly inferior to those in multinational's home, should companies apply: Home country standard, Host country standards, and Something in between.

Human rights

In developed countries, basic human rights such as freedom of association, freedom of speech, freedom of assembly, and freedom of movement, are taken for granted. While in other countries, these rights may not exist.

Emmanuel Kant

Kantian ethics are based on the philosophy of ? who argued that people should be treated as ends and never purely as means to the ends of others.

Ethics / Business Ethics

Refers to the accepted principles of right or wrong that govern the conduct of a person, the members of a profession or the actions of an organization.

Righteous moralist

approach claims that a multinational's home country standards of ethics should be followed in foreign countries.

Straw men

approach denies the value of business ethics or apply the concept in an unsatisfactory way.

Utilitarian

approaches to ethics hold that the moral worth of actions or practices is determined by their consequences.

Ethical dilemmas

are situations in which none of the available alternatives seems ethically acceptable. real-world decisions are complex, difficult to frame, and involve consequences that are difficult to quantify.

Cultural relativism

argues that ethics are culturally determined and that firms should adopt the ethics of the cultures in which they operate, or in other words, "when in Rome, do as the Romans do."

Naïve immoralist

asserts that if a manager of a multinational sees that firms from other nations are not following ethical norms in a host nation, that manager should not either.

Justice theories

focus on the attainment of a just distribution of economic goods and services.

Rights theories

recognize that human beings have fundamental rights and privileges which transcend national boundaries and cultures.

Social responsibility

refers to the idea that business people should take the social consequences of economic actions into account when making business decisions, and that there should be a presumption in favor of decisions that have both good economic and good social consequences.

Universal Declaration of Human Rights

specifies the basic principles that should always be adhered to irrespective of the culture in which one is doing business.

Friedman doctrine

suggests that the only social responsibility of business is to increase profits, so long as the company stays within the rules of law.

Decision Making Process

the values and norms that are shared among employees of an organization.

Personal ethics

(the generally accepted principles of right and wrong governing the conduct of individuals) influence business ethics.

curroption

The U.S. Foreign Corrupt Practices Act outlawed the practice of paying bribes to foreign government officials in order to gain business.

Personal ethics Decision-making processes Organizational culture Unrealistic performance expectations Leadership Societal Culture

The causes of unethical behavior are complex and reflect:

Friedman doctrine Cultural relativism Righteous moralist Naïve immoralist

There are four common straw men approaches:

Employment practices Human Rights Environmental regulations Corruption

Which Ethical Issues Are Most Relevant to International Firms? The most common ethical issues in business involve:

organizational culture

can legitimize unethical behavior or reinforce the need for ethical behavior.

Unrealistic performance expectations

encourage managers to cut corners or act in an unethical manner

Societal Culture

firms headquartered in cultures where individualism and uncertainty avoidance are strong are more likely to stress ethical behavior than firms headquartered in cultures were masculinity and power distance rank high.

Leadership

helps establish the culture of an organization, and set the examples that others follow.