BUSINESS ETHICS IN A

GLOBAL ECONOMY
Ramsha khan

INTERNATIONAL BUSINESS ETHICS

International business ethics deals with the question of what

t do in situation where ethical moral come into conflict as a
result of different culture practices.

The importance of international business ethics has been

rising steadily along with the growth of international
business. Technologies like the Internet have made
international business all the more viable, and many
companies can only find the desirable growth and profit
they seek by expanding into new markets.

CULTURE

Everything in our surrounding made by people, both tangible

and intangible

Language, religion, law, politics, technology, education, social

organization, general values, and ethical standards

Differences in speech and body language.

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CULTURAL AND ETHICAL

RELATIVISM

Cultural relativism means that morality varies from one culture

to the next (business practices are defined as right or wrong
based on a particular culture)

Relativism :the belief that different things are true, right, etc.,
for different people or at different times.

Ethical relativismis the theory that holds that morality is

relative to the norms of one's culture. That is, whether an action
is right or wrong depends on the moral norms of the society in
which it is practiced. The same action may be morally right in
one society but be morally wrong in another.
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MULTINATIONAL CORPORATIONS

Amultinationalcorporation (MNC) is a corporation that has its

facilities and other assets in at least one country other than its
home country. Such companies have offices and/or factories in
different countries and usually have a centralized head office
where they co-ordinate global management.

Corporate organizations that operate on a global scale without

significant ties to any one nation or region

Because of their size and financial power, MNCs have been

criticized for engaging in unethical behavior.

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GLOBAL ETHICAL ISSUES

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racial discrimination
Human rights
Price discrimination
Bribery
Harmful products
Pollution
Telecommunications issues
Intellectual property protection
The World Trade Organization (WTO)

RACIAL DISCRIMINATION

Racial discriminationis when a

person is treated less favorably than
another person in a similar situation
because of theirrace, color, descent,
national or ethnic origin or immigrant
status.

sara unsuccessfully applies for a job as

a receptionist with a large hotel. When
she calls the human resources
manager to ask why she did not get
the job, she is told that the manager
doesnt want to employ a receptionist
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with
an accent.

HUMAN RIGHTS

Concern for the well-being of employees; key

concerns are use of child labor, payment of low
wages, and abuses in foreign factories

Multinational corporations should view the law

as the floor of acceptable behavior and strive to
improve workers quality of life.

The Human Rights Act is based on the European

Convention on Human Rights and adds
protection for workers' rights and freedoms.
Provisions within the Act deal with work-related
matters.
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PRICE DISCRIMINATION

Occurs when a firm charges different prices to different groups of

customers (these differences are legal if they do not reduce
competition, or can be justified on the basis of cost)

Price discriminationis apricingstrategy that charges customers

differentpricesfor the same product or service. In pureprice
discrimination, the seller will charge each customer the maximum
pricethat he or she is willing to pay.

Gouging is when unusually high prices are charged due to a shortage.

Dumping involves charging high prices for a product at home and low prices in
foreign markets.

The practice of charging high prices for products sold in domestic markets while
selling the same products in foreign markets at low prices, often below the costs of
exporting them
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BRIBES
Definitions

BribesRelatively large amounts

of money given far the purpose
of influencing officials to make
decisions or take actions that
they otherwise might not take.

Example

Money given, often to high-ranking

officials. Purpose is often to get these
persons to purchase goods or services
from the bribing firm.

HARMFUL PRODUCTS

Pesticides

Tobacco products

Dumping of waste materials

Products become harmful because of illiteracy,

unsanitary conditions, and cultural values

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TELECOMMUNICATIONS
ISSUES

Day trading
Money laundering

Illegally received funds are

transferred or used in a
financial transaction so as
to conceal the actual
owner.

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INTELLECTUAL PROPERTY
PROTECTION

Violations of copyright laws

Copyrightis a legal right created by the law of a country that

grants the creator of an original work exclusive rights for its use and
distribution. This is usually only for a limited time.

Published and unpublished materials

Napster

Trademark infringement is the unauthorized use of atrademarkor

service mark on or in connection with goods and/or services in a
manner that is likely to cause confusion, deception, or mistake
about the source of the goods and/or services
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IMPROVING GLOBAL
BUSINESS ETHICS

Inflict no intentional
or direct harm

Produce more good

than bad for the host
country

Contribute to host
countrys
development

Respect the human

rights of their
employees

Pay their fair share of

taxes

Respect local cultural

beliefs that do not
violate moral norms

Cooperate with the

government to
develop and enforce
background
institutions