DIFFERENCES IN CULTURE (CH. 3) DIFFERENCES IN CULTURE (CH. 3)

ANDAND

ETHICS IN INTERNATIONAL BUSINESS (CH. 4)ETHICS IN INTERNATIONAL BUSINESS (CH. 4)

Supplementary Mid-Term Exam Substitute Supplementary Mid-Term Exam Substitute Course Assignment: Class Presentation for Chapters 3 & 4 Course Assignment: Class Presentation for Chapters 3 & 4

Overview and Formal ReportOverview and Formal ReportTeam: Zakimy Correa-Castro and Scott GreenTeam: Zakimy Correa-Castro and Scott Green

Golden Gate UniversityGolden Gate University

What is Business Ethics What is Business Ethics and and

What Defines an Ethical Dilemma?What Defines an Ethical Dilemma?

Business Ethics – The accepted principles of right or wrong governing the Business Ethics – The accepted principles of right or wrong governing the conduct of business people.conduct of business people.

Ethical Dilemma – The quandary people find themselves in when they have to Ethical Dilemma – The quandary people find themselves in when they have to decide if they should act in a way that might help another person or group decide if they should act in a way that might help another person or group even though doing so might go against their own self-interest.even though doing so might go against their own self-interest.

Ethical Strategy – A course of action that does not violates ethical principles.Ethical Strategy – A course of action that does not violates ethical principles.

BusinessBusiness

EthicsEthics

AppropriateAppropriate InappropriateInappropriate

Venn Diagram

Stakeholders Affected By Business EthicsStakeholders Affected By Business Ethics

Ethical Issues Ethical Issues in in

International BusinessInternational Business

Employment PracticesEmployment Practices

Human RightsHuman Rights

Environmental PollutionEnvironmental Pollution

CorruptionCorruption

Moral ObligationMoral Obligation

Three Major US Employment Laws Often Accepted and Three Major US Employment Laws Often Accepted and Applied to International Cases Under Certain Provision and PretextApplied to International Cases Under Certain Provision and Pretext

Age Discrimination in Employment Act of 1967 (ADEA)Age Discrimination in Employment Act of 1967 (ADEA)

Select Cases that extended outside the US:Select Cases that extended outside the US:(De Yoreo v. Bell Helicopter Textron, Inc., 1986; Lopez v. Pan Am World Services, Inc., 1987; Wolf v. J. I. Case Co., 1985).

Title VII of the Civil Rights Act of 1994, as amended in 1991 (Title VII)Title VII of the Civil Rights Act of 1994, as amended in 1991 (Title VII)

Select Cases that extended outside the US:Select Cases that extended outside the US:(Akgun v. Boeing Co., 1990; Bryant v. International Schools Services, Inc., 1980; EEOC v. Bermuda Star Line, Inc., 1990; Love v. Pullman Co., 1976; Seville v. Martin Marietta Corp., 1986).

Americans With Disabilities Act of 1990Americans With Disabilities Act of 1990

Select Cases that extended outside the US:Select Cases that extended outside the US:(Arno v. Club Med, 1994; Kimble v. Holmes & Narver Services, 1993; Peterson v. DeLoitte & Touche, 1993).

PracticesPracticesEmploymentEmployment

Human RightsHuman RightsA Few United Nations’ Covenants, Conventions, and AdoptionsA Few United Nations’ Covenants, Conventions, and Adoptions

International Covenant on Civil and Political Rights of 1966 International International Covenant on Civil and Political Rights of 1966 International Covenant on Economic, Social, and Cultural Rights of 1966 Covenant on Economic, Social, and Cultural Rights of 1966

Convention on the Elimination of All Forms of Racial Discrimination (entry into Convention on the Elimination of All Forms of Racial Discrimination (entry into force 1969)force 1969)

Convention on the Elimination of All Forms of Discrimination Against Women Convention on the Elimination of All Forms of Discrimination Against Women (entry into force 1981)(entry into force 1981)

Convention on the Rights of the Child (entry into force 1989)Convention on the Rights of the Child (entry into force 1989)

International Convention on the Protection of All Migrant Workers and Members International Convention on the Protection of All Migrant Workers and Members of their Families (entry into force 2003)of their Families (entry into force 2003)

Environmental PollutionEnvironmental Pollution5 Major Intergovernmental Environmental Organizations 5 Major Intergovernmental Environmental Organizations

Along With Hundreds of NGOs (Private Non-Governmental Organizations Not Along With Hundreds of NGOs (Private Non-Governmental Organizations Not Listed Below) Providing Oversight and Best Practice MethodologiesListed Below) Providing Oversight and Best Practice Methodologies

European Environment Agency (EEA)European Environment Agency (EEA)

Kyoto Protocol Treaty Kyoto Protocol Treaty

Intergovernmental Panel on Climate Change (IPCC)Intergovernmental Panel on Climate Change (IPCC)

United Nations Environment ProgrammeUnited Nations Environment Programme

Earth System Governance ProjectEarth System Governance Project

Environmental Pollution:Environmental Pollution:Kyoto Protocol (adopted 1997; entry into force 2005), as November 2009 187 Kyoto Protocol (adopted 1997; entry into force 2005), as November 2009 187

Countries have signed and ratifiedCountries have signed and ratified

World’s Top Ten Emitters China1 – 17%, 5.8

United States ® – 16%, 24.1 European Union-27 ® – 11%, 10.6

Indonesia2 - 6%, 12.9 India – 5%, 2.1

Russia ® – 5%, 14.9 Brazil – 4%, 10.0

Japan ® – 3%, 10.6 Canada ® – 2%, 23.2

Mexico – 2%, 6.4

CorruptionCorruption

Foreign Corrupt Practices Act of 1977 (FCPA)

International Banking Act of 1978 (P.L. 95-369, 92 STAT. 607).

International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001* (P.L. 107-56)

Convention on Combating Bribery of Foreign Public Officials In International Business Transactions (entry into force: 1999)

Moral Obligations Moral Obligations

Corporate Social Responsibility (CSR)

Corporate Social ResponsibilityCorporate Social Responsibility is the way a company’s managers and employees view their is the way a company’s managers and employees view their duty or or obligation to make decisions that protect, enhance, and promote the welfare and well- to make decisions that protect, enhance, and promote the welfare and well-

being of stakeholders and society as a wholebeing of stakeholders and society as a whole

Four Different Approaches:

Obstructionist ApproachObstructionist Approach Defensive ApproachDefensive Approach

Accommodative ApproachAccommodative Approach Proactive ApproachProactive Approach

The Roots of Unethical BehaviorThe Roots of Unethical Behavior

Personal EthicsPersonal Ethics

Decision-Making ProcessesDecision-Making Processes

Organization CultureOrganization Culture

Unrealistic Performance Unrealistic Performance ExpectationsExpectations

LeadershipLeadership

An Ethical Solution to Unethical Behavior

Ethics Ombudsman: A manager responsible for A manager responsible for communicating and teaching ethical standards communicating and teaching ethical standards

to all employees and monitoring their conformity to all employees and monitoring their conformity to those standards. to those standards.

Philosophical Approaches To EthicsPhilosophical Approaches To Ethics

Straw Men

- - The Friedman Doctrine: The basic The basicfundamental premise that states thatfundamental premise that states that

only social responsibility of business only social responsibility of business is to increase profit.is to increase profit.

- - Cultural Relativism: The belief that ethics The belief that ethics are nothing more than a reflection of a are nothing more than a reflection of a culture and that firms should simply culture and that firms should simply adopt the ethics of the cultures in which adopt the ethics of the cultures in which they operate.they operate.

- - The Righteous Moralist: The belief that a The belief that a multinational’s home-country standards of multinational’s home-country standards of ethics are the appropriate ones for ethics are the appropriate ones for companies to follow in foreign countries.companies to follow in foreign countries.

- - The Naïve Immoralist: The belief that if a The belief that if a manager of a multinational sees that firms manager of a multinational sees that firms from other nations are not following ethical from other nations are not following ethical

norms in a host nation, that manager should not norms in a host nation, that manager should not either.either.

Rights Theories: Developed in the 20th Century, Developed in the 20th Century, these are theories that recognize that human these are theories that recognize that human beings have fundamental rights and privileges beings have fundamental rights and privileges that transcend national boundaries and cultures. that transcend national boundaries and cultures.

● Utilitarian and Kantian Ethics - Classical advocates of the Utilitarian - Classical advocates of the Utilitarian principle are David Hume (1771-1776), principle are David Hume (1771-1776), Jeremy Bentham (1784-1832), and Jeremy Bentham (1784-1832), and John Stuart Mill (1806-1873). The John Stuart Mill (1806-1873). The Utilitarian Approaches to Ethics hold Utilitarian Approaches to Ethics hold that the moral worth of actions is that the moral worth of actions is determined by their consequences.determined by their consequences.

- Based on the philosophy of Immanuel - Based on the philosophy of Immanuel Kant (1724-1804), the Kantian Kant (1724-1804), the Kantian approach to ethics hold that people approach to ethics hold that people should be treated as ends and never should be treated as ends and never purely as purely as means means to the ends of others.to the ends of others.

Justice Theories: They are theories that They are theories that focus on the attainment of a just distribution focus on the attainment of a just distribution of economic goods and services.of economic goods and services.