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FACULTY OF ECONOMICS AND BUSINESS ADMINISTRATION

VALUES-PERSONAL OR CULTURAL ?
WHERE DOES BUSINESS ETHICS STAND ?

Contents
1.Personal and cultural values.......................................2
2.Dimensions of Culture..................................................4
2.1 American Culture.......................................................5
2.2 Culture in India...........................................................6
2.3. Culture in United Kingdom.......................................9
3. Ethics in Business.......................................................9
3.1 Ethical Principles.....................................................10
4.Bibliography................................................................13

1.Personal and cultural values


A personal value is absolute or relative and ethical value, the assumption of which
can be the basis for ethical action. A principle value is a foundation upon which
other values and measures of integrity are based.
Personal values provide an internal reference for what is good, beneficial,
important, useful, beautiful, desirable, constructive, etc.Personal values develop
from circumstances surrounding us, and can change over time. For example,
people who apply their values appropriately regardless of arguments or negative
comments from others are said to have integrity. Understanding and recognizing our
personal values and interests is important to assist us in making healthy and
responsible decisions for our future.
Personal values are implicitly related to choice; they guide decisions by
allowing for an individual's choices to be compared to the associated values of each
choice. Personal values are not universal; one's family, nation, generation and
historical environment help determine one's personal values. This is not to say that
the value concepts themselves are not universal, but that each individual possess a
unique view of them (i.e. a personal knowledge of the appropriate values for their
own genes, feelings and experience).
Personal values exist in relation to cultural values, either in agreement with
or divergence from prevailing norms. A culture is a social system that shares a set
of common values, in which such values permit social expectations and collective
understandings of the good, beautiful, constructive, etc. Without normative personal
values, there would be no cultural reference against which to measure the virtue of
individual values and so culture identity would disintegrate.
Values are applied appropriately when they are applied in the right area. For
example, it would be appropriate to apply religious values in times of happiness as
well as in times of despair. Values generate behaviour and help solve common
human problems for survival by comparative rankings of value, the results of which
provide answers to questions of why people do what they do and in what order they
choose to do them
The values of a society can often be identified by noting which people receive honor
or respect. Because values differ across cultures, an understanding of these
differences should be helpful in explaining and predicting behavior of employees
from different countries

Value

Value Description

High Score

Low Score

Power

The degree of equality,

Indicates that inequalities of power and

Indicates the society de-

Distance

or inequality, between

wealth have been allowed to grow

emphasizes the differences

Index (PDI)

people in the country's

within the society. These societies are

between citizen's power and

society

more likely to follow a caste system that

wealth. In these societies

does not allow significant upward

equality and opportunity for

mobility of its citizens.

everyone is stressed.

Dimension

Individualism

Degree to which a

Indicates that individuality and

Typifies societies of a more

(IDV)

society reinforces

individual rights are paramount within

collectivist nature with close

individual or collective

the society. Individuals may tend to

ties between individuals.

achievement and

form a larger number of looser

Reinforce extended families

interpersonal

relationships.

and collectives where

relationships.

everyone takes responsibility


for fellow members of their
group.

Masculinity

Degree to which a

Indicates the country experiences a

Indicates the country has a

(MAS)

society reinforces, or

high degree of gender differentiation.

low level of differentiation

does not reinforce, the

Males dominate a significant portion of

and discrimination between

traditional masculine

the society and power structure, with

genders. Females are

work role model of

females being controlled by male

treated equally to males in all

male achievement,

domination.

aspects of the society.

control, and power


Uncertainty

Level of tolerance for

Indicates the country has a low

Indicates the country has

Avoidance

uncertainty and

tolerance for uncertainty and ambiguity

less concern about ambiguity

Index (UAI)

ambiguity. within the

Creates a rule-oriented society that

and uncertainty and has

society i.e.

institutes laws, rules, regulations, and

more tolerance for a variety

unstructured situations.

controls in order to reduce the amount

of opinions. Reflected in a

of uncertainty.

society that is less ruleoriented, more readily


accepts change, and takes
more and greater

Long-Term

Degree to which a

Indicates the country prescribes to the

Indicates the country does

Orientation

society embraces, or

values of long-term commitments and

not reinforce the concept of

(LTO)

does not embrace,

respect for tradition. This is thought to

long-term, traditional

long-term devotion to

support a strong work ethic where long-

orientation. In this culture,

traditional, forward

term rewards are expected as a result

change can occur more

thinking values.

of today's hard work. However,

rapidly as long-term

business may take longer to develop in

traditions and commitments

this society, particularly for an

do not become impediments

"outsider".

to change.

2.Dimensions of Culture
Is a widely accepted industry tool that is used to measure cultural differences. One
of the commonly used dimensions is Geert Hofstedes Cultural Dimensions, where
cultural data was initially collected from IBM employees from 70 countries, then
further enhanced with data from commercial airline pilots and students in 23
countries, civil service managers in 14 counties up-market consumers in 15
countries and elites in 19 countries.
The dimensions are :

High power distance versus low power distance:

Power distance is the degree to which people in a country accept that power in
institutions and organizations is distributed unequally.
A high-power-distance rating means that large inequalities of power and wealth
exist and are tolerated in the culture. Such cultures are more likely to follow a
class or caste system that discourages upward mobility of its citizens.
A low-power-distance ranking indicates the culture discourages differences
betweenpower and wealth. These societies stress equality and opportunity.

Individualism versus collectivism:

Individualism is the degree to which people


prefer to act as individuals rather than as members of groups and believe in
individual
rights above all else. Collectivism emphasizes a tight social framework in which
people
expect others in groups of which they are a part to look after them and protect
them.

Uncertainty avoidance:

This is the degree to which people in a country prefer structured over


unstructured situations. In cultures that score high on uncertainty avoidance,
people have an increased level of anxiety about uncertainty and ambiguity. In
cultures that score low on uncertainty avoidance, individuals are less dismayed by
ambiguity and uncertainty and have a greater tolerance for a variety of opinions.
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Masculinity versus femininity

These dimensions reflect the degree to which the


culture favors traditional masculine roles such as achievement, power, and control
versus aculture that views men and women as equals.A high-masculinity rating
indicates the culture has separate roles for men and women, with men dominating
thesociety. A high-femininity rating means that the culture has little
differentiationbetween male and female roles. High femininity does not mean that
the culture emphasizes feminine roles; rather, it emphasizes equality between
men and women.
Long-term orientation versus short-term orientation
This newest addition toHofstedes typology focuses on the degree of a
societys long-term devotion to traditional values. People in cultures
with long-term orientations look to the future andvalue thrift,
persistence, and tradition. In a short-term orientation, people value the
here and now, change is accepted more readily, and commitments do
not representimpediments to change.

2.1 American Culture


Culture reflects ones values and international students sometimes may be faced
with values that conflict with their own. Its important to take note of these cultural
differences,as you will soon realize that they are not personal differences and you
should not take them as such:
Americans no longer believe in the power of Fate, and they have come to
look at people who do as being backward, primitive, or hopelessly naive
Most Americans find it impossible to accept that there are some things that
lie beyond the power of humans to achieve. And Americans have literally
gone to the moon, because
they refused to accept
earthly limitations.
In the American mind,
change is seen as an
indisputably good condition.
Change is strongly linked to
development, improvement,
progress, and growth

Many older, more traditional cultures consider change as a disruptive,


destructive force, to be avoided if at all possible. Instead of change, such
societies value stability, continuity, tradition, and a rich and ancient heritage
none of which are valued very much in the United States.
Equality is, for Americans, one of their most cherished values. This concept
is so important for Americans that they have even given it a religious basis.
They say all people have been "created equal." Most Americans believe
that God views all humans alike without regard to intelligence, physical
condition or economic status.
Americans think they are more individualist in their thoughts and actions
than, in fact, they are. They resist being thought of as representatives of a
homogenous group, whatever the group. They may, and do, join groupsin
fact many groupsbut somehow believe theyre just a little different, just a
little unique, just a little special, from other members of the same group.
And they tend to leave groups as easily as they enter them.
If you come from a more formal society, you will likely find Americans to be
extremely informal, and will probably feel that they are even disrespectful of
those in authority. Americans are one of the most informal and casual
people in the world, even when compared to their near relativethe
Western European.
x Americans have a reputation of being an extremely realistic, practical and
efficient people. The practical consideration is likely to be given highest
priority in making any important decision in the United States.
Foreigners generally consider Americans much more materialistic than
Americans are likely to consider themselves. Americans would like to think
that their material objects are just the natural benefits that always result
from hard work and serious intenta reward, they think, that all people
could enjoy were they as industrious and hard-working as Americans.

2.2 Culture in India


Value is placed on respect for an individuals dignity and personal
autonomy. People are not meant to be controlled. One is taught not to
interfere in the affairs of another. Children are afforded the same
respect as adults. Indian parents generally practice noninterference
regarding their childs vocation. Indians support the rights of an
individual. One does not volunteer advice until it is asked for.

To have the patience and ability to wait quietly is considered a good


quality among Indians. Evidence of this value is apparent in delicate,
time-consuming works of art, such as beadwork, quillwork, or
sandpainting. Patience might not be valued by others who may have
been taught "never to allow grass to grow under ones feet."
Generosity and sharing are greatly valued. Most Indians freely
exchange property and food. The respected person is not one with
large savings, but rather one who gives generously. Individual
ownership of material property exists but is sublimated. Avarice is
strongly discouraged. While the concept of sharing is advanced by
most cultures, it may come into conflict with the value placed by the
dominant society on individual ownership.

If we explore the Indian culture through the lens of the 6-D Model, we can get
a good overview of the deep drivers of Indian culture relative to other
world cultures.
Power distance
India scores high on this dimension, 77, indicating an appreciation for
hierarchy and a top-down structure in society and organizations. Employees
expect to be directed clearly as to their functions and what is expected of
them. Control is familiar, even a psychological security, and attitude towards
managers are formal even if one is on first name basis.Communication is top
down and directive in its style and often feedback which is negative is never
offered up the ladder.

Individualism

India, with a rather intermediate score of 48, is a society with both collectivistic
and individualistic traits. The collectivist side means that there is a high
preference for belonging to a
larger social framework in
which
individuals
are
expected to act in accordance
to the greater good of ones
defined in-group(s). For a
collectivist, to be rejected by
ones peers or to be thought
lowly of by ones extended
and immediate in-groups,
leaves him or her rudderless
and with a sense of intense
emptiness.
The
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employer/employee relationship is one of expectations based on expectations


Loyalty by the employee and almost familial protection by the Employer.
The individualistic aspect of Indian society is seen as a result of its dominant
religion/philosophy - Hinduism. The Hindus believe in a cycle of death and
rebirth, with the manner of each rebirth being dependent upon how the
individual lived the preceding life. People are, therefore, individually
responsible for the way they lead their lives and the impact it will have upon
their rebirth. This focus on individualism interacts with the otherwise
collectivist tendencies of the Indian society which leads to its intermediate
score on this dimension.
Masculinity
India scores 56 on this dimension and is thus considered a masculine society.
India is actually very masculine in terms of visual display of success and
power. The designer brand label, the flash and ostentation that goes with
advertising ones success, is widely practiced. However, India is also a
spiritual country with millions of deities and various religious philosophies. It is
also an ancient country with one of the longest surviving cultures which gives
it ample lessons in the value of humility and abstinence. This often reigns in
people from indulging in Masculine displays to the extent that they might be
naturally inclined to. In more Masculine countries the focus is on success and
achievements, validated by material gains. Work is the center of ones life and
visible symbols of success in the work place are ery important.
Uncertainty avoidance
India scores 40 on this dimension and thus has a medium low preference for
avoiding uncertainty. In India, there is acceptance of imperfection; nothing has
to be perfect nor has to go exactly as planned. India is traditionally a patient
country where tolerance for the unexpected is high ; even welcomed as a
break from monotony.
Pragmatism
India has a score of 51 on this dimension, which indicates a preference for a
more long-term, pragmatic culture. In India the concept of karma dominates
religious and philosophical thought. Time is not linear, and thus is not as
important as to western societies which typically score low on this dimension.
Societies that have a high score on pragmatism typically forgive a lack of
punctuality, a changing game-plan based on changing reality and a general
comfort with discovering the fated path as one goes along rather than playing
to an exact plan.
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Indulgence
India receives a low score of 26 in this dimension, meaning that it is a culture
of restraint. Societies with a low score in this dimension have a tendency to
cynicism and pessimism. Also, in contrast to indulgent societies, restrained
societies do not put much emphasis on leisure time and control the
gratification of their desires. People with this orientation have the perception
that their actions are restrained by social norms and feel that indulging
themselves is somewhat wrong.

2.3. Culture in United Kingdom


If we explore the British culture, we can get a good overview of the deep
drivers of British culture relative to other world cultures.
Power distance
At 35 Britain sits in the lower rankings of PDI i.e. a society that believes that
inequalities amongst people should be minimized. Interestingly is that
research shows PD index lower amongst the higher class in Britain than
amongst the working classes. The PDI score at first seems incongruent with
the well established and historical British class system and its exposes one of
the inherent tensions in the British culture between the importance of birth
rank on the one hand and a deep seated belief that where you are born
should not limit how far you can travel in life. A sense of fair play drives a
belief that people should be treated in some way as equals.
Individualism
At a score of 89 the UK is amongst the highest of the individualistic scores,
beaten only by some of the commonwealth countries it spawned i.e. Australia
and the USA. The British are a highly individualistic and private people.
Children are taught from an early age to think for themselves and to find out
what their unique purpose in life is and how they uniquely can contribute to
society. The route to happiness is through personal fulfillment. As the
affluence of Britain has increased throughout the last decade, with wealth
also spreading North, a much discussed phenomenon is the rise of what has
been seen as rampant consumerism and a strengthening of the ME culture.
Masculinity
A high score (masculine) on this dimension indicates that the society will be
driven by competition, achievement and success, with success being defined
by the winner/best in field a value system that starts in school and continues
throughout organisational behaviour.
A low score (feminine) on the dimension means that the dominant values in
society are caring for others and quality of life. A feminine society is one
where quality of life is the sign of success and standing out from the crowd is
not admirable.
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Uncertainty avoidance
At 35 the UK has a low score on uncertainty avoidance which means that as a
nation they are quite happy to wake up not knowing what the day brings and
they are happy to make it up as they go along changing plans as new
information comes to light. As a low UAI country the British are comfortable in
ambiguous situations - the term muddling through is a very British way of
expressing this. There are generally not too many rules in British society, but
those that are there are adhered to (the most famous of which of of course the
British love of queuing which has also to do with the values of fair play).
Pragmatism
In societies with a normative orientation, most people have a strong desire to
explain as much as possible. In societies with a pragmatic orientation most
people dont have a need to explain everything, as they believe that it is
impossible to understand fully the complexity of life. The challenge is not to
know the truth but to live a virtuous life.
With an intermediate score of 51 in this dimension, a dominant preference in
British culture cannot be determined.
Indulgence
A high score of 69 indicates that the British culture is one that is classified as
indulgent. People in societies classified by a high score in indulgence
generally exhibit a willingness to realise their impulses and desires with
regard to enjoying life and having fun. They possess a positive attitude and
have a tendency towards optimism. In addition, they place a higher degree of
importance on leisure time, act as they please and spend money as they
wish.

3. Ethics in Business
Employers do their best to hire individuals who are a good fit, meaning that
they match well with the organization's norms. Still, people are not
clones. They come into an organization with the personal values they
obtained from their family, school, and religion. A conflict can occur
when an employee has to make an ethical decision if their personal
values do not match the organization's norms.
The employee may not openly express their divergent view, but their
resistance to the norms of the organization can still surface in subtle ways.
And like a cancer, their stance can spread throughout the organization,
causing negativity and dysfunction.
Today, things have got more complicated:

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1.There is no longer one agreed moral code. Most people have a weak sense
of religion or none at all. So their morals must come from somewhere else.
2.There are competing religious and social moral codes, especially for
multinational companies operating in different parts of the world and
employing people from different cultures.
3. The pursuit of profit has become a goal in its own right, and this puts
pressures on people to compromise their standards, not just ethically, but in
less important areas also. For example, a very rude manager might be
tolerated because he (it usually is a he) makes large profits. So when good
behaviour and good profits come into conflict, businesses find it difficult to
resist the profits.
4. Businesses are only the people who work there; businesses dont decide
anything its the people who make decisions. But businesses have group
cultures with their own norms and standards. Individuals have a strong need
to fit in and be accepted, so it is very difficult for any individual to stand up
against attitudes and decisions they disagree with.
5. Greater wealth in the western economies means people have less
tolerance for ethically dubious behaviour. We are no longer so desperate for
growth and employment at any cost. People are also better educated and
better informed. People are less deferential ie they are less accepting of what
people in authority say. So there are higher expectations of how businesses
should behave.
6. Businesses have to sell to consumers and employ workers who have their
own standards and opinions. They are not going to buy from or work for a
business they disapprove of. So there is a competitive pressure for better
behaviour from businesses.
7. Many managers and owners have ambitions of social acceptance and
recognition eg knighthoods, and so are not going to get caught behaving
unethically.
8. Modern technology creates ethical dilemmas which never existed until quite
recently. Medical products, and gene technologies, are a good example of
this. Should parents be allowed to alter the genes of their unborn children,
and should businesses sell the products to do this?

3.1 Ethical Principles


Abraham Lincoln described character as the tree and reputation as the
shadow. Your character is what you really are; your reputation is what people
think of you. Thus, your reputation is purely a function of perceptions (i.e., do
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people think your intentions and actions are honorable and ethical) .while your
character is determined and defined by your actions (i.e., whether your
actions are honorable and ethical according to the 12 ethical principles:
1. HONESTY. Be honest in all communications and actions. Ethical
executives are, above all, worthy of trust and honesty is the cornerstone of
trust. They are not only truthful, they are candid and forthright. Ethical
executives do not deliberately mislead or deceive others by
misrepresentations, overstatements, partial truths, selective omissions, or any
other means and when trust requires it they supply relevant information
and correct misapprehensions of fact.
2. INTEGRITY. Maintain personal integrity. Ethical executives earn the trust
of others through personal integrity. Integrity refers to a wholeness of
character demonstrated by consistency between thoughts, words and actions.
Maintaining integrity often requires moral courage, the inner strength to do the
right thing even when it may cost more than they want to pay. The live by
ethical principles despite great pressure to do otherwise. Ethical executives
are principled, honorable, upright and scrupulous. They fight for their beliefs
and do not sacrifice principle for expediency.
3. PROMISE-KEEPING. Keep promises and fulfill commitments. Ethical
executives can be trusted because they make every reasonable effort to fulfill
the letter and spirit of their promises and commitments. They do not interpret
agreements in an unreasonably technical or legalistic manner in order to
rationalize non-compliance or create justifications for escaping their
commitments.
4. LOYALTY. Be loyal within the framework of other ethical
principles. Ethical executives justify trust by being loyal to their organization
and the people they work with. Ethical executives place a high value on
protecting and advancing the lawful and legitimate interests of their
companies and their colleagues. They do not, however, put their loyalty above
other ethical principles or use loyalty to others as an excuse for unprincipled
conduct. Ethical executives demonstrate loyalty by safeguarding their ability
to make independent professional judgments. They avoid conflicts of interest
and they do not use or disclose information learned in confidence for personal
advantage. If they decide to accept other employment, ethical executives
provide reasonable notice, respect the proprietary information of their former
employer, and refuse to engage in any activities that take undue advantage of
their previous positions.
5. FAIRNESS. Strive to be fair and just in all dealings. Ethical executives
are fundamentally committed to fairness. They do not exercise power
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arbitrarily nor do they use overreaching or indecent means to gain or maintain


any advantage nor take undue advantage of anothers mistakes or difficulties.
Ethical executives manifest a commitment to justice, the equal treatment of
individuals, tolerance for and acceptance of diversity. They are open-minded;
willing to admit they are wrong and, where appropriate, they change their
positions and beliefs.
6. CARING. Demonstrate compassion and a genuine concern for the
well-being of others. Ethical executives are caring, compassionate,
benevolent and kind. They understand the concept of stakeholders (those
who have a stake in a decision because they are affected by it) and they
always consider the business, financial and emotional consequences of their
actions on all stakeholders. Ethical executives seek to accomplish their
business objectives in a manner that causes the least harm and the greatest
positive good.
7. RESPECT FOR OTHERS. Treat everyone with respect. Ethical
executives demonstrate respect for the human dignity, autonomy, privacy,
rights, and interests of all those who have a stake in their decisions; they are
courteous and treat all people with equal respect and dignity regardless of
sex, race or national origin. Ethical executives adhere to the Golden Rule,
striving to treat others the way they would like to be treated.
8. LAW ABIDING. Obey the law. Ethical executives abide by laws, rules and
regulations relating to their business activities.
9. COMMITMENT TO EXCELLENCE. Pursue excellence all the time in all
things. Ethical executives pursue excellence in performing their duties, are
well-informed and prepared, and constantly endeavor to increase their
proficiency in all areas of responsibility.
10. LEADERSHIP. Exemplify honor and ethics. Ethical executives are
conscious of the responsibilities and opportunities of their position of
leadership and seek to be positive ethical role models by their own conduct
and by helping to create an environment in which principled reasoning and
ethical decision making are highly prized.
11. REPUTATION AND MORALE. Build and protect and build the companys
good reputation and the morale of its employees. Ethical executives
understand the importance of their own and their companys reputation as
well as the importance of the pride and good morale of employees. Thus, they
avoid words or actions that that might undermine respect and they take
affirmative steps to correct or prevent inappropriate conduct of others.

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12. ACCOUNTABILITY. Be accountable. Ethical executives acknowledge


and accept personal accountability for the ethical quality of their decisions and
omissions to themselves, their colleagues, their companies, and their
communities.

4.Bibliography
1.https://www.princeton.edu/~achaney/tmve/wiki100k/docs/Business_ethics.html

2. http://geert-hofstede.com/united-kingdom.html
3.http://www.prenhall.com/behindthebook/0132431521/pdf/Robbins_CH03.pdf

4. http://www.uri.edu/mind/VALUES2.pdf
5. http://lms.aspira.org/sites/default/files/Definition%20of%20Values.pdf

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