BUSINESS ETHICS IN A

GLOBAL ECONOMY
Contents
 Introduction
 Cross cultural ethical issues

 Cross religion ethical issues

 Cross racial ethical issues

 Conclusion





INTRODUCTION
International Business Ethics


 Business ethics emerged as a field in the

1970s but international business ethics did
not emerge until the late 1990s.


 Many new practical issues arose out of the

international context of business.


 Theoretical issues such as cultural relativity of

ethical values receive more emphasis in this
field.

Contd.


 Country differences give rise to some interesting

ethical issues. Some of them are discussed
below.
v
Ø Whether they should do business in totalitarian
countries that violates the human rights of their citizens
(e.g: China)
v
Ø         Whe the r firms sho uld inve st in c o untrie s whe re  the  
go ve rnme nt re pre sse s its c itize ns in po litic al and/o r 
e c o no mic  fre e do m. 
v
Ø         Whether an international firm should adopt high levels of 
worldwide regulations or  focus only on meeting local 
regulations.
v

CROSS CULTURAL ETHICAL ISSUES
 What is Culture?


 Culture is a system of values and norms

that are shared among a group of people
and that when taken together constitute
a design for living.


 The fundamental building blocks of

culture are values and norms.
 



 VALUES:


 Values are abstract ideas about what a

society believes to be good, right, and
desirable.


 Values include attitudes towards concepts like

Ø Freedom, Honesty and Loyalty
Ø Responsibility
Ø Personal relations
 NORMS:


 Norms are social rules and guidelines that

prescribe the appropriate behavior in
particular situations.


 Norms can be divided into folkways and mores.



Ø Folkways are the routine conventions of everyday

life, but generally have little moral significance.
Ø
Ø Mores are more serious standards of behavior, the
breaking of which may be very inappropriate or
even illegal.
 Social Structure
 The social structure of a country can be
described along two major dimensions:
individualism vs. group.


Ø Individual: A focus on the individual and

individual achievement is common in many
Western societies.


Ø The group: In sharp contrast to the Western

emphasis on the individual, in many Asian
societies the group is the primary unit of
social organization.



Language:


 The language of a society allows it to

communicate.
 Helps describe how different people see the
world.
 In countries with more than one language, one
also finds often more than one culture.


 CROSS-RELIGIONAL ETHICAL ISSUES

 Religion can be defined as a system of shared
beliefs and rituals that are concerned with the
realm of the sacred.

 Religion influences behavior and shapes culture.

 Four of the major religions of the world are discussed
below on ethical concepts.:

Ø Christianity is the largest religion and is common
throughout Europe, the Americas, and other countries
settled by Europeans.
Ø
Ø Islam: With 750 million followers this is the second
largest of the world’s major religions.

Contd.
Ø
Ø Hinduism: Approximately 500 million
followers making it the world’s oldest major
religion.
Ø
 Buddhism: There are around 250 million
Buddhists, most of who are found in Central
and Southeast Asia, China, Korea and Japan.




Cross-racial ethical issues
 The categorization of humans into populations
 or groups .


  Visual traits such as skin

colour, cranial or facial features and hair
texture.


 Pre-conceived notion about a country or an

ethnicity.


 Create more universal awareness of racial

equality and the need for racial unity.

 Seven Moral Guidelines for MNCs
 Inflict no intentional or direct harm.
 Produce more good than bad for the host.
country
 Contribute to host country’s
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.
conclusion
 Attention to business ethics has substantially
improved .


 Maintaining a strong ethical culture is

essential .


 A business that lacks ethical principles is

bound to fail sooner or later.

ANY QUESTIONS?
THANK YOU