ETHICAL ISSUES IN INTERNATIONAL BUSINESS
ETHICS
ETHICAL ISSUES IN INTERNATIONAL BUSINESS
Many of the ethical issues and dilemmas in international business are rooted in the fact that political systems, law, economic development, and culture vary significantly from
Nation to nation. Consequently, what is considered normal practice in one nation may be considered unethical in others. Because they work for an institution that transcends
National borders and cultures, managers in a multinational firm need to be particularly sensitive to these differences and able to choose the ethical action in those circumstances where variation across societies creates the potential for ethical problems. In the international business setting, the most common ethical issues involve employment practices,
Human rights, environmental regulations, corruption, and the moral obligation of multinational
Corporations.
EMPLOYMENT PRACTICES
As we saw in the opening case, ethical issues may be associated with employment practices in other nations. When work conditions in a host nation are clearly inferior to those in a multinational’s home nation, what standards should be applied? Those of the home nation, those of the host nation, or something in between? While few would suggest that pay and work conditions should be the same across nations, how much divergence is acceptable?
For example, while 12-hour workdays, extremely low pay, and a failure to protect workers against toxic chemicals may be common in some developing nations, does this mean that it is OK for a multinational to tolerate such working conditions in its subsidiaries there, or to condone it by using local subcontractors?
HUMAN RIGHTS
Beyond employment issues, questions of human rights can arise in international business.
Basic human rights still are not respected in many nations. Rights that we take for granted in developed nations, such as freedom of association, freedom of speech, freedom of assembly, freedom of movement, freedom from
ETHICAL ISSUES IN INTERNATIONAL BUSINESS
Many of the ethical issues and dilemmas in international business are rooted in the fact that political systems, law, economic development, and culture vary significantly from
Nation to nation. Consequently, what is considered normal practice in one nation may be considered unethical in others. Because they work for an institution that transcends
National borders and cultures, managers in a multinational firm need to be particularly sensitive to these differences and able to choose the ethical action in those circumstances where variation across societies creates the potential for ethical problems. In the international business setting, the most common ethical issues involve employment practices,
Human rights, environmental regulations, corruption, and the moral obligation of multinational
Corporations.
EMPLOYMENT PRACTICES
As we saw in the opening case, ethical issues may be associated with employment practices in other nations. When work conditions in a host nation are clearly inferior to those in a multinational’s home nation, what standards should be applied? Those of the home nation, those of the host nation, or something in between? While few would suggest that pay and work conditions should be the same across nations, how much divergence is acceptable?
For example, while 12-hour workdays, extremely low pay, and a failure to protect workers against toxic chemicals may be common in some developing nations, does this mean that it is OK for a multinational to tolerate such working conditions in its subsidiaries there, or to condone it by using local subcontractors?
HUMAN RIGHTS
Beyond employment issues, questions of human rights can arise in international business.
Basic human rights still are not respected in many nations. Rights that we take for granted in developed nations, such as freedom of association, freedom of speech, freedom of assembly, freedom of movement, freedom from
References: Years (Doubleday, 1997). 3). H. Hamilton, “Shell’s New World Wide View,” Washington Post, August 2, 1998, p (New Haven, CT: Yale University Press, 2002). Press, 1993). 1997), pp. 1320–46. Corning (1996).html.