Financial Strategy
Questions
1. Ethical Standards
a. Can a multinational firm adopt varying ethical standards [such as with regard to product safety (Pinto), employee benefits (Nike) and “kickbacks” to win business (Siemens)] in its global operations? Why or Why Not? Discuss in depth based on the goals of multinational corporations? (Be sure to identify the merits and demerits for both options). (Read: Class notes and discussions)
- A multinational corporation (MNC) is a business firm incorporated in one country that has production and sales operations in several other countries.
- Multinational corporation’s main goals are to improve revenue and profits by keeping the costs down, and to maximize profits for its shareholders.
- Additionally, these companies are also networks of parties and people working together towards a common goal.
- Employees, suppliers, government agencies, and customers represent a major part of the value of the company.
- In order to motivate employees to work hard for a company, a level of trust must be built. As it is important to develop trust between companies and their external environment (customers, suppliers, government, and interest groups). Such trust can only grow from the perceived security that the interests of all individual stakeholders are taken into account.
- As such, the means utilized by corporations to maximize profits should be such that they not only comply with applicable laws, but that they also adhere to social responsible behavior that includes preservation of human capital, the environment, and the relationship with their stakeholders.
- Social responsibility should not be limited to countries where there are strict laws to protect against bribery, child labor, environmental protection, and the like. In the age of the Internet, information flows very rapidly across the world and sooner or later people from around the world will find out about inappropriate behavior of corporations. Violating stakeholder’s
1. Ethical Standards
a. Can a multinational firm adopt varying ethical standards [such as with regard to product safety (Pinto), employee benefits (Nike) and “kickbacks” to win business (Siemens)] in its global operations? Why or Why Not? Discuss in depth based on the goals of multinational corporations? (Be sure to identify the merits and demerits for both options). (Read: Class notes and discussions)
- A multinational corporation (MNC) is a business firm incorporated in one country that has production and sales operations in several other countries.
- Multinational corporation’s main goals are to improve revenue and profits by keeping the costs down, and to maximize profits for its shareholders.
- Additionally, these companies are also networks of parties and people working together towards a common goal.
- Employees, suppliers, government agencies, and customers represent a major part of the value of the company.
- In order to motivate employees to work hard for a company, a level of trust must be built. As it is important to develop trust between companies and their external environment (customers, suppliers, government, and interest groups). Such trust can only grow from the perceived security that the interests of all individual stakeholders are taken into account.
- As such, the means utilized by corporations to maximize profits should be such that they not only comply with applicable laws, but that they also adhere to social responsible behavior that includes preservation of human capital, the environment, and the relationship with their stakeholders.
- Social responsibility should not be limited to countries where there are strict laws to protect against bribery, child labor, environmental protection, and the like. In the age of the Internet, information flows very rapidly across the world and sooner or later people from around the world will find out about inappropriate behavior of corporations. Violating stakeholder’s