Ethics and the Conduct of Business Eighth edition Chapter 14 International Business Ethics Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Modules • Introduction: International Business Ethics • 14.1: Different Standards • 14.2: Guidelines for Multinationals • 14.3: Wages and Working Conditions • 14.4: Foreign Bribery • 14.5: Human Rights Abuses • Conclusion: International Business Ethics Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Learning Objectives (1 of 2) • • 14.1: Categorize the various ethical problems that multinational companies may face in their foreign operations, especially while conducting business in lessdeveloped countries 14.2: Explain how the moral concepts of rights, welfare, and justice offer guidelines for conducting international business and the role of global civil society in developing and enforcing these guidelines Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Learning Objectives (2 of 2) • • • 14.3: Describe the ethical issues in determining wages and standards for working conditions in international business, and factors that multinational corporations and foreign contractors should consider to improve on those set by market mechanisms 14.4: Evaluate the various forms of bribery and factors that foster them, the ethical problems with bribery, and the diverse means and strategies for combating bribery 14.5: Relate the challenges multinational companies face in dealing with repressive governments, and how a strategy of constructive engagement can be applied to operations in countries with a record of human rights abuses Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Introduction: International Business Ethics • Global marketplace • Diversity of business standards • Repressive governments • Corruption • Affects host country development Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.1: Different Standards (1 of 2) Objective: Categorize the various ethical problems that multinational companies may face in their foreign operations, especially while conducting business in less-developed countries • 14.1.1: Relevant Differences – Conditions in countries differ • 14.1.2: Variety of Outlooks – Overview – Cultural differences • 14.1.3: Right to Decide – Right of the host country Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.1: Different Standards (2 of 2) Objective: Categorize the various ethical problems that multinational companies may face in their foreign operations, especially while conducting business in less-developed countries • 14.1.4: Business Necessity – Necessary practice for business Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.2: Guidelines for Multinationals (1 of 2) Objective: Explain how the moral concepts of rights, welfare, and justice offer guidelines for conducting international business and the role of global civil society in developing and enforcing these guidelines • 14.2.1: Rights – Fundamental International rights – Rights-based guidelines drawback • 14.2.2: Welfare – Richard DeGeorge guidelines • 14.2.3: Justice – Distribution of benefits – Violation of market rules Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.2: Guidelines for Multinationals (2 of 2) Objective: Explain how the moral concepts of rights, welfare, and justice offer guidelines for conducting international business and the role of global civil society in developing and enforcing these guidelines • 14.2.4: International Codes – International codes Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Figure 14.1: Moral Authority for Codes of International Business Ethics30 Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.3: Wages and Working Conditions Objective: Describe the ethical issues in determining wages and standards for working conditions in international business, and factors that multinational corporations and foreign contractors should consider to improve on those set by market mechanisms • 14.3.1: Setting Wages – Obstacles – Argument for market wages – Arguments against market wages 14.3.2: Working Conditions Overview Copyright â 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.4: Foreign Bribery (1 of 2) Objective: Evaluate the various forms of bribery and factors that foster them, the ethical problems with bribery, and the diverse means and strategies for combating bribery • 14.4.1: What Is Bribery? – What is bribery • 14.4.2: What's Wrong with Bribery? – Economic effects – Noneconomic consequences Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.4: Foreign Bribery (2 of 2) Objective: Evaluate the various forms of bribery and factors that foster them, the ethical problems with bribery, and the diverse means and strategies for combating bribery • 14.4.3: Combating Bribery – – – – Problems Solution Anti-bribery strategies Foreign Corrupt Practices Act Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Table 14.1: World’s 10 Industry Sectors Most Likely to Involve Bribery Industry Sector Score (0–10) Public works contracts and construction 5.3 Real estate, property, legal and business services 6.1 Utilities 6.1 Oil and gas 6.2 Mining 6.3 Power generation and transmission 6.4 Pharmaceutical and healthcare 6.4 Heavy manufacturing 6.5 Arms, defence and military 6.6 Fisheries 6.6 Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Table 14.2: Strategies for Combating Bribery Anti-Bribery Tactics and Goals Score (0–10) • Limit government involvement and promote free markets and healthy competition Design and enforce proper regulations to clarify and simplify processes Alter the government’s role in the economy Pay civil servants more to remove the need for extra income Make civil service jobs so attractive that the risk of losing them will deter bribery Reduce the temptation to demand or accept bribes Carefully select projects to eliminate those most vulnerable to bribery Closely monitor approved projects Have funding agencies and loaning investment banks perform checks Eliminate bribery in government projects Create special law enforcement units to uncover and prosecute instances of bribery Promote international standards against corruption to combat bribery Use international cooperation to recover plundered assets Focus on enforcing laws to prevent and criminalize bribery • • • • • • • • • Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved 14.5: Human Rights Abuses Objective: Relate the challenges multinational companies face in dealing with repressive governments, and how a strategy of constructive engagement can be applied to operations in countries with a record of human rights abuses • 14.5.1: Constructive Engagement – Constructive engagement strategy • 14.5.2: Liability for Abuses – MNCs indirectly accountable for abuses Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved Conclusion: International Business Ethics • MNCs have social responsibility • Diverse political and legal systems • Diverse standards • Guidelines for international business • International codes of ethics Copyright © 2017, 2012, 2009 Pearson Education, Inc All Rights Reserved ... set by market mechanisms 14. 4: Evaluate the various forms of bribery and factors that foster them, the ethical problems with bribery, and the diverse means and strategies for combating bribery 14. 5:... Reserved 14. 2: Guidelines for Multinationals (1 of 2) Objective: Explain how the moral concepts of rights, welfare, and justice offer guidelines for conducting international business and the role of. .. moral concepts of rights, welfare, and justice offer guidelines for conducting international business and the role of global civil society in developing and enforcing these guidelines • 14. 2.4: International