www.ebook3000.com Ethics for International Business Business takes place in an increasingly global environment, crossing political and cultural boundaries, and consequently ethical dilemmas arise The central focus of this successful and innovative text lies in how to make and explain “best choice” judgments in international business situations The newly-updated version of this groundbreaking textbook continues to provide a topical and relevant analysis of the ethical dimensions of conducting business in a global political economy From a starting point of applied ethics, the book introduces a common set of normative terms and analytical tools for examining and discussing real case scenarios Extensive real-world examples, presented in the form of exhibits, cover issues including: • foreign production, including sweatshops • export of hazardous products • testing and pricing of HIV/AIDS drugs • advertising tobacco, alcoholic beverages and infant formula • deceptive marketing techniques and bribery • religious and social discrimination • cultural impacts from “music, movies and malls” • environmental issues, including oil spills, rain forest preservation, global warming and genetically modified foods • Internet censorship and privacy issues in China • fair trade certification and consumer boycotts • oil companies in the Sudan • foreign investors in Burma To keep pace with the changing landscape of global business, this new edition features: • • • • • Updated exhibits that introduce new issues and are sourced from more international publications Increased coverage of issues arising in emerging markets Updated descriptions and assessments of relevant international agreements Seventeen new photographs that were chosen to accompany cases designed for classroom discussion Three new figures that help depict the ethical analysis process The continued globalization of business increases the relevance of this textbook and its unique focus on specifically international ethical challenges faced by business, where governments and civil society groups play an active role While most business ethics texts continue to focus heavily on ethical theory, this textbook condenses ethical theory into applied decision-making concepts, emphasizing practical applications to real world dilemmas Anyone with an interest in the ethical implications of international business, or the business implications of corporate responsibility in the global market, will find this book a thought-provoking yet balanced analysis Clearly written, this has become the textbook of choice in this increasingly important field John M Kline is a Professor of International Business Diplomacy in the Walsh School of Foreign Service, Georgetown University He is a past Director of the Master of Science in Foreign Service Program and the Karl F Landegger Program in International Business Diplomacy His teaching focuses on international business-government relations, international investment strategies and negotiations, and international business ethics www.ebook3000.com Ethics for International Business Decision Making in a Global Political Economy Second Edition John M Kline First edition published 2005 by Routledge 270 Madison Avenue, New York, NY 10016 This edition published 2010 by Routledge 270 Madison Avenue, New York, NY 10016 Simultaneously published in the UK by Routledge Park Square, Milton Park, Abingdon, Oxon OX14 4RN Routledge is an imprint of the Taylor & Francis Group, an informa business This edition published in the Taylor & Francis e-Library, 2010 To purchase your own copy of this or any of Taylor & Francis or Routledge’s collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk © 2010 John Kline All rights reserved No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers Trademark Notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe Library of Congress Cataloging-in-Publication Data Kline, John M Ethics for international business : decision-making in a global political economy / John M Kline.—2nd ed p cm Business ethics International business enterprises—Moral and ethical aspects Globalization—Moral and ethical aspects I Title HF5387.K578 2010 174′4—dc22 2009043143 ISBN 0-203-88059-5 Master e-book ISBN ISBN13: 978–0–415–99942–7 (hbk) ISBN13: 978–0–415–99943–4 (pbk) ISBN13: 978–0–203–88059–3 (ebk) www.ebook3000.com Dedication For my family and my students www.ebook3000.com CONTENTS List of Figures xi Preface xiii Chapter The Value Foundation for a Global Society Introduction Why Ethics Matters Studying Ethics for International Business Organization of the Book Personal and Organizational Decision Making Chapter Ethics and International Business Introduction Ethical Analysis Ethical Concepts and Principles Legal and Social Contracts Contracts with a Global Society Delimiting Corporate Social Responsibility Using Ethical Analysis in a Global Political Economy Developing an Ethical Framework Case Scenario Methodology Exhibit 2.1 A Mine for Tambogrande, Peru 7 12 14 15 17 18 18 20 Chapter Human Rights Concepts and Principles Introduction Individual Rights, State Authority and Human Rights 27 27 27 vii 1 viii • Contents Civil and Political Rights and/or Economic, Social and Cultural Rights Exhibit 3.1 US Human Rights Policy Ethical Minimum Conditions and Corollary Obligations Exhibit 3.2 Selling Kidneys in Moldova International Business, Human Rights and Good Corporate Citizenship Exhibit 3.3 Google and Internet Rights in China Chapter Political Involvements by Business Introduction Contrasting Standards of Corporate Responsibility Lessons from the South African Experience Exhibit 4.1 The Choice to Reform or Withdraw Historical Choices in Angola and Uganda Sudan’s Internal Conflicts Exhibit 4.2 China Invests in Sudan’s Oil Fields Military Repression in Burma Governance and Resource Allocation in Nigeria Exhibit 4.3 Defining Shell’s Role in Nigeria “Foreigners” Allocate Chad’s Oil Revenue Ethical Issues and Case Experience on Business Political Involvements 29 30 32 34 38 42 47 47 48 49 56 58 61 63 65 68 70 73 76 Chapter Labor and Production Standards Introduction Peeking Inside a “Sweatshop” Exhibit 5.1 From Sixth Grade to the Shoe Factory Assessing Supply Chain Responsibilities Exhibit 5.2 Wal-Mart Sets Chinese Supplier Standards Living Wage, Debt Bondage and Union Rights Communities and the Foreign Production Process Exhibit 5.3 The Bhopal Gas Leak’s Continuing Saga Emerging Efforts Toward Common International Standards 85 85 86 88 92 96 98 101 105 106 Chapter Product and Export Controls Introduction Actors and Decision Tools Product Risk for Consumers Exhibit 6.1 Exporting Goods Banned at Home Risk and Benefits for Multiple Stakeholders 111 111 112 113 114 118 www.ebook3000.com Contents • ix Product Use and Abuse International Trade in Hazardous Waste Exhibit 6.2 Scavenging Dumped Computers in Ghana The Movement Toward Global Standards A Triple Dilemma for Pharmaceuticals Exhibit 6.3 Drug Tests and Infected Babies in Thailand 123 124 126 129 131 133 Chapter Marketing Motives and Methods Introduction Choices for Marketing Standards and Values International Marketing of Tobacco Exhibit 7.1 No “Mild” Cigarettes in the European Union Advertising Alcoholic Beverages International Codes for Marketing Infant Formula General International Marketing Techniques Obesity and the Marketing Connection Exhibit 7.2 Stop Soft Drink Ads for Kids Racial, Ethnic and Socioeconomic Marketing Issues Exhibit 7.3 Promoting Skin-Whiteners in India Marketing Through Bribery and Facilitating Payments Exhibit 7.4 Debating Standards for “Petty Corruption” 145 145 146 150 155 156 158 161 162 164 165 167 170 172 Chapter Culture and the Human Environment Introduction Cultural Change in a Global Political Economy Systemic Dimensions of Cultural Change Exhibit 8.1 Community Contracts in Papua New Guinea Clashes Between Local Culture and Global Values Exhibit 8.2 Fast Food and “Gender Apartheid” in Saudi Arabia Exhibit 8.3 GE Confronts Fetus Bias Challenging Cultural Traditions: Music, Movies and Malls Exhibit 8.4 Selling Starbucks in the Forbidden City Blends and Contrasts in Corporate Culture 177 177 178 179 182 185 Nature and the Physical Environment Introduction Conceptualizing the Human Relationship with Nature Protection, Restoration and Sustainable Development Exhibit 9.1 Ecuador and Chevron/Texaco Dispute Oil Damage 207 207 208 209 Chapter 188 193 195 199 202 212 264 • Ethics for International Business the way individuals perform their roles as business executives, or as government and civil society representatives Both organizations and individuals possess options in their actions Incorporating ethical analysis into personal and organizational decision making can help assure that outcomes reflect conscious “best choice” judgments, even in the demanding environment of a global political economy www.ebook3000.com FURTHER READING Barnet, R and Cavanagh, J., Global Dreams, New York: Simon & Schuster, 1994 Barnet, R and Muller, R., Global Reach, New York: Simon & Schuster, 1974 Beauchamp, T., Case Studies in Business, Society and Ethics, 5th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2009 —— , Bowie, N and Arnold, D (eds), Ethical Theory and Business, 8th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2009 Bergsten, F., Horst, T and Moran, T., American Multinationals and American Interests, Washington, DC: Brookings Institution, 1978 Boatright, J., Ethics and the Conduct of Business, 6th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2009 Buchholz, R and Rosenthal, S., Business Ethics, Upper Saddle River, NJ: Prentice Hall, 1998 Carroll, S and Gannon, M., Ethical Dimensions of International Management, Thousand Oaks, CA: Sage, 1997 Cavanagh, G., American Business Values: A Global Perspective, 5th edn, Upper Saddle River, NJ: Pearson, 2006 Coicaud, J.-M and Warner, D (eds), Ethics and International Affairs, New York: United Nations University Press, 2001 Crane, A and Matten, D., Business Ethics: Managing Corporate Citizenship and Sustainability in an Age of Globalization, Oxford: Oxford University Press, 2007 Davies, P., Current Issues in Business Ethics, New York: Routledge, 1997 De George, R., Business Ethics, 6th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2006 —— , Competing with Integrity in International Business, Oxford: Oxford University Press, 1993 DesJardins, J and McCall, J., Contemporary Issues in Business Ethics, 5th edn, Belmont, CA: Thomson Wadsworth, 2005 Dienhart, J., Business, Institutions, and Ethics, New York: Oxford University Press, 2000 Donaldson, T., The Ethics of International Business, New York: Oxford University Press, 1989 —— and Dunfee, T (eds), Ethics in Business and Economics, Brookfield, VT: Ashgate Dartmouth, 1997 —— , Ties that Bind: A Social Contracts Approach to Business Ethics, Boston, MA: Harvard Business School Press, 1999 Donaldson, T., and P Werhane, Ethical Issues in Business, 8th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2008 Enderle, G (ed.), International Business Ethics: Challenges and Approaches, Notre Dame, IN: University of Notre Dame Press, 1999 Fisher, C., Business Ethics and Values, 3rd edn, New York: Prentice Hall/Financial Times Press, 2009 Freeman, R., Strategic Management, Boston, MA: Pitman, 1984 —— (ed.), Business Ethics: The State of the Art, Oxford: Oxford University Press, 1991 Friedman, M., Capitalism and Freedom, 3rd edn, Chicago: University of Chicago Press, 1963 265 266 • Further Reading Fritzsche, D., Business Ethics: A Global Managerial Perspective, New York: McGraw-Hill, 1997 Gladwin, T and Walter, I., Multinationals Under Fire, New York: Wiley, 1980 Goodpaster, K and Nash, L., Policies and Persons: A Casebook in Business Ethics, 3rd edn, New York: McGraw-Hill Dushkin, 1998 Hennelly, A and Langan, J., Human Rights in the Americas, Washington, DC: Georgetown University Press, 1982 Hoffman, M., Frederick, R and Schwartz, M (eds), Business Ethics, New York: McGraw-Hill, 2001 Hoffman, M., Lange, A and Fedo, D (eds), Ethics and the Multinational Enterprise, New York: University Press of America, 1986 —— , Kamm, J., Frederick, R and Petry, E (eds), Emerging Global Business Ethics, Westport, CT: Quorum Books, 1994 Hufbauer, G and Mitrokostas, N., Awakening Monster: The Alien Tort Statute of 1789, Washington, DC: Institute for International Economics, 2003 Hufbauer, G., Schott, J., and Elliott, K., Economic Sanctions Reconsidered, vols, Washington, DC: Institute for International Economics, 1990 Iannone, P (ed.), Contemporary Moral Controversies in Business, Oxford: Oxford University Press, 1989 Jennings, M., Business Ethics: Case Studies and Selected Readings, 6th edn, Mason, OH: South-Western Cengage Learning, 1999 Kline, J., International Codes and Multinational Business, Westport, CT: Quorum Books, 1985 —— , Foreign Investment Strategies in Restructuring Economies, Westport, CT: Quorum Books, 1992 Malachowski, A (ed.), Business Ethics: Critical Perspectives on Business and Management, London: Routledge, 2001 Minus, P (ed.), The Ethics of Business in a Global Economy, Boston, MA: Kluwer, 1993 Moran, T., Beyond Sweatshops, Washington, DC: Brookings Institution, 2002 Newfarmer, R (ed.), Profits, Progress and Poverty, Notre Dame, IN: University of Notre Dame Press, 1985 Paine, L., Cases in Leadership, Ethics, and Organizational Integrity, Chicago: Irwin, 1997 Powers, C., People/Profits: The Ethics of Investment, New York: Council on Religion and International Affairs, 1972 Regan, T (ed.), Just Business: New Introductory Essays in Business Ethics, New York: Random House, 1984 —— and Singer, P (eds), Animal Rights and Human Obligations, 2nd edn, Englewood Cliffs, NJ: Prentice Hall, 1989 Roussouw, D., Business Ethics in Africa, 2nd edn, Oxford: Oxford University Press, 2002 Rubin, S and Hufbauer, G (eds), Emerging Standards of International Trade and Investment: Multinational Codes of Conduct, Totowa, NJ: Rowman & Allanheld, 1984 Sethi, S., Setting Global Standards: Guidelines for Creating Codes of Conduct in Multinational Corporations, Hoboken, NJ: Wiley, 2003 Sethi, S and Falbe, C (eds), Business and Society, Lexington, MA: Lexington Books, 1987 Sethi, S and Steidlmeier, P., Up Against the Corporate Wall, 6th edn, Upper Saddle River, NJ: Prentice Hall, 1997 Sethi, S and Williams, O., Economic Imperatives and Ethical Values in Global Business: The South African Experience and International Codes Today, Boston, MA: Kluwer, 2000 Sethi, S., Steidlmeier, P and Falbe, C., Scaling the Corporate Wall, 2nd edn, Upper Saddle River, NJ: Prentice Hall, 1997 Shambaugh, G., States, Firms, and Power, Albany, NY: State University of New York Press, 1999 Shaw, W., Business Ethics, 6th edn, Belmont, CA: Wadsworth, 2008 Shue, H., Basic Rights: Subsistence, Affluence, and US Foreign Policy, Princeton, NJ: Princeton University Press, 1980 Smith, A., The Wealth of Nations, New York: Modern Library, 1937 Soule, E., Morality and Markets: The Ethics of Government Regulation, Lanham, MD: Rowman & Littlefield, 2003 Steckmest, F., Corporate Performance: The Key to Public Trust, New York: McGraw-Hill, 1982 Sullivan, R (ed.), Business and Human Rights, Sheffield: Greenleaf, 2003 Tavis, L., Power and Responsibility: Multinational Managers and Developing Country Concerns, Notre Dame, IN: University of Notre Dame Press, 1997 —— and Williams, O., The Pharmaceutical Corporate Presence in Developing Countries, Notre Dame, IN: University of Notre Dame Press, 1993 www.ebook3000.com Further Reading • 267 Velasquez, M., Business Ethics: Concepts and Cases, 6th edn, Upper Saddle River, NJ: Pearson Prentice Hall, 2006 Varley, P (ed.), The Sweatshop Quandary, Washington, DC: Investor Responsibility Research Center (IRRC), 1998 Weir, D and Schapiro, M., Circle of Poison: Pesticides and People in a Hungry World, San Francisco, CA: Food First/Institute for Food and Development Policy, 1981 Weiss, J., Business Ethics: A Managerial, Stakeholder Approach, Belmont, CA: Wadsworth, 1994 Williams, O (ed.), Global Codes of Conduct: An Idea whose Time has Come, Notre Dame, IN: University of Notre Dame Press, 2000 www.ebook3000.com INDEX abaya 188, 190 abortions of female fetuses 192, 193, 194 Acer 43 Aceros Zapla 184–5 active/positive ethical duty 37 Adidas 95–6 Advertising Standards Council of India (ASCI) 167 affirmative actions 16 Afghanistan 188, 189, 190 Afrikaner Nationalist Party 51 agriculture: biotechnology 228–32; palm oil plantations 181, 182, 183; Peru 21; trade policies and agricultural products 31–2 aid 31, 131; and avoided deforestation 216, 217–20 AIDS/HIV 132–4, 135, 137–9, 140, 141 Akobo, M 71 Akol, L 64 alcoholic beverages, marketing 156–8 Alibaba 40–1 Alien Tort Claims Act of 1789 (ATCA) 71, 77, 241–2 All-India Democratic Women’s Association (AIDWA) 168 Allende, S 48 Allicock, B 217 Allicock, R 218 alternatives, free choice with 146, 149–50 American Apparel and Footwear Association 68 ‘Americanization’ 195–202 Amin, I 60, 61 Amnesty International 66 Angola 58–9 Annan, K 243 apartheid 48–9, 49–57, 76, 78, 186, 188–9, 191, 242, 247, 251 applied ethics approach 11 Arakis Energy Corporation 62, 63 Argentina 184–5 Arnold, E 226 asbestos victims 103 Aung San Suu Kyi 66, 68 awareness 15–16 Baby Killer, The 158 Baidu 41, 43 Bangladesh 97, 191 banks 53–4 banned products, exporting 113–18 Bardan, N 33, 34 Barnevik, P Basel Action Network (BAN) 126, 128 Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal 130 BASF 231 BAT 66, 155 Bee, R 106 Beer Institute 157 Beijing, Forbidden City 198, 199–200 Bell Helicopter 60 beneficial complicity 77 Bentsen, L 88 Berjaya 215 Bhavre, K 193, 194 269 270 • Index Bhopal tragedy 103, 104–6 Bill of Rights 28 biogenetics 226–32 Bioplasty 116, 117 blogging 41, 42–3 Bollywood 197 Bolsa Familia 107 Bone, C.I 213 Borowai villages, PNG 181, 182–3 bottled water 226, 227 boycotts, consumer 250–52 BP 172 Bray, J 172 Brazil 107, 218 breast implants 116–18 breastfeeding 158–9 bribery 170–3 British Midland Airways 190 burqa 190 Brundtland, G.H 150, 153 Brunton, B 183 Burma 65–8, 241 Bush, G.H.W 88 Business Charter for Sustainable Development 234 business guidance and control mechanisms 5, 239–56; business codes and monitoring mechanisms 243–7; consumer boycotts and certification schemes 250–54; investment, divestment and shareholder activism 247–50; national and international law 240–3; selection of the best means 254–5 Business Week 39 Buthelezi, G 50 buying preferences 122 Cabinda oil operations 58–9 California 100 Cambodia 107–8 Canada 62, 196–7 cancer risk 115–16 capability 15, 209; and political involvement 76–80 Cape corporation 103, 242 capitalism 39 carbon market 219, 220, 221–3 Cartagena Protocol on Biosafety 232 case scenarios 4; methodology 18–24 caste system 191–2 causality 15, 76–8, 209 Caux Round Table 244 caveat emptor principle 146–7 CDC Capital Partners 181, 183–4 censorship 40; China 40–1, 42–3 Center for Food Safety 229 Center for Science in the Public Interest 157 certification schemes 244, 246, 250, 252–4 Chad 73–6, 80 Chamba, C 214 Chapple, A 182, 183, 184 Chase Manhattan Bank 53–4 Chen Junqi 199, 200 Chevron 59, 62, 63, 72, 242 Chevron Texaco 210–14, 242 Chicago Climate Exchange 222 child labor 86–92, 107, 191, 253 child labor inspectors 90 children: marketing and 161, 162–4; street children 123–4 Children’s Food and Beverage Advertising Initiative 163 Chile 48 chimera 232 China 36, 79, 125, 153, 224; electronic waste 126–7; globalization and culture 199–201; internet 40–5, 242; US and 39; Wal-Mart sustainability summit 96, 96–7 China National Petroleum Corporation (CNPC) 65, 63–4 chlorofluorocarbons (CFCs) 223–4 choice 2–3; choices for marketing standards and values 146–50; free and living wage 99 Christopher, W 30 CIA 48, 58–9 cigarettes 150–6 ‘circle of poison’ 118 citizenship, corporate 38–45 civil and political (CP) rights 28, 29–32, 36, 39 civil society groups 50; business guidelines and control mechanisms 246–54, 254; role responsibilities and approaches 261–3; see also non-governmental organizations (NGOs) civil war: Angola 58–9; Sudan 61–5 Clement, M 127 Clinton Administration 30–1 cloning 232 Coalition for Environmentally Responsible Economics (CERES) 234 Coca-Cola 164, 226, 242 cod 225 Code of Hammurabi 28 codes of conduct 243–7 coffee 59–61, 251–2, 253–4 Cohen, J 200 collective bargaining 101 colonialism: Angola 58; Sudan 61 commission, acts of 15 Commission for Promotion of Virtue and Prevention of Vice (Mutaween) 187–9 Committee to Protect Journalists 44 Common Code for the Coffee Community (4Cs) 245 www.ebook3000.com Index • 271 common morality theory 10–11, 18 communities: community contracts 181, 182–3; community development 70–1, 73, 80; and foreign production process 101–6 comparative advertising 161 complicity 77 computers 43; waste 125, 126–7; see also internet concealment 147, 148 conditionality 37–8, 53 connection continuum 77–8 consequentialism 38 Conservation International 215, 216 Consumer Product and Safety Commission (CPSC) 115–16 consumers 112; boycotts 249, 250–52; domestic and foreign, and pesticides 119; product risk for 113–18 contracted labor supply chain 94–5 contracts 10, 12–15, 85; community contracts 181, 182–3; legal 12–13; with a global society 14–15; social 12–13, 28 Convention Against Corruption 171 Convention on the Law of the Sea 225 Convention on the Protection and Promotion of Diversity of Cultural Expressions 197–8 Copps, S 196–7 Corbin, R 218, 219–20 corollary obligations 32–8 corporate citizenship 38–45 corporate culture 178, 202–4 corporate internal decision structure 8–9 corporate social responsibility, delimiting 15–17 Correa, S 212 Corruption 8, 170–3 cost/benefit evaluation 9–10, 11, 19; product and export controls 112–13, 122–3; see also teleological approaches Cracky Nut cereal 165 Craig, J 213 created compulsion 147, 148 Cressy, P 157 critical need 16, 76, 78–9, 139 cultural, economic and social rights 28, 29–32, 36, 39 cultural relativism 177 Cultural Revolution 200 culture 177–206, 260; challenging cultural traditions 195–202; corporate culture 178, 202–4; cultural change in a global political economy 178–9; local-global value clashes 185–92, 193–5; systemic cultural change 179–85 cyclamate 116 dams 224–5 Darfur 61, 64, 65 DDT 130–1 debt bondage 96–101, 191 deception 147, 148 decision formula 10 decision tools 112–13 decisions on ethical dilemmas 5, 257–64 deductive approach to reasoning 11, 12 Defense Front of Tambogrande 21 deforestation 214–21 Del Monte Foods 242 Dell 43 deontological approaches 10, 11, 113, 209 Depo Provera 114 Deportes Mike 86, 87, 88–90, 91–2 developed nations 29, 31 developing nations 29, 31; aid see aid; loan conditionality 37–8, 53 development: preservation vs 214–21; sustainable 209–14, 233–5 development policy 179 direct action 69, 70, 71, 72 direct complicity 77 disability-adjusted life year 140 Disney 94, 249 distribution 19–22; resource allocation see resource allocation divestment 54, 57, 247–50 no harm mandate 16, 37 Donaldson, T 37–8 Douglas, O 70, 71 Dow Chemical 103, 104, 105–6 Dow Corning 116, 117 downsizing 102–3 drug testing 131–6 Drummond 242 due diligence 119 Dunkin’ Donuts 187, 188 DuPont 222–3 Earth Policy Institute 226 Earth Summit (1992) 209, 233 economic sanctions 49, 50 economic, social and cultural (ESC) rights 28, 29–32, 36, 39 Ecuador 242 Eddie Bauer 94, 95–6 education 86, 89 efficiency El Monte ‘sweatshop’ 100 El Salvador 251–2 electronic waste (e-waste) 125, 126–7 Eliasch, J 219 e-mail 41, 42–3 emissions trading systems 219, 220, 221–4 Emperador Cuauhtemoc school 90 entertainment 193–5, 195–202 272 • Index Environmental Mining Council of British Columbia 21 escrow account 59 ethical analysis 4, 7–26; case scenario methodology 18–24; contracts with a global society 14–15; corporate social responsibility 15–17; global political economy 17–18; legal and social contracts 12–13 ethical dilemmas 11–12; decisions 5, 257–64 ethical framework 18 ethical minimum conditions 32–8, 191 ethical relativism 14–15 ethical risk assessments 51–2 Ethical Tea Partnership 245 ethical theory continuum 11 ethical theory pyramid 11, 12 Ethical Trading Initiative (ETI) 245 ethics: concepts and principles 9–12; definition 7; importance of 2–3 ethnic marketing issues 165–70 Euro Disneyland 197 Europe 202 European Court of Justice 154, 155 European Union (EU) 204; Directive on Misleading and Comparative Advertising 162; GM foods 228; Greenhouse Gas Emission Trading System 222; sugar policies 31–2; tobacco marketing 154–5; unfair practices 161–2 exaggeration 147, 148, 149 exports see product and export controls extraterritorial application of national law 241–2 ExxonMobil 73, 74, 212, 242, 249 facilitating payments 170–3 Fair and Handsome 168 Fair Labor Association (FLA) 246 Fair and Lovely 166–8 Fair Trade 253 Fajardo, P 212, 213 family need 87–90 fast-food restaurants 187, 188 Federal Trade Commission (FTC) 157 Federation Internationale de Football Association (FIFA) 244 female infanticide 192, 193 Feminist Majority Foundation 189 fetuses, sex selection of 193–5, 195 field workers 121–2 financial services 53–4 fisheries 225–6 flame retardant-treated pajamas 113–16 Folger’s coffee 251–2 food: marketing and obesity 162–4; product labels 162; right to 30–1, 37 Food and Agriculture Organization (FAO) 228–30; International Code of Conduct on the Distribution and Use of Pesticides 129 food industry codes of conduct 244, 245–6 Food and Drug Administration (FDA): cyclamate 116; drug testing 131–2; silicone breast implants 116–17, 117–18 Forbidden City, Beijing 198, 199–200 Ford Motor Company 166 Foreign Corrupt Practices Act of 1976 (FCPA) 170, 241 foreign direct investment (FDI) 47; and avoided deforestation 216, 217–20; Burma 66–8; Gulf Oil in Angola 58–9; labor and production standards 92 Forest Carbon Partnership Facility (FCPF) 220 Forest Stewardship Council 219 forestry resources 214–21 Fortune 99, 100 Framework Convention on Tobacco Control 153–4, 260 France 165, 197 free samples of infant formula 149, 159, 160 Freeman, E 15 Freese, B 229 French, P 8–9 Friedman, M 15, 17 Friends of the Earth 229, 230 FTSE4Good indices 248 Fujimori, A 21 Fujitsu 203 Fuller Company 123–4 fundamental human rights 32–8 Gangmasters Licensing Authority 245 Gap 94 Garcia, G 20 garment industry 107–8 gender segregation 187, 188–9 General Electric (GE) 192, 193–5 General Motors (GM) 54, 189 generic drugs 137–41 genetic modification 226, 227–32 George, S 194 Ghana 203; e-waste 125, 126–7 Glaser, L.M 21 Global Compact 108, 171, 243, 244 global concern, evolving 258–9 global-local value clashes 185–95 Global Network Initiative 43–4 global political economy 17–18; cultural change 178–9 Global Reporting Initiative (GRI) 234, 244 global social contract 14–15 global society 45; contracts with 14–15; value foundation for 1–6 www.ebook3000.com Index • 273 global standards 10–11, 14–15; bribery 170–1; evolving 259–61; labor and production 106–9; marketing infant formula 158–61; natural environment 233–5; product and export controls 114, 129–31 global warming 219, 220, 221–4 globalization 92, 239–40, 257; and culture 177, 178–95 glue-sniffing 123–4 Gobin, D 219 Golban, M 35 gold mining 19–24 ‘golden rice’ 230–1 Google 41–3, 43–4 Gore, A 221 governance 68–73 governments 17–18, 21, 22; business political involvement see political involvement; and control of MNEs 239–40, 240–3; product export and trade control issues 112; role responsibilities and approaches 261–3; state authority 27–9 Great Firewall 41 Green, M 97 Green Dam-Youth Escort 43 ‘green’ labels 253 greenhouse gas emissions 219, 220, 221–4 grupos 203 Guatemala 123–4 Guerrero, F 89 Guerrero, V 86–90 Guidelines for Multinational Enterprises 14, 242 Gulf Oil 58–9 Gupta, M 194 Guyana 216–20 Harris Corporation 60 Hawkins, J 245–6 hazardous waste, trade in 124–9 Hazera Genetics 231 Heineken 66 help protect others 16 Helsinki Declaration 134 Hewlett-Packard 43, 66 Hidalgo, A 89–90 Hindustan Lever 166–8 HIV/AIDS 132–4, 135, 137–9, 140, 141 homogenization of cultures 195–202 Honduras 123–4 ‘honor killings’ 186 Hu Jintao 65 human-nature relationship 208–9 human organs, trade in 33–6 human rights 5, 10, 27–46, 48–9, 209; CP rights and ESC rights 28, 29–32, 36, 39; ethical minimum conditions and corollary obligations 32–8; evolving global concern 258–9; good corporate citizenship 38–45; individual rights, state authority and 27–9; rank-ordering human rights issues 79 Human Rights First 43–4 human stem cells 232 Humanistic ethic 208, 232 Hungary 132 IBM 203 Ijaw people 69, 70 imagery 147, 148, 149 Imperial 155 implants, breast 116–18 Inamed Corporation 117 Inconvenient Truth, An 221 India 79; Bhopal tragedy 103, 104–6; caste system 191–2; cultural globalization 197; marketing 166–70; skin-whitening products 166–8, 169, 191; ultrasound machines and sex selection 193–5, 195 indigenous peoples 180–1; community contracts 181, 182–3 individuals 8, 9; individual rights 27–9; personal decision making 6, 263–4 Indonesia 203–4, 252 inductive approach to reasoning 11, 12 infant formula 149, 158–61, 251, 260 Infant Formula Action Coalition (INFACT) 159 information dissemination 137 informed free choice 146, 147–8 Institute of Medicine 162–3 intellectual property rights (IPRs) 137–41, 230, 231, 232 Inter-American Convention against Corruption 171 Inter-American Development Bank (IADB) 215, 216 Interfaith Center on Corporate Responsibility (ICCR) 249, 250 International Bottled Water Association 226 International Center for Alcohol Policies 157 International Chamber of Commerce 234 International Code of Conduct on the Distribution and Use of Pesticides 129 International Code of Marketing of Breastmilk Substitutes 160, 260 International Council of Beverage Associations (ICBA) marketing code 163, 164 International Council of Infant Food Industries (ICIFI) Code of Ethics and Professional Standards 160 International Federation of Pharmaceutical Manufacturers’ Associations (IFPMA) 244 international financial policy 37–8 274 • Index International Labor Organization (ILO) 68, 87, 101, 260 international law 14, 240–3 international marketing techniques 161–2 International Monetary Fund (IMF) 37–8, 171 International Service for the Acquisition of Agri-Biotech Applications (ISAAA) 229 international standards see global standards internet 40–5 investment: and divestment 247–50; FDI see foreign direct investment ‘invisible hand’ Iran 35–6 Irian Jaya 252 Islam 186–90 ISO 14000 series 234 Israel 35 ITT Corporation 48 Iwokrama Forest Reserve 216, 218–19 Latin America 135–6, 203; glue-sniffing 123–4 laws: legal contracts 12–13; international 14, 240–3; national 13, 240–3; Sullivan Principles and apartheid in South Africa 54–5 Lennon, J 200 Lenovo 43 Lesotho 224–5 levels of ethical responsibility 37–8 Levi Strauss 95–6 liberalization 184–5, 239 little foxes (zorritas) 86, 88–90 living wage 98–101, 109 Liz Claiborne 95–6 loans, international 37–8, 53–4 local-global value clashes 185–92, 193–5 logging 214–21 Los Angeles 100 lung disease 135–6 luxury goods 169–70 Jagdeo, B 217, 218 James, C 229–30 Japan 202 Jayaraman, N 106 machismo 203 Magna Carta 28 malaria 130–1 malls 195–202 Mandela, N 50 Manhattan Minerals 19–23 manipulation 147, 148, 149–50 market competition, theory of 170 market liberalization 182–5, 239 market mechanisms, and global warming 219, 220, 221–4 marketing 145–75, 260; alcoholic beverages 156–8; bribery and facilitating payments 170–3; choices for marketing standards and values 146–50; general international marketing techniques 161–2; infant formula 149, 158–61, 251, 260; obesity and 162–4; racial, ethnic and socioeconomic issues 165–70; tobacco 150–6 marketing continuum 147–8 Marks and Spencer (M&S) 245 Max Havelaar Foundation 253 maximal responses 16 McDonald’s 187, 188 McGhan 116, 117 McSally, Lieutenant Colonel M 190 Menem, C 184 Mensah, I 126 Mentor 116, 117 Mexican yellow bean 230 Mexico 86–92, 107 Microsoft 42, 43–4 Middendorff, E.W 21 military repression 65–8 milk nurses 159, 160 Mill, J.S Kaiser Aluminum 203 Kant, I 10 Kathie Lee Gifford clothing 96, 97 Kay, S 226 Kellogg Company 163, 165 Kessler, D 157 Khan, N 105 kidneys, trade in 33–5 Kirin beer 165 Kissinger, H 59 knowledge 15–16 Koop, C.E 152 Koppes, R 249 Kraft Foods 163, 244, 245, 246, 253–4 Krugerrand gold coins 52 Kyoto Protocol 217, 221–2, 233, 236 labels: food products 162; warning labels 120–2, 154 labor and production standards 16–17, 85–110, 259, 260; assessing supply chain responsibilities 92–8; common global standards 106–9; communities and foreign production process 101–6; living wage, debt bondage and union rights 96–101; Mexican sweatshop 86–92 labor relations 203 land: community contracts 181, 182–3; rights 180 language 197 Larrea, D 213 www.ebook3000.com Index • 275 Millennium Development Goals 226 Mineral Policy Center 21 minimal responses 16 minimum conditions 32–8, 191 minimum wage rates 96–8 mining: gold mining in Peru 19–24; systemic cultural change 180 Mittee, B 72 models 168–9 Moldova 33, 34–5 Molina, C 93, 94 Moncayo, D 214 monitoring mechanisms 243–7 Monsanto 230–1 Montreal Protocol 223, 233 morality Mother Jones magazine 118 mother-to-child AIDS transmission 133–4, 135 mothercraft nurses 159, 160 Motorola 66 movies 195–202 Mr Clean 197 Multifibre Arrangement (MFA) 108 Multilateral Fund 223 multiple stakeholders 118–23 Museveni, Y 61 music 195–202 Mutaween 187–9 nation-state system National Academy of Sciences (NAS) 157 National Bioethics Advisory Commission 134 national interest national laws 13, 240–3 National League for Democracy (NLD) 66 National Society for Human Rights (NSHR) 189 national sovereignty 75, 78 natural environment 207–37, 253, 259; biogenetics 227–32; damaged by oil spills 69, 70, 71; decisions to alter or adjust 233–5; human relationship with nature 208–9; market mechanisms and global warming 219, 220, 221–4; preservation vs development 214–21; protection, restoration and sustainable development 209–14; water resource management 224–6, 227 natural resources: systemic cultural change 179–81; see also mining, oil Naturalistic ethic 208, 232 nature reserves 216 negative injunction 16 negative/passive ethical duty 37 Neighbor to Neighbor 251–2 Nestlé 158, 160, 251 Netherlands, The 216 Newmont Mining Corp 22 Niger Delta Development Corp 71 Niger River Delta 69, 70–1, 72 Nigeria 68–73, 242 Nike 95–6, 107, 201 Nissan 197 non-governmental organizations (NGOs): oil resources in Chad 73–5; Tambogrande, Peru 20, 21–2, 24; see also under individual names non-interference principle 48–9 non-party democracy 61 North American Free Trade Agreement (NAFTA) 92 Norwood, V 126–7 Nuñez, J 212, 213 Nwokolo, H 70, 71 Obasanjo, O 71 obesity 162–4 Obote, M 60, 61 Occidental Petroleum 242 Ogoni people 69, 71–2 oil 76; Angola 58–9; Burma 66–8; Chad 73–6; Ecuador 209–14; Nigeria 68–73; Sudan 61–3, 64–5 Oklahoma 97 omission, acts of 15 open-pit mining 19–24 Oportunidades 107 Organization of American States (OAS) 170–1 Organization for Economic Cooperation and Development (OECD) 31; Guidelines for Multinational Enterprises 14, 242 organs for transplants 33–6 overseas drug testing 131–3 Oxfam 21–2, 253 Pacific Rim Plantations 182–3 Page Airways 60 pajamas treated with Tris 113–16 Pakistan 36 palm oil plantations 181, 182–3 Papua New Guinea (PNG) 180, 181, 182–3 partnerships 233–4, 234–5 passbook system 52 passive/negative ethical duty 37 patents 230, 231, 232; drugs 137–41 paternalism 203 Paul, V 193 Pellow, D.N 127 Penney, J.C., retailer 94 Pepsico 66, 164 perceived needs 149 Perles, G 197 Peron, J 184 personal computers (PCs) 43; waste 125, 126–8 personal decision making 6, 263–4 276 • Index Peru 19–24, 26 perverse incentives 219 pesticides 118–23; global standards 129–31; GM crops and 228, 229–30; supply chain 119–22 PetroChina 64 Petroecuador 210, 212, 213 Pew Center on Global Climate Change 222 pharmaceutical products 131–41 Philippines 36, 99 Philips 66 Phillips-Van Heusen 95–6 physical environment see natural environment Pizza Hut 188 placebos 132–5 plastic bottles 226, 227 Poland 124, 166 Polaroid 52–3 policy evaluation 38 political and civil rights 28, 29–32, 36, 39 political economy 4; global 17–18, 178–9 political involvement 39, 47–83, 260–1; Angola 58–9; Burma 65–8, 241; Chad 73–6, 80; contrasting standards of corporate responsibility 48–9; ethical issues and case experience 76–80; Nigeria 68–73, 242; responses to apartheid in South Africa 48–9, 49–57, 76, 78, 191, 242, 247; Sudan 61–5; Uganda 59–61 political neutrality principle 48–9 polygamy 203–4 Popular Movement for the Liberation of Angola (MPLA) 58–9 Portugal 58 positive/active ethical duty 37 practicability 38 Prasad, R.S 167 precautionary principle 228 Premier Oil 66 prescriptions, medical 137 preservation 214–21 Prince of Wales Business Leaders’ Forum (PWBLF) 244 prior informed consent (PIC) 113, 129, 131 Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides (Rotterdam Convention on PIC) 129, 130 privatization 36, 184–5, 239 Procter & Gamble 251–2, 254 product certification programs 244, 246, 250, 252–4 product and export controls 111–43, 259; actors and decision tools 112–13; global standards 114, 129–31; product risk for consumers 113–18; product use and abuse 123–4, 136–7; risks and benefits for multiple stakeholders 118–23; trade in hazardous waste 124–9; triple dilemma for pharmaceuticals 131–41 product quality standards 93 production: process 101–6; standards see labor and production standards productivity/social separation principle 17 profits 2–3 property rights 23; intellectual see intellectual property rights protection, environmental 209–14 protectionism 31–2 protest actions 69, 70, 71, 72 provision of assistance 16 proximity 16 Puckett, J 126 Puritans 191 Quijandria, J 21 racial marketing issues 165–70 Rahman, L 94 Rainforest Action Network (RAN) 252 Rainforest Alliance 246, 253–4 Raja, V 193, 194 rational free choice 146–7 rational persuasion 147, 148 rationality 7–8 Rawls, J 10 Reebok 95–6 referendum 20, 21, 22, 23 regulatory controls 232 Reich, R 100 relativism: cultural 177; ethical 14–15 religion 7–8, 186, 191; Islam 186–90; shareholder activism 249, 250 relocation 102–3 Reporters Without Borders 43 repression, military 65–8 Resistol 123–4 resource allocation 79–80; Nigeria 68–73; oil revenue in Chad 73–6 restoration, environmental 209–14 retailers 93–6, 100 right to food 30–1, 37 rights, human see human rights risk: product risk for consumers 113–18; risks and benefits for multiple stakeholders 118–23 road-building project 218 Rodriguez, A.F 88 role responsibilities and approaches 261–3 Roman Catholicism 191 Ross, C 21–2 Rostenkowski, D 88 Rotterdam Convention on PIC 129, 130 Ruales, G 213 Rugmark Foundation 244 www.ebook3000.com Index • 277 rule utilitarianism 10, 11 rules, deontological 10, 11 sabotage 69, 70 safe-use standards 119–22 Salinas de Gortari, C 88 San Lorenzo Valley 20, 21 Sanchez, T 90 Saro-Wiwa, K 71, 242 Saudi Arabia 186–90 Schell, O 200 Scott, L 96, 97 Scott Paper 252 self-regulation, voluntary 240, 243–7, 254 self-sacrifice 117 sex selection 192, 193–5 Shah Makhdum plant, Dhaka 94 Shand, H 230 shareholder activism 247–9, 250 shareholder perspective 15, 17 Sharpeville massacre 51 Shell 172; General Business Principles 72; Nigeria 70–3, 77, 242 Shi Tao 40 shoe factories 87, 88–90, 91 silent complicity 77 silicone breast implants 116–18 Sinopec Corp 64 skin-whitening products 166–8, 169, 191 Smith, A Social Accountability International (SAI) 244 social contract 12–13, 28; global 14–15 social, economic and cultural rights 28, 29–32, 36, 39 socially responsible investment (SRI) funds 248–50 socioeconomic marketing issues 165–70 ‘soft law’ approach 14, 240, 242–3 solvent abuse 123–4 Sony 43 South Africa: apartheid 48–9, 49–57, 76, 78, 186, 188–9, 191, 242, 247, 251; asbestos victims 103; Lesotho dam project 224–5 Soweto street demonstrations 51 Spanish Inquisition 191 stakeholders 15, 17, 85; product and export controls and multiple stakeholders 118–23 Standard Oil of California (Socal) 62 standard setting 101 standards 7, 8; choice for marketing standards 146–50; global see global standards; labor and production standards see labor and production standards Starbucks: China 198, 199–200, 201; Fair Trade 253; Saudi Arabia 187–9 state authority 27–9 stem cells 232 Stern report 217 Stockholm Convention on Persistent Organic Pollutants (POPs) 129–30, 131 street children 123–4 subsidiarity chain 16, 49, 78, 108 subsidiarity principle 16 Sudan 61–5 Sudan People’s Liberation Army 64 sugar 31–2 suicides 123 Sullivan, L 54–5, 56–7, 189 Sullivan Principles 54–7, 109, 189, 247 Sumatera Island, Indonesia 181 supply chain responsibilities 85; assessing 92–8 Suriname 214–16 sustainable development 209–14, 233–5 sweatshops 16–17, 86–92, 259; see also labor and production standards Syngenta 231 systemic cultural change 179–85 Taiwan 99, 191 Taliban 188, 189, 190 Talisman 62–3, 64, 65 Tambo, O 50 Tambogrande, Peru 19–24, 179 Tavis, L 17 teleological approaches 9–10, 11, 38, 208; decision tools 112–13 television 196; commercials 161 Texaco 210–14 Texpet 210 Thailand 132–4, 135 Three Gorges Dam 224 tobacco marketing 150–6 Toledo, A 21 toluene 89 Total 66–8, 242 trade: agricultural products 31–2; in hazardous waste 124–9; in human organs 33–6; and human rights 39; labor and production standards 92–3; product and export controls see product and export controls; with South Africa 52–3; with Uganda 58–61 Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement 138, 139–40 trade sanctions 60–1, 68 TransFair 253 Transparency International (TI) 172 transplants, organs for 33–6 Tris 113–16 tuna 225 Tutu, D 50 Uganda 59–61 278 • Index ultrasound machines 192, 193–5 understood free choice 146, 148–9 unfair practices 161–2 Unilever 172 Union Carbide 103, 104–6 union rights 96–101 United Kingdom (UK) 165; and Burma 66; Cape corporation case 103; Guyana rain forests 216, 217, 218 United Nations (UN) 48, 49, 204, 209; Bali Climate Change Conference 217, 219, 220; Cartagena Protocol 232; Convention Against Corruption 171; Convention on the Law of the Sea 225; Global Compact 108, 171, 243, 244; Millennium Development Goals 226–7; Universal Declaration of Human Rights 28–9, 32, 36, 101, 139, 186, 209, 260 United Nations Educational, Scientific and Cultural Organization (UNESCO) 197 United States (US): Cambodia 107; Constitution 28; corporate culture 202; dams 225; Declaration of Independence 28, 30; extraterrestrial extension of laws 241–2; human rights policy 29–31; influence on consumers in developing countries 151–2; Kyoto Protocol 221–2; military 190; promotion of cigarette exports 152; and South Africa 50, 55, 57; Sudan 62–3; sweatshops 100–1; trade with China 39; TRIPS exception policy 139 Universal Declaration of Human Rights 28–9, 32, 36, 101, 139, 186, 209, 260 unlined pits 213 Unocal 66–8, 77, 241 utilitarianism 9–10, 11; see also teleological approaches values 7, 8; choices for marketing standards and values 146–50; local-global clashes 185–95; value foundation for a global society 1–6 ‘veil of ignorance’ test 10 Viera, J 93 vitamin A deficiencies 230–1 Vogue India 169 Voluntary Principles on Security and Human Rights 63, 73, 76–7 voluntary self-regulation 240, 243–7, 254 wages: living wage 96–101, 109; sweatshop labor 87–90 Wal-Mart sustainability summit 96, 97–8 warning labels 120–2, 154 Washington Post, The 131 waste, hazardous 124–9 wastewater pits 210, 212–14 water resource management 224–6, 227 Watergate 170 Weidenhamer, J 127 Wheeler, F 217, 219 Wheeler, S 106 Wijn, A 245, 246 Wine Industry Ethical Trading Association 245 Wipro Ltd 193 witchcraft 191 withdrawal 54, 57, 247–9 Wolf, P 249 women 186–90 Workers’ Rights Consortium (WRC) 246 workplace hazards 87, 89 World Bank 171; Chad 73, 75 World Conferences on Women 186 World Health Assembly 138 World Health Organization (WHO): alcohol 156; ban on trade in organs 35; drugs 137–8, 140; International Code of Marketing of Breastmilk Substitutes 160, 260; obesity 163, 164; tobacco marketing 153–4, 156 World Medical Association 132–4 World Summit on Sustainable Development (2002) 233 World Trade Organization (WTO) 31–2, 138, 201; labor standards 108; pharmaceuticals 139–40; TRIPS 138, 139–40 Wysham, D 219 Yadama natural gas project 66–70 Yahoo! 40–1, 42, 43–4, 242 young people 152–3 zorritas (little foxes) 86, 88–90 Zuma, J 204 www.ebook3000.com ... Cataloging -in- Publication Data Kline, John M Ethics for international business : decision- making in a global political economy / John M Kline.—2nd ed p cm Business ethics International business. .. Ethics for International Business Organization of the Book Personal and Organizational Decision Making Chapter Ethics and International Business Introduction Ethical Analysis Ethical Concepts and.. .Ethics for International Business Business takes place in an increasingly global environment, crossing political and cultural boundaries, and consequently ethical dilemmas arise The central