International business ethics challenges the corporate world to deal with questions of what to do in situations where ethical standards come into conflict as a result of the different cultural practices in the nation. Since, there is this dilemma that has progressively troubled the large multinational corporations, international business ethics has arisen to help address these adhesive subject matters. There are several international business ethics discussions on the question of how to act in the home country as opposed to the host country is at the central point of most international corporations.
The argument in question is how companies should practice their business according to the host country socially accepted morals that would show respect both to the citizens and the culture of the hosting country in which the business is conducting affairs. Ethics in International Business International business ethics has many discussions going on how companies should practice their business morels in their home country versus the host country that they also have headquarters.
Another argument that has arisen is what a business employee should do when socially accepted norms are morally objectionable to the cultural values of the corporations’ home. The possibility of ensuring the agreement between behavior and ethical values has been a great importance for a long time in the business world. The request in this process was to show change of ethical values depending on various standards and organize an ethical system that is conducive to development within a society and businesses in different countries.
Employing ethical standards and values in many organizations around the world, would facilitate the development of the business system and industries and prompt the development to inspire confidence on consumers leading to greater production on products.
Therefore, the objective in this study is to review the issues mentioned above with regards to domestic and international business depending on profound publications.
The purpose of this paper is to review the literature on ethics, compare it with a global point of view and attempt to differentiate the study between five articles with respect to the prevailing strength of international corporations and their influence on host markets in their countries. Fundamental Approaches in Developing Ethical Values Organizations that show universal ethical standards present an enhanced performance in there company that delight in a positive image before society and have provided accommodations to create stronger relations with stakeholders in the long run.
Companies are improving issues in different industries and societies with respect of being implementers around the world. Having knowledge in human resource, technology, natural sources, capital and entrepreneur are main contributions for having ethics in a business. Organizations are increasing their performance and accomplishments by the managerial talents of prospective leaders in their company. Leadership can be defined has the process of social impact in which an individual can support others for the achievement of a joint objective within an organization.
A manager who can influence the attitude and behavior of their employees are definitely being a role model of an objective and intense executive implementing the ethical standards of that company. Being a liberal manager establishes the ethical standards to become an instigator of ethical climate within an organization. An organizational environment should inspire positive behaviors and attitudes, unethical attitudes that should decline, and cease to be existent. The culture in internationals business differentiates life in one group from life in another group. This includes mental contents, norms, institutions, and other related things.
Organizational culture is the collective behavior of people who are constituents of companies forming organizational values, vision, systems, language, norms, attitudes, behavior, belief and habits. The values and culture have reflective impact on ethical climate in organizations which inhabits on the ethical measurements changing in the structure of an organization. All these concepts facilitate the motivation of both employers and employees that would lead positive effects for organizations. Motivation is a psychological trait that would lead an individual or related party to a desired action on a definite goal.
Motivation in an organization is considerable to sustain an employee with occupational pleasure, individual satisfaction, and positive contribution to the work place and its environment. Ethical Management, Impact on Individual and Organizational Performance Companies are supposed to be able to achieve and demonstrate an ever increasing performance showing improvement on leading in their industries to acquire competitive advantages. Having a high level of performance could be greatest achieved with competent and motivated employees.
The conduct of business in an organization with an ethical manner is of great importance to secure an increasing performance as well. Organizations functioning towards ethical standards should ensure unbiased applications of business and recall a sense of justice to stimulate motivation among their employees. Employees that are motivated through a positive ethical organizational climate and leadership do much better than a less motivated employee. This promotes the organizational achievement that causes a wider development in the external environment of the organization as to be a positive instance and stimulator.
India provide a hypothetically important area of research for international business in terms of the rapid development of their institutions and organizations. Their culture represent 80% of the world’s population. Since there are various rules of international business, including the nature of multinational corporation activities such as joint venture and technology transfer, mostly originate from the traditional global triad markets of Western Europe, the United States, and Japan (Rugman 2000 and Verbeke, 2003).
The framework we can recommend, which divides the global environment based on the factors that effect and coerce the behavior of corporations in their approach to international business, take responsibility with a global economic triad that is divided as follows: Anglo-Saxon countries such as the United Kingdom and the United States, the non-Anglo-Saxon major economies of continental Europe and Japan, and the developing regions of the world, like India that is at the bottom-of the- pyramid economies (Hahn, 2008; Prahalad and Lieberthal, 1998).
The concept of the International business systems approach to the triad system, is too distinct the projected tactic that rather than grouping countries and regions together as vis-a-vis. The traditional economic triad definition is alliances are made based on the business system or the type of capitalism that exists in target countries, regions, and societies. Social Accountability International The effect of Islamic ethics, has an enriching effect on Jordanian business practices. India gives a more interesting ethical picture in the world of business.
Being a large Hindu religion with substantial minority groups, India is a country embraced of people speaking twenty-six different languages within two large ethnic groups. With India being a single culture that can be examine as Indian business ethics can be completely misleading to people. Considering the existence of “under cultures” throughout the Indian population, international business performed in India would need to be carefully examine with various ethical codes in practice throughout the country in order to understand the culture and begin to apply any sort of integrative social ethical theory.
The applications of ethical codes to international business have been marked at best. The reasons for the codes are mixed because a great deal of it is the attempts to formulate universal ethical principles, with the effort to accommodate some local cultural practices that would affect business ethics. Another major reason behind the failure of social ethics is that the attempts have all been based on the Western philosophical thought process. The Confucian and Islamist traditions possess working and effective ethical codes which seem to work well in those cultures.
In 1997, Social Accountability International (SAI) published Social Accountability 8000, a voluntary standard that attempts to ensure humane workplaces worldwide. These standard was revised and updated in 2001. Reasonably using the exhortative approach endeavored up until that time by the International Labor Organization (ILO), SA8000 is a frank, open attempt to convince companies that it would be in their best business interests to become registered to this standard. Conclusion
We can conclude that there are two fundamental problems with the traditional framework of international business environment of the twenty-first century. It is quite clear that the companies of Western Europe and the United States are not highly standardized to global ethics practices, and that corporations from these two regions seem to behave under different rules, logic, and strategies. Even within Western Europe, there is a clear difference in the business behavior between different countries and corporations (Lowenberg, 1999; O’Sullivan, 2000; Ottaway, 2001; Thomsen and Pedersen, 1999; Westney, 1999).
Research on corporate governance that has carried out in the 1990s had shown clear differences between two types of mature business systems: the Anglo-Saxon system and the system of continental Europe n (Albert, 1991; Roe, 1994; Thomsen and Pedersen, 1999). Recent comparative business ethics have shown the great diversity of cultural values and business ethic frameworks in the world. The nature of development can be seen as comparatively general and not specific to any particular nation or region. The large emerging economies are China, Brazil, and Russia; while the large developing economy is India.
The optimism of workplace environments becoming an acceptable level to work, then the concept of dissertation ethics can be put in play under which multinational corporations in business with their developing country workers can provide a hypothetical justification for opening and maintaining a moral discourse which can then establish and mutually maintain ethical principles based on agreement and cooperation. This would be a truly revolutionary development and one which would create a wholly new code of international business ethics involving the employer and the employees as cooperating associates.
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