International Business Ethics - While in Rome, Do as the Romans Do - Coursework Example

Title: International Business Ethics Name Course Name Instructor’s Name Date Business Ethics Topic: “While in Rome, Do as the Romans Do” When it comes to business ethics, many people strongly disagree with the statement. This is because what managers should understand is that ethics are supposed to be international not local. Ethics are set of standards that govern a person’s behavior or the behavior of a group or an organization. Basically, ethics refer to the distinction between what is right and what is wrong. However, in terms of business environment ethics, determining what is “right” may not always be straightforward. Most dramas in business settings relating to ethics are usually in the conflict between what one person thinks is right against what another person thinks is wrong depending on what seems to be effective at the moment. This brings about the ambiguity of ethics understanding. This is because, some people believe that ethics are supposed to be guided by moral principles. On the other hand, other people believe that doing what is right is situational other than morally guided. Philosophers define ethics as the manner of the way a person behaves (Pellegrino, 2012). For instance, according to John Pekel and Doug Wallace, ethics can be described as the basis through which we live our normal lives. Some ethicists furthermore believe that ethics becomes the guidelines of. Thesis: “Ethics encompass the judgment on what is acceptable and what is not acceptable. In an organization, ethics are directed by the organization’s culture and core values. Therefore, ethics are applicable in any region and they entail declining a path that is likely to bring about faster profits.” Business ethics determine how people should behave in a business setting, or how they relate with the stake holders. When an organization is undergoing change, then the role of business ethics is manifested. According to Pekel and Wallace, change causes a close examination and analysis of the values that were regarded as insignificant in an organization (Sójka & Wempe, 2012). Business ethics are very important because they guide the leaders on how to relate to the workers and vice versa. Moral values also play a vital role in solving work place problems and misunderstandings. Managing ethics in a business is useful because some people argue that doing what is right in certain situations causes more harm than lying and covering the wrong deeds. The importance of business ethics is that they draw customers because they enhance trust on the company’s products and this improves the sales. Ethics also uphold employees’ relationships with each other such that they are obliged to stay in the organization with reduced labor turnover. This in the long run results in improved returns. More importantly, business ethics attract potential workers in an organization and this reduces recruitment expenses which also ensure that the organization acquires the most appropriate employees for specific posts. In addition to this, good business ethics are an attraction to potential investors because of the increased profits and they maintain the life of the business. Good ethics result to a good business and the outcomes are success and increased profits. In contrary, unethical behaviors discourage stakeholders and investors because they lose trust in the company. Employees’ turnover is also high and this increases recruitment costs (Wilkens, 2011). When production cost increases, returns are also reduced and the business is usually at the verge of falling. In conclusion business ethics are determiners of success. Business Ethics in a Global Perspective Due to globalization and expansion of businesses and markets, then managers and other business leaders should develop a specific global set of ethics that govern the operation of businesses in different regions. Some scholars such as James Adams and Joseph Fletcher state that ethics in a business environment are supposed to be situational and this means that they should be flexible whereby they can be stretched to solve specific dilemmas. However, this idea does not apply in a global situation. This is because there is no way an organization can use certain principles in one location and change these principles in another location. There are several shortcomings that result from changing business ethics from one location to another. According to the distributive theory of ethics, all people are supposed to be treated the same regardless of their location (Kramer, 2014). One of the demerits is that there is a high risk of tarnishing the image of the organization. For instance, in some countries in Africa, Asia, Eastern Europe and Middle East if an international organization wants to establish in these places, then the organization is supposed to pay so that they can set up their businesses. Due to this reason, various companies participate in this competition regardless of the means to do so. This brings out the issue of bribery which is a vice and against the morals of any organization. For instance, Siemens Company based in Germany has recorded over two billion dollars used in bribes so that the company can establish itself overseas. This predicament hit the company really hard until the Chief Executive Officer and the board chairman resigned from the company in 2007. This shows that the principle of “While in Rome, Do as the Romans Do” does not apply and if someone tries to violate the principle of ethics then the reputation of the company is destroyed (Pellegrino, 2012). These humiliations based on ethics can cause a great fall for organizations. This is to say that managers should reflect on this practice and think whether it is appropriate to destroy the status of leading organizations just for the company to set up in foreign land. It is, therefore, important to note that businesses in all the regions should uphold a common set of principles that govern their operation. To make sure that global ethics are sustained both locally and overseas, the top management should be supportive of the businesses that are facing challenges. For instance, in cases where a company is making loses in one country due to the strict adherence to moral principles, the business should not compromise its stand because it is assured of support from the top management in the domestic market. This is possible in companies where the CEO and other leaders are involved in enforcing the global ethics and encouraging the employees to adhere to the set principles in all situations. If the top management is involved in encouraging transparency, then they will conduct auditing and market monitoring procedures that analyze the potential markets. Due to the fact that diversity brings complexity, it is correct to say that in most cases it is not easy to solve a problem in a foreign land that normally would be very easy to solve in the local environment. Due to this complication, international business ethics are very crucial in the operations of all multinational organizations. International business ethics are important in situations where moral principles do not apply in a certain region due to diversities in terms of culture and market models. This has been the cause of endless debates concerning the behavior of a company in a domestic market and how to behave in another region. One would argue that the statement “while in Rome, Do as the Romans do” is applicable in business environments. This is because some people believe that following the principles set by the host country is a gesture of respect for the culture of the country and its citizens. In other countries, for instance, the Latin American countries, it is morally acceptable for companies to give bribes to government personnel to conduct business. One question that a leader desiring to invest in such a country is that is it acceptable to go against the principle of ethics so that the company can establish itself in the country? The reflection on this question is that if a certain behavior is not morally right in the home country, the culture of another country does not make the same behavior right. This would be a violation of what the company stands for. In addition to this, if people think that bribery is wrong, then they feel that it is wrong in any location and going against it due to circumstances creates some tension. This narrows down to the fact that there is nothing like situational ethics. What is right is right in any geographical location. (Bowie, 2013) Creating international business ethics is based on the central idea that certain morals are accepted internationally, and such morals should be used when building principles for multinational companies. For instance, the declaration of human rights is one of the fundamentals that should be followed by companies when constructing international business ethics. This is because human rights are universal meaning they apply in all the regions of the world and for all the people. If business ethics are built in conjunction with human rights, then there will be harmony in applying these ethics in diverse regions. Businesses are supposed to respect human rights everywhere such as no child labor, the customers should have fair bargaining rights, equal rights in employment, using technologies that are not a danger to the environment, do away with corruption of any kind and lastly to support the people in the specific country in taking care of the environment which applies globally. In addition to this, there are certain rules that apply for companies that desire to invest in developing nations. Such guidelines include; respecting the culture of the people in the host country, aiming at positive impact on the people in such countries, avoiding any behavior that may be harmful to the people, respecting and upholding human rights, being responsible for behaviors that are not acceptable and solving any disagreements, following the laws set by the governments and other institutions concerned with rules and regulations and ensuring that there is waste management and adequate care of the environment (Kramer, 2014). In case of any hazardous technologies being used, it is the responsibility of the company to make sure that the citizens are not affected and that the environment is safe for the employees. Challenges in International Business Ethics International business ethics are very important as outlined in the above discussion. However, there are various challenges faced in the construction and implementation of these ethics. One of the challenges is on the issue of a normal business environment. There is an assumption in the construction of these ethics of an ideal business environment where competition is not considered as a real factor. For instance, if there are several companies that want to do business activities in a country where they must bribe the administration for them to set up business entities. Licenses cannot be issued unless bribes are issued meanwhile the competitors safely secure places to do business because they are willing to pay bribes. In such cases, the company needs to choose whether to keep following its principles while the competitors are established and successful (Morrison, 2015). In such cases, international business ethics seems inappropriate for most companies and as a result not many companies will adhere to these rules. In such cases, international business ethics are challenged, and this creates a gap in their functionality. Secondly, another limitation occurs where these ethics try to replicate the home country into the foreign country. In most cases, the laws are made based on the home country rules but rarely look at other areas. It is not possible to have a replica form of governance in more than one country. In addition to this, these ethics are made in comparison with the governments and law enforcement institutions. There is no apparent method to determine whether these laws are correct and whether they are justified to be true. Moreover, the issue of cultural justice is not easy to implement. This is because, these cultural laws are set based on the western perspective. This implies that if a conflict is there, certain cultural regulations are supposed to exist which are not aligned in one direction, that is, neither western nor eastern. These cultural guidelines are supposed to form a general perspective of justice without any bias. Again, there is no metrics to measure whether these guidelines are correct or not (Sójka & Wempe, 2012). Conclusion Due to the process of globalization, the ethical dilemmas are increasing significantly hence the need for international business ethics. Multinational companies are becoming very successful as opposed to other local companies. This growth has been made easy by the expansion of communication and transport advancements. Due to that, then developing overseas is not a choice but a must for all companies. Ethics govern the behavior of these businesses in their home country and in the host countries. Correct procedures should be put in place to make sure that the international ethics are not ambiguous. These international ethics should be built on a standard ground so that if there are any scandals then they are solved with limited bias and this improves the business environment atmospheres. References Bowie, N.E. (2013). Business Ethics in the 21st Century. Springer Science & Business Media. Kramer, D. (2014). A Question of Honour: How Codes of Ethical Conduct and Moral Dilemmas Impact Behaviour. Hamburg: Anchor Academic Publishing. Morrison, J. (2015). Business Ethics: New Challenges in a Globalised World. London: Palgrave Macmillan. Pellegrino, N. (2012). When in Rome. London: Orion. Sójka, J. and Wempe, J. (2012). Business challenging business ethics: new instruments for coping with diversity in international business. 3rd ed. Dordrecht: Kluwer Academic Publishers. Wilkens, S. (2011). Beyond Bumper Sticker Ethics: An Introduction to Theories of Right and Wrong. 2nd ed. Westmont: InterVarsity Press.  Read More