Business Ethics in India and Brazil

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The two articles, which are from the same source, I have selected provide excellent summaries of the business ethics in the two countries selected, they are a guide to people wishing to do business in these two developing and fast growing nations. The countries I have selected are India in Asia and Brazil in South America. Both of these countries are part of the BRIC (Brazil, Russia, India and China) group of countries which represent 4 of the fastest growing economies in the world, as such there is a lot of interest with large organizations to enter and benefit from this growth.

The first which focuses on India offers a list of ethical tips for operating in India, it talks briefly about the ethical climate in the country and then lists seven ethical and compliance issues to consider before entering the country to do business. (Global Compliance India, Ethisphere, Oct 2008)

The second article which focuses on Brazil is in a little more detail, this is probably because there are bigger differences in terms of the way business is conducted due to the colonization of India. Again it offers ethical tips and lists ethical and compliance issues, however in addition it includes a section on cultural concepts and etiquette tips. (Global Compliance Brazil, Ethisphere, Sept 2008) INDIA

The article describes how conducting business in India has great allure for global corporations for a number of reasons, firstly India has 2nd largest population in the world, it is also a source for intellectual capital and a relatively inexpensive educated labor force, nearly all of which speaks English. The article then goes onto give a number of etiquette tips which in summary are;

Recognizable - Foreigners stand out easily and are often expected to act in a higher standard, don’t be alarmed if people stare! Patience – Dealings can drag being aggressive and quick in negotiations may be interpreted as showing disrespect, so be patient when dealing with the enormous bureaucracy. Pens v Leather – Pens are a status symbol whereas leather gifts may offend.

Cricket & Bollywood - Two subjects that Indians are passionate about are Bollywood, which does more movies annually than the U.S. and U.K. combined and Cricket which is the national sport. Be right – Don’t point, only use full hand to indicate something and never pass anything to someone with left hand. Learn “Namaste” - It can go a long way to earning respect and building relationships to fold your hands and say “Namaste” for ‘hellos’ and ‘goodbyes’.

The climate in India is different, foreign multinationals should expect to be held to a higher standard than a domestic Indian corporation. As such, a foreign enterprise may be more likely to be investigated for a particular activity than a domestic Indian company.

Recognize that brand and reputation, built in part by relationship to community, are extremely important build goodwill through such things as developing schools and institutes, providing housing (or supplements) to employees.

When rolling out compliance and ethics programs in India, it is very important to be culturally sensitive and tailor the programs accordingly. For example, if a multinational corporation were to impose a Western-centric ethics training program on their India employees, this could come across as paternalistic and insulting.

The article lists Seven Compliance and Ethics issues to consider;
BRIBERY
According to Transparency International, of the top 30 export countries, Indian companies are most likely to offer a bribe to get business. Companies are also pressured to give bribes to win business in India. The only effective solution is training (including Foreign Corrupt Practices Act), strict policies and zero tolerance.

TRANSPARENCY
It can be difficult to get accurate information, including financials and forecasting, from a JV partner in India. Be certain to have strong local and international counsel in setting up a JV, it is...
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