Why an international code of ethics would be good for business

Topics: Ethics, Business ethics, Business Pages: 22 (6556 words) Published: October 15, 2013
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Conftct​​Why an international code of business ethics would be good for business My XanEdu​​​Journal of Business Ethics; Dordrecht; Jan 1998; Larry R SmeltzerMarianne M ​​​Jennings

Source (subtitle):​JBE
Volume:​17
Issue:​I
Start Page:​5766
ISSN:​01674544
Subject Terms:​International
​Business ethics
​Codes
​Culture
​Social life & customs
​Studies
​Culture
​Business ethics
Classification Codes: 9180: International
​2410: Social responsibility
​9130: Experimentalltheoretical treatment
​1200: Social policy
Abstract:
Many international business training programs present a viewpoint of cultural relativism that encourages business people to adapt to the host country's culture. This paper presents an argument that cultural relativism is not always appropriate for business ethics; rather, a code of conduct must be adapted which presents guidelines for core ethical business conduct across cultures. Both moral and economic evidence is provided to support the argument for a universal code of ethics. Also, four steps are presented that will help ensure that company ethical standards are followed internationally.

Full Text:
Copyright Kluwer Academic Publishers Group Jan 1998 [Headnotel ABSTRACT. Many international business training programs present a viewpoint of cultural relativism that encourages business people to adapt to the host country's culture. This paper presents an argument that cultural relativism is not always appropriate for business ethics; rather, a code of conduct must be adapted which presents guidelines for core ethical business conduct across cultures. Both moral and economic evidence is provided to support the argument for a universal code of ethics. Also, four steps are presented that will help ensure that company ethical standards are followed internationally.

Introduction

In many executive training seminars for international business, executives are taught to honor customs in other countries and "Do as the Romans Do." The emphasis on international business training is on learning how other cultures do business and adapting to their way of business (Wines and Napier, 1992; Paige and Martin, 1983). To some companies, adapting to foreign cultures often requires ethical compromises. That is, companies may conduct international business operations in a manner that is

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contrary to its standards of conduct in U.S. operation. In fact, some of the conduct in international operations may run contrary to the basic tenets of capitalism. The issue that arises is whether it is possible to successfully conduct business in those countries where cultural issues require ethical compromises that could significantly affect business operations.

Cultures hold significant variations in language, nonverbal communication, and social custom. Anthropologists, historians, and sociologists are intrigued by these differences. Many business people feel that culture differences between countries can make or break business operations between and within particular countries. Business people also discover that cultural norms for doing business in one country often conflict with codes of ethics and other business standards established in the United States. Even divisions within a company can be at odds. A domestic subsidiary may observe that a foreign subsidiary is operating successfully using tactics not permitted within the firm's domestic code of ethics.

A manager for a U.S. title insurer provides a typical example. He complained that if he tipped employees in the U.S. public recording agencies for expediting property filings, he would be violating the company's code of ethics, and could be charged with violations of the Real Estate Settlement Procedures Act, RICO statutes, and state and federal...

References: [Reference]
1993, 'Ethics and Behavior on the Russian Commodity Exchange ', Journal of Business Ethics 12, 741744.
Paige, R. M. and 1. N. Martion: 1983, 'Ethical Issues and Ethics in CrossCultural Training ', in D. Landis and R. W Brislin (eds.), Handbook of Intercultural Training, vol. 1 (Pergamon Press, New York), pp. 3660.
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