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International Business > Chapter 5 > Flashcards

Chapter 5 Flashcards

1
Q

what are the most common ethical issues concerned with? (5)

A

employment practices,
human right
environmental considerations, corruption, moral obligations of MNCs

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2
Q

To guard ethical abuses a firm should (3)

A
  • establich acceptable standards that protect the basic rights of employees
    -audit foreign subsidies and contractors regularly to ensure that standards are being met
    -take corrective action if they notice abuses
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3
Q

what are the 5 freedoms associated with human rights

A
  • freedom of association
    -freedom of speech
    -freedom of assembly
    -freedom of movement
    -freedom from political repression
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4
Q

which country had a apartheid system

A

south africa

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5
Q

what did business from developed countries that operate in south africa think

A

they questioned the ethics of doing business there

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6
Q

what business took action regarding working in south africa

A

general motors

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7
Q

what did general motors do

A

they adopted the sullivan principles

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8
Q

what are the sullivan principles

A

that the company should not obey the apartheid rules in its own operations in south africa, and they should promote the abolition of the apartheid laws,

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9
Q

after 10 year what did leon sullivan conclude

A

that adopting the principles was not enough to end the apartheid regime and that business could not justify operating in south africa anymore

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10
Q

what happened after leon sullivan changed his mind about the ethics of working in south africa

A

many american companies divested their south african operations, and many american pension funds said they wont hold stocks of companies that operate in south africa, then the apartheid regime and introduced democratic elections

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11
Q

is it ethical for multinational corporations to operate in countries that are repressive

A

inward investment by MNCS can be a force for economic, political, and social progress to improve human rights in the foreign country

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12
Q

economic progress in a nation could create pressure for

A

democratization

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13
Q

why would a mnc produce in a country with less pollution controls

A

less costly to produce there , so they are free to despoil the environment while lowering costs to obtain a competitive advantage

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14
Q

what is the tragedy of the commmons

A

when a resource is held in common but owned by no one and is overused by individuals

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15
Q

how do corporations contribute to the global tradegy of the commons

A

they move production to locations where they are free to pump plutants into the atmosphere or dump them in ocean, thereby harming global commons

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16
Q

how do international business gain advantages in corrupt contries

A

making payments to corrupt government officials in order to gain an economic advantage

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17
Q

when does the problem of ethics regarding environmental pollution arise

A

Problems occur when environmental regulations differ between host and home nations.

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18
Q

what is the US foreign corrupt practices act (FCPA)

A

the act outlaws the paying of bribes to foreign officials to gain business

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19
Q

what does the FCPA allow

A

facilitating payments

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20
Q

what are facilitating payments

A

they are NOT payments to secure contracts that would not otherwise be secured and they arent payments made to obtain exclusive preferential treatment, they are payments to ensure receiving standard treatment that a business ought to receive from a foreign gov

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21
Q

the OECD followed the US and made the ?

A

convention on combating bribery of foreign public officials in international business transactions

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22
Q

what is the CONVENTION ON COMBATTING BRIBERY

A

obliges member states of the OECD to make bribery of foreign officials a criminal offense, but it excludes facilitating payments made to expedite routine gov action

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23
Q

How do bribes affect a company

A

the may improve efficiency and help growth, but they reduce the inventive to invest and it reduces the returns on investment and leads to low economic growth

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24
Q

how do bribes reduce ROI

A

officials may siphon off the profits from business activity which reduces the business incentive to invest and may retard economic growth

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25
Q

what are ethical dilemmas

A

ethical dilemmas are situations where there are. no alternatives that seem ethically acceptable

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26
Q

what are the determinants of ethical behaviour? (6)

A

societal culture
personal ethics
organizational culture
unrealistic performance goals
decision making processes
leadership

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27
Q

what are personal ethics

A

generally accepted principles of right and wrong that govern the conduct of individuals

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28
Q

how are personal ethics formed

A

formed by our parents, our schools, religion, and media

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29
Q

what is a possible ethical issue that can arise when managers from another country face pressure

A

they violate their personal ethics because they are away from their ordinary social context and culture

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30
Q

ethical problems arise in processes that

A

do not incorporate ethical considerations

31
Q

how does organizational culture affect unethical behaviour

A

values and norms in the organization may not encourage people to think about the ethical consequences of their decisions

32
Q

how do unrealistic performance goals effect unethical behaviour

A

pressure from the company to meet unrealistic goals may force employees to cut corners and act unethically

33
Q

how does leadership effect unethical behaviour

A

leaders that dont establish a culture of ethical behaviour will cause unethical behaviour in emplyees, employees take cues from their leaders on how to behave

34
Q

what factors in societal culture affect unethical behaviour

A

individualism and uncertainty avoidance, masculinity and power distance

35
Q

cultures that have higher ethical behavior have which societal culture

A

societal cultures with high individualism and uncertainty avoidance have higher ethical behaviour

36
Q

what is philosophy

A

a system of beliefs and knowledge that provides a global influential framework

37
Q

what is methodology

A

methodology helps approach dealing with something by providing methods and tools

37
Q

what is approach

A

approach is a focused way to deal with something, largely influenced by philosophy

38
Q
A
38
Q

what are straw men approaches

A

offer inappropriate guidelines for ethical decision making

38
Q

what are the 4 straw men approaches

A

the friedman doctrine cultural relativism
the righteous moralist
the naive immoralist

39
Q

what is the friedman doctrine

A

the idea that the social responsibility of business is to increase profits so long as the company stays within the rules of the law then tooz

40
Q

what is cultural relativism

A

ethics are reflection of culture, and we should reject the idea that universal notions of morality transcend different cultures

41
Q

what is the righteous moralist approach

A

the home country standards of ethics should be followed in foreign countries,

42
Q

the righteous moralist approach is usually criticized because

A

the proponents go too far

43
Q

the naive immoralist approach is

A

if a manager of a mnc sees that firms from other nations are not following ethical norms in the host nation then they shouldnt either

44
Q

utilitarian approaches to ethics suggest

A

the moral worth of actions or practices is determined by their consequences, so good=utility,

45
Q

how are actions considered desirable under utilitarian approaches to ethics

A

actions are desirable if they lead to the best possible balance of good consequences over bad consequences

46
Q

what are the best decisions under utilitarian approach to ethics

A

the best decisions are those that produce the greatest good for the greatest number of people

47
Q

what are the drawbacks of the utilitarian approach to ethics

A

difficult to measure the benefits and costs of an actions, fails to consider justice

48
Q

what are kantian ethics

A

believe that people should be treated as ends and never purely as means to the ends of others
people have dignity and should be respected

49
Q

kantian ethics require individuals to act based on

A

principles that can be consistently applied to everyone so it emphasizes universality and impartiality

50
Q

what are the rights theories

A

believes that human beings have fundamental rights and privileges that transcend national borders and cultures

51
Q

moral theorists argue that —– form the basis for a moral compass that managers should use in ethical decision making

A

fundamental human rights

52
Q

what is the UN declarayon of human right

A

lays down the principles that should be adhered to regardless of culture

53
Q

what is article 1 of the human rights declaration

A

all human beings are born free and equal in dignity and rights, and people should act towards eachother in a spirit of brotherhood

54
Q

what is article 2

A

everyone is entitled to all the rights in the declaration regardless of race color , sex, language, religion

55
Q

what is article 3

A

everyone has the right to life, liberty and security

56
Q

what are the justice theories

A

focus on the attainment of a just distribution of economic goods and services that is considered fair and equitable

57
Q

what system would you design under a veil of ignorance

A

you create policies that work for everyone even those on extremes of the spectrum

58
Q

under the veil of ignorance each person is permitted to the max amount of

A

basic liberty like right to vote and freedom of speech

59
Q

when is inequality allowed under the veil of ignorance

A

allowed only if the inequalities benefit everyone

60
Q

what organizational culture and leadership should we enforce to have ethical behaviour

A

articulate values that place a strong emphasis on ethical behaviour

emphasize the importance of a code of ethics

implement a system of incentives and rewards that recognize people that engage in ethical behaviour

61
Q

how do we go about decision making to be ethical

A

-put decision making process that requires people to think about the ethical dimension of the decision
-ask yourself is people close to you would approve of the decision
-ask yourself does it fall within the accepted values
-

62
Q

what are the 5 steps to think through an ethical problem

A

1- identify which stakeholds the decision woudl affect
-determine if the decision would violate the rights of any of the stakeholders
-establish a moral intent ( moral concerns above other concerns)
-engage in ethical behaviour
-audit decisions later to see if they are consistent with ethical principles

63
Q

what role should a firm create to ensure ethical behaviour

A

have ethics officers

64
Q

what do ethics officers do

A

asses the efficiency of the ethics program
develop and train employees on the ethics program
comply with laws
monitor and audit ethical behaviour
take action when appropriate
review and update the code of ethics periodically

65
Q

what is the importance of moral courage

A

enables managers to walk awag from a decision that is profitable but unethical
-give employees the power to say no to their superiors if they want them to act unethically
-gives employees the integrity to go public if theres unethical behaviour in a company

66
Q

what is CSR

A

corporate social responsibility

67
Q

what are the rules of csr

A

-with power comes responsibility, csr advocates that businesses need to recognize their noblesse oblige, and acknowledge that power can be used in a positive way

68
Q

what is noblesse oblige

A

term that refers to honorable and benevolent behavior that is considered a responsibility for those with high status

69
Q

why are sustainable strategies beneficial

A

help the firm make good profits without harming the environment

70
Q
A

International Business (7 decks)

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