Bus 598 - donaldson assignment PDF

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Bus 598 - donaldson assignment Fall 2018...

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BUS 415 Donaldson Assignment 1. Cultural relativism is a principle which states that, with respect to international business, there is no right or wrong as the ethics of one culture are no better than any other. In a nutshell, things like bribery, child labor, unsafe working practices, in countries that might be less economically developed, are no more or less ethical than their opposites in countries that might be more developed. As a result, proponents of cultural relativism may take a blasé attitude to certain unethical practices abroad (for example, dumping toxic waste in residential areas). On the opposite end of the spectrum, there is the principle of cultural imperialism, which states that one should apply the same ethics from one’s home country, to every country abroad. For example, if a company would not engage in bribery at home in the United States, it should not accept nor tolerate any form of bribery in any other countries where it does business. Neither of these is a satisfactory approach to international business ethics because cultural relativism is morally blind, and cultural imperialism is absolutist. Both are extremes which do not consider the fact that ethics are not black and white, there are moral gray areas. Thus, when doing business abroad, a company needs to operate with respect to cultural values, traditions, and beliefs, as well as sticking to certain fundamental moral principles. 2. Donaldson explains that despite differences between cultural and religious traditions, there are commonly shared perspectives on what it means to be human. He describes these as recognizing “…a person’s value as a human being…treat[ing] people in ways that respect [their]…basic rights… members of a community…work[ing] together to support and improve…institutions…” [Paragraph 23] Furthermore, Donaldson goes on to

state that the core values international business people should use are, “…respect for human dignity, respect for basic rights, and good citizenship.” [Paragraph 23] 3. Donaldson argues that in order to foster ethical conduct, a company must actually stick to its core values. He argues that “…though most large U.S. companies have both statements of values and codes of conduct…[t]oo many companies don’t do anything with the documents; they simply paste them on the wall to impress employees, customers, suppliers, and the public.” [Paragraph 30] He goes on to say that not only do companies need to live up to their codes of conduct and core values, they need to establish clear guidelines and direction and what to do in various situations where a firm’s ethics are tested. However, Donaldson elaborates further by stating that, “[c]odes of conduct must be explicit to be useful, but they must also leave room…to use… judgment in situations requiring cultural sensitivity.” [Paragraph 31] In short, not only does a company have to actually stick to its core values, but it must also strike a balance between “…providing clear direction and leaving room for individual judgment…” [Paragraph 34] 4. A good example of a company striking a balance between its values and creative judgment is when Levi Strauss discovered two of its suppliers using child workers under the age of 14. Instead of simply firing the children, which may have caused serious difficulties for their families, Levi Strauss agreed to pay for the children’s tuition and provide books and uniforms. Furthermore, the suppliers agreed to pay the children’s wages while they attended school, as well as offering each child a job when they turned 14. In this way, the children could receive an education without suffering serious hardship, and still be allowed to work later on. One great example of a company sticking

to its core values is story of the senior executive at Motorola that walked away from a $10 million sale with a South American government, because the government officials asked for a $1 million kickback. This sale would have increased Motorola’s annual profits by 25%, but the senior executive understood that by sticking to Motorola’s corporate values, he would help “…cement a culture of ethics for thousands of employees at Motorola.” [Paragraph 46]...