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Chapter Eight Ethical Issues in International Business. Ethical Theory and Business, 6 th Edition Tom L. Beauchamp & Norman E. Bowie. Objectives. After studying this chapter the student should be able to:

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Chapter eight ethical issues in international business

Chapter EightEthical Issues in International Business

Ethical Theory and Business, 6th Edition

Tom L. Beauchamp & Norman E. Bowie


  • After studying this chapter the student should be able to:

    • Describe problems encountered by multinational corporations when conducting business with other countries.

    • Contrast the transcendental normative environment and the group normative environment.

    • Analyze the ethical issues of the Japanese business community.


  • Discuss the concept of reciprocity as it applies to the Chinese culture.

  • Explain the guidelines for conducting business with Chinese businesspeople.

  • Contrast gift giving, bribery, and corruption.

  • Define the term sweatshop.

  • Discuss the development of the campus anti-sweatshop movement.

  • Discuss possible standards for appropriate wages and labor standards in international sweatshops.


  • Discuss the potential economic problems that may occur if current sweatshop practices are changed.


  • Multinational Corporations

  • Bribery

  • Sweatshops



Norman bowie
Norman Bowie

  • “Relativism and the Moral Obligations of Multinational Corporations”

  • General multinational corporation obligations

  • Distinctive obligations

  • Relativism

  • Morality of the marketplace

Daryl koehn
Daryl Koehn

  • “What Can Eastern Philosophy Teach Us About Business Ethics?”

  • Cullen Chair of Business Ethics, University of St. Thomas in Houston

  • Do Asian values exist?

  • Watsuji Tetsuro and Confucius

    • Meaning of trust

    • Relations are for life

    • Ethics beyond rights

Iwao taka
Iwao Taka

  • “Business Ethics: A Japanese View”

  • Religious dimension

    • Transcendental normative environment

      • Numen – Soul, spirit, or spiritual energy.

      • Transcendentalism – The philosophy that every phenomenon is an expression of the great life force and is ultimately connected with the numen of the universe.

    • Japanese meaning of work

    • Group normative environment

Iwao taka1
Iwao Taka

  • Living between the group and individual environments

  • Social dimension

    • Concentric circles of corporations

      • Family, fellows, Japan, and world

    • Dynamics of the concentric circles

      • The individuals

      • The contextuals

    • Group environment and concentric circles

Iwao taka2
Iwao Taka

  • Japanese recognition of the American business community

    • Job description and the transcendental logic

    • Employees’ interest and the group logic

    • Claims against the Japanese market and the concentric circles’ ethics

Iwao taka3
Iwao Taka

  • Ethical Issues of the Japanese business community

    • Discrimination and transcendental logic

      • Transcendental logic has favored the male society.

      • Transcendental logic has been used to accuse certain workers of laziness.

    • Employees’ dependency and the group logic

    • Exclusiveness of the concentric circles

Patricia h werhane
Patricia H. Werhane

  • “Exporting Mental Models: Global Capitalism in the Twenty-First Century”

  • Ruffin Professor of Business Ethics, University of Virginia

  • Mental models - The mechanisms whereby humans are able to generate descriptions of system purpose and form; explanations of system functioning and observed system states; and predictions of future system states.

Patricia h werhane1
Patricia H. Werhane

  • This article examines the possibilities of using an American free enterprise capitalist model for conducting business in a global arena.

P steidlmeier
P. Steidlmeier

  • “Gift Giving, Bribery, and Corruption: Ethical Management of Business Relationships in China”

  • Associate Professor School of Management, Binghamton University

  • Developing a cultural framework for reciprocity

    • Artifacts

    • Social knowledge

    • Cultural logic

P steidlmeier1
P. Steidlmeier

  • Interacting with others in China

  • Moral analysis of reciprocity

  • Guidelines for doing business right in China

    • Investigate the backgrounds of local executives you place in charge of company matters.

    • Ensure no one individual has total control over company matters.

    • Treat remarks such as “China is different” and “You shouldn’t get involved” as red flags.

P steidlmeier2
P. Steidlmeier

  • Establish regular and detailed auditing systems to ensure transparency.

  • Be aware of the political standing of your counterparts and do not get caught in the cross fire of Chinese power struggles.

  • Explain your difficulties to the Chinese side and offer alternatives that are legitimate.

  • As much as possible, use Chinese sources themselves as the basis for your unwillingness to do corrupt deals.

P steidlmeier3
P. Steidlmeier

  • Rather than becoming entangled in a specific minor bribe, place the whole matter in a broader context of negotiation.

Thomas donaldson and thomas w dunfee
Thomas Donaldson and Thomas W. Dunfee

  • “When Ethics Travel: The Promise and Peril of Global Business Ethics”

  • ISCT Core norms

    • Hypernorms

    • Consistent norms

    • Moral free space

    • Illegitimate norms

  • Navigating the ISCT map

Richard applebaum and peter dreier
Richard Applebaum and Peter Dreier

  • “The Campus Anti-Sweatshop Movement”

  • The global sweatshop

    • Sweatshop – A process where profits are sweated out of workers by forcing them to work longer and faster.

  • Kathie Lee

  • Robert Reich

Richard applebaum and peter dreier1
Richard Applebaum and Peter Dreier

  • A “sweat-free” campus

    • Began at Duke University, Fall 1997

    • Required manufacturers of items with the Duke label to sign a pledge that they would not use sweatshop labor

    • Quickly spread to other U.S. universities/colleges

    • United Students Against Sweatshops (USAS) formed Summer 1998

  • The industry’s new clothes

Ian maitland
Ian Maitland

  • “The Great Non-Debate Over International Sweatshops”

  • Carlson School of Management, University of Minnesota

  • International sweatshop labor standards

    • Home-country standard

    • Living wage standard

    • Classical liberal standard

Ian maitland1
Ian Maitland

  • Charges against sweatshops

    • Unconscionable wages

    • Immiserization thesis

    • Widening gap between rich and poor

    • Collusion with repressive regimes

  • Labor standards in international sweatshops: painful tradeoffs