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c hapter 5. ethics and social responsibility in international business. Chapter Objectives 1. Describe the nature of ethics Discuss ethics in cross-cultural and international contexts Identify the key elements in managing ethical behavior across borders

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c hapter 5

chapter 5

ethics and social responsibility in international business

chapter objectives 1
Chapter Objectives 1
  • Describe the nature of ethics
  • Discuss ethics in cross-cultural and international contexts
  • Identify the key elements in managing ethical behavior across borders
  • Discuss social responsibility in cross-cultural and international contexts

5-2

chapter objectives 2
Chapter Objectives 2
  • Identify and summarize the basic areas of social responsibility
  • Discuss how organizations manage social responsibility across borders
  • Identify and summarize the key regulations governing international ethics and social responsibility

5-3

exporting jobs or abusing people
Exporting Jobs or Abusing People?
  • Minute Maid
  • Tropicana
  • Nestle
  • Nike

5-4

ethics
Ethics

Ethics is an individual's personal beliefs about whether a decision, behavior, or action is right or wrong.

5-5

ethical generalizations
Ethical Generalizations
  • Individuals have their own personal belief systems
  • People from the same cultural context will tend to hold similar beliefs
  • Behaviors can be rationalized
  • Circumstances affect adherence to belief systems
  • National culture is intertwined with ethics

5-6

figure 5 1 ethics in a cross cultural context
Figure 5.1 Ethics in a Cross-Cultural Context

Behavior of

Organization

Toward Employees

Behavior of

Employees

Toward Organization

Cultural

Context

Behavior of Employees

and Organization

Toward Other Economic Agents

5-7

how organizations treat employees
How Organizations Treat Employees

Some businesses in Africa have taken steps to educate their employees about how AIDS is contracted.

5-8

acceptability of bribery
Acceptable

Russia

China

Taiwan

South Korea

Unacceptable

Australia

Sweden

Switzerland

Austria

Acceptability of Bribery

5-9

managing ethical behavior across borders
Managing Ethical Behavior Across Borders

Guidelines or codes

Ethics training

Organizational practices

Corporate culture

5-10

corporate social responsibility
Corporate Social Responsibility

Corporate social responsibility is the set of obligations an organization undertakes to protect and enhance the society in which it functions.

5-11

areas of social responsibility
Areas of Social Responsibility

Organizational

stakeholders

Natural

environment

General social

welfare

5-12

examples of companies with a commitment to csr
L.L. Bean

Toyota

Lands’ End

3M

Dell Computer

DaimlerChrysler

BP

Honda

Examples of Companies with a Commitment to CSR

5-13

approaches to social responsibility
Approaches to Social Responsibility

Obstructionist

Defensive

Accommodative

Proactive

5-15

figure 5 3 approaches to social responsibility
Figure 5.3 Approaches to Social Responsibility

Most

Responsible

Least

Responsible

Obstructionist Defensive Accommodative Proactive

5-16

obstructionist stance
Obstructionist Stance
  • Do as little as possible to address social or environmental problems
  • Deny or avoid responsibility
  • Examples
    • Astra
    • Nestle
    • Danone

5-17

defensive stance
Defensive Stance
  • Do what is required legally, but nothing more
  • Corporate responsibility is to generate profits
  • Example
    • Philip Morris

5-18

accommodative stance
Accommodative Stance
  • Meet ethical and legal requirements and more
  • Agree to participate in social programs
  • Match contributions by employees
  • Respond to requests from nonprofits
  • No proactive behavior to seek such opportunities

5-19

proactive stance
Proactive Stance
  • Strong support of social responsibility
  • Viewed as citizens of society
  • Seek opportunities to contribute
  • Examples
    • McDonald’s
    • The Body Shop
    • Ben & Jerry’s

5-20

managing compliance formally
Managing Compliance Formally

Legal compliance

Ethical compliance

Philanthropic giving

5-21

managing compliance informally
Managing Compliance Informally

Leadership

Organizational

culture

Whistle-blowing

5-22

evaluating social responsibility
Evaluating Social Responsibility

A corporate social audit is a formal and thorough analysis of the effectiveness of the firm’s social performance.

5-23

steps in corporate social audit
Steps in Corporate Social Audit

Define social goals

Analyze resources devoted

to each goal

Determine degree of

achievement for each goal

Make recommendations

5-24

actors in policy formulation process
Actors in Policy Formulation Process

The state

The market

Civil society

5-25

regional stereotypes
Regional Stereotypes

Anglo-Saxon

approach

Asian

approach

Continental

European approach

5-26

regulating international ethics and social responsibility
Regulating International Ethics and Social Responsibility
  • Foreign Corrupt Practices Act (FCPA)
  • Alien Tort Claims Act
  • Anti-Bribery Convention of the Organization for Economic Cooperation and Development
  • International Labor Organization (ILO)

5-27