International business is evolving and developing in the context of the 21st century, moving forward at an unrivaled pace. It is clearly a beneficial innovation for all enterprises having the potential to expand beyond national borders, giving additional opportunities and profits to those who dare to enter the international market and sustain the competitive advantage as compared to other companies acting in this sphere. The tendency of globalization that has marked the turn of the third millennium also adds positively to the development of international business, erasing all barriers of an economic, geographical, and legislative character.
However, it has turned out that it is impossible to eliminate some types of barriers, namely cultural ones. With the intensification of globalization and overall world integration, the cultural differences that used to be underestimated revealed themselves more intensely, showing that the underlying reasons for all misunderstandings that may emerge in the business sphere may come from cultural diversity, mentality, and peculiarities that one or another country may possess. These peculiarities and differences may not only complicate the process of conducting business affairs but also make it completely impossible.
Ethical issues have been recently recognized as one of the key factors of failure of success of a particular country, its campaigns, and undertakings. The reason for this is that within the past few decades, the reputation of the company, its ethical profile, and the pattern of corporate ethics it adopts influences its perception by consumers, directly influencing sales and overall profit. Thus, the necessity to comply with the established rules and standards that may not be fixed legally but that exists in the minds and hearts of people all over the world have to be kept to in order to sustain profitability, no matter how strange it would sound.
Logically, in order to sustain a good reputation and be successful in the world market, the international companies are urged to establish a code of ethics that would comply not only with the ethical standards accepted in the host country but also in the countries in which the outsourcing capacities of the company are located or the target market at which the company sells its products or renders its services exist. Only under this condition, it becomes possible to retain the popularity and respect and to act in compliance with the laws of all countries involved in the international business activity of a particular country.
Every ethical decision has a set of underlying principles to which one should keep in order to really conduct the ethical activity. However, decisions are not always made in accordance with ethics or morality; hence one may find a set of principles guiding the decision-making process in the work of Goree (2007). The author states that if the decision is made with consequences of the decision taken into account, there are the following considerations: the company thinks only about itself and takes into consideration its personal interests; the company thinks about everyone affected by the future decision; virtues, rights, and duties are also taken into account in a set of cases (Goree, 2007).
In case the company is guided only by individualistic considerations in the decision-making process, it usually acts in compliance with its national laws (which is logical, considering legal problems and lawsuits that may result from unlawful behavior and activities) to sustain its reputation and customers.
However, in the case of conducting its international activity or outsourcing its facilities, the company does not take into account the cultural peculiarities, local laws, habits, and beliefs of the partnering country, which is unethical though legally permissible. In this case, the company may save a certain amount of money (the more conditions a company has to comply with, the more expenses it involves) and may not be accused of being unfair or acting unlawfully. But the fact is that the behavior of this company will still remain unethical and will entail negative consequences in the long run.
Actions guided by thinking about everyone affected are more problematic, time-, money- and labor-involving. However, these actions do not only permit the company to remain prestigious, clean in legal aspects, and respected by the partnering company, but also enrich its cultural and legal experience by complying with new rules and standards, which will certainly remain its advantage in the long run.
The principle of rights involves more basic considerations inherent in every nation and every human being – “according to the principle of rights, an action is considered moral when it respects the rights of others and is considered immoral when it violates another’s rights” (Goree, 2007). Thus, judging from this point, it becomes clear that international business may be considered moral only if it takes into consideration the right of the partnering company (and country) to authenticity.
A principle of duty is one more basic principle that provides for the fairness of conducting business affairs – it is purely individual because it states that one should act correctly only because they know that it is right. Here it is the matter of choice – it is everyone’s duty to act morally; nevertheless, some people do this, and some do not.
Finally, the principle of virtues is the most general principle that states that one should live according to principles of ethics as this will make them a good person. Consequently, a question arises on how this should be done and what principles are the right ones to keep to (Goree, 2007). The subjective truth may dictate different ethical principles to different people, thus creating no unified pattern for being ethically correct.
Bibliography
Goree, K. (2007). Ethics in the Workplace. 2nd Edition. Thomson-South Western.