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Ethics Considerations in Intellectual Property Valuations Essay


Introduction

The continued advancement of the global trade practise has encountered numerous challenges, chief among them being the moral or ethical aspects of obtaining other people’s ideas without consent. Most countries in the world have established intellectual property laws that seek to protect businesses from losing their original ideas to other entities unfairly. Nonetheless, this legal framework experiences numerous challenges, as violation of these rights remains widespread globally.

This paper seeks to explore the relationship between intellectual property and business ethics elaborately and further provide existing examples of instances where the intellectual property law has been violated.

Moreover, this paper tackles the question of culture and business, especially focusing on how this concept has affected businesses in their participation of trade in the global scale. The paper defines the critical dimensions of culture and explains how these dimensions are affected when businesses operate on cross-cultural landscapes.

Relationship of intellectual property and business ethics

Business entities experience the growing need to register and consequently associate themselves with a distinctive clue that represents their brand, as part of their unique identification of their product or service. This unique identification of the brand is referred to as intellectual property, which may be in the form of a name, word, symbol, design, image, phrase, logo, or a combination of any of the above features (Budde-Sung, 2013).

Importantly, however, the aspect of intellectual property becomes threatened by the fact that once a good or service expands its market beyond certain limits, such as regional or continental boundaries, the practicality of protecting trademarks becomes almost impossible, particularly if done purely on commercial morality basis. The question of business ethics, hence, comes in as a way of offering protection of the intellectual property (Reilly, 2008).

Although many countries have established legal frameworks that seek to protect trademarks, commercial morality in this respect underscores the conviction that the trademark symbol supersedes the mere effort of a business entity to use it as the source of individual revenue (Budde-Sung, 2013). In essence, the question of business ethics comes in when frameworks like the Unfair-Competition Law or any other similar doctrines are introduced for purposes of planning to provide support to commercial morality in general.

The Unfair-Competition Law is used mainly as fair use guidelines that seek to preserve a particular distinction that is gradually vanishing, especially owing to the contemporary changes influenced by the current, as well as emerging technologies. The unfair competition in business ethics is explained as any effort that a business rival undertakes, either through imitation or through other unwarranted means, to misinform the public that buying their product is the same as buying what someone else has manufactured.

Overly, the basis of the unfair competition law is the structure of a society that is committed to upholding free competition as a means of dealing with business malpractices that are considered as offensive to the society’s morals (Reilly, 2008). The issue of business ethics, in general, comes in when the commercial unfairness is controlled, as it is considered as unfair competition if it emerges that a misuse has been committed to gain commercial advantage of another individual’s proprietary right unfairly.

The business ethics emphasise the fact that there is a need for competition to be conducted within certain limits to preserve its sustainability; no matter how committed a person may be regarding the belief that competition is the best probable tool of trade within any given democratic society.

The trademark law, which in this case constitutes an aspect of intellectual property, is intended to promote or uphold commercial morality as a means of preventing competitors from redirecting the customers of a particular producer through “illegitimate” means (Budde-Sung, 2013).

Quote any two real life examples of intellectual property law violation or dispute in the Middle East region

One significant instance of intellectual property law dispute in the Middle East, particularly in Saudi Arabia, is the widespread behaviour of pirating copyrighted software. Despite the existence of numerous enforcements of legislative mechanisms that are meant to curb software piracy in the country, the trend depicts that software copyright violation is increasing.

According to practical statistics representative of the situation, stolen programs that were eventually installed in personal computers in 2000 stood at 33% and were worth $11.75 billion. In 2011, the figures rose to a whooping $449 million worth of pirated software (Alalwan, 2015). It implies that Saudi Arabia has failed to protect the intellectual property rights (IPR) effectively, as the universal convention requires of all countries (Aljabre, 2012).

The second instance of intellectual property dispute that occurred in the Middle East came to the fore in 2012, pitting giant clothing chain Primark of Europe and a local outlet in Dubai that mimicked the same name (Jones, 2012). The fake shop opened its offending clothing store in the Bur locality in Dubai and illegally used the Primark trademark to convince local customers that it was an extension of the European retailer. This occurred at a time when Primark had not ventured into the Middle East market at all.

The breach of Primark’s intellectual property occurred despite the UAE being a member of the Paris Convention that seeks to protect industrial property (Jones, 2012). Indications by the Associated British Foods, which is the official owner of the Primark trademark, of intentions to sue the fake brand in Dubai prompted the proprietor to suggest that he was willing to enter into a franchise deal with Primark (Kerr, 2012).

Analyse the impact of cultural and social differences on business ethics practices interpretation and adaptation

Culture represents varying societal beliefs and practices, which make people from different backgrounds different from each other. A multinational business entity requires adhering to the existing government laws, as well as policies, irrespective of the country in question (Danon-Leva, Cavico & Mujtaba, 2010).

Despite this, there is equally the need for the businesses to draw the line or consider critically particular ethical dilemmas in their ventures. According to Hofstede (2011), cultural dimensions aspects of individualism, masculinity, power distance, and uncertainty avoidance form the sources of the cultural impacts of business ethics practices, which eventually influence how these differences are interpreted and adapted.

In terms of individualism, Hofstede (2011) argues that different cultures value social ties differently. For instance, some societies value a collectivistic kind of relationship where people define themselves in terms of communities while other cultures value individualistic existence, where people look at themselves as single entities. Hofstede (2011) categorises the majority of the Asian countries like Saudi Arabia and UAE as collectivistic.

On the other hand, nations like the USA and a majority of the European countries, like the UK and France, are individualistic. These cultural dispositions make most of the companies from individualistic countries to preoccupy their attention more on profit maximisation, as opposed to focusing on general life improvement for the entire society.

Businesses from individualistic cultures or countries operating abroad in collectivistic countries may experience the pressure to venture into corporate social responsibilities more than they would anticipate.

In terms of the masculinity dimension, Hofstede (2011) argues that societies differ regarding how they distinguish roles on grounds of gender. Masculine cultures are characterised as assertive, materialistic, and robust, while feminine cultures are seen as tender, modest, and concerned more about the quality of life.

Business enterprises originating from masculine cultures are more likely to uphold internal competition among employees, with the most outstanding performer being feted publicly and encouraged to work even better to maintain their exceptional performances. However, such firms are likely to face ethical business dilemmas, especially where they venture into feministic societies. In such feministic cultures, priority is not given to the outstanding employee, but the focus is directed to the entire workforce to improve their general performance.

In terms of power distance, Hofstede (2011) argues that power distribution also varies in different societies, with high power distance societies expecting an unequal distribution of power between the governing and the governed. On the contrary, low power distance societies expect relatively equal distribution. Arab countries have high power distribution compared to Western Europe countries like Germany.

It means that a German firm is likely to encourage subordinates to play a role in decision-making and offer mechanisms through which subordinates may challenge some orders from their superiors.

However, a subsidiary of the firm based in Kuwait or Iran is likely to encounter difficulties in its operating policies because workers in these countries do not expect to play any role in management decision-making. Challenging company managers in this instance may be construed to mean lack of respect; hence the employees are unlikely to participate in such activities.

Regarding uncertainty avoidance, Hofstede (2011) explains that societies also differ based on the extent to which individuals believe ambiguous occurrences threaten them. Cultures with high uncertainty avoidance indices like Korea pay more attention to the rules and structures that would avoid or limit the presence of uncertainties.

Conversely, countries with low uncertainty avoidance, like the USA, have fewer rules and structures geared towards uncertainties. Thus, Korean business firms based abroad in countries like the USA are likely to focus more on feasibility studies to evaluate the likelihood of uncertainty events occurring before they venture into an operation. Nonetheless, this may fail to make sense for their American employees, who culturally do not put great emphasis on uncertainty evaluation and planning.

Conclusion

Intellectual property is the unique identification of brands in the form of a name, word, symbol, design, image, phrase, logo, or a combination of any of the above features. Many countries across the world presently establish legal frameworks that seek to protect trademarks, but this is not enough as protecting intellectual rights is affected by social values to a larger extent. Instances of real life violation of intellectual protection laws include the case of Saudi Arabia, where pirating copyrighted software is widespread.

Other notable cases of violation include the emergence of a fake Primark store in Dubai, which mimicked the original Primark trademark that originates from the UK. Culture and social differences have an influence on business ethics practices across the world.

These influences occur mainly based on the key cultural dimensions that include individualism, masculinity, power distance, and uncertainty avoidance. Overly, businesses will adopt the standard individualism, masculinity, power distance, and uncertainty avoidance indices reflective of their home countries, but they will need to adapt changes to suit to the dimensions of their host countries.

References

Alalwan, J. A. (2015). Research-in-progress: Determinants of software piracy behavior in Saudi Arabia. International Journal of Innovation, Management and Technology, 6(4), 316-319.

Aljabre, A. (2012). Understanding software piracy in Saudi Arabia and the need for change. Journal of Emerging Trends in Computing and Information Sciences, 3(11), 1516-1520.

Budde-Sung, A. (2013). The invisible meets the intangible: Culture’s impact on intellectual property protection. Journal of Business Ethics, 117(2), 345-359.

Danon-Leva, E. Cavico, F. J. & Mujtaba, B. G. (2010) Business Ethics: A Cross-Cultural Comparison between Hong Kong and the United States. Journal of Business Studies Quarterly, 1(4), 1-20.

Hofstede, G. (2011). Dimensionalizing cultures: The Hofstede model in context. Online Readings in Psychology and Culture, 2(1), 33-22.

Jones, R. (2012). . Web.

Kerr, S. (2012). Fake Primark pops up amid Dubai’s bling. Web.

Reilly, R. F. (2008). Ethics considerations in intellectual property valuations. Valuation Strategies, 12(2), 24-30

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IvyPanda. (2020, May 8). Ethics Considerations in Intellectual Property Valuations. Retrieved from https://ivypanda.com/essays/ethics-considerations-in-intellectual-property-valuations/

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"Ethics Considerations in Intellectual Property Valuations." IvyPanda, 8 May 2020, ivypanda.com/essays/ethics-considerations-in-intellectual-property-valuations/.

1. IvyPanda. "Ethics Considerations in Intellectual Property Valuations." May 8, 2020. https://ivypanda.com/essays/ethics-considerations-in-intellectual-property-valuations/.


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IvyPanda. "Ethics Considerations in Intellectual Property Valuations." May 8, 2020. https://ivypanda.com/essays/ethics-considerations-in-intellectual-property-valuations/.

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IvyPanda. 2020. "Ethics Considerations in Intellectual Property Valuations." May 8, 2020. https://ivypanda.com/essays/ethics-considerations-in-intellectual-property-valuations/.

References

IvyPanda. (2020) 'Ethics Considerations in Intellectual Property Valuations'. 8 May.

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