JBS S.A. Food Business in Brazil Research Paper

Introduction

JBS S.A. is a meat processing company in Brazil and is estimated to be the biggest in its industry worldwide. It produces processed chicken, beef, and pork while selling by-products from meat processing. Being headquartered in Sao Paulo, it operates in a unique business environment that offers opportunities for growth while seeming a threat. This paper examines how the firm has endured the political, economic, legal, social, and ethical environment while operating in the nation.

Political Systems and Economic Systems in Brazil

In Brazil, every state has its laws and policies that govern how businesses are run. For instance, a state has the capability to decide on tax rates. Therefore, the culture and operations of JBS S.A. are influenced when it has to deal with different state VAT, which applies to the circulation, importation, and supply of goods and services. Despite the increase in GDP, the country has not been capable of growing at the same speed as before the recession that happened several years ago. The country is expected to continue growing at that pace in the near future, which influences how JBS S.A. operates. For instance, the firm has had to abort some expansion plans into other areas in the nation.

Legal System of Brazil

The judiciary system in Brazil is multifaceted, with each state having its laws and policies. This has resulted in companies experiencing different taxes while in various states. The nation is greatly affected by corruption in multiple forms, such as nepotism, bribery, and cronyism. Numerous of JBS S.A.’s rivals, for instance, have paid media outlets to ruin the brand’s image by spreading false information about some of its operations. Being a top organization in its line of business, others with a desire to further penetrate the market and gain a larger share, resort to corrupt measures (Castilho & Barakat, 2022). In business, image is essential, and since organizations want to defeat others, they bribe media outlets to create wrong ideas about those ahead of them.

The Brazilian legal framework is structured to guarantee the protection of intellectual property in each of its most relevant forms, that is, copyright, industrial designs, patents, software, trademarks, and trade secrets. This allows JBS S.A. to function well, knowing that no other company can steal its new ideas and use them in the market. Regarding product safety and liability, the Centers for Disease Control and Prevention regulates legal consumer relations in the country, ensuring the management does not utilize false advertising of its products.

Political and Economic Progress of Brazil

The economy in Brazil is slowly progressing, especially after the inflation that hit the country several years ago. It is better for the country to experience this type of growth than none at all. Furthermore, the political environment is allowing more democracy which has brought peace in areas that experienced much violence before (Pereira et al., 2020). However, the economy’s slow growth will delay its plans and may force the organization to experience more losses as there were already investments in new plants and subsidiaries.

Brazil’s Culture and Effect on Costs of Doing Business

The culture of bribery has affected many businesses in Brazil. Therefore, that situation poses a threat to the multinational meat processor. Paying bribes results in losses since the costs continue to increase and it is money that could have been invested elsewhere and, thus, affects certain areas of the business. The most impacted aspect is the transportation of processed goods as corrupt law enforcement demand to be paid to allow easy transit (Hill, 2020). Another area impacted by corruption is marketing, whereby the company has had to pay media outlets to ensure they are protected from bad publicity.

Impact of Brazil on Corporate Culture and Practices

Brazilians prefer and accept a formal way of greeting, especially at a first meeting. This can include situations where business dealings are being discussed, such as agreeing to a new contract or acquiring another business (Hill, 2020). For example, a handshake is a common form of greeting in the country, which has prompted the firm’s management to ask employees to practice formal language and treat potential clients with respect. Words that have been emphasized when addressing people include Senhor and Senhorita.

More than ninety percent of the populace in Brazil is religious. The segment has reached sixteen million members in the last ten years, which is a significant increase (Hill, 2020). This poses a threat for businesses, especially when a leader in one of the religious establishments in the country has a negative opinion about a certain product. For example, Buddhists do not consume dairy products, which means if the firm wants to gain more market, management must communicate with Buddhism leaders.

In Brazil, conducting business needs a detailed comprehension of the meaning of ethical business culture and how it is associated with inherent dangers and opportunities in the business environment. The majority of the economic crises in the country had their basis in ethical deviations and corruption scandals. Despite the corruption-promoting surroundings, deep-rooted ideas of jeitinho can be seen to be aiming toward positive results. Jeitinho is a Portuguese word used to mean bending the rules in an attempt to accomplish something. This has resulted in JBS S.A. adopting ethical practices in all operations, for example, processing, transportation, and distribution.

Ethical Issues in the History of JBS S.A.

The company has always empowered the locals to apply for job opportunities. Governments in different countries have asked firms to ensure that a certain percentage of employment chances are allocated to the host population. This is important as it is part of the social responsibility businesses have. In recent times, JBS S.A. has emphasized that its management to consider more females in top leadership positions in the company. Regarding human rights, the firm has advocated and supported causes against a slave or free labor. Lastly, the organization does not have a history of corruption scandals which is why it continues to expand, be accepted and grow even in other markets (Hill, 2020). Its management has continuously asked for more legislation to ensure businesses are socially and ethically responsible. The latter aims to deal with the issue of corruption which continues to affect some aspects of its business operations.

Ethical History of the Leadership at JBS S.A.

The meat processing company is always committed to conducting business ethically, with integrity, and in compliance with every applicable law, rule, and regulation. The company anticipates that vendors would demonstrate similar devotion to integrity and ethical business conduct by complying with all legislation (de Oliveira et al., 2018). The firm has participated in many charities that seek to promote the education of young people in slums. This is a testament to the organization’s commitment to corporate social responsibility.

Conclusion

Businesses in Brazil and the whole continent of South America have had to persevere in a corruption-filled environment. This has not stopped many of them from acting ethically. As a result of that, many have established a good image that has earned them a chance to be accepted in the North American markets. JBS S.A. has shown commitment towards ethics in business practices as part of its devotion to corporate social responsibility. It has offered employment opportunities across various states in Brazil and empowered many startup businesses.

References

Castilho, A. R. B., & Barakat, S. R. (2022). The relationship between climate change mitigation strategies and the financial performance of Brazilian companies.Journal of Industrial Ecology.

de Oliveira, J. A. S., Basso, L. F. C., Kimura, H., & Sobreiro, V. A. (2018). Innovation and financial performance of companies doing business in Brazil. International Journal of Innovation Studies, 2(4), 153-164.

Hill, C.W. L. (2020). International business: Competing in the global marketplace. (13^th ed.). McGraw-Hill Higher Education.

Pereira, A. F. A., Stocker, F., Mascena, K. M. C. D., & Boaventura, J. M. G. (2020). Corporate social performance and financial performance in Brazilian companies: Analysis of the influence of disclosure. BBR. Brazilian Business Review, 17, 540-558.