Globalization of Ethical Decision Making C H A P T E R 10.
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Transcript of Globalization of Ethical Decision Making C H A P T E R 10.
![Page 1: Globalization of Ethical Decision Making C H A P T E R 10.](https://reader035.fdocuments.in/reader035/viewer/2022081419/56649f305503460f94c4a3c6/html5/thumbnails/1.jpg)
Globalization of Ethical Decision Making
C H A P T E R 10
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Chapter Objectives
• To understand the role of capitalism and economics as factors in business ethics
• To discuss global values, goals, and business practices within ethics
• To explore and question common global business practices
• To gain awareness of global ethical issues
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Chapter Objectives (cont.)
• To assess the role of the international monetary fund
• To assess the role of the world trade organization in business ethics
• To assess the role of multinational corporations in business ethics
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Chapter Outline
• Capitalism, Economics, and Business Ethics• Common Values, Goals, and Business Practices• Global Business Practices• Sustainable Development• International Monetary Fund (IMF)• World Trade Organization (WTO)• The Multinational Corporation (MNC)
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Capitalism, Economics and Business Ethics
• The first decade of the 21st century was a turbulent one– Ethical misconduct and excessive risk-taking
seemed rampant– Many stakeholders lost confidence in businesses
• Lack of fairness, trust and honesty made stakeholders question the stability of major institutions, as well as the intentions of executives
• Even the competence of governmental regulatory institutions was called into question
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Key Figures in Modern Economics
• Adam Smith• John Maynard Keynes • Milton Friedman
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Capitalism, Economics and Business Ethics
• Socialism: Advocates that wealth and power be shared equally across society based on the amount of work expended in production
• Social democracy formed in the 1940s as an offshoot of socialism
• Current global economic system has created bimodal wealth distribution: The middle class shrinks so that there are many poor and a few very wealthy
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Common Values, Goals, and Business Practices
• Global common values: Shared across most cultures
• Country cultural values: Specific to certain groups that express actions, behavior and intent
• Culture: Everything in our surroundings that is made by people
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Global Business
• Dumping: The practice of charging high prices for products sold in domestic markets while selling the same products in foreign markets at low prices, often below the costs of exporting them
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Cultural Relativism
• The concept that morality varies from one culture to another
• There is a continuum of cultural relativism
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Sustainable Development
• Is a systematic approach to achieving development in such a way that the earth’s resources are preserved for future generations
• Some companies conduct their own sustainability performance reports
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The International Monetary Fund
• The IMF emerged from the Bretton Woods agreement of 1944
• The IMF assumed a major role in the 1980s in the management of the less developed countries (LDC) debt crisis
• An ethical issue surrounding the IMF has to do with the increased inequality in LDCs
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The World Trade Organization
• The WTO was established in 1995 and now includes 133 member nations and 33 others with observer status
• Administers its own trade agreements, facilitates future trading negotiations, settles trade disputes and monitors the trade policies of member nations
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The Multinational Corporation
• Are public companies that operate on a global scale without significant ties to any one nation or region
• MNCs are subject to ethical criticism over their impact on the countries in which they do business
• Because of increased scrutiny and pressure to be socially responsible, many corporations belong to Business for Social Responsibility