Posted by
Ian on Thursday, April 23, 2009 5:40:57 PM
Example of how Socialism will run out of rich people's money and leave UK bankrupted (Gordon's fault) and why capitalism is the best platform ever made. Most people wish they were us obviously so they attack us. And that constitution for the rest of the world and not the American people ideology is more stupid than the libertarian view. I can see through it. Republicans know what libertarians are good for the country and the President's Cabinet has no libertarians. Libertarians actually know that they're doing. Rein Capitalism in Germany, works, 3rd largest economy in the world..Libertarians run amuck...awesome example. I got 100% on
this assignment which is about the fraud ponzi schemes. deontelelogy...not totaltarian views work better.
1.)
Today businesses operate in a very complex world; whereby, decisions they make today may have repercussions on changes they need tomorrow. The fact is the world is changing and so are ethical issues. I believe ethical training starts with our youth; where the family and experiences we encounter along the way, provides us with our values; however, our values are only an imprint on us. In the business world, our value imprint takes on another dimension that revolves on ethical standards in the parameter of business. A business ethics program provides a business person with a foundation or decision-making process to identify ethical issues which he/she may face. It also provides the business person with avenues or approaches he/she would take to resolve those issues. In other words, knowledge on ethical issues helps one identify, analyze and resolve ethical issues while promoting ones ethical behavior. An example would be social engineering involving computers. A representative who says he is an outsourced IT repair person and asks for PC specs so he can fix the network problem. The issue taking place here is social engineering; whereby, an attack that relies on deception in order to access a system. The man representing himself as a technician only wants PC specs for unauthorized access to the system. To resolve this situation, the employee must divert the call to the IT center or a simple “no” response would also do the job. Essentially what the employee did for the company was to prevent a breach in business’s computer system and comply with the company’s policy which says any person who performs system analysis must be redirected to the Information Technology employee in order to prevent phishing. This employee also protected the company from losing the customer’s trust which would have a great impact on the company itself.
An ethical business environment needs to have trust established from top management down to every aspect of company’s stakeholders. The company should have a pulsating message which encompasses the concept of integrity and honesty that not only provides the benefits for the company, but also for their stakeholders and society as well. Enforcing a positive ethical culture will do the following: Improve day to day operation, increases employee commitment, promotes investors’ loyalty through dependability, trust and commitment, and lastly it provides a better profitable picture while establishing a relationship with society. Why study Ethics? An important reason is a good ethical program can enable a business person to make a ethical ‘right’ choice instead of an unethical ‘wrong’ choice when confronting an ethical issue and embraces the ideology that the person is responsible for his/her actions which can have an ethical or legal impact on their company as well on how the society views the organization. Another impact on why to study ethics is that it also provides the business person knowledge in order to cope between our personal values and the values of the company.
2.)
A stakeholder is anyone who may have a stake or claim in a company, products, operations, markets, industry and outcome. Stakeholders have the ability to influence a company as well as a company has the capability to influence them. Stakeholders can apply their values and standards to many complex ethical issues such as: 1.) working conditions for example health and safety issues, wage issues, sexual discrimination issues. 2.) Consumer rights and product safety, where there may be an issue with safety and quality of a product; where products are recalled or how a customers complaint is handled; therefore, is there a procedure in answering complaints. 3.) Environmental conservation where the issue could be that the company isn't recycling enough or how they are managing their waste or use of electricity that supplies the company. These issues may directly or indirectly affect individual stakeholder’s own interests. The company has to maintain a continual open relationship with the stakeholders. Stakeholders can provide resources that give weight to a company's long term success. These tangible or intangible resources are as following: supply of capital from shareholders, materials resources or intangible knowledge from suppliers, revenue supplied by the customer who also may supply loyalty and good advertisement for the company, infrastructure that is provided by the community that the company resides in and the media which may promote a positive image for the company. Stakeholders encourage companies to be accountable, transparent and responsible in the company’s day-to-day activities. These interactions between the company and its stakeholders cut both ways. Stakeholders have the ability to withdraw their support or resources and that gives them strength over a business by giving the company negative exposure through media source such as the news, podcast, or withdrawal of financial support.
There are two types of stakeholders that have influence on a company. Primary stakeholders have a direct impact on the viability of a company success which includes the following: employees, customers, investors, government regulatory bodies, community, suppliers, and shareholders. Secondary stakeholders engage with the company indirectly such as special interest groups (GreenPeace, National Labor Union ), trade association (Aerospace Industries Association, Airports Council International - North America, American Society of Travel Agents, Nuclear Energy Institute), media (newpapers, radio, TV), and competitors (Pepsi vs. Coca-Cola, Intel vs. AMD, Microsoft vs. Nintendo)
A company, depending on its size, dictates who they believe is primary vs. secondary. Both primary and secondary stakeholders do have an impact on company’s ethical decision making process. Corporate government
3.
It should be a requirement for any organization to promote its positive attributes on a stakeholder and to curtail the negative impact. Rather then just thinking and serving the shareholder about profits and delivering profits, I believe businesses today should take a holistic view on how they conduct their businesses. They should also think about the employee, the customer, the supplier and even the environmental activist. The public is looking at a company more holistically; whereby, the character and the quality of the leadership provide more of an impact than the business itself. An example of this holistic view is Home Depot which promotes community volunteer work and provides pay supplements to any employee that goes into the military; whereby, any employee who spends time in the service will always have their job waiting for them when they return. Home Depot believes that is an investment and a responsibility to their employees. They also supplied building materials and volunteers to assist rebuilding the area destroyed by Hurricane Katrina. This company strategy involves the board, senior management, and the employees in the company. Their belief system is to give good will to society for it is just the right thing to do. Business ethical concerns should be part of their foundational values and incorporate their business strategy. Most companies have developed formal systems of accountability, oversight and control known as corporate governance. It is a check and balance system that limits employees and mangers opportunities to deviate from policy and strategies and prevent unethical and illegal activates. It provides integrity to the corporate culture. Directors and officers of corporations are both fiduciaries for the shareholders. Their duty is to provide leadership in prudent decisions that prevent unethical conduct not only in themselves and employees of the organization.
There are four levels of social responsibility which are economic, legal, ethical, and philanthropic. Economic responsibility is to be profitable so in order to maximize the stake holder’s wealth and value by providing jobs in the community and contributing goods and services for the economy. The next level is legal; whereby, the company establishes compliance to government law and regulations. The third level is ethical where the company follows standards for acceptable behavior as judged by the stakeholder. Finally, the fourth level is philanthropic where the company gives back to society.
Reputation can be the greatest asset to any company in order to sustain a relationship with its investors, consumers, financial analyst, media, and government watchdog groups. Their reputation is created by their actions, choices, and behavior that are consequentially viewed through the stake holder’s eyes and to earn their trust. Oil companies may have a negative view by the public, because of the recent gas hikes that happen in the latter part of 2008. People believed they were ‘price gouging’ the public.
4.
Ethical intensity is the importance of an ethical issue of the eyes of the individual or workgroup in the organization. It is personal, temporal in character to accommodate values, beliefs, needs, perception of a situation. Senior employees and executives have a major role in resolving ethical issue intensity, because they usually take a stance on ethical issues to control these ethical issues until it’s a nonissue. The importance of this is unless individuals in a company share a common ground about issues. Top management can affect how an individual perceives an ethical issue. This can be done through rewarding or punishing unethical acts. Individual factors include education, age, and locus of control. It may be perceived that the higher education, the better judgment I have. This may be possible; however, I believe it is the exposure to ethical challenging decisions that make one capable of making a better ethical decision. Age can be a factor. How does one expect a younger employee to make a prudent decision without an experience employee’s guidance? Locus of control is either external or internal. It is how one sees himself. External control, the person believes the events of their lives are from uncontrollable forces. In external control these people in this category are the followers. They believe that other situations that luck and chance and powerful people control them. People who use internal control believe their lives are controlled by their own effort and skill and that they influence their environment. The debate is who is more ethical? The followers or the person who forms his/her own destiny. An example is followers who follow the rules and code of conduct. Are they more ethical for decision making? Leadership. The person who forms their own destiny. The Independent. Is it possible that they reinforce the rules of conduct and provide a better decision making policy to enforce ethical standards? Will he/she believe he/she is above it all and believes he/she is entitled to his/her own needs vs. the company. The corporate culture and obedience to authority makes up the organization factors. Corporate culture can be defined as a set of values, beliefs, goals, norms, and a way of solving problems, the members of an organization share. It is the corporate culture of an organization that breeds ethics. It tells its members what the company’s vision, values, and goals are and it incorporates policies and rules for ethical behavior in decision making. It also can be said that significant others or coworkers are the major forces in guiding employees in making either an ethical or unethical decisions or behavior in their day-to-day activities. When an employee sees other employees disrespecting rules or policy by getting away with it; is it possible that the employee will see the unethical display as acceptable? Another example is the environment that displays an ethical code of conduct and employees abiding by the rules and management enforcing these rules. The chances are the employee sees his company as more ethical; therefore, the culture improves the ethical standards and the employee is more compliant to those rules. The examples above also open the doors for opportunity factors. The question that needs to be asked regarding as opportunity is the companies’ top management enforces the company’s policies, rules, and formal codes to the workforce. If the answer is yes then I believe the chances of an employee becoming more ethical are great. Leadership is the answer to ethical conflicts and issues. Leaders need to believe in these vision or goals and they need to believe in their employee’s ethical standing. Leaders needs to be ethical themselves and they need to provide good ethical decision making policies, rules, and formal codes and they are the ones that channel it down through managers, supervisors in order to enforce the codes. They also need to provide knowledge to all employees on what they expect from the employees. They are the enforces of the code. A good example would be an insurance adjuster taking bribes from a company that is breaking environmental codes and the adjuster allows them to do business by covering up evidence that could be harmful like chemical spill. If the knowledge of the insurance adjuster behavior is exposed, his or her company should terminate him, because he exhibit unethical behavior and good leadership should expect employees to abide by the rules.
Good leaders should be transparent and actively involved in all theorganization’s decision making. They should be role models for the organization values. They should have integrity and character in order to be good leaders. As I mentioned earlier in question 2, Home Depot is a good example where leadership has dictated excellent ethical decision making, because their leaders takes on a holistic view and have a passion to do right.
5. Moral philosophies are guidelines to determine how conflicts and human interest is to be settled while optimizing mutual benefits for business people as they form business strategies and resolve ethical issues. It also refers to principles people use to decide what is right and what is wrong. Individuals learn decision making approaches through their cultural and social development. These values are dependent on the ability to think critically and accept responsibility for his/her decision. This includes economic value orientations where the act produces more value than its effort. Idealism is a philosophy that has special values of ideas and ideas are products of mind where it refers to a higher order of existence. Realism is a theory is where a person is always guided by his/her own self interest. This theory believes that actions are self motivated have a tendency towards negative ethical decision making. Ethical decisions are guided in the workplace by the company’s culture and are influenced by others such as co-workers and superiors. People usually don’t think of their moral philosophies when making decisions; however, their moral philosophies can be interchanged depending on if they’re making a decision in their personal life or in their job. Rules, personalities in the job, may promote an individual to change their moral philosophy to what is compatible in the work environment; where moral rights, fairness, justice, and common good come into play. A company’s core values on how it is to make decisions will determine how the individual will use his/her moral philosophy. Most employees don’t have the power to use their personal philosophies, because most of these decisions are formed in the complex work environment. An example of cognitive development is the Kohlberg’s model which explains how people make different decisions in similar ethical situations dependent on the stage of moral development they’re in. The following are the six cognitive moral development stages: 1.) Stage of punishment and obedience. This is the person’s response to rules and labels of good and bad which is dependent on a person who has power. For example, a company that requires employees not to receives gifts from others because of their performance. A person may just deny the gift, because of company rules. Another person may take the gift, because he/she believes he/she can get by with it or there is no consequence. 2.) The stage of individual instrumental purpose and exchange is where a individual makes moral decisions based on fairness to him/her. It is a stage where rules and authority figures are no longer relevant. In the US, bribery is against the law; however, in another country such as Russia, bribery is a commonplace; therefore, an individual who wants to start up a company may believe in order to be successful; he will offer money to a official in order to get there. This may be unethical to United States standards; however, in other countries it is a part of entitlement. 3.) This is the stage of mutual interpersonal expectations, relationships, and conformity. In this stage the individual considers the well being of others; where the fairness to the individuals is one of the ethical motives. An example of this is a manufacturing job such as an auto worker where the middle manager obeys the goals of the company and the controls the work force in a fair way in order to achieve productivity. 4.) For the stage of social system and conscience management, the individual determines what duty to society is right due to his/her by respecting authority and maintaining social order. An example is security personnel monitoring a store via camera. They have a duty to protect the store, but they also have a duty to society in who monitors the dressing rooms. It usually is a female monitoring a female dressing room and a male monitoring a male dressing room. 5.) In the stage of prior rights, social contract or utility, the individual is concern all with upholding the basic rights, values, and legal contracts of society. In this level, the business may promote ethics training for its employees in order to promote good ethical behavior and decision making, thereby, being responsible to society. The final stage is the stage of universal ethical principles which come into play. In this final stage, the individual believes there are inalienable rights which are universal in nature with consequence. A good example of this is Ford making a vehicle called a Pinto in the early 1970s. It had a manufacturing flaw that caused the gas tank to explode in rear-end collisions. This case would argue discontinuing this product, because the public has an inalienable right to life without the fear of injury due to this flaw. In this case, profit doesn’t justify the continuation of manufacturing this vehicle.
6.)
There are two moral philosophies, teleology and deontology that one may use to evaluate activity of his or her ethical actions. Teleology is an act that is morally right if it produces some desired results. The consequentialist is a today's form of teleology which hold “the consequences whereby the end justifies the means.” a particular action that forms a basis for any valid moral judgment for action; whereby, the weight given to the consequences and evaluating the rightness and wrongness of the action.
Egoism is the segment of teleology. Egoists believe that they should make decisions that maximize their own self interest. Their slogan is “Do whatever it takes to help one self.” An excellent example of this is Bernie Madoff with his $50 billion dollar ponzi scheme.
Enlightened egoism is taking a long range prospective and allows for the well being of others although their own self interest remains paramount on the hierarchy tree. This category is where whistle blowers. Some whistle blowers report misconduct to the government regulatory agency in order to make themselves look as if he/she are caring people looking out for their company, when in fact they’re looking for self interest. It’s a double edged sword.
A Utilitarian is also concerned with consequences; however, the utilitarian searches for the greatest good for the greatest number of people. Utilitarian decision making relies on comparison to cost and benefits to all affected parties. A good example of a utilitarian is the animal rights group (PETA). PETA convinced Mobil, Texaco, Pennzoil, Shell and other oil companies to cover their exhaust stacks, after showing how millions birds and bats had become trapped in the shafts and burned to death.
Rule utilitarianism would calculate the costs and benefits in society at large if everyone acted in a particular way. A good example is Ford Motor Company in the 1960s which I mentioned earlier using the cost benefits over safety. They manufactured the Pinto fuel tank knowing it had potential to explode when rear ended. Another example if rule utilitarian is that bribery is wrong where under no conditions would bribery be accepted even if that means a lost of jobs. The act utilitarian uses a specific action itself rather then the general rules governing it, in order to assess the greatest utility. Here, in this example, an act utilitarian would agree that bribery is wrong, but only under certain circumstances. Like I mentioned before, bribery in Russia is a commonplace. Some businesses would be comfortable using the bribery in order to establish their business there or to survive in that society.
Deontology refers to moral philosophies that focuses on the rights of individuals and on the intentions associated with a particular behavior rather than on its consequences. Rule deontologists believe that rules dominate decision making; so his/her team is just as important. Rule deontology is to carry out the duty according to the rules created even if the conclusion is wrong. Act deontologists believe that rules are useless from particular experiences and that that deciding on particular situations as they show up is best. Act deontology requires a person to use equality, fairness and impartiality when making decisions. They believe rules are only guidelines; whereby, past experience weighs more than rules when making decisions. They also are well aware that some of their actions may be perceived as right or wrong. Their act takes precedence over any rule or another way to say it, their actions promotes the greatest balance of good vs. bad. Many internet websites track users while online. This practice offends the public, because they view it as an invasion of privacy.
Nonconsequentialist focus their rightness on the individual, not society. An example of this would be an Admiral of the US Navy telling the truth about a design failure in torpedoes. This man used truth over consequences which eventually relieved him of his command.
7.)
Corporate culture can be defined as a set of beliefs, goals, norms, and problem solving methods that employees of an organization share. Corporate culture also involves values and rules that prescribe the behavior for organizational members. Ethical culture reflects whether they have an ethical conscience. Some of the factors in ethical culture include corporate policies on corporate ethics, leadership abilities on top management on ethical issues that influences co-workers and ethical or unethical behavior. The more ethical employees perceive an organizations culture to be, the less likely they are to make unethical decisions. Companies that promote ethical values to enhance the employees experience usually has positive support on the employees commitment to the firm. Obedience to authority is usually why employees resolve ethical issues by simply following their superior. There are two major factors that keep a corporation ethical. Companies produce an ethical climate; whereby, they focus on issues of right and wrong. The ethical climate is the organization’s conscience. Organizations can manage their culture with employees who match their own. Together, the influence of organizational culture and their employees may limit misconduct; however, there are two essential factors to promote a positive organization culture; the board of directors and leaders who have character, integrity, honesty, and value the company’s mission.
A leader is a person with the ability or authority to guide others towards achievement of a goal and has significant impact on ethical decision making, because he/she has the power to motivate others and enforce the organizations rule and impact. Leadership styles of an organization influence how an employee acts. A leader also should have the firm’s vision and values in mind. He should also be concerned about the welfare of the shareholders as well as the employee. Good leaders can promote and achieve positive climate and strong ethical leaders have courage, and knowledge to make decisions that are best in the long run. There are six leadership styles coercive leader, authoritative leader, affiliative leader, democratic leader, pacesetting leader, and coaching leader. Leaders will alternate the style depending on the risk and desire to achieve positive climate. The seven habits of a strong ethical behavior are the following: 1.) strong personal character 2.) Passion to do right. 3.) Proactiveness 4.) Consider stakeholder’s interest. 5.) Good role modeling for organizations values. 6.) transparent and active decision making 7.) taking on a holistic view for the firm’s ethical culture. An example of a good leadership is a man named Robert Nardelli, CEO of Home Depot, who runs the business in a holistic viewpoint. He believes that all stakeholders are important and they all contribute to the success of the company.
8.)
There are two kinds of organizational structures that are important in business ethics, centralized organization and decentralized organization. Centralized organization is what General Motors and Internal Revenue Service use. A decision making authority and responsibility is all top level management. A little authority is delegated to lower levels. Usually centralized organizations are used in routine and efficiency production process. Each worker knows his/her job and has a clear understanding on how to carry out assignments. This kind of organization has formal rules, policies and procedures that are backed to elaborate control systems. In other words, flexibility, adaptability, problem recognition is not emphasized. This kind of structure can lead to unethical acts, because the communication is limited between the employee and top management. A disadvantage to centralized organizations is if there is great risk in the top of the hierarchy that risk may ultimately result in incapacity in leading an organization. The employees will feel less motivated to perform if they cannot share their ideas on how to improve the organization; thereby, becoming more frustrated. This can cause a lack of connectedness, because employees don’t understand the overall ramifications of their behavior. Employees may try to transfer blame for their actions on others who are not guilty. You can have decentralization so that this formula will share decision making and overall this is an advantage. Employees can have impact on improving their productivity and lowering inefficient habits. A decentralized structure will free up time as well. Decentralized areas have one weakness which is opposing points-of-view leading to delays. Decentralized organizations could have too many employees handling whatever needed to be done resulting in overstaffing and loss of revenue.
Do I think a person’s status within an organization creates an opportunity for unethical behavior…my answer is yes. I have done a good deal for research on CEOs and found that because of their power and flexibility in the company they have more advantage than others in providing unethical behavior such as the ponzi schemes that Bernie Madoff and Tom Petters used to promote their financial status at the expense of others. Another example for unethical behavior is the two CEOs, Thain and Fuld Jr., who used their executive power to promote bonuses and wealth for themselves and others in top management. I also believe they prevented the stakeholders from being knowledgeable of the negative financial status that brought their company to bankruptcy. This was called transparency avoidance. I believe it is the CEOs job to promote an ethical climate in their company for employees to follow; however, their unethical imprint has left their company and their stakeholders with mistrust in big corporations. Having said this, I also believe the little man or employee that has less status has room to make their unethical imprint on a company. This is largely due to the work environment in which he works. If his co-workers get by with little white lies or taking shortcuts when they shouldn’t be and it becomes a norm for the environment, then the employees believe they can get away with that sort of thing too. In this case, you have a recycling of unethical behavior that will continue until a manager or supervisor puts a stop to it by relocating or terminating the bad apples. My conclusion to this question is people with power such as top management have more freedom to do unethical behavior if that is what they intend to do; however, every employee can be seen as having potential for unethical acts if the climate is right.
9.
Organizations which develop an effective ethics program have a a written code of conduct, an ethics officer to oversee the program, careful delegation of authority, formal ethics training, rigorous auditing, monitoring, enforcement and revision of program standards. For example in Argentina, only 26% of CEOs use value system of the founder resulting in the most problems. The code of conduct will not solve all the ethical issues; this is left up to the corporate culture to problem-solve. An ethics program can help avoid legal problems with the Federal Guidelines for organizations. The seven minimum requirements for ethics and compliance are as follows: 1.) standards and procedures, 2.) high-level personnel are responsible for an ethics and compliance program 3.) no substantial discretionary authority given to individuals which do misconduct. 4.) Establishment of systems to monitor, audit, and report misconduct, 5.) standards and procedures communicated effectively via ethics training programs. 6.) consistent enforcement of standards, codes and punishment. 7.) continuous improvement of the ethics and compliance program.
An ethics program can require federal judges to increase fines for companies which tolerate misconduct. The Sarbanes-Oxley Act has new requirements for corporate governance to prevent fraudulent behavior. The accounting oversight board establishes financial reporting requirements for instituting a code of conduct. The compliance orientation teaches required conduct while the values orientation sharpens shared values that the corporate culture identifies with.
The code of conduct reports violations, disciplinary action for violations, and structure of the due process. The code of conduct is more akin to the regulatory set of rules and tends to elicit less debate about specific actions. The suggested code of ethic standards that should be included are trustworthiness, respect, responsibility, fairness, caring and citizenship. The support of management, training and distribution are the only ways to have success with these codes of ethics requirements. The people who manage ethics programs are called ethics officers. Ethics officer is a person who has knowledge and experience and helps foster positive ethical values and standards, and assists the leadership and employees of the organization in living up to such standards. They are responsible for assessing the needs or risks, developing and distributing a code of conduct/ethics, conduct training programs, monitoring conduct, taking action on violations, and reviewing and upgrading the code to society standards. They also assist in an organizational culture in which the ‘right thing’ is frequently communicated and reinforced. Their job is to integrate their organization’s ethics and values, compliance, and conduct practices into the everyday decision-making process at all levels of the organization. Ethical officers help organizations see the ethical standards, communicate those standards, integrate into the culture of businesses and hold individuals accountable to those standards. The ethics officer should have direct access to the ultimate leadership of an organization. The ethics officer is the ultimate leader of an organization. In the ideal ethics office structure, the ethics officer would report to the board of an organization with an administrative reporting relationship to a board of directors. High end executives do not have the time to emulate an ethics officer. Two-thirds of ethical officers are full time. Sometimes you want to bring an independent perspective to the culture of the organization. A good ethical officer is a great communicator and a trusted employee who maintains credibility well.
10.
We live in a global economy. In business today, the companies are expanding branches outside their home countries where there are different cultures, values, laws and ethical standards. Cultural differences can be perceived from country to country such as language, communication, body language, timing of an encounter such as setting time limits for meetings vs. being laid back and not setting any specific time in a length of a meeting and finally the laws of their land.
I guess the ethical question that can be asked for any global business is to which country’s ethical standard should a business adhere to promote their values, ethic standards, and even laws on members of the other culture? Should it be their own values, standards, and laws from which is formed from their own country or should it be with the country which they are doing business? I believe this issue in itself can make it sometimes hard for companies to establish what is right or wrong in the decision making process. There seems to be an universal concept that honesty, charity, virtue, and beneficence. Some companies such as General Motors, Shell Group, Propter and Gamble had agreed to abide by the Global Sullivan Principles; whereby, these principles encourage social responsibility. I will highlight some of the Global Sullivan Principles which are the following: a business will support universal human rights which includes their employees, the community, where they operate, and to whom they do business with; promote equal opportunity at all levels of the company regardless race, gender, age or religious belief, and operate without unacceptable worker treatment such as the exploitation of children, female abuse; physical punishment; provide a safe and healthy work place; promote fair competition that respects intellectual and property rights; and work with government and communities in which they do business in order to improve the quality of life in those communities.
Public companies that operate on a global scale without any one tie to any one nation or region are called multinational corporation (MNC). Examples of some of these companies are include Shell Oil, Ford Motor Company, Nike, Microsoft, and Cisco Systems. The ethical issues arise, because these companies have a lot of financial power and in many countries, power may take precedence over the country’s well being. A good example of the above is a Unocal Oil Corporation, also known as Union 76, that established a natural gas pipeline in Myanmar in Southeast Asia. They were accused by human rights activists who claimed that the company was responsible for forced labor, rapes, and murder that were committed by the soldiers that were assigned to watch the gas pipeline. Unocal’s defense insists that they are not guilty, because they should not be responsible for the deeds of the soldiers; however, the company realized that the soldiers had a role in securing the pipeline. In June 2004, the US Supreme Court filed the Alien Tort Claims Act ruling that foreigners could file lawsuits in US Courts to address human rights abuses overseas. Some other human rights suits pending against multinational companies involve abuses in Colombia, Indonesia, Nigeria with poor human rights records such as sweat shops, unfair pay, etc.
Even when MNCs try to make ethical decisions that achieve their own objectives and try to benefit the countries where they manufacture/market their products, they still can be vulnerable to ethical issues. An example of this is when Ford Motors faced liability, because of the Bridgestone/Firestone “assassin tires” have injured and killed Venezuelans. It caused economic damage and 400 Venezuelans wanted repaid damages. The Venezuelans wanted full reimbursement on any tire made by Bridgestone or Firestone.
In Russia, bribery affects multinational corporations. Corruption is 20% of the country’s grouse domestic product and 80% of businesses are involved with some kind of bribery. The Foreign Corrupt Practices Act addresses these issues with the transparency requirements of Securities Exchange Acts and bribery itself. Violators may be disqualified from doing business with the United States government. As a result of FCPA only regulating American businesses, it can put them at a disadvantage in competitive edge of their ladder ranking in the global economy. The best way to avoid FCPA termination is learning and implementing the country’s culture and national laws very well national laws. The World Trade Organization is a regulator for many countries which give a common international law to member states and set policies on social issues like banking (to prevent money laundering), food sanitation, and agriculture requirements and indirectly enforce, ISO14001, an international fossil fuel pollution law with controls and limits. The Omnibus Trade and Competiveness Act enhanced the FCPA so no loopholes remained in the prosecution of bribery. The Organization of Economic Cooperation and Development is a treaty that has consequences for offering fake advantages to foreign businesses. However, giving bribes is a legal practice in countries like Mexico, South Africa, Middle East, India, and Pakistan. Bribery is wide spread or normal occurrence in the developing nations such as Dominican Republic, Nigeria, Panama, Paraguay, Peru, Costa Rica, Bolivia, and Venezuela.