To Pay or Not to Pay – Overseas Business Ethics and the Reality of Bribery

October 23, 2011 at 3:46 pm (Business Ethics, Diversity in the Workplace)
Tags: , , , , , , , , , , ,

Bribery

       I recall vividly the global climate of suspense and worry at the end of the Cold War.  Despite being nestled in my high school melodrama in a small Midwestern city, I was nevertheless exposed to terms of “corruption” and “bribery” as it related to the new global business landscape.  Every media type reported on the cost of blue jeans and American music in the new Russia.  When the superpower that was the Soviet Union fell, the creation of new governments and new business opportunities brought the reality of the cost of bribery home.

        The U.S. government had been actively involved in the reduction of foreign corruption in business practices since the passage of the Foreign Corrupt Policies Act of 1977.  This legislation put in punitive measures for companies operating in the United States.  This put US manufacturers at a competitive disadvantage in the global marketplace where they were competing with countries and companies without such restrictions.  Even if restrictions were in place, most governments around the world were hard-pressed to enforce them due to the nature of the practice as well as the financial backing of such enforcement.  It became quickly evident that this could only be combated on a global scale, with corporations, governments and civilians working together.

The escalation of the problem following the Cold War finally brought in support from 35 other industrialized nations in 1988 with the Organization for Economic Cooperation and Development (OECD) Convention (aka Bribery convention).  This brought many trading nations together for the purpose of transparent evaluations of each other’s policies in regards to business corruption and successfully prosecuting those who do not comply with fair business standards.   This program has been hampered with the problems of the lack of finance, transparency, and political and social climates of participating countries.  Also, China and India are not signatory to the convention, so fall outside of its parameters.  These two economic powerhouses still include opportunities for bribery with officials making lower wages and lax enforcement.

What this means for the average consumer is that the costs associated with bribery and corruption would be considered the cost of goods sold.  Companies that engage in these practices gain an unfair advantage over those who do not.  Certainly not all of the “bad” companies are bringing forth products that are entirely beneficial to society.  I’m certain most will recall the lead paint in Chinese toys attempting to spoil last year’s Christmas season.  As more information becomes readily available for consumers, the good economic citizen would take care in discovering where the goods they are purchasing are coming from.  Is that company one with integrity and a realistic approach to fight corruption?  Is it a company that ships in containers full of “who-knows”?  National security issues aside, you pay for the corrupt practices in every purchase you make whether it is in taxes that go to help ferret it out and prosecute it, or in the bottom line price of that “must-have” toy of the year, imported by the boatload from countries that could care less about it’s safety or what laws are broken to get it there.

by Joe Hemmelgarn, Business Major – IUPUC

Leave a Comment

Cultural Diversity in the Workplace

August 5, 2011 at 2:06 pm (Diversity in the Workplace, Working Well with Teams)
Tags: , , , , , , , , , , , , , , , , , , , , , ,

The following is an article written by X204 Business Communication Adjunct Lecturer Robin Fritz for Chron.com, the online business portal for the Houston Chronical:

Overview – Thanks to technology and faster transportation, the world is growing smaller every day, leaving plenty of opportunities for businesses to expand their products, services and staffs on a global scale.  But with a more global business environment comes a host of new challenges, not the least of which is learning to function in a multicultural workplace comprised of people with widely differing backgrounds.  For businesses with a very diverse workplace, successfully juggling a multicultural staff can make or break the bottom line.

What is Culture? – Culture is an interwoven system of customs, morals, traits, traditions and values shared by a group of people or a society.  It provides people with a common heritage, and it links them through shared experiences and joint learning.  Cultures exist on scales both large and small, ranging from large cultures extending to countries and regions, such as the American culture or Middle Eastern culture, to such small and distinct cultures as that of Amish communities in Pennsylvaniato the Basque culture in southern France.  Moreover, cultures provide people with a sense of self identity and community, and it greatly influences their actions within the workplace.

What is Diversity? – But, not all cultures are the same.  For instance, some cultures operate on a more “low-context” level than others.  People raised in low-context cultures tend to be very literal – focusing on the spoken word – and they’re more often analytical and action oriented.  Low-context employees also tend to use linear logic in the workplace, for example proceeding from point A to point B to point C and so on.  Additionally, business managers raised in low-context cultures strive to be efficient and professional, and they treat time as a very limited commodity.  North America and Western Europe are examples of low-context cultures.

Embracing Cultural Diversity – High-context cultures, on the other hand, tend to be more contemplative and intuitive, and workers raised in such cultures often treat time as an endless resource.  Additionally, in such cultures, spiral logic is more common, with individuals circling indirectly around a topic, considering it from all angles and viewpoints instead of head on.  Whereas Americans may be very literal, high-context workers pay attention to more than just the spoken word, believing that all aspects of communication – body language, facial expressions, etc.  – carry as much meaning as the actual words themselves.  Examples of high-context cultures include Far Eastern, Middle Eastern and Hispanic cultures.

Encouraging Cultural Diversity – In today’s global economy people from both low-context and high-context cultures are interacting in multicultural workplaces like never before and, as people are affected both visibly and invisibly by their cultures, conflict can result from the inevitable misunderstandings.  For example, employees from high-context cultures such as China, Mexico or Japan may prefer to imply no with their body language rather than saying no in actual word form.  Literal Americans and Canadians, however, often overlook these subtle implications and may fail to understand. 

To overcome multicultural misunderstandings, smart business managers will take the time to learn about and understand the differing cultures represented within their workplace, and will train their employees from different cultures on how best to communicate with each other in the workplace.

http://smallbusiness.chron.com/multicultural-effects-workplace-10989.html

Leave a Comment