BUSINESS ETHICS GROUP PROJECT

Sec: B, GROUP-8
Karunya Valleesan 201912067

Swapnil Raut 201912095

Shrirupa Baidya Roy 201912091

Mayukh Mitra 201912072

Ranjeet Singh 201912083

CULTURAL AND CONTEXTUAL DIFFERENCES IN

BUSINESS CONDUCT ACROSS THE WORLD

INTRODUCTION
An article in Bloomsberg Business Week says, “Ethics must be global,
not local to build a truly great, global business, business leaders need to
adopt a global standard of ethical practices”. In order to participate in
global business and communication, ethics and values play a very
important role. An increase in productivity can be attained by having a
sound knowledge of conducting oneself. With globalization and
advancement of MNCs there arises various issues regarding
acceptability of different cultures and with better understanding of these
differences of cultures and values there will be more successful global
business practices. And for better understanding of these ethical
practices it is important to know the ethical standards that impact the
ethical behaviours. It is known that human action is determined by the
triadic interaction among the specific environment (institutional factors),
person (personal factors) and behaviour itself (organizational actions) all
within a particular social context (national culture). Culture forms an
important aspect of ethical behaviour because culture represents
accumulated experiences and knowledge of the background of the
people. Analysis of business ethics involves striking a balance between
the assumption that ethics is universal and timeless on the one hand,
and the practical need to interpret business ethics according to particular
situations and times. If cultural differences among countries are
considered, different countries could be clustered into four specific
cultural dimensions: power distance, uncertainty avoidance,
individualism vs. collectivism, and masculinity vs. femininity. Other than
the cultural differences the differences in ethical practices also are due
to institutional differences like different rules of conduct, cheap child
labour, group versus individual contribution, ethic of justice, equality and
human rights.

GIFTING CULTURE
In Asian countries like Japan and China, a businessperson giving gifts-
sometimes an expensive one- to a business partner is considered as a
sign of respect. As per their culture it is offensive to decline a gift or
come empty-handed to an important meeting. But according to the
American and European cultures, giving gifts in business meetings or
accepting lavish gifts was equivalent to taking a bribe.
Practices that maybe wrong or unacceptable in one country, could be
logical or unnecessary in another country due to differences in
backgrounds, cultures and values.

BRIBERY
As per the US business culture, bribing to obtain a contract is considered
highly unethical and illegal. But it is exactly the opposite in the European
business culture. In European countries like France and Germany,
bribing or paying money is not unethical, it is merely the price that has to
be paid in doing business. Legal impacts of this is not as great in the
European countries as it is in the US.

CHILD LABOUR
Child labor is a widely known issue in a lot of developing and under
developed countries. Despite having legal laws which prohibit child
labor, such practices are still majorly prevalent in Africa, Southern and
Western Asia. These countries do not consider child labor as an
unethical practice. For them, it is acceptable and normal. But in the
United Stated, it is highly frowned upon. If an MNC is found to be using
child labor, it could become public relations nightmare, for that company
leading huge decline in their domestic sales.
NEPOTISM/ FAVOURITISM
Middle East countries give a lot of importance to cultural traditions of the
region. “Wasta” the Arabic word for connections and influence is a
custom which is ingrained in the social life and economy of the Middle
East. This is because family relationships and social networks are
prioritized in business decisions like who gets promoted or hired.
Whereas, in Western countries, though “connections” play a role in
Western business and hiring practices, most of the Western employers
hire, promote and fire employees on the basis of the individual’s skills
and performance. “Wasta” as per the Western Culture would be
considered as favoritism or nepotism and would be seen as unethical.

Some countries in the Far East like Hong Kong, have a high tolerance
for certain unethical practices like bribery. But they have a very low
tolerance for stealing credit from a subordinate or the failure to
acknowledge a subordinate’s work. For them, such a thing is highly
unethical and unacceptable.

CONCLUSION
It is shown that the impact of culture on various Institute of different
places in the world. As an organization moves into a region with culture it
faces many hurdles such as different language norms and beliefs, tastes
and preferences, etc. If the organization does not align itself with the
prevailing culture then it cannot fully reap benefits of expansion. Through
the review it is evident that there are immense similarities and difference
between the ethics and values of different companies around the world.
Similarities are always good but with differences come conflict. It is
important to understand the importance of culture for marketing strategy
it was found that culturally incompatible marketing can backfire and
damage an organization’s reputation in many ways.