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Global Ethics in the Face of Increasing Globalization

The etymology of the expression "When in Rome, do as the Romans do" offers multiple variations and interpretations, as does a converse but more contemporary form of the phrase - "When in Rome, do as you would at home." Consideration of both articulations provides the opportunity for an interesting study of a future framework for conducting international business in an ever increasing environment of globalization. In particular, the ethical The purpose of this

principles comprising such a framework deserve considerable focus.

brief paper is to first analyze John R. Boatright's view of both the culturally relativistic and ethically imperialistic aspects of the "When in Rome . . . " statements as "inadequate attitudes," and then explore an alternative and superior approach to completing this idiom. Whether to "do as the Romans do" or "do as you do at home" while in Rome can be viewed as a choice between cultural relativism and ethical imperialism. Following the former path is to follow "the cultural relativist's creed." (Donaldson, 1996) Cultural relativism holds that there is an equality between cross cultural ethics that cannot be challenged. bribery of public officials in Indonesia may be accepted while it is abhorred in Singapore, yet the cultural relativist sees no problem under either scenario as both attitudes are equally permissible. In Donaldson's view, "the other end of the spectrum from cultural relativism is ethical imperialism, which directs people to do everywhere exactly as they do at home." In stark contrast to the cultural relativist, the ethical imperialist For instance,

attempts to apply rigid consistency in the application of ethical principles. Boatright and Donaldson share the view that both approaches are woefully inadequate when applied to the conduct of business across international borders. Further, both men seem to agree that both views are embodied by the two forms of the "When in Rome . . . " idiom. Boatright

expresses the root cause for his belief in the inadequacy of both attitudes on page 419 of the

text, when speaking of the relativist and absolutist forms of the phrase he states that, "Neither of these positions can be adopted without exception." In Boatright's view, neither mindset is "wholly justified," and therefore represents an imperfect approach to forming acceptable and ethical business behavior abroad.

While Boatright and Donaldson agree on the inadequacies of relativism and absolutism, they hold divergent views on the principles or rules that multinational corporations should abide by. For Donaldson, the key lies in three principles: 1.) respect for core human values, 2.) respect for local traditions, and 3.) contextual relevance in ethical decision making. Boatright's divergence exists on two levels. He views Donaldson's rights based principles as lacking clarity and as being inapplicable to a majority of the complex ethical challenges facing international decision makers. Boatright's criticism of Donaldson's proposed rights based principles seems harsh in light of his own lack of elaboration on a meaningful, practical solution. In fact, Boatright, seems to merely

introduce, briefly discuss, and conclude that there is the need for "the development of international agreements and codes of ethics." (p. 443)

While it is clear that both adages offering suggestions for conduct "When in Rome" are inadequate, it is also clear that the development of a framework for conducting international business is a daunting task. The failure of either relativism or absolutism to grant exceptions based on contextual circumstances in a cross cultural environment is clearly a fatal flaw shared by both views. However, there are several approaches in existence that attempt to remedy this shortcoming of the two extremes. One such view is that of Georges Enderle that offers a typology of four different global ethical views. Enderle's "Foreign Country Type" is representative of the relativist view, while his "Empire Type" comports to the absolutist approach. His addition of an "Interconnection Type," which seeks to blend and connect

nations into regional coalitions, offers an expansion

beyond the rigidity of relativism and absolutism. The European Union provides perhaps the best illustration of this type. But it is Enderle's "Global Type" that lies at an extreme of his typology and seeks to synthesize ethical principles that would be best representative, and most likely to be accepted by the global business community. Enderle's typology attempts to offer two additional global types in order to alleviate the difficulty global ethical decision makers experienced under the rigidity of the relativist and absolutist models, where the allowance for exceptions was nonexistent.

Another alternative tool developed for use by global business decision makers in order to meet the challenges presented by cross cultural conflicts is Integrative Social Contracts Theory (ISCT). Developed by Donaldson in collaboration with Thomas Dunfee, this model employs the concepts of hypernorms and moral free space in an attempt to achieve balance in the conduct of international business. Under ISCT, hypernorms represent those ethical

principles and values that transcend a broad range of cultures, and are therefore desirable as normative guides to international business decision making. To the contrary, moral free

space in the ISCT model is where inconsistent principles and values that conflict with the broadly accepted norms are found. The ISCT model strives to strike a balance between

adherence to hypernorms and the avoidance of moral free space in the ultimate goal of achieving a global ethical framework for decision making in the conduct of international business. Contributions such as Enderle's typology and the ISCT model of

Donaldson and Dunfee that seek to navigate between the extremes of relativism and absolutism could best be summarized by changing the adage to "When in Rome, strike a globally sensitive ethical balance."

It would seem that any development efforts toward a global ethics framework for conducting international business would draw its principles from the three ethical theories that have had the greatest influence on moral philosophy in the last three centuries -- utilitarianism, natural

rights theory, and Kantianism.

Indeed, the historical development efforts surrounding a

global framework for ethics in international business have included principles drawn from these three philosophies. In the exploration of whether agreement on a global ethic is even attainable, Boatright cites theologian Hans Kng as observing that globalization itself calls for the "globalization of ethics." (p. 440) Further review of Dr. Kng's work at The

Global Ethics Foundation reveals a significant body of work devoted toward achieving a global ethic, not just in international business but in politics, religion and everyday life. Embedded in Kng's work entitled, "Declaration Toward a Global Ethic" are principles quite similar to those espoused by Immanuel Kant. Kant's reflection of the Christian concept of the Golden Rule can be seen in the following text from the Declaration: " There is a

principle which is found and has persisted in many religious and ethical traditions of humankind for thousands of years: What you do not wish done to yourself, do not do to others. Or in positive terms: What you wish done to yourself, do to others!" Such a principle is essential to success in achieving a global ethics framework.

Another Kantian argument contained in Kng's Declaration is that of respect for persons. The principle of humanity should be a key component of any global ethical framework. As Boatright points out, fundamental human rights such as those that Donaldson sets forth are merely "minimal conditions for ethical behavior" (p. 423), and are not involved in the majority of critical moral issues faced in international business. Rather, the focus is more on abuses of power by multinational corporations. Indeed, and as Boatright points out, corrupt practices such as bribery is a significant cause of global poverty and underdevelopment. (p. 433) Bribery and other forms of corruption are therefore a key threat to the principle of

humanity that is essential for the success of a global ethic. Bribery undermines economic efficiency and inevitably leads to lowered standards of living, even threatening minimal

standards of living and the basic human right thereof. forms of bribery are intolerable, and it is for this

Even the most basic and common

reason that the Kantian categorical imperative and the principle of humanity are most important to multinational companies operating abroad and amidst bribery. Respect for

these principles lends itself to the formation of strong codes of conduct that clearly outline ethical courses of action in environments where bribery is prevalent. Companies that hold the value of respect for people constant while never compromising integrity will stand the best chance of navigating the ethical maze that some corrupt foreign environments present. Adherence to these principles allows for unambiguous language in codes of conduct that offer clear direction in challenging circumstances. But specific procedures for handling

situations susceptible to the offering or acceptance of bribes must be coupled with the flexibility for international business managers to exercise judgment in culturally sensitive situations. Despite the need for flexibility in the exercise of judgment where cultural sensitivity is required, it is the ambiguity presented by these very situations that creates the most challenging problems. In cases such as these, a decision making framework involving even top management is essential to solve these problems. For instance, in countries where child labor is accepted at the expense of basic minimal levels of education, multinational corporations may face pressure to pay bribes or other "fees" in order to retain access to vital resources in those countries. A solution to this might be for the multinational corporations under such pressure to partner with local governments to provide the same level of expenditure toward education, salary and benefits for those children, while at the same time avoiding such corrupt payments. When empowered and supported by strong ethical codes and guidelines, multinational corporations are better positioned to firmly resist bribery and corruption rather than simply conceding to it

as

the

path

of

least

resistance.

Progress toward a global ethics framework has been significant, but vast socioeconomic disparity remains a daunting challenge. Of the 100 largest global economies, only 47 are

nation states. This underscores the increasing levels of responsibility facing multinational corporations in a world of ever increasing globalization. Hans Kng's call for and pursuit of a global ethic in the face of such rapid globalization is a laudable crusade, but remains a daunting challenge.

References Boatright, J. R. (2009). Ethics and the Conduct of Business (6th ed.): International Upper Saddle River, NJ: Pearson Education, Inc.

Business Ethics, pp. 416-418.

Carroll, A.B. "Managing ethically with global stakeholder: A present and future challenge," Academy of Management Executive,2004,Vol. 18, No.2, pp 114-119.

Donaldson, T., "World View: When is different just different, and when is different wrong?" Harvard Business Review, September -October 1996, pp. 48-62.