Major Challenges that Multinationals face at ethical decision making:

Individual Influences on Ethical Decision making:

People from different cultural backgrounds are still likely to have different beliefs about right
and wrong, different values and have different feelings for different group of people based on
their nations, religions and cultures. The problem occurs when this kind of people take decisions
for any corporation. At decision making time, they always judge the situation or people at their
way of thinking which based on nations, religions and cultures.
The type and quality of education by individuals, as well as their professional training and
experience, might also have important influences on ethical decision making. The problem will
occur in this situation is when the decision maker’s decision may not be acceptable by others or
decision maker could take a decision which not suitable for the situation.
Psychological factors can also have important influence over decision making. Individual will
take decision based on what he/she thinks about morally rights and wrongs. If we take Kohlberg
Cognitive moral development theory; first individual will think about the situation on the bases
of self-interest and external rewards. Then, individual will see others expectations. Finally,
individual take decision based on his/her personal moral principles that he always follows.
Personal values are also plays important role in decision making situation. Personal values have
long been argued to be influential in the type of decisions make in organizations. As values are
key repositories of what is good/bad and right/wrong but finding out exactly what values
decision makers have and which ones influence which decisions is fraught with difficulty.
Some acts of ethical decision-making are strongly influenced by the degree of personal integrity
by individual. Situation like, all the employers of the company doing something wrong and that
thing is accepted by all the employers. If individual things doing that thing is totally harmful for
the company and try to stop it that going to be the personal integrity. If individuals fails to do so
that harm overall decision making process of the company.
Ethical Challenges of Globalization:

Multinationals have significant impact on globalization of business practices. If a corporation go

for global market, it need to understand natural culture and moral values. To understand this we
have to take a look at Hofstede model with its five dimensions characterizing different cultural
values: individualism/collectivism, power distance, masculinity/femininity, uncertainty
avoidance, long/short term orientation. Individual need to understand about different culture at
any ethical decision making situation. For an example individualist cultures will tend to regard
independent autonomous acting for good as more acceptable for each worker to be individually
responsible to their employee; whereas, collectivist cultures will tend to emphasize the necessity
of association and participation association. The point is different cultures will view employee
rights and responsibilities differently. This means that managers dealing with employees
overseas, need to first understand the cultural basis of morality in that country.

Ethical Issue like ‘Dirty Tricks’:

It is a big issue for any company and stay careful about it also a big challenge. To industrial
espionage, dirty tricks can include various tactics like negative advertising, stealing customers,
sabotage. It will be a very big risk if the decision taking group will involves in this kind of work
and it will badly harm the company. For some personal reason if some employee or high
authority do dirty trick, that will be very unethical work. So it’s a big challenge for any company
to aware about this issue.

Discrimination:

Multinational companies faces so many major challenges when they face ethical decision
making. So one of the major challenge is discrimination. In the work place there are many
common bases for discrimination such as gender, age, religion, race, disability and nationality.
But when it come to an ethical decision making it’s become a challenge for the company.
Because the company may need a local employee to understand the market, so they need to
move the other employee who is from a different nationality. It is an ethical decision for a MNC
but most of the times employees who got moved think that this was an unethical decision and
discriminated by the company.

Freedom of conscience and speech:

Another major challenge is freedom of conscience and speech. All the MNC’s around the world
have their own confidential matters which they don’t want to share with others or don’t want to
disclose with others. Most of the times it may hampered their work or may cause damage to the
company. So for this the freedom of speech of the employees gets some certain restriction. But
most of the time employees think that the companies are taking their rights from them which is
totally wrong. For the employees right most of the MNCs give the right of freedom of speech so
that employees may give their decisions, plan, reviews or anything else that will help the
company. But employees just mixed those rights and certain restriction with each other.

Corruption and Bribery Challenge in ethical decision making:

Corruption is one of the major problem during ethical decision making in global organization. I
is also a serious problem in our society and every organization. Corruption in business is mainly
happened during the interface between business manager and public official. Corruption is one of
the reason to fail decision making. Corruption allocate resources and opportunity in a unfair way.
If decision making manager involved in corruption then that organization cannot take a proper
effective decision .but corruption and act of corruption occur daily all over the world.

Bribery is a widespread phenomenon in international business. The term bribery means to give
money of gift in cash or something .in order to purchase them to more favorable and biased
decision for business goal. If decision making manager take bribery its illegal and its threats to
company’s operations, profitability or possible loss of business opportunities. Doing corruption
and taking bribery manager or decision-maker has the potential to negatively impact human
rights, environmental issues, sustainable development or any other stakeholder issue. Manager
unethically doing it and it’s a big challenge now a days to take ethical decision for organization.
Informational privacy:

If the informational privacy is poor and someone in the office misuse the company’s information
that will be harmful for the company. So it’s a big issue or big challenge during decision making
time. Organization has its own secret data and how when the data are released to other by
organization executive body this can be challenging fact during taking ethical decision.

Trust & integrity:

Trust and integrity is also a significant issue in ethical decision making. If a decision maker or
manager lost his trust with organization or customer its will effect badly. Every decision maker
or manager should have fair decision making power. If manager didn’t make fair decision its will
be harmful for organization. If manager take a fair decision organizations other staff will work
properly due to his fair decision taking for organization. So trust and integrity is another
challenge in ethical decision making.

Misuse of power:

As we know mainly the decision making powers are in the hand of the hierarchical officers of
the organization. Mangers who has the power to taking decision which is wrong or writes for the
company sometimes they violate the ethical rule of the company. They often abuse their powers
for their own selves. This abusing of powers we can see in decision making processes as well as
in recruitment of employee and also in the purchasing decisions. Manager dose this unethical
works for their profit and sometimes for nearest ones. This kind of excessive abuse of power can
be harmful for the organizations in the long run.

In many decision making process higher officers don’t take the opinions of their subordinates
which is also count as unethical in corporate moral values. Everyone has the right to be a part of
the corporations every decision by this other employees can relate themselves with company and
become motivated. But when managers dominate other employees it make bad environment of
working as well as spoil the reputation of the company. This kind misuse of power can make
impact on company profile in the global markets. They need to solve the decision making
problem to establish the company in a reputed position internationally.

Question of loyalty:

Every employee of the company have to be obedient to the company’s code of conducts when
they are involving in any decision making. Higher to lower all work as a function to take
decision for the company. Manager of the Organizations have to take control over his employees
as well as he also should to be accountable for the organization. Honesty is a great virtue in
corporation world. Employees need to motivate to being loyal to the company’s betterment. If
the employees don’t be loyal to the company, they can’t be able to take any decision to the fever
of the company. In a result company will lose its growth to compete in the market with the
competitors. Also they don’t be loyal to the company, they can do any unethical works as like;
giving company’s information to the competitors which might destroy the company in future.

Workplace environment:

Appreciation is important in workplace environment. Just a little gesture of saying ‘nice job’ or
‘thank u’ can make good impression among colleagues. This way, your employees can
understand what they’re doing well, and do more of it. Also praising someone in details shows
you’re paying courtesy, attention and not tossing around empty phrases. When people feel like
they’re doing good work, they find enthusiasm to work even harder. In order to work efficiently
effectively good workplace environment is important. Employees get demotivated if they don’t
find their workplace suitable for working.

Lack of equal opportunity:

Equal opportunity ascends from the similar action of all people, unhindered by artificial barriers
or prejudices or likings, except when particular discrepancies can be clearly justified. In simple
words Equal opportunity refers to the policy of giving everyone the same opportunities for
employment, pay, and promotion, without discriminating against particular groups. In many
workplaces lack of opportunity is present. This arises problems among workers. Equal
opportunity should be maintained in order to keep peaceful working environment.

Workplace diversity:

Workplace diversity refers to the variety of differences between entities in an organization.

Diversity not only comprises how individuals classify themselves but also how others observe
them. Diversity within a workplace includes race, gender, ethnic groups, age, religion, sexual
orientation, citizenship status, military service and mental and physical conditions, as well as
other discrete variances between people.

Employees need to be aware of how to co-occur with a diverse range of people, as well as be
knowing of cultural sensitivity, to achieve synchronization within a diverse workplace.
Sensitivity training can help an organization manage diversity in the workplace by helping
employees become more self-aware, which plays a vital role in serving employees understand
their own cultural prejudices and biases.