A Global Approach towards Teaching Ethics in International Business

A Global Approach towards Teaching Ethics in International Business

Hussain G. Rammal (University of South Australia, Australia)
DOI: 10.4018/978-1-61350-510-6.ch007
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Abstract

The areas of ethics and social responsibility have increasingly become important in the study of international business and are now covered at the undergraduate and postgraduate levels. While the introduction of ethical theories and responsibilities of corporations within the subject matter has helped create awareness of ethical issues faced by managers in the global marketplace, the current body of knowledge focuses mainly on the Western perspective. This chapter extends the ethical perspective to non-Western philosophies and covers the teachings and ideologies of Confucianism, Gandhism and Islam. These philosophies describe the ethical and moral values that help can explain the decision-making behavior of managers in China, India and many Muslim countries. These suggested codes of ethics are relevant for both students and academics, especially in light of the increasing number of acquisitions by firms from emerging economies.
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Review Of Current Practice

The International business discipline is an emerging area of knowledge. Today many educational institutions globally offer students the option to major in international business or study the courses as part of the general undergraduate and postgraduate degrees. These offerings are particularly attractive for international students from developing countries who wish to obtain a globally recognized education. Many of the topics covered in the international business course focus on trade and investment policies, which tend to be quite similar globally. Therefore the textbooks used to teach international business are standardized and do not need much adapting. The US and European based textbooks tend to dominate the market (see for example Wild, Wild and Han, 2008; Hill, 2010; Cavusgil, Knight and Riesenberger, 2012) and include a chapter, or at least a detailed section, on international business ethics. Although these books compare management practices around the world and highlight the different cultural values and norms, this comparison does not necessarily extend to ethical theories and perspectives. Even in a country like Australia where many of these international business books are adapted to suit the Asia-Pacific region (for example see Wild, Wild, Han and Rammal, 2007; Dowling, Liesch, Gray and Hill, 2009), the content of the ethics chapter follows the US and UK text and only covers ethical theories and philosophies proposed by Western philosophers. Some of these theories are briefly summarized here1:

The Friedman doctrine states that the primary purpose of the management is to maximize shareholders’ return as long as they do so within the rules of the law. This doctrine is seen to be outdated and is generally covered in the textbooks to highlight the changing nature of business ethics.

The Utilitarian approach to ethics states that a decision is ethical and appropriate if the benefits of the decision outweigh the costs of implementing it. This approach can help explain why in some instances decisions like downsizing are taken by managers where a small number of workers lose their jobs in order to keep the company operational and the majority of the workers employed.

The Kantian approach to ethics advocates treating human with dignity and respect and not merely as input for production. This approach is relevant to our understanding of issues related to the use of sweatshops and bonded labor.

Key Terms in this Chapter

Haram: Prohibited under Islamic law.

Gandhism: See Gandhian Philosophy.

Halal: Permissible under Islamic law.

Shariah: Islamic law based on the teachings of the Qur’an.

Satyagraha: A non-violent protest movement used by Gandhi against the British rule.

Confucianism: Refers to the teachings and sayings of Chinese philosopher Confucius.

Guanxi: Chinese personal business networks or connections.

Gandhian Economics: The economic philosophy based on the teachings of Gandhi.

Gandhian Philosophy: Also known as Gandhism. Refers to the sayings and teachings of Mohandas Gandhi.

Swadeshi: Refers to Gandhi’s emphasis on a nation being self-sufficient.

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