C6 -ethics_and_government_compatibility_mode_

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C6 -ethics_and_government_compatibility_mode_

  1. 1. GLOBALIZATION,GLOBALIZATION,GLOBALIZATION,GLOBALIZATION, GOVERNMENTGOVERNMENTGOVERNMENTGOVERNMENT RELATION, ANDRELATION, ANDRELATION, ANDRELATION, ANDRELATION, ANDRELATION, ANDRELATION, ANDRELATION, AND ETHICAL ISSUES INETHICAL ISSUES INETHICAL ISSUES INETHICAL ISSUES IN BUSINESSBUSINESSBUSINESSBUSINESS
  2. 2. TOPIC OUTCOMES At the end of this chapter, students should beAt the end of this chapter, students should beAt the end of this chapter, students should beAt the end of this chapter, students should be able to:able to:able to:able to: Explain the impact of globalization overExplain the impact of globalization overExplain the impact of globalization overExplain the impact of globalization over 2 Explain the impact of globalization overExplain the impact of globalization overExplain the impact of globalization overExplain the impact of globalization over businesses.businesses.businesses.businesses. Explain the relationship betweenExplain the relationship betweenExplain the relationship betweenExplain the relationship between government regulation and businessgovernment regulation and businessgovernment regulation and businessgovernment regulation and business practices & ethical conduct of businesses.practices & ethical conduct of businesses.practices & ethical conduct of businesses.practices & ethical conduct of businesses.
  3. 3. GLOBALIZATION IN TODAY'S BUSINESSGLOBALIZATION IN TODAY'S BUSINESSGLOBALIZATION IN TODAY'S BUSINESSGLOBALIZATION IN TODAY'S BUSINESS GlobalizationGlobalizationGlobalizationGlobalization refers to the increasing movement of goods, services, and capital across national borders. Transnational and multinational companies exceed borders, making everything from product conception, design, manufacturing toproduct conception, design, manufacturing to assembly truly international. Think of an iPod. It was designed in the USA, its parts were produced in Taiwan, the Ukraine, Thailand, it is assembled in China and is shipped into the world. The label shouldn't read "Made in China", but "Made in the World". Globalization
  4. 4. FACTORS THAT DRIVES GLOBALIZATIONFACTORS THAT DRIVES GLOBALIZATIONFACTORS THAT DRIVES GLOBALIZATIONFACTORS THAT DRIVES GLOBALIZATION 1.1.1.1. TechnologicalTechnologicalTechnologicalTechnological innovationinnovationinnovationinnovation –––– internet,,,, sophisticated software, fiber optics, wireless, and satellite technology, among others, have made it easier and faster for companies to communicate with employees, partners, suppliers, and customers all over the globe in real time. 2.2.2.2. TransportationTransportationTransportationTransportation systemsystemsystemsystem –––– improvement in transportation, from air freight to ocean vessels, enable fast and cheap movement of goods and services from one place tomovement of goods and services from one place to another. 3.3.3.3. TheTheTheThe riseriseriserise ofofofof majormajormajormajor transnationaltransnationaltransnationaltransnational companiescompaniescompaniescompanies –––– big, well- capitalized firms are better equipped to conduct business across national borders than smaller, local companies. 4.4.4.4. SocialSocialSocialSocial andandandand politicalpoliticalpoliticalpolitical reformsreformsreformsreforms –––– critical has made products and services accessible to the entire computerized world, creating a wish to buy things irrespective of where they are produced. E.g. When China opens its economy, this accelerate globalization process.
  5. 5. HOW GLOBALIZATION AFFECT BUSINESS?HOW GLOBALIZATION AFFECT BUSINESS?HOW GLOBALIZATION AFFECT BUSINESS?HOW GLOBALIZATION AFFECT BUSINESS? Multi national companies (MNCs) need to deal with government in various countries, thus prune to ethical business conduct. Corporations and individuals, especiallyCorporations and individuals, especially corporations doing business globally, must understand and evaluate the cultures of the people with which it wishes to do business in order to ensure smooth transactions and negotiations.
  6. 6. HOW BUSINESS & GOVERNMENT RELATE?HOW BUSINESS & GOVERNMENT RELATE?HOW BUSINESS & GOVERNMENT RELATE?HOW BUSINESS & GOVERNMENT RELATE? Governments create the rules & frameworks in which businesses are able to compete against each other. From time to time the government will change these rules and frameworks forcing businesses torules and frameworks forcing businesses to change the way they operate. Business is thus keenly affected by government policy. Key areas of government policy that affect business are:
  7. 7. HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.) 1.1.1.1. Economic policiesEconomic policiesEconomic policiesEconomic policies – Government interferes the country’s economy for reason to rectify economic cycle. But some had triggered issues such as: E.g. some claimed that privatisation of government agencies or institutions made workers lost theiragencies or institutions made workers lost their pensions. E.g. according to a statement made by a Public Works Minister, the NSE was built for a projected use of 160,000 vehicles per day, but is now being used by 1,200,000 vehicles per day.
  8. 8. HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.)HOW BUSINESS & GOVERNMENT RELATE? (CONT.) 2.2.2.2. Legal changesLegal changesLegal changesLegal changes – Government changes the laws regularly in line with its political policies. As a result, businesses are continually having to respond to changes in the legal framework: E.g. The requirement for businesses to cater for disabled people, by building ramps into offices, shops etc.people, by building ramps into offices, shops etc. E.g. Creating tighter antiantiantianti----competition lawcompetition lawcompetition lawcompetition law on what constitutes fair competition between businesses. [Further reading material: Competition policies in Malaysia] E.g. Imposing requirements to reduce “glass ceiling”“glass ceiling”“glass ceiling”“glass ceiling” for women and preventing sexual harassment at workplace.
  9. 9. ISSUE 1: BRIBE VS. GREASE PAYMENTISSUE 1: BRIBE VS. GREASE PAYMENTISSUE 1: BRIBE VS. GREASE PAYMENTISSUE 1: BRIBE VS. GREASE PAYMENT Grease Payments Grease Payments Relatively small sums of money given for the purpose of getting minor officials to: Relatively small sums of money given for the purpose of getting minor officials to: • Do what they are supposed to be doing • Do what they are supposed to be doing faster • Do what they are supposed to be doing better BribesBribes Relatively large amounts of money given for the purpose of influencing officials to make decisions or take actions that they otherwise might not take. If the officials considered the merits of the situation only, they might take some other action. Relatively large amounts of money given for the purpose of influencing officials to make decisions or take actions that they otherwise might not take. If the officials considered the merits of the situation only, they might take some other action. Is “greasing” similar to “bribery”?Is “greasing” similar to “bribery”?Is “greasing” similar to “bribery”?Is “greasing” similar to “bribery”? Anti- Corruption Video
  10. 10. ISSUE 2: ENFORCEMENT OF JAKIM HALALISSUE 2: ENFORCEMENT OF JAKIM HALALISSUE 2: ENFORCEMENT OF JAKIM HALALISSUE 2: ENFORCEMENT OF JAKIM HALAL LOGO W.E.F. 1LOGO W.E.F. 1LOGO W.E.F. 1LOGO W.E.F. 1STSTSTST JAN 2012JAN 2012JAN 2012JAN 2012 Can the Malaysian government makes itCan the Malaysian government makes itCan the Malaysian government makes itCan the Malaysian government makes it compulsory for all companies claimingcompulsory for all companies claimingcompulsory for all companies claimingcompulsory for all companies claiming sellingsellingsellingselling halalhalalhalalhalal product to display no otherproduct to display no otherproduct to display no otherproduct to display no othersellingsellingsellingselling halalhalalhalalhalal product to display no otherproduct to display no otherproduct to display no otherproduct to display no other than JAKIM certified HALAL Logo? Will thisthan JAKIM certified HALAL Logo? Will thisthan JAKIM certified HALAL Logo? Will thisthan JAKIM certified HALAL Logo? Will this new requirement be construed as againstnew requirement be construed as againstnew requirement be construed as againstnew requirement be construed as against the individual rights as what had beenthe individual rights as what had beenthe individual rights as what had beenthe individual rights as what had been promoted by the Western countries?promoted by the Western countries?promoted by the Western countries?promoted by the Western countries?
  11. 11. ISSUE 3: THE SHARE SWAPPING BETWEENISSUE 3: THE SHARE SWAPPING BETWEENISSUE 3: THE SHARE SWAPPING BETWEENISSUE 3: THE SHARE SWAPPING BETWEEN MAS AND AIR ASIAMAS AND AIR ASIAMAS AND AIR ASIAMAS AND AIR ASIA 1.1.1.1. List down the affected stakeholders.List down the affected stakeholders.List down the affected stakeholders.List down the affected stakeholders. 2.2.2.2. Has the Malaysia government madeHas the Malaysia government madeHas the Malaysia government madeHas the Malaysia government made the right decision when instructingthe right decision when instructingthe right decision when instructingthe right decision when instructing MAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia sinceMAS to swap shares with Air Asia since many parties claiming that it was amany parties claiming that it was amany parties claiming that it was amany parties claiming that it was a “win“win“win“win----lose” business dealing?lose” business dealing?lose” business dealing?lose” business dealing? 3.3.3.3. If you were the owner of MAS, what willIf you were the owner of MAS, what willIf you were the owner of MAS, what willIf you were the owner of MAS, what will be your decision then i.e. how will yoube your decision then i.e. how will yoube your decision then i.e. how will yoube your decision then i.e. how will you rectify the current situation?rectify the current situation?rectify the current situation?rectify the current situation?
  12. 12. ISSUE 4: THE SETTING UP OF LYNAS PLANT ATISSUE 4: THE SETTING UP OF LYNAS PLANT ATISSUE 4: THE SETTING UP OF LYNAS PLANT ATISSUE 4: THE SETTING UP OF LYNAS PLANT AT GEBENG, PAHANG.GEBENG, PAHANG.GEBENG, PAHANG.GEBENG, PAHANG. Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard”Whose voices has more “right to be heard” over the issueover the issueover the issueover the issue –––– politicians or the residentspoliticians or the residentspoliticians or the residentspoliticians or the residents nearbynearbynearbynearby GebengGebengGebengGebeng areas? Why?areas? Why?areas? Why?areas? Why?
  13. 13. CONCLUSIONCONCLUSIONCONCLUSIONCONCLUSION It is inevitably for government to regulateIt is inevitably for government to regulateIt is inevitably for government to regulateIt is inevitably for government to regulate laws to control unethical or unlawfullaws to control unethical or unlawfullaws to control unethical or unlawfullaws to control unethical or unlawful business activities. But, as the laws isbusiness activities. But, as the laws isbusiness activities. But, as the laws isbusiness activities. But, as the laws is made by human being, there are certainlymade by human being, there are certainlymade by human being, there are certainlymade by human being, there are certainly few loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated byfew loopholes being manipulated by certain parties for personal interest. Tocertain parties for personal interest. Tocertain parties for personal interest. Tocertain parties for personal interest. To overcome this risk, organization and itsovercome this risk, organization and itsovercome this risk, organization and itsovercome this risk, organization and its corporate people should create our owncorporate people should create our owncorporate people should create our owncorporate people should create our own method as “check and balance”method as “check and balance”method as “check and balance”method as “check and balance” mechanism to ensure that we run ourmechanism to ensure that we run ourmechanism to ensure that we run ourmechanism to ensure that we run our business ethically.business ethically.business ethically.business ethically.
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