This document discusses four issues related to globalization, government relations, and ethical issues in business: 1) Whether "grease payments" are similar to bribery in influencing officials' decisions. 2) Whether the Malaysian government can enforce requiring halal logos on all food products. 3) The share-swapping deal between MAS and AirAsia and whether it benefits stakeholders. 4) Who has more right to be heard over the setting up of a Lynas plant near Kuantan - politicians or nearby residents.

1. GGGGLLLLOOOOBBBBAAAALLLLIIIIZZZZAAAATTTTIIIIOOOONNNN,,,,
GGGGOOOOVVVVEEEERRRRNNNNMMMMEEEENNNNTTTT
RRRRRRRREEEEEEEELLLLLLLLAAAAAAAATTTTTTTTIIIIIIIIOOOOOOOONNNNNNNN,,,,,,,, AAAAAAAANNNNNNNNDDDDDDDD
EEEETTTTHHHHIIIICCCCAAAALLLL IIIISSSSSSSSUUUUEEEESSSS IIIINNNN
BBBBUUUUSSSSIIIINNNNEEEESSSSSSSS

2. TOPIC OUTCOMES
At the end of this chapter, AAAttt ttthhheee eeennnddd ooofff ttthhhiiisss ccchhhaaapppttteeerrr,,, ssssttttuuuuddddeeeennnnttttssss sssshhhhoooouuuulllldddd bbbbeeee
aaaabbbblllleeee ttttoooo::::
EEEExxxxppppllllaaaaiiiinnnn tttthhhheeee iiiimmmmppppaaaacccctttt ooooffff gggglllloooobbbbaaaalllliiiizzzzaaaattttiiiioooonnnn oooovvvveeeerrrr
2
bbbbuuuussssiiiinnnneeeesssssssseeeessss....
EEEExxxxppppllllaaaaiiiinnnn tttthhhheeee rrrreeeellllaaaattttiiiioooonnnnsssshhhhiiiipppp bbbbeeeettttwwwweeeeeeeennnn
ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt rrrreeeegggguuuullllaaaattttiiiioooonnnn aaaannnndddd bbbbuuuussssiiiinnnneeeessssssss
pppprrrraaaaccccttttiiiicccceeeessss eeeetttthhhhiiiiccccaaaallll ccccoooonnnndddduuuucccctttt ooooffff bbbbuuuussssiiiinnnneeeesssssssseeeessss....

3. GLOBALIZATION GGGLLLOOOBBBAAALLLIIIZZZAAATTTIIIOOONNN IIIINNNN TTTTOOOODDDDAAAAYYYY''''SSSS BBBBUUUUSSSSIIIINNNNEEEESSSSSSSS
GGGGlllloooobbbbaaaalllliiiizzzzaaaattttiiiioooonnnn refers to the increasing
movement of goods, services, and capital
across national borders.
Transnational and multinational companies
exceed borders, making everything from
pprroodduucctt ccoonncceeppttiioonn,, ddeessiiggnn,, mmaannuuffaaccttuurriinngg ttoo
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. FACTORS THAT DRIVES FFFAAACCCTTTOOORRRSSS TTTHHHAAATTT DDDRRRIIIVVVEEESSS GGGGLLLLOOOOBBBBAAAALLLLIIIIZZZZAAAATTTTIIIIOOOONNNN
1111.... TTTTeeeecccchhhhnnnnoooollllooooggggiiiiccccaaaallll iiiinnnnnnnnoooovvvvaaaattttiiiioooonnnn – 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.
2222.... TTTTrrrraaaannnnssssppppoooorrrrttttaaaattttiiiioooonnnn ssssyyyysssstttteeeemmmm – improvement in transportation,
from air freight to ocean vessels, enable fast and cheap
mmoovveemmeenntt ooff ggooooddss aanndd sseerrvviicceess ffrroomm oonnee ppllaaccee ttoo
another.
3333.... TTTThhhheeee rrrriiiisssseeee ooooffff mmmmaaaajjjjoooorrrr ttttrrrraaaannnnssssnnnnaaaattttiiiioooonnnnaaaallll ccccoooommmmppppaaaannnniiiieeeessss – big, well-capitalized
firms are better equipped to conduct business
across national borders than smaller, local companies.
4444.... SSSSoooocccciiiiaaaallll aaaannnndddd ppppoooolllliiiittttiiiiccccaaaallll rrrreeeeffffoooorrrrmmmmssss – 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. HOW GLOBALIZATION HHHOOOWWW GGGLLLOOOBBBAAALLLIIIZZZAAATTTIIIOOONNN AAAAFFFFFFFFEEEECCCCTTTT BBBBUUUUSSSSIIIINNNNEEEESSSSSSSS????
Multi national companies (MNCs) need to
deal with government in various
countries, thus prune to ethical business
conduct.
CCoorrppoorraattiioonnss aanndd iinnddiivviidduuaallss,, eessppeecciiaallllyy
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. HOW BUSINESS HHHOOOWWW BBBUUUSSSIIINNNEEESSSSSS GGGGOOOOVVVVEEEERRRRNNNNMMMMEEEENNNNTTTT RRRREEEELLLLAAAATTTTEEEE????
Governments create the rules
frameworks in which businesses are able to
compete against each other. From time to
time the government will change these
rruulleess aanndd ffrraammeewwoorrkkss ffoorrcciinngg bbuussiinneesssseess ttoo
change the way they operate.
Business is thus keenly affected by
government policy. Key areas of
government policy that affect business are:

7. HOW BUSINESS GOVERNMENT HHHOOOWWW BBBUUUSSSIIINNNEEESSSSSS GGGOOOVVVEEERRRNNNMMMEEENNNTTT RRRREEEELLLLAAAATTTTEEEE???? ((((CCCCOOOONNNNTTTT....))))
1111.... EEEEccccoooonnnnoooommmmiiiicccc ppppoooolllliiiicccciiiieeeessss – 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
aaggeenncciieess oorr iinnssttiittuuttiioonnss mmaaddee wwoorrkkeerrss lloosstt tthheeiirr
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. HOW BUSINESS GOVERNMENT HHHOOOWWW BBBUUUSSSIIINNNEEESSSSSS GGGOOOVVVEEERRRNNNMMMEEENNNTTT RRRREEEELLLLAAAATTTTEEEE???? ((((CCCCOOOONNNNTTTT....))))
2222.... LLLLeeeeggggaaaallll cccchhhhaaaannnnggggeeeessss – 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
ppeeooppllee,, bbyy bbuuiillddiinngg rraammppss iinnttoo ooffffiicceess,, sshhooppss eettcc..
E.g. Creating tighter aaaannnnttttiiii-ccccoooommmmppppeeeettttiiiittttiiiioooonnnn llllaaaawwww on what
constitutes fair competition between businesses. [Further
reading material: Competition policies in Malaysia]
E.g. Imposing requirements to reduce ““““ggggllllaaaassssssss cccceeeeiiiilllliiiinnnngggg”””” for
women and preventing sexual harassment at workplace.

9. ISSUE 1: BRIBE IIISSSSSSUUUEEE 111::: BBBRRRIIIBBBEEE VVVVSSSS.... GGGGRRRREEEEAAAASSSSEEEE PPPPAAAAYYYYMMMMEEEENNNNTTTT
Grease
Payments
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
BBrriibbeess
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.
IIIIssss ““““ggggrrrreeeeaaaassssiiiinnnngggg”””” ssssiiiimmmmiiiillllaaaarrrr ttttoooo ““““bbbbrrrriiiibbbbeeeerrrryyyy””””???? Anti-
Corruption
Video

10. ISSUE 2: ENFORCEMENT IIISSSSSSUUUEEE 222::: EEENNNFFFOOORRRCCCEEEMMMEEENNNTTT OOOOFFFF JJJJAAAAKKKKIIIIMMMM HHHHAAAALLLLAAAALLLL
LLLLOOOOGGGGOOOO WWWW....EEEE....FFFF.... 1111SSSSTTTT JJJJAAAANNNN 2222000011112222
CCCCaaaannnn tttthhhheeee MMMMaaaallllaaaayyyyssssiiiiaaaannnn ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt mmmmaaaakkkkeeeessss iiiitttt
ccccoooommmmppppuuuullllssssoooorrrryyyy ffffoooorrrr aaaallllllll ccccoooommmmppppaaaannnniiiieeeessss ccccllllaaaaiiiimmmmiiiinnnngggg
sssssssseeeeeeeelllllllllllllllliiiiiiiinnnnnnnngggggggg hhhhhhhhaaaaaaaallllllllaaaaaaaallllllll pppppppprrrrrrrroooooooodddddddduuuuuuuucccccccctttttttt ttttttttoooooooo ddddddddiiiiiiiissssssssppppppppllllllllaaaaaaaayyyyyyyy nnnnnnnnoooooooo ooooooootttttttthhhhhhhheeeeeeeerrrrrrrr
tttthhhhaaaannnn JJJJAAAAKKKKIIIIMMMM cccceeeerrrrttttiiiiffffiiiieeeedddd HHHHAAAALLLLAAAALLLL LLLLooooggggoooo???? WWWWiiiillllllll tttthhhhiiiissss
nnnneeeewwww rrrreeeeqqqquuuuiiiirrrreeeemmmmeeeennnntttt bbbbeeee ccccoooonnnnssssttttrrrruuuueeeedddd aaaassss aaaaggggaaaaiiiinnnnsssstttt
tttthhhheeee iiiinnnnddddiiiivvvviiiidddduuuuaaaallll rrrriiiigggghhhhttttssss aaaassss wwwwhhhhaaaatttt hhhhaaaadddd bbbbeeeeeeeennnn
pppprrrroooommmmooootttteeeedddd bbbbyyyy tttthhhheeee WWWWeeeesssstttteeeerrrrnnnn ccccoooouuuunnnnttttrrrriiiieeeessss????

11. ISSUE 3: THE SHARE IIISSSSSSUUUEEE 333::: TTTHHHEEE SSSHHHAAARRREEE SSSSWWWWAAAAPPPPPPPPIIIINNNNGGGG BBBBEEEETTTTWWWWEEEEEEEENNNN
MMMMAAAASSSS AAAANNNNDDDD AAAAIIIIRRRR AAAASSSSIIIIAAAA
1111.... LLLLiiiisssstttt ddddoooowwwwnnnn tttthhhheeee aaaaffffffffeeeecccctttteeeedddd ssssttttaaaakkkkeeeehhhhoooollllddddeeeerrrrssss....
2222.... HHHHaaaassss tttthhhheeee MMMMaaaallllaaaayyyyssssiiiiaaaa ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt mmmmaaaaddddeeee
tttthhhheeee rrrriiiigggghhhhtttt ddddeeeecccciiiissssiiiioooonnnn wwwwhhhheeeennnn iiiinnnnssssttttrrrruuuuccccttttiiiinnnngggg
MMMMMMMMAAAAAAAASSSSSSSS ttttttttoooooooo sssssssswwwwwwwwaaaaaaaapppppppp sssssssshhhhhhhhaaaaaaaarrrrrrrreeeeeeeessssssss wwwwwwwwiiiiiiiitttttttthhhhhhhh AAAAAAAAiiiiiiiirrrrrrrr AAAAAAAAssssssssiiiiiiiiaaaaaaaa ssssssssiiiiiiiinnnnnnnncccccccceeeeeeee
mmmmaaaannnnyyyy ppppaaaarrrrttttiiiieeeessss ccccllllaaaaiiiimmmmiiiinnnngggg tttthhhhaaaatttt iiiitttt wwwwaaaassss aaaa
““““wwwwiiiinnnn--lllloooosssseeee”””” bbbbuuuussssiiiinnnneeeessssssss ddddeeeeaaaalllliiiinnnngggg????
3333.... IIIIffff yyyyoooouuuu wwwweeeerrrreeee tttthhhheeee oooowwwwnnnneeeerrrr ooooffff MMMMAAAASSSS,,,, wwwwhhhhaaaatttt wwwwiiiillllllll
bbbbeeee yyyyoooouuuurrrr ddddeeeecccciiiissssiiiioooonnnn tttthhhheeeennnn iiii....eeee.... hhhhoooowwww wwwwiiiillllllll yyyyoooouuuu
rrrreeeeccccttttiiiiffffyyyy tttthhhheeee ccccuuuurrrrrrrreeeennnntttt ssssiiiittttuuuuaaaattttiiiioooonnnn????

12. ISSUE 4: THE SETTING UP IIISSSSSSUUUEEE 444::: TTTHHHEEE SSSEEETTTTTTIIINNNGGG UUUPPP OOOOFFFF LLLLYYYYNNNNAAAASSSS PPPPLLLLAAAANNNNTTTT AAAATTTT
GGGGEEEEBBBBEEEENNNNGGGG,,,, PPPPAAAAHHHHAAAANNNNGGGG....
WWWWWWWWhhhhhhhhoooooooosssssssseeeeeeee vvvvvvvvooooooooiiiiiiiicccccccceeeeeeeessssssss hhhhhhhhaaaaaaaassssssss mmmmmmmmoooooooorrrrrrrreeeeeeee ““““““““rrrrrrrriiiiiiiigggggggghhhhhhhhtttttttt ttttttttoooooooo bbbbbbbbeeeeeeee hhhhhhhheeeeeeeeaaaaaaaarrrrrrrrdddddddd””””””””
oooovvvveeeerrrr tttthhhheeee iiiissssssssuuuueeee –– ppppoooolllliiiittttiiiicccciiiiaaaannnnssss oooorrrr tttthhhheeee rrrreeeessssiiiiddddeeeennnnttttssss
nnnneeeeaaaarrrrbbbbyyyy GGGGeeeebbbbeeeennnngggg aaaarrrreeeeaaaassss???? WWWWhhhhyyyy????

13. CCCCOOOONNNNCCCCLLLLUUUUSSSSIIIIOOOONNNN
IIIItttt iiiissss iiiinnnneeeevvvviiiittttaaaabbbbllllyyyy ffffoooorrrr ggggoooovvvveeeerrrrnnnnmmmmeeeennnntttt ttttoooo rrrreeeegggguuuullllaaaatttteeee
llllaaaawwwwssss ttttoooo ccccoooonnnnttttrrrroooollll uuuunnnneeeetttthhhhiiiiccccaaaallll oooorrrr uuuunnnnllllaaaawwwwffffuuuullll
bbbbuuuussssiiiinnnneeeessssssss aaaaccccttttiiiivvvviiiittttiiiieeeessss.... BBBBuuuutttt,,,, aaaassss tttthhhheeee llllaaaawwwwssss iiiissss
mmmmaaaaddddeeee bbbbyyyy hhhhuuuummmmaaaannnn bbbbeeeeiiiinnnngggg,,,, tttthhhheeeerrrreeee aaaarrrreeee cccceeeerrrrttttaaaaiiiinnnnllllyyyy
ffffffffeeeeeeeewwwwwwww lllllllloooooooooooooooopppppppphhhhhhhhoooooooolllllllleeeeeeeessssssss bbbbbbbbeeeeeeeeiiiiiiiinnnnnnnngggggggg mmmmmmmmaaaaaaaannnnnnnniiiiiiiippppppppuuuuuuuullllllllaaaaaaaatttttttteeeeeeeedddddddd bbbbbbbbyyyyyyyy
cccceeeerrrrttttaaaaiiiinnnn ppppaaaarrrrttttiiiieeeessss ffffoooorrrr ppppeeeerrrrssssoooonnnnaaaallll iiiinnnntttteeeerrrreeeesssstttt.... TTTToooo
oooovvvveeeerrrrccccoooommmmeeee tttthhhhiiiissss rrrriiiisssskkkk,,,, oooorrrrggggaaaannnniiiizzzzaaaattttiiiioooonnnn aaaannnndddd iiiittttssss
ccccoooorrrrppppoooorrrraaaatttteeee ppppeeeeoooopppplllleeee sssshhhhoooouuuulllldddd ccccrrrreeeeaaaatttteeee oooouuuurrrr oooowwwwnnnn
mmmmeeeetttthhhhoooodddd aaaassss ““““cccchhhheeeecccckkkk aaaannnndddd bbbbaaaallllaaaannnncccceeee””””
mmmmeeeecccchhhhaaaannnniiiissssmmmm ttttoooo eeeennnnssssuuuurrrreeee tttthhhhaaaatttt wwwweeee rrrruuuunnnn oooouuuurrrr
bbbbuuuussssiiiinnnneeeessssssss eeeetttthhhhiiiiccccaaaallllllllyyyy....

14. 14