The document discusses how advancements in transportation and communication have made the world a closer community, exposing societies to new ideas and opportunities for trade, travel, and global markets. However, it also notes that jingoism, or extreme patriotism, still threatens more open international trade. It examines evolving expectations for business ethics and corporate social responsibility as companies operate globally across different cultures.

1. The newest revolution would break down national barriers,
expose the most closeted societies to notions from others,
and create opportunities for trade, travel, and ideas.
M anagement thought is both a process in and a product
of its changing environment
Lenny M artini - 29006014
Part IV The M odern Era- Ch. 22
Introduction
this chapter examines the evolving expectations and obligations concerning
business ethics and the relationship between business and society
also examines opportunities in the global marketplace and how
competing cross-culturally has influenced business decisions
obligations to behave in a legally, ethically, and socially responsible manner
and opportunities to c ompete globally across different cultures
the moral oughts that sustain a civilized soc iety
Ethics, codes of moral conduct, have long been of conc ern in history, but people still
struggle to make the right decisions as individuals and this struggle is confounded as
they come under the influence of others in organizations
Social responsibility, the moral conduct of business in its environment, has
also undergone changes over time
business transaction embedded in trust and confidence
search for guidelines to moral conduct beyond the
question of legal boundaries
Summary
Joseph Wharton
The world is now a closer community because of advancements in transportation and communication
Global markets bring new opportunities, yet jingoism threatens the prospects of more open markets
Robert W. Johnson
trade among nations has been initiated and carried out as a political strategy
free trade provided the best of all possible worlds because all nations
would concentrate on what they could best produce
Ethics
David Ricardo
a market exchange system needed to allowed each nation to find its
comparative advantage among other trading nations
transportation and communication revolutions pushed back the
frontier for trade, enabling the loc al markets of yesteryears to
become the electronic commerce and global markets of today
cheaper labor, better way to produce, lower costs
align the interests of management with others as well
as serving as a guide to moral conduct
John Stad
believed that business schools had a responsibility to teach ethics to the
future business owners
Sherman Anti-Trust Act
Clayton Anti-Trust Act (1914)
Legislation
The globalization of business
Securities Act (1933)
Securities Exchange Act (1934)
the new-global competition is an extension of the past
Sarbanes-Oxley Act (2002)
outsourcing jobs
social responsibility addresses the expectations that
soc iety has about a business firm
free trade vs protectionism
opening product and factor markets or protecting indigenous special interest groups
business must meet the needs and desires of human
beings, whether they work for it, purchase its products,
or live in the same community
separation of owners and manages led to more ethical dilemmas as
principal and agents interests come into conflict
the notion of multinational enterprise has undergone an evolution
with changing technologies and market opportunities
growth of international finance and securities market
set a high moral and ethical standards of curriculum of business schools
need for service capitalism by rendering good service in
return for its right to operate
Although people may have gained knowledge of those of other nations, it is
often without a greater understanding of them
problems
obligations of business firms appear to be more variable and changing
as a soc ial values and legal obligations change
answered by national policy
merchant provided the means for artists, sculptors, and writers in Renaissance
NAFTA
the European Union
person in business preserve the cultural heritage
trade alliances
business leaders provided a view of the obligations of firms
Andrew Carnegie believed that the acquisition of wealth imposed a duty
APEC
19th century court placed management as trustee of the shareholders
and could do nothing with corporate assets
as firms become more global in their outlook and operations, they
find themselves working with diverse cultures
a set of beliefs held in common by group of people about economic,
social, and political form of behavior
legal notions of business obligations
term of culture
management theories face their serious challenge as cross-cultural studies are made
found a clustering of values that had an impact on leader-follower relations
traditionalism vs modernity
Donna Wood
Bernard Bass
Obligations and
Opportunities
collectivism vs individualism
determine which leadership attributes and behaviors are endorsed
widely and which appear to be culturally contingent
Howard Bowen
project GLOBE
social responsibility
the obligations of businessmen to pursue those policies, to make those
decisions, or to follow those lines of action which are desirable in
terms of the objectives and values of our soc iety
synonymous with public responsibility, social obligations, business morality
if you mess it up, you c lean it up
Individuals & Organizations : Relating to Evolving Expectations
organizational behavior
since business influenced society, it had to accept the social
obligations that followed
studies of cross culture management
M anagement Opportunities in a
Global Arena
strategic management
business-government relations
social responsibility served the long-run interest of business
social responsibility improved the public
image of business
how much do cultures vary?
how does this variance influence management practices ?
is this variance converging, diverging, or stable when a country
become more industrialized ?
enduring questions
with social responsibility, government
regulation could be avoided
Keith Davis
power distance
business had the resources and expertise
to apply to social problems
Business and Society
individualism versus collectivism
characterized cultural differences in these dimensions
masculinity versus femininity
increased its legitimacy in society
argument in favor of soc ial responsibility
are management theories culture bound ?
the degree of inequality among individuals considered by that culture as normal
5% clause, permitted corporations to deduct up from net income for
contributions to society
business alone could not solve the problems of economic life
human resource management
information and technology transfer
revision of the Federal Revenue Act (1935)
business leaders were proactive, desirous of laws to protect themselves
as well as consumers
that as a trustee of the stockholders, management
should optimize their return
M anaging across cultures
Geert Hofstede
argument against social responsibility
uncertainty avoidance
social involvement was costly and diluted the primary
economic purpose of the firm
business should not be given responsibilities for which it was
neither equipped to perform nor could be held accountable
and long-term versus short-term orientation
On balance, Davis favored social involvement on the part of business, but acknowledged Bowen's caveat that certain things
should not be expected of business but should be left to others who were better able to carry out those responsibilities
Ethics, corporate soc ial responsibility, and laws further complicate the issue of competing across national borders
a continuum from "cultural relativism" (do whatever local customs, traditions, and
ethics permit) to "ethical imperialism" (one set of standards everywhere)
good business and good ethics go hand in hand but different
nations and regions faced particular types of problems
misuse of power for private benefits
Donaldson
(a) "economic" objectives aimed at optimizing the efficiency of its total resource conversion process
Igor Ansoff
the social objectives exert a modifying and con straining influence on management behavior
making more companies accountable
Peter Drucker
Firms must ask if their core competencies/strengths are appropriate to
the opportunities in a particular market
wiil foreign investment be welcomed
does the political system provide safeguards for employees and
intellectual and physical property
Choosing to enter the global market
involves more than an understanding of
cultural and ethical issues
will competing abroad serve the long-run best interests of our stakeholders?
management must put economic considerations first and could justify its existence
only through the economic results it produced
there could be noneconomic consequences of managerial decisions, such as improved community well-being, but that
these were by-products made possible only by an emphasis on economic performance
describing four categories of
responsibilities
economic
legal
ethical
discretionary/ philanthropic
is the economic system conducive to private market-driven enterprise
is the rivalry in the intended market currently too formidable
(b) "social" or noneconomic objectives
In most firms the economic objectives exert the primary influence on the firm's behavior and form the
main body of explicit goals used by management for guidance and control of the firm
global management issues
greater corporate responsiveness to stakeholders
can a transfer of technology benefit all
those groups without whose support the organization would cease to exist
distinguished between "objectives" and "responsibilities
corruption
the need for integrity in business and political leadership
stakeholders
Enderle
Archie Carroll
Economic responsibilities were primary
Legal responsibilities were those regulations and rules created by political
institutions to legitimize and govern business activities
Ethical responsibilities were expectations of how a firm should conduct its
business beyond what the law required
Philanthropic responsibilities were voluntary choices
Unanswered is the question about who defines what is ethical or socially responsible behavior
22- Obligations and Opportunities - Lenny 29006014.mmap - 10/12/2006 -