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Global Ethic Standards

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    Globalisation had brought new and common standard for worldwide. The norm, consumption attitude, believes and personal preference had been made into common. The global process shows fast growing speed make business communication becomes more multicultural. It also leads to complex condition in business. The growing need for cross culture ethic that require more regulations such as equal treatment, work safety guarantee and environment friendly policy. Under the globalisation trend, economic links are growing and changing every day.

    Some rapid change can be found in economic alliances, investment, workplace environment, modern technology and global customer preference. Development of technologies is so fast (Seilius, Simanskiene, 2006; Thomas, 2008). Modern technologies become available even for underdeveloped country (Bannock, 2005). The increasing global business brings the relative low price and more choice for global customer. However, some conflict like cross culture issues such as management, market strategy setting, employee treatment and CSR (Cooperate social responsibilities).

    It is necessary to handle that in a suitable way. Under the different ethic standard influenced by different culture, if the manager set the wrong plan it may cause culture myopia. As a result, the company will waste large resources and lose big. Another reason for increasing need for cross culture ethic setting is migration. Some people with knowledge and skill leave their native countries because of better living and working conditions. As they joined multinational companies to do international business, they must follow some common ethic by communication skill or respect native culture.

    Racial tensions may happen some time if the conflict can’t settle in a good position. In fact, there is rare ethic conflict for global customers directly. At the aspect of product, company had already chosen different segment strategy for different target market globally. The purpose of this paper is to discuss whether the global ethic will be accepted. First, the various definitions of ethics and relevant related concept will be discussed. An extend topic for the role of global ethic also included. Later, we argue why the ethic standard cannot be followed, it will be discussed in three levels as industry, individual and social.

    In the final section, the challenge universal ethic standard at global environment will be covered. A global ethic can be defined as an ethical perspective according to which there are significant ethical relations between countries and between individuals living in different societies. Those ethics normally combined universal values, obligations in global area. Different culture forms different ideology at different societies. Culture refers to the norms, values, and beliefs of a particular group or community in a particular area or geographic location, and shared by its members (Hofstede, 1980).

    It refers to the norms and value systems can influence the members to behave in a particular way considered acceptable by the other members in the group. To some point, culture is the source for people to behave, which set the basic rules for their ethic base line. More than that, the religion also play important role in ethic standard setting. As doing business, the customer and partner were always involved people have different believes. It is significantly important to know their taboo and respect their belief. Followed by those common rules, the trade will obvious show positive result.

    Magill (1992) mentioned that personal religiosity provides a basic foundation to understand the nature of one’s ethical behaviour. Weaver and Agle (2002) asserted that religiosity is known to have an influence on human attitudes and behavior. This behavior is influenced by religious self-identity, which was formed as a result of the internalization of the role expectations offered by the religion. The potential influence from religion on personal behaviour can be seen as the identification for right or wrong. Therefore, different religions also differentiate from each other.

    It probably for the country that at the same develop stage will show more understanding. Cross culture ethic play important role for all of cross culture items. It is a branch of ethics philosophy that evaluates things about morality. Business ethics (Vasiljeviene & Jeurissen, 2002; Pruskus, 2005) play an significant role in economic and society transformations. Globalisation had bring new require for company to accept upcoming technological and human relation changes. It is big task for manager to adapt new ethic standard for better develop company.

    Hence, manager needs to deepen knowledge and experience about culture and moral environment where they operate. According to Gabler (2006, 339), employees of an ethical company normally have higher self-awareness responsibilities for their actions and for the actions of others. With the higher ethic standard, they will care other’s feeling during communication. Thus, the ethic company will also create relative ethic employee, who has less opportunity to do anti-social behaviour. Global ethic is the key for sustainable development.

    The common business ethic had been the benchmark for legal cats, international humanized norm which could be applied for international enterprises. In my opinion, the common global ethic may exist as increasing needs for CSR for global company. However, the rural area only has relative low standard workplace and their employee’s benefits also can’t be protected. Hence, the global standard won’t be fully accepted in short run. Because, business is for profit, the cheap labour and resource abundant market are always been targeted. In some rural area, their income can only support their daily cost.

    It is unrealistic for them to achieve that level nowadays. For example,there are normally four requirement cannot be followed by global company. We will analysis those separately at global industry level as follows. First of all, child labour had been a popular topic for long time. In many developing countries such as Vietnam and Cambodia, as they can’t provide universal education, the children have to work in unhealthy condition at age as young as four. Even those children have to work full time that in order to reduce the financial burden of their family.

    According to the Bureau of statistic report that although children work as full time, but they were paid much less than prevailing rate in their country, even lower than the minimum wages. Moreover, they can’t receive extra pay for overtime work. Another report by International Labour Organisation shows in developing countries there are at least 250 million child labours between the ages from 5 to 15. Half of them are worked for full time. Typically, they worked in service, prostitution and agriculture industry. Due to long time worked in unhealthy environment, the child labour’s bodies are smaller.

    Some of them suffer from developmental malformation. The children are unlikely to live to 50 years old. Even some western humanitarian agencies tried to help them, but as the large number of group and their national conditions, it cannot be solved in short term. At the second place. Until now, the wage and working hour haven’t been unified in certain region. The wage levels are extremely lower for similar types of work in developing countries than developed countries. For example, Honduran labour earns $24 per week on average.

    However, the basic cost is $22 per week, which only leaves $2 for other purchase such as transportation, clothing and entertainment. It is also happened in China. A family need earn 87 cents (ANU Dollar) to survive in an urban area. An analysis of Walt Disney Cooperation in China found that the employee earned 35 cents per hour. Overtime work happened frequently, but with less extra reward. Under the special condition, Chinese employee have to followed “monthly tool deposits” policy, which refers to they have to save their money in the factory, if they leave the factor before two years, they will lose their money and extra interest.

    Some similar can be found in Saipan that employee has to pay at least $2000 recruitment fee before they worked for the company. Although the minimum & maximum work hours law had been enacted for long time, but it can’t been fully enforced. Another real example for China as some factory regularly work 16 hours per day during the peak production season. Despite the Chinese labour law had clear requirement for maximum 49 hours’ work per week for individual.

    By lack of legal regulatory, the Chinese labour has to followed hegemon clause by unethical company, because they hadn’t paid for month, but they don’t know how to use law to protect their legal benefit. Finally, they have to stay and work for the unethical company. From the surface, China had bring cheap product all over the world, we can find product with “made in China” label everywhere. However, less people know that there is less humanism in those host country. Even the home country know their domestic condition, but as they offer more profit and China have blocked internet to access, the investor just let them drift.

    For example, Microsoft factory in Dong guan have tough rules to restrict employee’s action and employee have to work at least 12 hours per day. In some under development country, it is obviously worse more. Thirdly, working conditions are seriously threatened worker health and safety. Some common accident happened in all countries, but has different rehabilitation works. Based on survey from International Labour Organization and World Health Organization, the shift of manufacturing industry to developing countries will increase the possibility of occupational disease and injury.

    For example, the low standard working environment, imperfection labour protection system and poor legal system will all attribute to the unrespectable condition. Some problem can be forecast as employee had to endure intense heat for poor exhaust system, contaminated drinking water and even limited use for bathroom. In Australia, the building workers are well equipping during their work and company will purchase insurance for them. By compare, in some developing country, the worker even doesn’t have basic equipment to ensure their safety such as protective clothing and fixed rope. Stand at developed country’s point that is unethical.

    For the developing country, it is the national condition, labour cannot require more, because if they don’t satisfied with the work environment, other thousands of workers are waiting for the opportunity. At last but not least, the equal treatment and discrimination is another popular topic for cross culture ethic. In Indonesia, the clothing factory has management style worked as terror. Some employees are beaten frequently by their manager. Another example from Mexican maquiladora factory, they require women to take pregnancy test, because of that condition will reduce their efficiency and they won’t hire them.

    For some more extreme example in El Szalvador, women work in manufacturing industries is forced to take birth control pills every day. Though the issues described above are human rights violations. However, in those countries, that had been widely accepted. Although the international business is growing extremely fast. Apart from the business, the host country and invest country still have their own ethic standard domestically. For the next, the description will prove business culture from different countries where the different ethic standard set by individual level. Most Chinese people are motivated by financial rewards (Hamzah, 1991).

    In order to achieve better life, Chinese people are hardworking, pragmatic, harmony. Due to the culture revolution from 1966 to 1976, the traditional value of Chinese people had been destroyed. Generation X and Generation Y are less concern on religious. The major religions in China were Buddhist, Taoist and Christian. The business ethic of Chinese people is mainly Confucianism. According to Ip (2003, 68) showed most manager in Chinese company are prefer to used Confucian value to develop organisational culture as Ren, Chi, Li and Yi, which refers to compassion, wisdom, norms and appropriateness.

    Cheung and Chan (2005, 47) found that many top manager in Hong Kong company displayed leadership approaches based on Confucian principle also, which emphasize harmony, learning and loyalty. Nowadays, Chinese people doing business less rely on contract, they prefer to choose individual informal agreement, and the deal can be made during feast time. In fact, the Confucian ideal of filial loyalty had been deep impact Chinese people’s life attitude. The power distance in China is essential large than other countries. May it is the reason that China nowadays suffers a lot corruption.

    Although doing business with other countries like America that followed by common standards. However, as the manufacturing plant is located in China. The labour pay normally followed native rules and employee has to keep working at the production line for 12 hours per day. It is not truly ethic issues, because if Chinese company don’t follow this, they will lose their comparative advantage, the home country will choose other developing country to doing business. As China stay at this stage, the ethic standard from Western country can’t be followed.

    The anglo cluster (including the US, Canada, Australia, and the UK) is very strong alliance. They formed group together and share culture heritage and their culture close to each other also on the same track. One of their common is these countries implement market economy. The ethical business cultures for the alliance are built by formal structure, policies, development program and consistent value-based ethical behaviour of top leadership. Personal moral development and authentic behaviour of leaders is perceived as an important factor in creating the ethical culture of an organization.

    Significant attention is paid to the development and enforcement of formal compliance programmes. (Ardichvili & Jondle 2009; Meyers 2004; Trevino & Nelson 2004). The business ethic standard in central Europe show significant difference. According to Mele (2008), cultural-historical differences among most countries of Europe are so significant and impossible to make generalizations about business ethics standard. Jackson (2001) classified that France and Germany are normally individualism. However, Vitell and

    Marta (2004) argued that central Europe less consider ethic standard for most and tend to emphasis on strengthening the overall legal framework. Based on Palazzo’s (2002) claim, the business ethic from German an Us are totally different. For example, German companies are less inclined to introduce formal ethic concept than American company. Secondly, German company manager are more focus on the current issues with flexibility. By compare, American company manager are tend to excessively care legal contract. The reason had been conclude by Palazzo et al. 2002) that the legalistic emphasis from American on business ethic is based on culturally belief. It is the same as the theory described by Trompenaars and Hampden Turner (1998), it called universalism, which refers to a strong belief makes the rules and law can apply to all. It is like particularistic that all the assumptions can be evaluated by the existed rules. In fact, ethical behavior can go further than legal behavior (Palazzo, 2002, 130). German culture make an antagonistic relationship between business and ethic, it also formed separate understanding of public and individual.

    As standing at different views they hold different opinions, the business ethic of German is generally more difficult to comprehend than other countries (Palazzo, 2002, 210). Based on the above description we can already figure that how the ethic system complex in global area. Here we will list the challenge for set an international ethical standards at the social aspect. The first challenge for building worldwide ethical standard is the climate change. It had been admitted that the overwhelming judgment of the scientific community that global warming had affect significantly for the earth (Gore, 2006; Stern, 2007).

    The major contributor is the fossil fuels and relevant industry. Even the sea levels are already rising dramatically (Klein, 2007). Even all the company knows reduce their carbon emissions will make the condition better. However, in order to earn more profit, those companies through FDI seeking more market space for manufacturing, they built factory in host country, after they pollute the environment, they turn to another cheap labor market. Although the CSR (cooperate social responsibility) had made them to tackling pollution. They had never stopped to enlarge their business at international stage.

    It is obvious some industries will benefit from these changes, on the other side, other industries may suffer. The green business company had proved some solutions. All and all, it is the biggest barrier and contradiction for setting global ethic standard. The second challenge is for make use of new energy. The relevant science indicates that we have passed the balance point in time for petroleum uses. It means first oil and other fossil fuel (coal and natural gas) deposits will be run down to near zero levels (Guardian, 2009). In practice, the alternative energy and technology had been developed since 1990s.

    Some countries are not willing to give their advantage for abundant resource, which make huge profit. The leader for the company need have long vision and encourage making long term strategic choices. With time going on, the increasing environment protection awareness will increase the petrol cost and also lead to limited supply. As we all know, petrol shows more power than solar energy, but as the request for sustainable development for the enterprise and earth, the entire industries need to get ready for energy shifted operation mode.

    The third challenge is increasing trade group socialist. Some union like BRIC, G-20, and G-80 had formed as group which shows closer trade relationship with each. Example like China and other emerging nations, under strong control of domestic economy, political stability, attenuated democracy and social harmony, China had been recognized as big threaten for Western countries. With different political system the consciousness gap is growing larger. In long run, the business is more tend to be happened between geography closed countries that have similar culture, which makes understandable.

    The last challenge for global ethical relates to the globalization. In order to keep peace with other developed country, some developing country forced the rural population leave their land that aim to large production crops for export. According to authority report, Urban poverty has been increasing in most countries subject to structural adjustment programs, most of which are deliberately anti-urban in nature’’ (United Nations, 2003). Some company or country had gain huge benefits from this new policy without taking on obligations for the millions of farmers who had displaced.

    It is the general trend for global standards built, but the subculture will constant existed. Unfortunately, unethical acts are all around the world, such as vast abuse, fraud and corruption. Rather than emphasizing on unethical behavior, the world need try to use ethic more positively. By setting policy with justice, freedom, loyalty and harmonious can truly protect the benefit for most people. The global ethic will be accepted in the coming future. Reference Ardichvili, A. , J. Mitchell, and D. Jondle. 2009. Characteristics of ethical business cultures. Bannock G.

    The economics and management of small business. An international perspective. – New York: Routledge, 2005. – 239 p. ISBN 0-415-33666-X Business ethics: from theory to practice. Edited by N. Vasiljeviene and R. Jeurissen. – Vilnius: Vilniaus universitetas, KHF, Verslo etikos centras, 2002. – 400 p. ISBN 9955-497-15-7 Cheung, C. , and C. Chan. 2005. Philosophical foundations of eminent Hong Kong Chinese CEOs’ leadership. Journal of Business Ethics 60: 47–62. Environment. Science and Engineering Ethics 10: 269–76. Gabler, D. 2006. Is your culture a risk factor?

    Business and Society Review 111, no. 3: 337–62. Gore, A (2006). An Inconvenient Truth. London: Bloomsbury Publishing. 30. Guardian: 2009, ‘Peak Oil Could Hit Soon, Report Says’, 08/10. Hamzah, S. : 1991, ‘Managing in a Multicultural Society – the Malaysian Experience’, Malaysian Management Review 26(1), 61–69. Ip, P-K. 2003. Business ethics and a state-owned enterprise in China. Business Ethics: A European Review 12, no. 1: 64–77. Jackson, T. 2001. Cultural values and management ethics: a 10-nation study. Human Relations 54: 1267–1302. Journal of Business Ethics 85: 445–51. Klein, N. 2007, Interviewed by Alfonso Cuaron. Magill, G. : 1992, ‘Theology in Business Ethics: Appealing to the Religious Imagination’, Journal of Business Ethics 11, 129–135. Marta, J. M. , A. Singhapakdi, A. Attia, and S. Vitell. 2004. Some important factors underlying ethical decisions of Middle-Eastern marketers. International Marketing Review 21, no. 1: 53–67. Mele, D. 2008. Business ethics: Europe versus America. In Leadership and Business Ethics, ed. G. Flynn, 13–27. Dodrecht: Springer. Meyers, C. 2004. Institutional culture and individual behaviour: creating an ethical Palazzo, B. 002. US-American and German business ethics: an intercultural comparison. Journal of Business Ethics 41, no. 3: 195–216. Pruskus V. Verslo etika: laiko issukiai ir atsako galimybes. – Vilnius: Enciklopedija, 2005. – 387 p. Seilius A. , Simanskiene L. Verslo organizaciju valdymas globalizacijos salygomis:teorinis poziuris// Verslas:teorija ir praktika, 2006, Vol. VII, No. 4. P. 213-221. Stern, N. : 2007, The Economics of Climate Change (Cambridge University Press, Cambridge). Thomas D. C. Cross-cultural management. – California, Thousand Oaks: Sage Publications, Inc. 2008. – 327 p. ISBN 978-1-4129-3956-0. Trevino, L. , and K. Nelson. 2004. Managing business ethics: straight talk about how to do it right. New York: Wiley. Trompenaars, F. , and C. Hampden-Turner, C. 1998. Riding the waves of culture: understanding diversity in global business. New York: McGraw Hill. United Nations Human Settlements Program: 2003, The Challenge of Slums (United Nations, London). Weaver, G. R. and B. R. Agle: 2002, ‘Religiosity and Ethical Behavior in Organisations: A Symbolic Interactionist Perspective’, Academy of Management Review 27(1), 77–98.

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