Cultural Differences and Ethical Standards
Understanding cultural differences while doing international business is a symbol of respect and facilitates effective communication that is essential for the success of a business. Understanding the culture in the foreign market could be critical in understanding how the people in the new market use words, hand gestures and other cues to express themselves. Other than helping in communication, understanding culture helps in fostering good relationships with stakeholders in the new market and this could be critical for the success of the business. Besides, understanding culture helps in making decisions (Weaver, 2001).
Should you pay the 10 percent commission? Justify your response.
In this particular scenario, it is the norm in the new market to pay a 10 percent commission before doing business. However, I should not pay the 10 percent commission as this is beyond culture. There is a thin line between culture and ethics and in this scenario, giving the commission is equal to giving a bribe and this is against my morals and beliefs. Whereas cultures differ between countries, ethical business practices remain the same across borders. Understanding the culture helps in decision making and in this case, it is necessary to consider ethics before giving in to the culture of the new market. Since I consider paying the 10 percent commission as bribery or corruption, I should not part with the money as this goes against my personal values as well as the common ethical business practices.
Does it make a difference if your competitors routinely pay such commissions?
Paying such commissions is a form of paying bribes, which is very common in many countries. Many companies pay these bribes and other payments that are meant to speed up the process of doing business. According to Nurettin, Semsettin and Mehmet (2014), even the most respected companies in the world have had questionable ethics because of paying bribes in form commissions and other small inducements. For instance, in 2008, Siemens was accused of using bribes in order to get secure large contracts in countries like Venezuela and Argentina. Therefore, it does not make a difference that my competitors routinely pay such commissions. Having even bigger companies routinely make such payments does not make the act acceptable and it still remains unethical. To stay on the right side of ethics, I would stay away from engaging in any form of corruption. Furthermore, paying the commission does not guarantee the success of the business in the foreign country.
Explain why this may or may not have an impact on your decision.
For a person or company that is guided by ethics, having my competitors routinely give in to the pressures of giving bribes should not impact my decision. Instead of focusing on what my competitors are doing, I should pay more attention to other cultural factors in the new market such as how people communicate, their values and attributes especially when it comes to doing business. These factors could be more critical for the success of my business than looking at what my competitors are doing (Nurettin, Semsettin & Mehmet, 2014).
Do you think there should be more or fewer attempt to regulate international ethics? Why?
I believe that there should be more attempts to regulate international ethics as ethical practices in business remain the same in all cultures. Paying bribes is unethical and also goes against fair business practices. Whereas global businesses are required to understand and adopt the culture of new markets, they should be guided by ethics. Other than paying taxes and permits, companies should not be required to part with any form of payment that meets the definition of bribery or corruption.