In a business organisation, investors should always get their moneys on time. The paper "Legal and Ethical Issues Affecting Multinational Corporations in East Asia" states that emergence of East Asia as a centre for international trade establishes the region as a centre of interest for multinational corporations and the organizations’ need to understand trends. As Wal-Mart faces unethical business practices, they have also been said to have encouraged goods produced outside the U.S. (www.pbs.org). an organisational culture could affect the behaviour of employees in an organisation. 1) Some Ethical Issues Confronting MNCs Child and/or Forced Labor Safety and Security Concerns Duration of Work Week 2. Wal-Mart needed to scrutinize their pay practices and double checking to see that every employee is paid for every single minute worked for. The model code envisioned four specified standards (derived from a set of standards developed in accounting) of behavior in four areas of values. A lot of things that could limit profit could be worked around if things like environmental standards, production costs, taxes, safety at the work place, production costs (Desjardins and McCall, 1990). As part of our 25th Birthday celebrations Ethical Consumer asked its readers to vote for who they thought was the least ethical company over the last 25 years.. Nestlé 'won' with 15% of the vote, finishing just above Monsanto (14%) and the UK's number one tax avoider Amazon (12%). Wal-Mart, a gigantic company retain a lot of customers, both home and away are widely known for their enormous variety of goods and services at low prices. Multinational corporations can use this same modality to insinuate corporate value systems into their workforce. Wal-Mart is being accused of paying their employees very low wages, with the average employee earning between $12,000 and $17,000 per year which is not a lot at all. Corruption scandals that sometimes make headline news in Western media can often be worse in developing countries. Some people think itâ s better to be unethical Other people donâ t know how to make sense of their ethical choices. Recognising the relationship between the economic, cultural and political aspects facing multinationals is, however a firm ground from which to identify the necessity for international codes for organisations carrying out international business. Global corporations must recognize the need for a uniform code of business ethics for protecting their citizens, their national interests, and the global environment. This is especially the case (as the previous link argues) when it is multinational companies going into poorer countries to do business. Utility indicates the quality of being useful and, philosophically, providing the greatest good for the greatest number (or the least harm for the greatest number) (Raiborn and Payne, 1990). . Procedurally, to be useful, an ethics code needs to meet certain minimal standards of construction. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! Multinational corporations (MNCs) have provoked considerable debate about the issues of "efficiency" and "social justice." These organisations must be aware of and must conform to the host country’s domestic laws. Multinational companies are sometimes faced with issues that tend to present challenge to them between balancing their interest in profit-making and expectations and interests … *You can also browse our support articles here >. According to the Times, the audit, “pointed to extensive violations, of child-labor laws and state regulations requiring time for breaks and meals,” including 1,371 instances of minors working too late, during school hours, or for too. these charges were denied by Wal-Mart denied. No business is protected or has a barrier to problems, the earlier these problems are detected, the better for the organisation. Do not automatically assume the worst behavior and insult the actors by addressing them only with a sense of “don’t do this; don’t do that.” Lastly, as indicated by Ferrell and Fraedrich (1994), the code should help the MNC achieve its objectives while benefitting the countries in which production facilities are located or products/services are sold. Wal-Mart intends to keep its prices low as it hopes to sell carbon dioxide credits for millions of dollars in a bid to save energy to companies other companies that can’t. the state or their spouses from their tax. So, men are holding more management positions than women. It should be: clear and understandable to the average person; comprehensive in indicating the extent of its provisions; and enforceable by specifying the ramifications of improper actions (Raiborn and Payne, 1990). Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. Every company has got problems and the companies that thrive are usually organisations that detect ethical problems early enough and create a solution for them. Getz suggests that control of the host is the basic right that must be recognized and respected by the MNC. 1-888-302-2840 1-888-422-8036 In: McDonald F., Tüselmann H., Wheeler C. (eds) International Business. Ethical Issues Associated with Multinational Corporations Navigating the boundaries between right and wrong can prove tricky for companies that operate in several nations and across cultures. In response to such concerns, MNCs have increasingly taken steps aimed at demonstrating their social responsibility as business organisations. See our Privacy Policy and User Agreement for details. It is corrupt for Wal-Mart to ban employees to talk to union representatives given that according to the National Labour Relations Act, employers should not be allowed to put off employees from creating a union for it is their right and should be enforced if need be. Not neglecting trade organisations such as United Nations as well as international agreement between companies. What is the duty of the multinational organisations in the countries businesses are located or situated? Ethical Issues Associated With Multinational Corporations and other kinds of academic papers in our essays database at Many Essays. The size of a multinational organisation and power could play a huge impact on the policy issues in a nation, such issues would be felt more by relationships with developing nations as supposed to developed nations. Globalization, Multinational Corporations, and Corruption. Lot of organizations implement the code of ethics in their company polices, which they implement during induction and regular training. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. Corporate codes of ethics can have reverse effects and mask anomalies or social evils in operations outsourced to low-wage countries. . OVERVIEW What is MNE? The paper explores the ethical issues which multinational companies are fronting when doing business abroad. Businesses should practice building an honest reputation to endeavourer that there is the constant smooth running in an organization. Getz (1990) came up with a list of Multinational organisations, how they were interrelated and their rights as well as their duties. Ethical Dilemmas for Multinational Enterprise: A Philosophical Overview Part One: Review Question #1 Multinational Corporations have always been and are currently now under harsh criticism. The increased presence of MNCs in the International Political Economy has led to the startling reality that companies can be political entities and their influence as political actors can be sizeable, both in positive and negative capacities. The theoretical standard of behavior reflects the highest potential for good, reflecting the spirit of morality. multinational companies (MNCs) might be pursuing profit at the expense of vulnerable workforces, the environment and so on. 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