Business Ethics & Globalization – Condensed Notes

Ethical Frameworks in Globalization

• Ethical Absolutism: actions judged by universal, unchanging standards; context irrelevant.
• Ethical Relativism: morality depends on societal norms & context; right/wrong vary by culture.
• Critiques of Relativism: existence of cross-cultural norms, logical inconsistencies, risk of excusing wrongdoing; mutual respect ≠ moral free-pass.

Common Ethical Dilemmas in International Business

• Child Labor
  • Illegal in many nations yet legal/unchecked elsewhere.
  • ILO: 25\% of children aged 10–14 in parts of Asia & W. Europe work; boys 11.2\% vs girls 7.8\% (global, 5–17 yrs).
  • Often unpaid/bonded; harsh, unsafe conditions ➜ ethical violation.
• Sweatshops
  • Characterised by dangerous, unhealthy environments, long hours, minimal pay.
  • Used by many global brands to cut costs.
• Overseas Outsourcing
  • Cost-driven relocation within a country viewed as acceptable by some; cross-border moves often deemed unethical (job loss, tax base erosion).
  • Raises question: home vs host country standards.
• Migrant & Illegal Workers
  • UN (1990): migrant = person working in a state where they’re non-national.
  • Businesses lower costs via exploitable labour; ethics questioned against UN right to work.

The Right to Work (UN Declaration)

• Negative/Liberty Right: freedom from interference in pursuing work.
• Positive Right: societal duty to provide opportunity.
• Individual Right: personal development through productive labour.
• Social Right: society obligated to ensure employment for all who seek it.

Global Ethical Issues & Resource Allocation

• Moral scope: duties extend beyond borders; businesses mediate rich–poor economies.
• Famine & Malnutrition
  • 17\% of global food wasted (UN Food Waste Index 2021). Ethical concern over surplus & disposal.
• Poverty & World Resources
  • Resource categories: natural; developed natural; manufactured; social/knowledge.
  • Ownership theories:
  1. Status Quo – current division stands; no external claims.
  2. Universal Ownership – resources belong to everyone; existing division unjust.
  3. Right to Universal Access – development needs trump territorial claims; equal access demanded.
  • Case: Madagascar’s rosy periwinkle ➜ pharma profit, no local return → status quo stance.

Global Common Goods

• Non-excludable resources (e.g., ozone layer) demand shared guardianship.
• Responsibility lies with all beneficiaries—states, firms, individuals.

Oil & Depletion of Natural Resources

• Finite, critical to modern life; rapid use raises inter-generational equity issues.
• Ethical questions for owners: produce/sell or withhold? price setting? moral duty to future generations.
• OPEC: seeks stable supply, fair producer income; sudden supply halt deemed morally harmful.
• Clean energy transition vital to balance present vs future needs.

Key Takeaways

• Global operations expose firms to conflicting legal & ethical norms.
• Absolutism vs relativism shapes judgement of practices like child labour & outsourcing.
• UN-affirmed right to work imposes duties on societies & businesses.
• Fair allocation of resources and stewardship of global commons (ozone, oil) require cross-border ethical considerations.
• Businesses must evaluate decisions through both home and host country lenses while considering long-term global welfare.