Comparative Business
Ethics
Bus 430: Cross Cultural Management
Professor: Rajiv Kozhikode
Presented by:
Herlinna Chung
Xindi Li
Lina Liu
Katrina Cheney
Agenda
Introduction
1st Article Summary + Reflection
2nd Article Summary + Reflection
Conclusion
Industry Application/Debate
References
Introduction

Ethics: Controvertial issue


people in different positions or countries
perceive ethics in different ways
Additional articles:


how a corporation can do business in an
ethical way
how the Hofstede cultural dimensions can
affect ethical decision-making in business
Overview of Article #1

“Ethics and Entrepreneurs: An International Comparative Study”

Findings:

Russia
Slovenia
United States

Conclusion: In the long-term, all countries should be able to
influence the ethical nature of business behavior by developing
formal and informal institutions that are conductive to high ethical
standards

Limitations: how should each company in the different countries
set up institutions, programs, or departments specifically for the
purpose of increasing business ethical behavior commitment and
what are the benefits?
Reflection of Article #1

Baking Ethics into Company Culture written by Christopher
Bauer

Looks at culture influences on corporate
level

Misconceptions of Business Ethics



Strategies on building ethical working environment



Rules of Conduct Vs Ethics Codes
Compliance Programs VS Ethics Programs
Employee involvement
Rewards
Why should companies invest in building an ethical business
culture?

Returns
Overview of Article #2

U.S.A.

Ethics = Law

Ethics = Morality
vs.
Hong Kong
Ethics = Law
Ethics = Dignity
Overview of Article #2

Americans view self-promotion and image
management as more ethical

Hong Kong Chinese view blackmail and
other illegal tactics as more ethical than
do Americans

Why?
Overview of Article #2

Americans more individualistic – the self is
the basic unit of moral concern
 Think more for and of themselves
 More aggressive and more likely to
“show off”

HK Chinese more collectivistic – the group
is the basic unit of moral concern
 Individual value based on how he can
serve the group
 More willing to have things like ethical
codes dictated by law
Reflection of Article #2

The Effects of Culture on Ethical Decision-making: An
Application of Hofstede's Typology

Influence of Hofstede's cultural dimensions on business
ethics decision making

A high individualism society: Business people are more likely
to behave unethically for personal gain

A high power distance culture: Superiors have more influence
on ethical decision making
Reflection of Article #2

Low uncertainty avoidance culture: More acceptive to
unethical behaviour which is different from organization
norms.
Reflection of Article #2

A high masculinity society contributes to one’s involvement in
unethical behaviour as it advocates men being ambitious,
competitive and pursuing material gain.
Application: Hotel Industry
A very wealthy man arrived for a two-week stay in a luxury hotel in New
York City. With him was his entourage of nine people who would be
occupying seven other rooms. Upon his arrival, he requested that he did
not want to be served by any African-Americans.
He explained that the wait staffs, housekeepers, bartenders and any other
service personnel who would have direct contact with him could not be
black or African-American.
The manager was shocked and stymied. He had been looking forward to
the man’s visit as well, the man had promised a lucrative pay. Yet the
customer was insisting on a racial discrimination practice.
Debate

What should the manager do?

What if our neighbor hotels accepted their
request? Are we
advantaged/disadvantaged?

How would he feel about granting/not
granting this request?

Could he face his employees the next
morning?
Most Common Ethical Issues in the Hotel Industry




Employee thefts
Use of recreational
drugs
Guest abuses
Racial conflicts



Asymmetric price
competition
Personal Relationships
Disclosure of
confidential
information
Conclusions
1.Differences in ethical attitudes happen at
different scales and in different positions
2.Employees of all levels should participate in
and contribute to ethics programs
3.Managers in MNCs can consider different
perceptions of ethics when training people
from diverse cultures
4.Hofstede’s cultural dimensions can have an
effect on ethical decision making
References

Bauer, C. (2009). Baking ethics into company culture. Financial Executive, 25(4), 1821.

Bucar, B., Glas, M., & Hisrich, R. D. 2003. Ethics and entrepreneurs: An international
comparative study. Journal of Business Venturing, 18: 261-281.

The Hofstede center: Hong Kong. [Web Graphic]. Retrieved from http://geerthofstede.com/hong-kong.html

The Hofstede center: Japan. [Web Graphic]. Retrieved from http://geerthofstede.com/hong-kong.html

Marriott. (1996, March 07). Business Values: Ethical and Legal Standards. Retreived
from http://www.marriott.com/default.mi

Ralston, D. A., Giacalone, R. A, & Terpstra, R. H. 1994. Ethical perceptions of
organizational politics: A comparative evaluation of American and Hong Kong
Managers. Journal of Business Ethics, 13: 989-999.

Vitell, S. J. (1993). The effects of culture on ethical decision-making: An application of
Hofstede's typology. Journal of Business Ethics, 12(10), 753-760.