Chapter 11Chapter ObjectivesIntroductionIntroduction (cont.)International Business Ethics and HRMEthical Relativism or Global Values?Universal Ethical PrinciplesSelf-regulation Initiatives: International Corporate Codes of ConductCaux Roundtable Principles for Business ConductCaux Roundtable Principles for Business Conduct (cont.)Enforcement of Codes of ConductGovernment Regulation:Is Bribery a Business Necessity?US Foreign Corrupt Practices ActGlobal Movement to Criminalize BriberyWorld Corruption IndexOCED Members’ Tax Treatment of BribesThe Role of HR in Operationalizing Corporate Ethics ProgramsThe Role of HR in Operationalizing Corporate Ethics Programs (cont)The Role of HR in Operationalizing Corporate Ethics Programs (cont.)Slide 21Slide 22Mode of Operation and HRMOwnership IssuesFamily-owned FirmsNon-Government OrganizationsResearch IssuesTheoretical DevelopmentsSlide 29Chapter Summary and Concluding RemarksChapter Summary (cont.)Slide 32IBUS 618, Dr. Yang 1Chapter 11IHRM Trends and Future ChallengesIBUS 618, Dr. Yang 2Chapter ObjectivesInternational business ethics and HRM.Mode of operation and IHRM.Ownership issues relating to IHRM requirements of organizations other than large multinationals, such as: Small and medium-sized firms (SMEs)Family-owned firmsNon-government organizations (NGOs).Theoretical developments and research issues in IHRM.International business ethics and HRM.Mode of operation and IHRM.Ownership issues relating to IHRM requirements of organizations other than large multinationals, such as: Small and medium-sized firms (SMEs)Family-owned firmsNon-government organizations (NGOs).Theoretical developments and research issues in IHRM.In this final chapter, we identify and comment on observed trends and future directions regarding:IBUS 618, Dr. Yang 3IntroductionIn this course, we have explored the IHRM issues in a multinational context. To that end, we have focused on several aspects:The implications that the process of internationalization has for the HR activities and policies. Developing global leaders: who to place in charge of foreign operations and units to cater for the managerial and technical demands of international business growth. Host-country issues relating to standardization versus adaptation of work practices and their implications for HRM.(cont.)IBUS 618, Dr. Yang 4Introduction (cont.)We tried to counter the imbalance towards expatriate issues, while recognizing the continued need to manage effectively international assignments, owing to the important strategic roles of expatriates and non-expatriates in sustaining international operations. We identified the managerial responses to the changing global work environment, particularly developing the required global mindset to accompany global operations, the use of informal control mechanisms, horizontal communication, cross-border teams and international assignments. We now turn our attention to trends and developments that present future challenges to IHRM.IBUS 618, Dr. Yang 5International Business Ethics and HRMWhen business is conducted across borders, the ethics program takes on added layers of complexity.Especially problematic when multinationals operate in host countries that have:Different standards of business practiceEconomically impoverishedInadequate legal infrastructureGovernments are corrupt, and Human rights are habitually violatedThe question arises not only in the context of different home- and host-country employment practices but also in the central operations and policies of multinationals.IBUS 618, Dr. Yang 6Ethical Relativism or Global Values?Three main responses to the question:The ethical relativism believes that there are no universal or international rights and wrongs, it all depends on a particular culture’s values and beliefs - when in Rome, do as the Romans do.The ethical absolutism believes that when in Rome, one should do what one would do at home, regardless of what the Romans do. This view of ethics gives primacy to one’s own cultural values.In contrast, the ethical universalism believes that there are fundamental principles of right and wrong which transcend cultural boundaries and multinationals must adhere to these fundamental principles or global values.IBUS 618, Dr. Yang 7Universal Ethical PrinciplesUniversal ethical principles can be seen in the agreements among nations who are signatories to: The United Nations Declaration of Human Rights The OECD Guidelines for Multinational Enterprises (adopted by the Organization of Economic Cooperation and Development) The Caux Roundtable Principles of BusinessThey indicate the emergence of a trans-cultural corporate ethic and provide guidelines that have direct applicability to a number of the central operations and policies of multinationals including the HRM activities of staffing, compensation, employee training and occupational health and safety.However, there are a wide range of situations where variations in business practice are permissible.IBUS 618, Dr. Yang 8Self-regulation Initiatives: International Corporate Codes of ConductThe need for international accords and corporate codes of conduct has grown commensurately with the spread of international business. Translating ethical principles and values into practice in the international business domain, even allowing for some consensus within the international community, is an enormous task in the absence of a supranational legislative authority. A number of mechanisms to facilitate the incorporation of ethical values into international business behavior have been suggested.IBUS 618, Dr. Yang 9Caux Roundtable Principles for Business ConductThe first international ethics code for business Developed in 1994 by Japanese, European and North American business leaders meeting in Caux, SwitzerlandAimed to set a global benchmark against which individual firms could write their own codes and measure the behavior of their executives. The Caux Principles are grounded in two basic ethical ideals: kyosei and human dignity.IBUS 618, Dr. Yang 10Caux Roundtable Principles for Business Conduct (cont.)The Japanese concept of kyosei means living and working together for the common good – enabling cooperation and mutual prosperity to co-exist with healthy and fair competition. Human dignity relates to the sacredness or value of