Have you been told that Business Ethics is a keystone for a trustworthy corporate responsibility? Probably have you also listen that must be on the same basis for all the companies worldwide. Well, this is a slippery road that will drive into serious management and negotiation problems in multinational corporations; and the reason is simple: the perception of what is ethical and what does not change across different cultures.
But allow me to develop the meaning of business ethics further, and you will understand why generalization must be avoided. Let's start by understanding ethics; if you look at the Greek root concept 'ethos,' which means character, Aristotle defines it as the individual's personality and its balance between good or bad, right or wrong. But who judges it? Indeed, it is not at the individual level. Let's hypothetically think that you have the power to extrapolate yourself to a far distant island where you are the only inhabitant, and you and yourself define the rules; who can contest you if you are a fair ruler or not? Nobody, you are alone! "Be ethical" can only be measured if you are in a group or belong to a society that can weigh and judge your actions. Cambridge dictionary defines ethos as the set of beliefs, ideas, actions, about the social behaviour and relationships of a person or a group.
If ethos, or be ethical, means I shall conduct myself accordingly to what the society I live in told me is the correct way to behave; consequently, the rules settled down already, and I need to follow them. The concept is more profound and involves other aspects of human life; still, thoroughly, you can follow me to what business ethics means: a set of rules and standards to mind when you are in a business environment, and guess what? This set was defined already by the organization you work for or the business environment where you exercise your professional activity.
Let's put an example to clarify what concerns us in this article. If a company establishes standards, such as not receiving gifts from suppliers, nor giving them to customers, to not generate bias, applying the same rule to all suppliers and customers worldwide may cause some relationship troubles. For some cultures, receiving or giving gifts in business environments is expected. For some cultures, this action means there is a genuine interest in building relationships. Different societies handle different concepts for what is ethically correct and what it is not, referring to gifts; in Anglo- Saxon cultures, for instance, countries like the US, UK, Australia, it is not expected to offer/receive gifts, the business relationship is quite transparent and straightforward: you have something interest, the price match, your company shows a good reputation, let's close the deal. In other cultures, like Asians, Arabs, and some parts of Latin America, gifts are expected because the business relationship is based on personal trust and care, not only in companies' achievements. For a Pakistani business person, probably after been expend several months building the relationship, at some point, the gift exchange will be expected and will be continuous.
Giving path to a more controversial subject, we all agree that corruption is wrong, is not desirable at any level, and it breaks company/people reputation generating millions in lost. But we cannot be naive to deny that in some cultures, corruption at different levels is expected, and rejecting it will make your deal or investment not advance further. For bad this reading makes you feel, it is a reality.
Let's parallel to a more typical action that all businessmen often face: 'tipping.' Have you ever thought that you are promoting a kind of corruption when you give a tip in a restaurant, hotel, or another service? If you feel this action looks like an altruistic act to recognize the good service you have received, you should not do it because the employee is getting paid to serve you in the best way possible. Giving a tip makes you buy the favor to receive better attention against others, and as high is the tip value, the better the service you are buying. Countries accept the tip as normal behavior in different levels; for instance, in the US, the tip is highly expected; in Brazil, it comes in the bill, you can pay it with a credit/debit card; in China, it is not expected at all. Please, do not take me wrong; you can tip if you wish, and it makes you feel good; it is proper to comment that the tip is the only income that some individuals will get in some developing countries.
However, my intention here is to point out that you will face corrupt behavior at some point in your business life, some more obvious than others, depending on the country/region you will go to do business. This behavior should not take you by surprise; contrary, you need to be prepared to face this naturally and try to understand the environment you are approaching. Like the example of the tips, for some countries, bribes, for instance, are expected; in others, it will come with the bill, and in others, it will not be expected at all.
Preparing yourself to face unpleasant situations will demand your full attention and preparation, especially if it goes against your business ethics policies. Here are some suggestions to help you identify the risks ahead and contour them. When you are developing customers, suppliers, business partners, the first step is to study the country/region you will prospect. Essential points to analyze are the economic performance, political system, and the recently developed SPI (Social Progress Index), which gives you an overview of how the society (in general) lives. Then, you shall go deep into the cultural distances; an excellent tool for it is the 6D model of National Culture developed by Prof. Geert Hofstede, which will give you some insights into the social behavior of the country you are analyzing.
Help yourself with some country reports available in several organizations; I suggest the 'Cube In' project sponsored by the European Commission. Finally, you need to know which points your business ethics policies are flexible and which ones are not. Remember, different cultures perceive ethical policies differently because, in culture, there is no right or wrong; there is just a different perception of the same reality. You shall need to find how comfortable you are to cede to meet your business partner halfway. What is your opinion? Have you faced some different behavior in other countries against your business ethics standards?