Cultural differences can often blur the business mix

THE rise of globalisation has resulted in diverse cultures becoming increasingly intertwined in business.

But, with globalisation, many business leaders are being confronted with the dilemma of how to apply their business ethics to foreign countries and companies.

A recent survey of the managing directors of WA import/export firms found ethical dilemmas were common in dealings with international markets. Managers listed bribery, corruption, racism and cultural differences as problems.

Bribery and corruption were the most problematic dilemmas faced by those surveyed. The managers said they were uncomfortable with the practice and one commented that, although his company was interested in dealing with a certain country, it could not accept paying the necessary tips, bribes and kickbacks.

Not all managers took the moral high ground. In some instances agents appointed by WA firms performed unethical acts on their behalf. This lack of direct involvement was seen to diminish the manager’s responsibility and therefore they thought it to be more acceptable.

Theft was another problem. Many reported feelings of frustration, anger and distrust after learning staff in foreign countries were stealing equipment or consignments.

Business managers said they were often told lies to cover up the disappearance of goods.

While racism was not overt, respondents told of a climate of mistrust between different cultures.

Perhaps the most telling problem for companies operating in foreign environments is the clashing of corporate culture. WA managers were often confronted with business practices that went against company policy. Those who continued to follow their ethics policy complained they were missing out on clients and trade.

Some managers said this cultural clash resulted in denying their clients or themselves business opportunities because of the imposition of their Australian values and beliefs. One manager had been offered the contract to relocate and expand a client’s tobacco factory, but his company had a firm no smoking policy.

The good news from the survey is that WA business managers place ethics high on their agenda.

Those who refused to take unethical actions reported feeling happier afterwards. However, many reported feeling appalled by what they encountered.

Those who had no choice but to comply with unethical practices said they felt angry, unhappy and often negative about future dealings with the region.

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