International Journal of Business from Bharatiya Vidya Bhavan's

M. P. Birla Institute of Management, Bengaluru

Vol.10, #2 (2016) pp 03-09 ISSN 0974-0082

Challenges in Global ethics

N. Ramanuja*

We believe, the global ethics emanates from the Chanakya in the chapter 7 of Chanakya Niti says so of
Individual to the family, the society, community, country profits in business:
and the world. All the transactional events like business One must be satisfied with whatever he has as
are a part of the Samyak or total concept of global wife, wealth, and income. Still, one must never
ethics. There is a beautiful sloka on human interaction get satisfied with the knowledge and acts of
in Mahābhārata’s Shānti-Parva 167:9 where Vidura charity.
tells Yudhisthira:
Earlier, businessmen feared that any ethical conduct or
adopting of moral philosophies would lead to sacrifice
of efficiency and productivity; and the competitiveness
in the market place would fade away. Lately, this
By self-control and by making dharma (right conduct) misconception about the business ethics has changed,
your main focus, treat others as you treat yourself. as businesses believe that being ethical and moral
This thought is reflected again in Bible Luke 6:31 “Do would provide loyal customers and greater acceptance
for other people everything you want them to do in the society. Today, more and more businesses
for you. Treat others the same way you want them are accepting ‘business ethics’ as a part of business
to treat you”. conduct.
The Need Cast doubt on many things that we believed or knew
In my opinion this maxim ‘Do not do unto others what until now. We have read that eminent philosophers
you do not want others to do unto you’ forms the basis like Milton Friedman were of the view that the aim
for emergence of ethics. According to Prof. Richard T De of the business is to earn profits by utilizing
George, University Distinguished Professor of Philosophy the resources and engaging in open and free
at the University of Kansas, “the focus of ethics competition, without deception or fraud. But does
discussion has moved from theological and religious this happen?
matters to ecological issues, social problems and more This process generates uncertainty, imbalances and
recently social responsibility and business ethics”. conflicts both socially (by confronting sectors which
* Chairman, Bharatiya Vidya Bhavan, Bangalore Kendra. This is a modified version of the key note address by the author in symposium on
Business Ethics on March 6, 2016.

Vol:10, #2 (June-December 2016) 03

adopt different attitudes and views regarding change) • Exploitation of workers
and personally. And this worry has been exacerbated by • Outsourced from countries which have no strong
the economic and financial crisis which, among other labour laws and also indulge in unhealthy labour
global problems, has revealed ethical deficiencies in practices including child labour
the actions of many institutions, and has again placed • Exploitation of Tax Loopholes
values at the forefront of people’s demands, as a • Indulging in unethical financial processes
guide for dealing with uncertainty and as a factor of
• Dumping toxins
stability in facing up to the crises and conflict. There
is a need shared values and ethics; they are vital for • Unnecessary medical procedures.
the proper functioning of the economic, political and In view of this, defining global ethics does become a
social network and, therefore, for the well-being and challenge as this aspect has to be dealt considering
development of the potential of every world citizen. various aspects like:
Challenges of ethics in a Globalised World 1. Technological imbalances
The advancement of technology dissolved international Scientific and technological progress is probably
boundaries and opened the cultures to a whole the phenomenon that is most decisively shaping our
new arena, enabling globalization of businesses. age. But together with the enormous opportunities
Globalization, ushered in during the decade of 1990s,is of this scientific and technological revolution that
an empowering entity. It interconnects the world, we are experiencing, a large number of new and
supports economic development, provides information difficult ethical questions is emerging. Here we
availability and has been a catalyst in emergence of a have remember Elvin Stakman’s famous maxim:
‘Global Village’ or ‘Vasudhaiva Kutumbakam’ spelt “Science cannot wait until ethics catches up with
out by our ancient sages. it, and nobody should expect scientists to think of
everything for everybody.” This however is not totally
Globalization, brought valid. We need a more constructive approach, along
in new ideas about the the lines of that of Heinz Pagels: “Science cannot
business and also ethics resolve moral conflicts but it can help to better
with the widening of the formulate the debates on conflicts.”
consumers and the supply
chain. But globalisation, Technology has contributed to the rise in inequality,
brings forth a multiplicity but there are also some significant ways in which
of new queries for the technology could reduce this inequality. But the
management, for which it adaptation to the computer technology which India
witnessed in the decade of 1990s and 2000s and
had to provide an ethical response. Although businesses
later has proved that it is possible to cope up with
increasingly are becoming global, businessmen began
proper foresight in adapting newer technologies
to realise that it was certainly not more uniform across
and keeping in pace the technology paradigms
the markets.
by incorporating appropriate technology in the
Global ethics as a foundation for businesses in education system. But the ethical paradox is – are
their world-wide operations began to emerge. new technologies making local industries obsolete
However, the case “how to transact ethically?” is and people lose out on jobs?
not as clear, as it is desired, when various cultures
2. Cultural differentiations existing in different
and different levels of economic development of
countries
countries are being experienced with.
Due to the unprecedented access to cultures, a much
Globalisation as we see has brought in many ethical wider audience than ever before has a gateway
issues like to see, hear and experience phenomena that

04 Dharana - International Journal of Business from M. P. Birla Institute of Management, Bengaluru

 were never accessible earlier. Misrepresentation, relates his experience in the distant mountain of
stereotyping and the risk of loss of cultural and Nepal to the short and long-term goals of American
intellectual property rights are the consequences of business. Here the trekkers were left with
unmonitored access. unexpected ethical dilemma left them questioning
their values--and the values of business, which
There are a number of negative impacts globalization
often places goal achievement ahead of other
has had on cultural diversity, including the influence
considerations such issues on poverty.
multinational corporations have on promoting a
consumer culture, exploitation of workers and markets Prof. Peter Albert David Singer, an Australian moral
and influencing societal values. This increased philosopher and Professor of Bioethics at Princeton
availability of commercial media and products can University, and the University of Melbourne,
"drown out" local cultural influences. It is also that presents a brilliant survey of the ethical problems
e-learning technologies perpetuates colonization by of globalization and focuses on ethical issues
designing curriculum that is based on the dominant concerning the reduction of extreme poverty. He
culture. Not having access to technologies that are examines the reasons why developed countries and
present in the classroom, combined with an education their people should contribute more for this purpose
system geared toward the dominant society can be a and argues that the elimination of poverty is a
lethal combination for non-dominant cultures. The common benefit in which ethical requirements and
present education, legal and power structures reflect the interests of the people of the developed countries
western ideas and philosophies. converge. But in reality is this happening? We are
seeing ideas of environmental pollution which would
Loss of individualism and group identity occur hinder progress in the developing countries being
when globalization encourages a 'Western ideal of thrust on them by the developed world. We see a
individualism'. We have seen many instances of the very clear divide between the developed and
negative influences on culture in our country also. developing countries. As we notice, this calls
But, this also has a positive side. Technology for proper policies to be put in place poverty
provides a medium where depiction of images and alleviation initiatives, keeping pace with the
thoughts can provide the means in which truism can technical paradigms.
be established. Global media centres allow cultures
a distinctive voice to promote awareness and provide
public knowledge and understanding of their stories
and identities. It also allows for the communication
on issues that are important in preserving the
culture and knowledge acquisition of cultural ways
- allowing them to retain their diversity.Technology
can be used to preserve language, customs and
culture. Technology allows for self-representation
and preservation of personal and collective identity
by providing autonomy and empowerment
3. Socio-economic considerations - Source: Milanovich D, Economist,
Ethics to assist the community World Bank Research Department
Here I am reminded of the famous ‘Parable of If it is in our power to prevent something any
the Sadhu’ which received the Harvard Business adverse happening, without sacrificing anything of
Review’s Ethics Prize in 1983. Mr. Bowen McCoy, comparable moral significance, we ought to do it.
Managing Director of the Morgan Stanley Company, This action seems non-controversial.

Vol:10, #2 (June-December 2016) 05

4. Education standards There is also a positive side to this. We have seen
Migration plays a very important role in the global many American/European universities coming to
society. Due to increasing poverty in the developing India to establish collaborative institutions.
countries and lack of opportunities, the migration of 5. Religious beliefs
educated people to developed countries has seen an Indian sages during the time of Rigveda recognised
increase. There are various opportunities provided the plurality in thought globally and came out with
by the developed countries, which at times tend to the concept of
be dangerous as well. Aa No Bhadrah Kratavo Yantu Vishvatah
Let knowledge come to us from all sides and
The Truth is one, the
learned perceive differently’. Globalization has now
brought in a culture of pluralism, meaning religions
“with overlapping but distinctive ethics and interests”
interact with one another. Essentially, most of the
world’s leading religious traditions—teach values
such as human dignity, equality, freedom, peace, and
solidarity. Therefore, through such religious values,
globalization engenders greater religious tolerance
in such areas as politics, economics, and society.
Comparison of Migration of Indian Temporary Today, secularism and multiculturalism are
Workers and Students in USA, Australia & Canada converging. Putting somewhat less enigmatically,
Source: Immigration reports of respective the issues about the proper regime are becoming
countries and more and more interwoven with issues about
the proper ways to deal with the growing diversity
of these societies. The main point of a secularist
regime is to manage the religious and metaphysical
philosophical diversity of views fairly and
democratically. This is a tough issue in developing
countries where religion plays a very important role
in the societal thinking. Despite these advantages,
the resistance to the new paradigms in developing
countries pose challenges, especially where religion
has an overpowering influence on the society.
There is also a fear that globalisation undermines
the concept of nationalism, with dominant migrant
Source: U S Census Bureau, Population Division population.
2000 to 2013 Single Year American Community 6. Business considerations –Strategic Planning
While education standards have gone up in the Business is primarily a form of social cooperation—
developing countries, to fill the gaps in the developed it is about people from various societies working
world, the expenditure on providing higher education together to create value that no one of us could create
means higher allocation of funds in the developing on our own. It is about creating chairs that allow the
country. Governments of developing countries need body to rest, vehicles and networks that enable us
to take up this as a challenge and come out with to travel and communicate over great distances,
strategies like Make in India to retain talent. a range of products and services as broad as the

06 Dharana - International Journal of Business from M. P. Birla Institute of Management, Bengaluru

 human imagination. Keeping sustainability in mind, the career path and through what means. Whether fast
the Companies need to limit its strategic initiatives growth path or slow but fairly consistent and acceptable
to those meeting needs of consumers without growth path - the choice is left to them.
depleting resources needed by future generations.
Scams and Crises
The view that “the business of business is business,
not ethics” is no longer acceptable. The companies In an age of corporate scams, swindles and general
need to change to a culture that places profits and malpractices – from the Enron, Lehman Brothers’ case
good performance ahead of ethical behaviour. It to that of the Reebok franchise in India which has
is ethically dangerous for company personnel to been charged with a multi-crore misappropriation of
assume that local ethical standards are an adequate goods and funds – ethical business practices might at
guide to ethical behaviour globally. first sound like an oxymoron, a contradiction in terms.
Across the world there is growing scepticism about big
Right or wrong? business – particularly trans-national big business –
In the guidelines for businesses decision-makers, but and the way it operates, supposedly with the bottom
there are still many “grey areas” not covered by laws line of profit being it’s only moral lodestar and its sole
and regulations. Some organizations develop ethical ethical imperative. Scams and crises are not new. In
guidelines for their members. Here ethics involve the Sanskrit there is a saying “VYAPARAM DROHA
standards about what is “right” and “wrong”. However, CHINTANAM” means Business is all about Cheating?
in a global setting it is not as easy, as it seems, to Even our ancestors were of the aware that the
decide what is right and what is wrong. Actually, it is businesses could also be means of unethical conduct
the social responsibility of a firm in the target market, and its only purport is to make profit and oneself rich!
which comes into debate in this context. In the recent times, the business arena, generally had
a more positive view of commerce. But two waves of
Present Ethical Education
scandals—Enron in 2001 and the global financial crisis
Business ethics being taught in Universities provides in 2008, followed by many scams around the world—
perspectives to students, in the sense, how ethical have decimated such a trust universally. As a result,
practices would help in creating and running businesses globally, people are more ambivalent about business
without resorting to fudging of accounts, balance than they were in the 1990s, and many students
sheet or numbers. Case studies of the firms which run entering business school today are eager to revive the
their businesses ethically, the struggles that they go focus on virtue. An interesting feature is that a survey
through to get Government approvals, delays caused in by the Aspen Institute showed an increase between
approvals for not paying bribes etc., would provide the 2002 and 2007 in MBA students’ desires to have their
students a deeper insight into how to navigate through careers make a contribution to society. The survey also
the pitfalls and how to run a business in a sustainable found a decline in the belief that a company's primary
and socially responsible manner. On the other hand, responsibility is to maximize shareholder value.
case studies of business houses which resorted to
unethical practices would provide them a picture of There are three main reasons why ethics has to play a
how such firms climbed to unbelievable heights within key role in business:
a short period and a steep decline, as soon as the • It is crucial that ethics have a considerable influence
outcomes of unethical practices get exposed. Once this if we want an efficient, smoothly operating economy.
exposure is given to the students, it is ultimately left Ethics helps the market to its best.
to the students to follow ethical or unethical practices. • The government and the legal system cannot resolve
Swaying from ethical to unethical or partially ethical certain key problems of business and protect the
or partially unethical is a result of not only dedicated society while ethics can. Ethics can only resolve
ethics class/ or embedded ethics teaching, but also by futuristic issues. That company’s social responsibility
comparing their peers or seniors, how they are climbing should extend beyond what the regulations require.

Vol:10, #2 (June-December 2016) 07

• Ethical activity is value in itself, for its own sake, lens is sufficient.” This approach depends upon healthy
because it enhances the quality of lives and the work collaboration among faculty trained in a variety of
we do. disciplines: law, ethics, marketing, organizational
behavior, economics, strategy, and general
The issue of teaching ethics is an old one. Almost
management.
2500 years ago, the philosopher Socrates debated the
question with his fellow Athenians and his position The real journey begins when we actively engage, as
was clear: Ethics consists of knowing what we live issues, the concepts of various markets, economic
ought to do, and such knowledge can be taught. models, human nature and environment, that are
Most psychologists today would agree with Socrates. foundational to prevailing beliefs about business. And
Studies indicate that a person's behaviour is influenced for those who teach business ethics, it begins when
by his or her moral perception and moral judgments. we stop fighting for legitimacy and start conducting
It is in the light this that the Corporate Boards need business in positive ways,that our knowledge
to spend more time on the reporting of non-financial empowers us to do.
issues such a strategic performance drivers, value
I would like to conclude with this mantra of Isavasya
to customer, quality improvement rates, stakeholder
Upanishad which highlights the need for ushering in
concerns, corporate culture measurement and
ethics and sustainability on this planet.
environmental issues.
Ethical Leadership
Leaders who lead ethically are role models,
communicating the importance of ethical standards, This entire universe is pervaded by God, for the reason that it
holding their employees accountable to those standards, is dependent upon primordial nature, which in its turn is also
pervaded by Him. Enjoy whatever is given to you by Him, and
and -- crucially -- designing environments in which
do not seek wealth from any other source.
others work and live. Moral leadership in a company
is of critical importance, especially in this century References:
society where government regulations, the public and 1. THE GLOBALIZATION AND GLOBAL ETHICS: THE CASE
consumer watch groups demand it and widespread OF LESS DEVELOPED COUNTRIES Dr. ÖZNUR YÜKSEL
media reacts to a company that fails to deliver on Professor, Dean and GUVEN MURAT Associate Professor
it. Small businesses must pay special attention to Dr., Vice Dean Zonguldak Karaelmas University, Faculty
maintaining moral expectations of communities they of Caycuma Economics and Administrative Sciences,
serve, making moral leadership and guidance key. Zonguldak, Turkey.
2. https://www.bbvaopenmind.com/wp-content/
In my experience as CEO of a large public sector with
uploads/2013/02/Ethics-in-Business-and-Finance_
global operations I have seen that ethical leadership the-Great-Post-Crisis-Challenge_Francisco-
can cause a host of positive outcomes, and to reduce Gonz%C3%A1lez.pdf
the risk of many negative outcomes. Leadership is
indeed the most important lever in an ethical system 3. http://docslide.us/documents/be-and-csr.html
designed to support ethical conduct. 4. http://www.colorado.edu/studentgroups/libertarians/
issues/friedman-soc-resp-business.html; The Social
Conclusion Responsibility of Business is to Increase its Profits; by
According to Professor Thomas Piper, one of the Milton Friedman.
architects of the business ethics program at Harvard, 5. https://en.wikipedia.org/wiki/Digital_divide
“Our emphasis is on a three-lens model: an economic
imperative; a legal/regulatory imperative that connects 6. http://www.e-ir.info/2014/07/16/religion-and-
to public policy concerns; and an ethical imperative. globalization-new-possibilities-furthering-challenges/,
Religion and Globalization: New Possibilities, Furthering
We believe that each lens is very important; no one
Challenges, Daniel Golebiewski, July 16, 2014.

08 Dharana - International Journal of Business from M. P. Birla Institute of Management, Bengaluru

 7. h t t p s : / / w w w . b b v a o p e n m i n d . c o m / w p -
content/uploads/2013/02/Secularism-and-
Multiculturalism%C2%AC_Charles-Taylor2.pdf
8. http://www.slideshare.net/rupaleeslideshare/
ethics-12132965
9. Teaching business ethics in Universities - is it a waste
of time? Theodora Issa Curtin University in research
gate.
10. Can you teach businessmen to be ethical? By Jonathan
Haidt January 13, 2014 in The washington Post.
11. Indian Philosophy and Business Ethics: A Review
Chandrani Chattopadhyay.
12. Advances in Management & Applied Economics
Journal, Vol.2, No.3, 2012, 111-123 Scienpress Ltd.,
2012.
13. http://ethicalsystems.org/content/leadership
14. http://www.changemag.org/archives/back%20issues/
november-december%202009/full-teaching-business-
ethics.html Teaching Business Ethics in the Age of
Madoff; by R. Edward Freeman, Lisa Stewart, and Brian
Moriarty.

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