Ethics refers to a code of conduct, rules, norms, and troubles established by people in business organizations. On the other hand, International business refers to a situation where people do business worldwide. Corporate culture plays a significant role in modeling business ethics as well as shaping organizational behavior.
How corporate culture influences the ethical behavior of an organization
According to Ferrell, Fraedrich & Ferrell (2009.p.185), just like parents guide the family, leaders assess and offer to counsel to employees on how they want the organization to run. Their activity, conclusions, and conversation influence prospects and norms that are consented in running the business.
They lay down the norms to be observed and expect all the employees to comply. Through power organizational leaders are able to control employees’ activities. As a result, leaders are able to regulate and develop corporate culture.
Furthermore, corporations come up with operations policies that hold all employees accountable for their activities. Violation of these policies may lead to an employee being penalized or even being dismissed from the company. In a bid to comply with the established policies, employees end up changing or adjusting their behaviors (Ferrell, Fraedrich &Ferrell, 2009.p.187).
In addition, motivation as a corporate culture significantly affects organizational ethics. Motivation is good in directing employees and assists in modeling their behavior and commitment to the organization. By managers motivating their employees, they encourage them to act ethically by ensuring that they offer quality products and services.
According to Grashaw (2010, para.11), the manner in which corporations motivate their employees determines the level of their ethical behavior. Generally, the established motivation system has to be aligned to organizational objectives. At times, motivation may trigger behaviors that are against the corporate culture hence affecting the ethics of the business. For instance, managers may demand employees to perform excellently for them to be promoted. This may lead to some employees acting unethically towards their colleagues and customers. Hence, employee motivation as a corporate culture may also adversely influence the ethical behaviors of employees. This is because it may lead to employees using all means available for them to achieve their objectives at the expense of those of the organizations (Hahn, 2007, para. 4).
Corruption in international business transactions
Corruption is one of the factors that have been sighted to hamper sustainable development. Basically, the vice adversely affects the reputation of any organization and may even affect international relationships. To both local and international businesses, corruption has been found to be very costly ((United Nations Global Compact, 2010). Taking part in a corrupt international transaction is not only unethical but is also illegal. Participating in the vice is ethical in the fact that it degrades the reputation of participating parties. It also ruins the image of the organization found to participate in the transaction.
Anti-corruption legislation has been established that is used in controlling international transactions. Over time, there has been an increase in the number of international businesses. This has increased the rate of international transactions thus increasing the chances of corruption. It is with this respect that corruption has been termed to be illegal leading to the establishment of international laws aimed at punishing those found to participate in corrupt international transactions (Hunger & Wheelen, 2008, p.248).
Corporate culture plays a significant role in influencing ethical behaviors in an organization. Established corporate policies hold all employees accountable for their activities thus ensuring that they stick to the established ethics. In addition, practices such as employee motivation may affect employee behavior if not well implemented. Corruption has been found to do more harm than good not only to business organizations but also an international business. Consequently, participating in a corrupt international transaction is unethical and illegal.
Ferrell, O. C., Freadrich, J. & Ferrell, L. (2009). Business Ethics. Ethical Decision Making and Cases (7th Ed.). Mason: South-Western Cengage Learning.
Grashaw, K. (2010). Employee Motivation: Theory and practice. Web.
Hahn, M. (2007). Group Norms in Organizations. Web.
Hunger, D. J. & Wheelen, T. L. (2008). Concepts on Strategic Management and Business Policy. New Jersey: Pearson Prentice Hall.
United Nations Global Compact. (2010). Transparency and anti-corruption.