International Marketing Busiess Essay Example

rules, and regulations.

The globalization of markets and competition has expanded globally due to various factors, with technological advancements playing a primary role. Improved transportation and communication options have made global trade more feasible today. As a result, consumers and businesses can access high-quality products from different countries. The rapid pace of technological advancements also fosters intense competition among nations striving to lead in innovation.

To adapt to globalization, countries have implemented measures such as endorsing global trade through agreements like the General Treaty on Trade and Tariffs or becoming members of organizations like the World Trade Organization (WTO), North American Free Trade Agreement (NAFTA), and the European Union (EU).According to Friedman, the intensified integration of markets, countries, and technologies is known as globalization. This process has been ongoing for thousands of years but gained momentum after the collapse of the Soviet Union in 1991. Globalization allows individuals, corporations, and nation-states to efficiently connect with the world and leads to increased integration in various areas such as production, ideas, culture, communication, and environmental pollution on a global scale. Across disciplines like economics, politics sociology psychology anthropology communications geography examples of globalization can be found in everyday life. In international business, global institutions like the General Agreement on Tariffs and Trade (GATT), now replaced by the World Trade Organization (WTO), along with the International Monetary Fund (IMF), World Bank, and United Nations (UN) play a crucial role in managing and regulating this phenomenon through aspects like market globalization where previously separate national markets merge into one large global market. The globalization of production refers to sourcing goods and services from various locations worldwide to benefit from factors such

as labor cost and quality factors such as labor energy materials land capitalThese institutions, which were established through voluntary agreements between individual nation-states and their functions are outlined in international agreements, have the purpose of establishing ethical rules and regulations for international business. Specifically, the WTO is responsible for monitoring the global trading system and ensuring member states comply with trade agreement rules. It also facilitates additional international agreements among its 145+ member states, including recently added Republic of China.

From an economic perspective, two major factors contribute to globalization. Firstly, since WWII there has been a reduction of barriers to the flow of goods, services, and capital. Secondly, advancements in communication technology, information processing, and transportation have played a significant role. Technological innovations are crucial for globalization while GATT and WTO have equally contributed by reducing trade and investment barriers.

During the 1920s and 30s, many countries implemented measures to protect their domestic industries from foreign competition by imposing high import tariffs on manufactured goods. Unfortunately, this led to the Great Depression. However, after World War II, Western industrial states committed themselves to remove barriers to international trade and investment through GATT (General Agreement on Tariffs and Trade). GATT's main objective was promoting dialogue among member nations to reduce trade barriers.As a consequence of these agreements, the average duty rates for manufactured goods have significantly decreased from approximately 30-40 percent in 1950 to only 3.9 percent in 2000. Regional economic integrations such as EU, NAFTA, FTAA, ASEAN, and APEC have further diminished duty rates and spurred economic growth by promoting trade and investment. Among these integrations, the EU has achieved remarkable success in establishing a unified

market by eliminating administrative barriers hindering trade and investment among member states. It is anticipated that the EU will eventually evolve into a political union akin to the United States.

According to the International Monetary Fund (IMF), globalization has had a favorable impact on living conditions worldwide, particularly in developed nations. While certain developing countries have made progress, this has resulted in an increasing income disparity between high-income and low-income countries. Additionally, there exists a substantial number of individuals living in poverty globally. However, it would be incorrect to solely attribute this divergence to globalization or assume that there is no possibility for improvement.

Low-income countries encounter difficulties integrating into the global economy due to their chosen policies and uncontrollable external factors. To address this issue effectively, each country must strive towards reducing poverty and avoid isolating themselves from the global economy.The international community should provide assistance to impoverished nations by strengthening the international financial system, promoting trade, and providing aid. This will help these nations integrate into the global economy, grow economically at a faster pace, and reduce poverty levels. This approach is crucial for ensuring that all countries can access the benefits of globalization. To effectively manage globalization, it is important to establish and empower international reform efforts and democratic multinational institutions. In line with this objective, a committee of 28 leaders supported by the United Nations produced influential reports in 1995 ("Our Global Vicinity") and 1999 ("The Millennium Year and the Reform Process"). These reports proposed strengthening global governance without establishing a world government while valuing both people's rights and civil society's role.

Ethical Issues in International Marketing

Ethics, which examines morals and values, has been

an area of interest for centuries. Aristotle referred to character as "ethos," emphasizing its persuasive power. He also identified virtues such as justice, courage, moderation, impressiveness, generosity,leniency, prudence,and wisdom.During Roman times,E mperor Justinian established schools to educate attorneys on ethics,morality,and law,in order to incorporate ethics into the legal system.Bonaparte introduced a set of 36 legislative acts to ensure equal treatment for all citizens, regardless of their background or social status. Throughout history, societies have recognized the importance of establishing laws and codes to guide human behavior. Ethical studies explore the distinctions between right and wrong, leading to the development of various theories such as egoism, intuitionism, emotivism, rationalism, and utilitarianism. Egoism proposes that individuals should only consider how actions affect themselves. Intuitionism emphasizes an immediate sense of moral value. Emotivism suggests that ethical decisions stem from emotions. Rationalism focuses on the metaphysical aspects of ethics while utilitarianism evaluates how moral actions can benefit everyone.

In regard to ethical universals and national cultures, there is no consensus among academics and researchers regarding a simple definition of culture. Anthropologist Edward Taylor defined civilization in the 1870s as "that complex whole which includes cognition, belief, art, ethical motives, jurisprudence, usage,and other capablenesss acquired by adult male as a member of society" (Taylor, 1871). Along with economic and political doctrine,reli-gion language,and education systems can also be considered as other capabilities.Religion is a key factor in shaping ethical systems, which consist of moral principles and values that guide behavior (Hill:ibid:105). Geert Hofstede defines culture as the "package of the mind," implying its influence on human thinking and behavior (Hofstede, 1984: 21). E. Hall explains that international sellers encounter barriers due to

diverse lifestyles, ways of thinking, and assumptions about family, government, economy, and individuality (Hofstede ibid: 21). Traditional definitions of civilization emphasize its comprehensive nature encompassing values, rituals, symbols, beliefs, and generational thought processes (Herskovitz 1952:634).

Values are abstract concepts representing what a group sees as good and right. In simpler terms, they are shared assumptions about how things should be (Mead1994 :7 ). The text explores the connection between cultural environments and perceived ethical dilemmas in Australia, Singapore, and Malaysia. Armstrong's research revealed that Australian International Business Directors commonly identified gifts/favors/entertainment as an issue influenced by culture. However,
large-scale corruption is seen as the most significant ethical concern for these directors.

Different cultural settings lead to varying ethical perceptions in international marketing; however,it is crucial to establish universally applicable rules for ethical consistency.Armstrong's research revealed that Australian general directors had differing opinions on compromising ethics in order to succeed in international sales. As globalization continues, ethical issues in cross-cultural settings become more prevalent, leading to criticism of sellers for unethical behavior. When operating in a foreign culture, sellers are faced with different values and norms, raising the question of which ethical stance they should adopt. DeGeorge argues that when conducting business internationally, it is important to utilize "our ethics" as our ethical values are essential and cannot be disregarded.

The text examines the impact of various ethical approaches on decision-making in international marketing. It explores descriptive-prescriptive and communicative attacks, as well as normative and descriptive theories of selling ethics. The descriptive approach focuses on understanding the values and moral reasoning of individuals and groups by considering factors such as personal experiences, chance, organizational environment, and cultural environment. On the

other hand, the normative approach aims to provide solutions for general moral questions about what one should do.

Researchers in this field strive to justify moral norms and ethical values. While there has been ongoing debate regarding assigning moral responsibility to business organizations in the past, some scholars argue that only individuals acting on behalf of corporations can possess moral motivations and be held accountable.However, some argue that certain aspects of an organization cannot align with moral responsibility because organizations have a purpose and are not fully independent. and their contents serve a specific purpose and cannot be held accountable for actions that contradict that purpose. Normative approaches can be categorized as "deontological theories" or "teleological theories," which aim to provide ethical guidelines for international sellers. Deontological theories focus on individual actions or behaviors, while teleological theories consider the consequences of those actions or behaviors. Deontologists believe that the qualities of an act, separate from its value, determine its rightness. They seek to establish a set of rules to live by, such as the long-standing "golden rule" of treating others as you would like to be treated. According to Laczniak, international sellers have moral duties encompassing fidelity, gratitude, justice, beneficence, self-improvement, and noninjury. On the other hand, teleological evaluation involves assessing the consequences of different behaviors and determining the overall balance between good and evil. Teleology can be divided into two subcategories: egoism and utilitarianism. Egoism defines rightness based on individual effects in order to achieve maximum personal good.
On the one hand, utilitarianism aims to achieve the greatest good for the most people, rather than solely focusing on personal gain. On the other hand, ethical

universalism argues that an action is morally correct if it produces the most favorable outcome for the majority. While some philosophers such as Hobbes and Nietzsche were ethical egoists who prioritized personal gain, G.E. Moore and John Stuart Mill embraced ethical universalism.

To illustrate how these theories differ in practice: deontologists prioritize honesty regardless of consequences, while teleologists may choose to lie if it saves a life or protects someone from harm. Nill and Shultz (1997: 4) propose a communicative approach as an ethical model for macro sellers which combines moral universalism with moral relativism. This approach establishes universally valid guidelines for conducting an ideal dialogue without imposing specific moral values or norms. Participants in the dialogue are expected to adhere to a set of universal duties while the outcome depends on them.

Employing a dialogic approach can be advantageous for sellers depending on the ethical dilemma and situational demands at hand. Further research is necessary to effectively implement this communicative approach as a real-world corporate ethical responsibility (Nill 2003: 92-97). In terms of international selling, domestic sellers face numerous moral dilemmas regarding what is morally right or appropriate even within their country's boundariesAccording to Cateora and Graham (142), ethical standards are often undefined or unclear. The complexity of business ethics in the international market is further exacerbated by cultural differences in values. What may be acceptable in one country could be unacceptable in another, as illustrated by the contrasting views on high-value gifts between the United States and other countries (www.business-ethics.org). In the realm of international marketing, it is commonly argued that sellers cannot rely solely on universally accepted ethical norms. Various studies propose different ethical

models, such as hyper norms or core values (Dunfee,1995; Dunfee, Smith, and Ross, 1999:14; DeGeorge, 2000). Nonetheless, despite these variations, there are still fundamental moral values that can be used to assess ethical issues in international marketing. It is crucial to identify violations of these values as ethical problems. When reviewing literature on international marketing ethics, it becomes evident that most studies employ scenarios as research tools and focus on specific sub-disciplines like market research, retail management, purchasing management, advertising management , marketing management , industrial marketing , and marketing education. Only a few studies specifically concentrate on International Marketing Ethics (Armstrong and Everett , 1991:61-7 ; Armstrong , Stening , Ryands , Marks,and Mayo , 1990:6-15 ; Armstrong , 1992 ).The text discusses the main ethical issues in international marketing that were identified through Armstrong's research. These issues include small scale bribery, large scale bribery, gifts/favors/entertainment practices, pricing problems, products/technology concerns, and tax evasion practices. It is crucial to address various factors that contribute to ethical behavior in global business. These factors consist of large scale bribery, gifts/favors/entertainment practices, pricing strategies, products/technology considerations, and tax evasion practices. Large scale bribery involves making significant payments with the intention of enabling law violation or influencing policy. Gifts/favors/entertainment practices involve a range of items such as physical gifts, call girls, company-paid personal travel opportunities, and extravagant entertainment after a transaction takes place. Pricing strategies encompass unfair differential pricing, questionable invoicing methods, tactics to eliminate local competition, selling products at lower prices than in the home country (dumping), and illegal pricing practices in the host country like price fixing agreements. Products/Technology refers to goods and technology that are

prohibited in the home country but allowed in the host country or considered inappropriate for use by people in the host country.Tax evasion practices involve methods such as manipulating prices between affiliated companies or using tax havens to reduce tax liability. To ensure ethical behavior in global business, attention should be given to cultural interpretations and ethical considerations. This may include adjusting interest payments on intra-firm loans and addressing questionable management and service fees charged among affiliates or with the parent company. It is important to avoid illegal activities like environmental pollution, unsafe working conditions, patent or copyright infringements, and intentionally overcharging a country by underweighting shipments.
Additionally, it is necessary to address questionable committees established with intermediaries such as sales agents, wholesalers, consultants, traders, and importers. These committees sometimes require excessively large fees for these intermediaries.
Cultural differences between countries can lead to misunderstandings regarding traditional exchange requirements and customs. Norms can vary across cultures; for example, gift-giving practices or political involvement may have different interpretations based on cultural backgrounds.In order for businesses to engage in international marketing efforts, it is crucial that they comply with legal regulations and ethical standards while also demonstrating social responsibility. Resolving challenging international marketing issues goes beyond simply making right or wrong decisions. These behaviors can include giving gifts, making financial payments, providing favors, offering entertainment, participating in political activities, attempting to influence politics as multinational companies, engaging in marketing during times of war in home or host countries, and engaging in illegal technology transfers. It is widely recognized that globalization is an inevitable and ongoing process. To successfully compete internationally, businesses must adhere to legal and ethical rules and

regulations. Regardless of whether a marketer operates domestically or internationally, acting ethically and responsibly should be a defining characteristic. When faced with questions involving breaking the law, harming the environment, denying someone's rights, taking unfair advantage or causing physical injury or harm- most people instinctively know what socially responsible and ethically appropriate response would be (Cateora and Graham). However international marketing issues are often complex decisions that cannot easily be categorized as right or wrong.International sellers often encounter the challenge of how to handle situations where there is no local law or where local customs approve of certain behaviors. This gives an advantage to companies that are willing to do whatever it takes, even if it involves unethical practices, compared to those that refuse to engage in such actions. While laws in many states establish a minimum standard for ethical or social responsibility, they serve as a starting point against which personal and societal morality is examined. In the United States, legal consequences generally prevent sellers from engaging in unethical transactions. However, ethical dilemmas in international marketing are not major concerns within the domestic market of the U.S. Instead, ethical quandaries arise due to cultural differences in international settings. A useful compass for ethics in international marketing is following the example set by ethical business leaders (J. Byrne, 2003). DeGeorge (Ibid) suggests five guidelines for addressing ethical issues in international business: 1) Avoid intentionally causing harm; 2) Promote more benefit than harm to the host country; 3) Respect the rights of employees and all others affected by one's actions or policies; 4) When possible and within ethical norms, respect and cooperate with the local culture

rather than opposing it.5. Multinational corporations ought to promote openness and integrity in their dealings with stakeholders, while also respecting the need for confidentiality when required. In addition, it is important for them to meet their tax responsibilities fairly and work together with local governments to establish fair laws and regulations.