Morality in International Contexts

Though the principles discussed in the chapter so far are clear enough but how they are to be applied in foreign countries is more difficult. Petty bribery, which is considered unethical in the U.S., is standard practice in Mexico; sexism and nepotism occur as a matter of course in some Arabic business environments. Should they try to introduce their own standards? Should multinationals follow the laws of the less developed countries in which they operate? Do they pay them the same wage? How do they treat their own employees doing the same job in two very different countries?

The following four queries can help clarify what a multinational corporation ought to do in the face of these difficulties:

1.   Does the local government truly represent the will of its entire people?

2.   Does the action produce consequences that are ethically acceptable from the point of view of at least one of the four ethical theories?

3.   What does the action really mean in the local culture's context?

4.   If the morally questionable action is a common local practice, is it possible to conduct business there without engaging in it? 

Morality in international contexts

This chapter examines the ethical aspects of the market system itself-how it is justified and what the strengths and weaknesses of the system are from the point of view of ethics. It begins by focusing on the economic conditions in the U.S. at the close of the 20th century, when proponents of industrial policy were influencing the government to help declining industries and their workers to adapt to new economic conditions. Others urged caution, advising the government to "avoid the pitfalls of protectionism." This dichotomy illustrates the distinction between  two  contradictory  ideologies,  those  who  believe  in  the  "free  market"  and  those  who promotes a "planned" economy.

These two ideologies take diverse positions on some very basic issues: How does society function? What is human nature really like? What values should it try to protect? What is the purpose of social institutions?

In general two important ideological camps, the individualistic and communitarian viewpoints characterize modern societies. Individualistic societies promote a partial government whose main purpose is to protect property, contract rights, and open markets. Communitarian societies, in contradiction define the needs of the community first and then define the rights and duties of community membership to make sure that those needs are met.

These two camps face the difficulty of coordinating the economic activities of their members in two separate ways. Communitarian systems use a command system in which a single authority decides who will produce it, what to produce and who will get it. Free market systems are trait of individualistic societies. Incorporating ideas from thinkers like John Locke and Adam Smith, they permit individual firms to make their own decisions about what to produce and how to do so.

Free market systems have two main mechanisms: a private property system and a voluntary exchange system. Pure free market systems would have extremely no constraints on what one can own and what one can do with it. Since such systems would allow things like slavery and prostitution however, there are no pure market systems.

Free Markets and Rights: John Locke

John  Locke  (1632-1704),  an  English  political  philosopher,  is  generally  qualified  with developing the idea that human beings have a "natural right" to private property and a "natural right" to liberty. Locke argued that if there were no governments, human beings would find themselves in a state of nature. In this state of nature, each man would be politically equal of all others and would be perfectly free of any constraints other than the law of nature i.e.

the moral values that God gave to humanity and that each man can discover by the use of his own God-given reason. As he puts it in a state of nature all men would be in:

"A state of perfect freedom to order their actions and dispose of their possessions and persons as they think fit, within the bounds of the law of nature, without asking leave, or depending upon the will of any other man. A state also of equality, wherein all the power and jurisdiction is reciprocal, no one having more than another... without subordination or subjection [to another].... But... the state of nature has a law of nature to govern it, which obliges everyone: and reason, which is that law, teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions."

Therefore, according to Locke the law of nature teaches us that we have a natural right to liberty. But because the state of nature is so hazardous, says Locke, individuals organize themselves into a political body to defend their lives and property. The power of government is limited however, extending only far enough to guard these very basic rights.

Locke's views on property rights have been very powerful in America. The Fifth Amendment to the U.S. Constitution even quotes Locke directly. In this view, government does not contribute or create property rights. Rather, nature does and government must therefore respect and protect these rights. Locke's view that labor creates property rights has also been dominant in the U.S.