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What Is the Relationship Between Business Ethics and Culture?

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  • Written By: Esther Ejim
  • Edited By: Kaci Lane Hindman
  • Last Modified Date: 18 September 2014
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The relationship between business ethics and culture can be viewed from the angle of the influence of a particular culture on the practice of business ethics. In its application to business ethics, culture may be defined in terms of the place of origin of the individuals who make up the human capital of the organization. Culture may also be defined in terms of a collection of a group of people who have something in common, such as an ideology, the fact that they are a minority, or the fact that they belong to a particular sex or religion. Business ethics and culture may also be analyzed from the perspective of the manner in which the management and employees of the business apply ethical standards to their business operations, while conducting their business in another country.

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With the growth of globalization and the ease with which people migrate from one country to another in search of better business and career opportunities, it is only too common to see that most medium to large businesses have a varied representation of employees from different backgrounds and cultures. This makes it imperative for such businesses to have some form of standard for dealing with the diverse cultures that constitute the employee base in order to create an inclusive corporate culture. An example of the relationship between business ethics and culture is the manner in which the management of an organization treats employees from other cultures. The ethical consideration here is whether the management apply the same standard of treatment for both the local and immigrant employees.

An example of the application of business ethics and culture can be seen in the case of a multinational company that opens a subsidiary in a less developed country. Assuming the management of the company have a different standard of treatment for their nationals and another treatment for the nationals of the less developed country, such an act would hardly be ethical. For instance, if they have different pay rates for employees in the same category or level it is a misapplication of ethics.

Also, business ethics and culture means that the employees and management must apply ethical standards in their dealings with customers from other cultures. One example would be a company that manufactures electronic items and has a branch in another country where it also manufactures similar items. The absence of business ethics might lead to a situation in which the business will manufacture substandard goods for sale in that particular foreign market. This might be due to the fact that the culture in that country is more corrupt and the business can get away with such an act, which can also be seen in the use of child labor.

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literally45
Post 3

Do multi-national corporations with factories oversees pay those employees the same rates as employees in the States? I don't think so. In fact, we often hear about how people oversees are made to work for mere pennies for these large companies that then sell their products expensively in the States.

ZipLine
Post 2

@bear78-- That's interesting, thanks for sharing that. It's definitely a different perspective on this topic.

I personally see a problem with that because I think that ethics rules are universal and should be applied regardless of the culture and society. I think if I was doing business in a different country, I would do something I consider unethical even if it's accepted in that culture.

bear78
Post 1

Culture of a country really determines the ethics rules for business. Anyone who has spent time in vastly different cultures can say this.

A friend of mine was in Afghanistan for a while and he told about the practice of gift giving among business owners, clients, government officials and others in Afghanistan. He said that any Westerner would consider this practice bribery, but in Afghanistan, giving gifts is a gesture. It's like a "thank you" and is not considered to be a bad thing.

This obviously has to do with the culture of that country and the traditions and worldviews of people making up that society. When people are doing business in another country, they may have to re-examine ethics rules based on that culture and tradition.

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