What marketing and ethical problems can bribes create in international marketing transactions?

Question

What will be an ideal response?

Answer 1

The use of payoffs and bribes is deeply entrenched in many governments. Because U.S. trade and corporate policy, as well as U.S. law, prohibits direct involvement in payoffs and bribes, U.S. companies may have a hard time competing with foreign firms that engage in these practices. Under the Foreign Corrupt Practices Act of 1977, it is illegal for U.S. firms to attempt to make large payments or bribes to influence policy decisions of foreign governments. Nevertheless, facilitating payments, or small payments to support the performance of standard tasks, are often acceptable. The Foreign Corrupt Practices Act also subjects all publicly held U.S. corporations to rigorous internal controls and record-keeping requirements for their overseas operations. Differences in ethical standards affect marketing efforts. When marketers do business abroad, they often perceive that other business cultures have different modes of operation. However, many businesspeople adapt to the cultural practices of the country they are in and use the host country's cultural practices as the rationalization for sometimes straying from their own ethical values when doing business internationally. For instance, by defending the payment of bribes or "greasing the wheels of business" and other questionable practices in this fashion, some businesspeople are resorting to cultural relativism-the concept that morality varies from one culture to another and that business practices are therefore differentially defined as right or wrong by particular cultures. Because of differences in cultural and ethical standards, many companies work both individually and collectively to establish ethics programs and standards for international business conduct.