Lesson 9

There are three activities or Ethical Scenarios, please choose one of them and then thoroughly answer the questions in the scenario.

Activity 1: Ethical Scenario I

Your team are special assistants to the governor of a southeastern U.S. state in which unemployment (especially in rural areas) is well above the national average. After nearly three years in office and elected on a pledge to create jobs, the governor is concerned. Because he respects your moral stance on big issues, the governor is seeking your insight. An Asian automobile maker has just told the governor that your state is on its short list of potential sites for a new manufacturing facility. The facility is expected to employ about 1,500 people, with plenty of spillover effects for the wider economy. The governor informs you that the Asian automaker expects significant incentives and concessions. The governor would like to offer some $300 million in tax breaks and subsidies in an effort to bring the new plant to the state.

Discuss the situation and then answer the questions:

                          1. What plan of action do you advise the governor to take? Would the outlay be an appropriate use of taxpayer money? Explain.
                          2. Would you feel comfortable defending your advice if it were to become public? Explain.

Activity 2: Ethical Scenario II

Your teams are lawyers working with the International Court of Justice in The Hague in the Netherlands. Your task is to review a recent decision by a U.S. judge regarding extraterritoriality. The case: French survivors of the Holocaust sued Yahoo USA because French citizens were purchasing Nazi memorabilia on Yahoo’s U.S. website. The lawsuit also charged Yahoo USA with hosting the websites of anti-Semitic groups. Although both these actions are illegal according to French law, they are permitted in the United States because of U.S. legislation protecting free speech. Because Yahoo’s French website did not violate French law, the U.S. federal judge hearing the case threw it out. The judge ruled that French law does not have the right to dictate the behavior of U.S. firms operating inside the United States. Today, the Internet can make it difficult to determine where jurisdictions begin and end.

Read, analyze and research the scenario. Then answer these questions:

                          1. If you had been the U.S. judge in this case, would you have ruled similarly? Explain.
                          2. What factors most influenced your decision?
                          3. Do you know of any Internet controls that companies or governments can use to stop such cases from occurring in the future?

Activity 3: Ethical Scenario III

You are chief operating officer of a U.S.-based telecommunications firm considering a joint venture inside China with a Chinese firm. The consultant you hired to help you through the negotiations has just informed you that ethical concerns can arise when international companies consider a cooperative form of market entry (such as a joint venture) with a local partner in any market. This is especially true when each partner contributes personnel to the venture because cultural perspectives cause people to see ethical dilemmas differently. This is of special concern to you because the venture had planned to employ people from both China and the United States. In light of this recent information, you are reassessing your entry mode options.

  1. Do you think your two companies can establish a set of ethical principles before commencing operations that will guide a potential joint venture?
  2. What ethical issues might arise in conjunction with other entry modes discussed in this chapter?
  3. Is there a company that succeeded under circumstances that are similar to those that your firm faces?
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