What does the case suggest is the value of ethical behavior? What did Siemens gain by introducing controls to minimize the likelihood of corruption?

            It is a fact that when one company like Siemens is enjoying so much success as well as great reputation around the globe, then ethical events become more critical in so many ways. The reputation of the company can be in stakes if they are ever involved in any unethical behavior and events. The company, which enjoys good repute amongst customers, has to remain careful about its conduct, otherwise the people views may change about them in a negative way, if they are involved in any wrong doings. The corruption scandal at Siemens suggested that company should have developed an ethical based work culture, where value is given to ethical behavior and conduct same like value is given to increase the amount of sales.

            Unethical behavior can be negative for society as well as competitors because they may be deprived of their capable rewards, if one company tries to deceive them by bribing people from other counties to get contracts. The unethical behavior gets a company away from doing legitimate efforts to keep their business on a right track. It was a great learning curve for Siemens as well because they were able to introduce more controls, and their code of business conduct was strengthened to keep doing things in a right manner. They were also able to review errors in their business conduct and tried to remove them accordingly. Their introduced controls allowed them to gain their business and confidence back from the market and involved in economic development without doing any wrong activities.

         Most countries lack adequate laws or enforcement to deal with bribery and other forms of corruption.  Why is this?  How do countries benefit from a strong rule of law that minimizes corruption?

         It is a fact that poor and developing countries lack rule of law as well as they are unable to enforce proper rules and regulations to deal with unethical and wrong conduct like corruption and bribery. It happens because their corrupt rulers want to sustain their power in the country and they want to work for their personal benefits, rather working for their countries. The corrupt persons in government of poor countries receive bribes, and involve in wrong doings, which damages their reputation and economy. The corruption cannot allow the economy to prosper, because when large companies sees an opportunity to bribe such corrupt governments to win contracts, but money goes in the bank accounts of corrupt rulers, rather going into the reserves of the country. It continues to happen due to corrupt rulers with an ineffective government.

            That’s why it is seen that developing countries struggle to boost their economies, because corruption keeps damaging them in so many different ways. The self-interest of corrupt rulers supersedes the interest of their country. So, if countries want to grow on many economic fronts, they will have to initiate better rule of law fighting corruption with iron hands. If a country will have a strong rule of law, then foreign investment will be promoted by its people. The rules will be made to enhance local economic activity. The countries with better rule of law and reputation allows investors to take part in their economic activities, and all of these aspects play their part in minimizing corruption and bringing in ethical behavior.

1c) Some argue that because ethical standards are lax in many countries, Siemens and other firms must pay bribes in order to obtain new business.  Do you agree with this view?  Stated differently, when doing business around the world, is it generally better to emphasize normativism or relativism?  Justify your answer

            It is true that many poor and developing countries lack any kind of ethical standards, but is it allowed to foreign companies like Siemens to take advantage of such situation to gain business in such countries. When this thing will be analyzed on the basis of ethics and ethical behavior, one can never support such argument that certain countries does not have good ethical standards, so corruption is rooted in their culture, and if you want to gain business in those countries, you must go with their line of unethical conduct. Unethical conduct and behavior cannot be justified for the sake of business or any other thing. One wrong act cannot be justified by telling another wrong act. If a company believe in ethical behavior and a proper code of ethics to do its business, then it should always discourage wrong doings like bribery as well corruption, rather they must stand up against these cultures, and expose their competitors, who are doing so.

        When efforts from all stakeholders will be made to encourage and enhance the level of ethical behavior and conduct, then things will get difficult for corrupt companies and rulers to sustain their corruption. When normativism is discussed, it means that ethics are clear like black and white, which means if you go with ethics, then it is good, and if you deceive ethics, then it is wrong. But relativism puts ethics in a grey area, whereas good conduct and ethical behavior cannot be associated with any grey areas. So, it is always recommended to go with normativism in any given circumstances.

Part C: Essay-based question

Using examples critically analyze the negative consequences of globalization.

           It is a well-known fact that globalization has been involved in bringing so many positives in the world, but when it is analyzed closely, it is also evident that some consequences have also been brought by globalization. There are various negative aspects of globalization, and one major aspect is instability and fluctuation in prices. The prices are fluctuating on regular basis, even then international bodies like World Trade Organization makes its efforts to control prices. But firms are able to maintain instability in prices due to globalization.

            The international trade is done on the basis of U.S Dollars, so when there is price instability, it also comes with fluctuations in value of currency for different countries, especially putting negative effects on poor and developing countries. The globalization has also made job insecurity a regular norm in modern world. Before the essence of globalization, the skills and educated people had value in their respective regions and had better job security. But now days, global firms always look for talents all around the world, and they even outsource their business to developing countries, where costs are lower for them to manufacture products or handle business activities. So, jobs have become insecure in so many ways. The globalization has also played its negative part in increasing environmental issues. The carbon footprints of global firms have been increasing because they have outsourced their production units in poor countries, where there are no evident rule of law to protect environment, so these global firms are involved in increasing pollution.

            Many economists tried to look at the results with great attention towards the business point of view. There are negative consequences of globalization, in which businesses are facing increased competition and workers have negative impacts because of greater competition. There are many reasons for the globalization which is not coming up to the mark and causing major problems. One of the reasons is improper using of finite resources more immediately as China joined the world trade organization in past years and with passing years coal began to increase in utilization.

    Fig.1 Statistical review of the world energy data (by the help of source consumption of   energy by China)

Many other negative impacts of globalization include carbon monoxide emission in the world for the years and trend is elevating for the coming years as well. The results of increasing such emission are very drastic. Not only this but, globalization also makes virtually impossible for the regulators in one country to foresee the implication at world level for their actions. More harmful impacts of globalization are the elevation of oil prices and transformation in consumption o limited oil supply from the developed countries to developing countries as oil meets are not coming up to the demand, so oil supply is limited and emerging crisis at the financial level.

To what extent do negative consequences outweigh the positive? Justify your answer.

        No doubt, there are positive impacts of globalization also exhibit a great role such as innovation that requires for making profit a spur to expand the trade and communication ideas. It promotes world peace and unity, but sometimes negative consequences outweigh the positive impacts as it does not only cause multiple environmental disasters by increasing the production in many parts of the countries such as Germany, China and America but also led to other developing countries. The elevation in the production means more natural resources are used and in proportional way of using the natural resources causes severe damage and starve ultimately. But globalization has encouraged companies to involve in those activities, which are not environment friendly, but they are not concerned with it, because they are trying to meet their global demand and supply needs. So, they just want to increase their production by any means regardless of its negative or positive effects.

        But the negative consequences of globalization do not outweigh the positive effects of globalization too much because globalization has brought so many positive consequences as well, which are significant in so many ways. The globalization has developed a global market allowing boosting economic activity and developing businesses on global scale, which has created more jobs as well. The foreign trade for developing countries has increased, and global companies have been able to invest in developing countries, which is helping poor countries to stand up on their feet in terms of economic fronts. The foreign investment has been a major positive change for so many countries as global firms do invest in countries all around the world, which has allowed different countries to attract foreign investors. It has build better infrastructure in various parts of the world. So, positive effects of globalization are way important than negative consequences, but certainly there is a need to mitigate negative effects to get things in right direction with more positive effects.

        The globalization has brought the concept of free trade, which has offered so much to this world. There are many advantages of free trade at global levels and these advantages are of two types including theories of absolute advantages and comparative advantages that provide support to the tree trade notion. The consumers and firms are more readily focusing on purchasing the products according to their requirements. Through globalization of trade, it is becoming easy to import products at cheaper rates as compared to the local products. This issue could lead to lowering of prices at different scales. Besides these advantages, the competition between industries is increasing and countries are providing lower cost products at global levels. The expenses of company are reduced to import the products from other sources.  The consumers are able to save money by having products at low cost. The use of these strategies has improved the living standards. Looking at the contributions of globalization, it can be concluded that positive effects of globalization are not completely outweighed by negative effects, and more positives can be added by following certain ethical guidelines in the business sector.