This question is from Chapter 5 of the Textbook called International Management

Question

This question is from Chapter 5 of the Textbook called International Management by Fred Luthans (9th edition):

Last week on the forum there was some discussion of bribery. Bribery is an acceptable practice in many countries and unacceptable (and illegal) in other countries. When there are opposing perspectives on an issue, it can be difficult for the MNC to create an effect strategy for an issue of this sort. I'd like us to have a conversation about bribery this week. We can use this example to look at the difficulties associated with "managing across cultures" (this week's chapter).

I'm providing a link here about bribery that might give you some background, but we don't need to limit our conversation to China since this is a problem with many countries. http://www.bloomberg.com/news/2013-11-21/china-s-bribery-culture-poses-risks-for-multinationals.html

I'll start us off simply and we'll see where the conversation develops this week. What would you advise an MNC to do if they are trying to do business in a country that is perfectly comfortable with bribery? Feel free to use any of the typologies from the chapter to help with your answer.

Explanation / Answer

Bribery in business world is an ethical issue which in some countries is acceptable but in other it is strictly illegal thus a company will have to be vigil while doing business in other countries about their laws and its implementation. If an MNC have a chance to do a business in a country that is perfectly comfortable with bribery then it has to look into its own internal policy which permits him to take those steps because if company’s internal policy are against those practices then there is no point of doing it because it shows that company in any format doesn’t promote such practices but there is no such policy or if there is flexibility in policy which allow a company to do business then company need to understand local land laws and policies. Company will perform a thorough study of country’s law and try to find out the loop holes so that if anything wrong has happened then company can save his position and have smooth exit from the country. Company need not invest heavily in such countries because if condition changes then whole investment may get wasted.

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