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Unit VI

Globalization and BusinessEthics

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Growth of GlobalCorporationsGlobalization is the growing

integration of the worlds economy. Itsuggests that an economic decisionmade in one part of the world will haefar!reaching e"ects in the rest of theworld.

#easons for the Global Corporations$

%he increasing importance of internationaltrade

&ore and more multinational companies

&ore and more global strategies

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'riers of Globalization

(ational and International %rade)pening up of the Economies *China+

India etc.,

(ew forms of business organizations'eelopment of nations

%echnological adancements

Improed transportation models

-ocietal changes

Cultural liberalization

Global perspectie

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Impact on India /0

-trong macro!economic growth1oreign inestment

Improed serice 2uality *both global

and national leels,Growing consumerism

Infrastructure deelopment

&ultilateral trade agreements+manufacturing+ serices andintellectual properties

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Impact on India 0/0

Integration of economies1ree trade

Global recognition

)utsourcing&ultiple brands

Internet/%echnology/-ocio!cultural

changes

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Impact on Indian Industry

%elecommunicationInformation technology

3utomobiles

4ealthcare and 5harmaceuticals&ines and &inerals

-teel and &anufacturing

3rms and 3mmunition3irlines

%ransport

Entertainment

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3dantages to 4ostCountryImproing balance of paymentsEmployment generation

-ource of %a6 reenue

%echnology transferIncreasing choice of products and

serices

Global reputation

Improing standard of liing

Creating competition

(ew ideas and styles

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'isadantages to 4ostCountryEnironmental impact3ccess to natural resources

Uncertainty in global mar7et

Increased competitionIn8uence and political pressure

Cultural and social impact

%ransfer pricing4ealth and safety

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5rinciples of Code ofConduct3ccountability

1airness

Integrity

5rofessional 'eelopment

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(eed for Code of BusinessConductCode of Conduct addressed to employees5roides a sense of direction and a moral

compass

5roides guidelines/framewor7 toemployees

Builds organizational culture

4elps attain long!term sustainable growth

Better self!goernanceImproed ris7 preention and

management

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International Code of Conduct/0

E2ual compensation+ fair wages+bene9t the lower income group

(o discrimination between

gender+ orientation andnationality

#espect for cultural and social

norms and traditions#espect religious sentiments and

freedoms

1ull disclosure of all material

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International Code of Conduct0/01ollow local laws and policies-hould not interene in local

goernment functioning

5resere ecological balance+enironmental policies and operations

-hould not create air+ water+ soilpollution e6cessiely

3oid improper or illegal practices

-hould not bribe local politicians orgoernments

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:histle Blowing

:histle blowing is the e6posureby an employee or professional ofcon9dential information which

relates to some danger+ fraud orother illegal or unethical conductconnected with the wor7 place+

be it of the employer or of fellowemployees.

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:hen is :histle Blowing;usti9ed