I B Issues EDited

8/11/2019 I B Issues EDited

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Prsenters:

Gurpreet Singh(7534)Sukhdeep Kaur(7520)


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What is International Business? It refers to all those business activities which involve

cross border transactions of goods, services, resourcesbetween two or more nations. Transaction of economicresources include capital, skills, people etc. forinternational production of physical goods andservices such as finance, banking, insurance,construction etc.


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There are several important social issues in I

B. Some Of the Issues while carrying on

International Business are as follows:

1.Social and Government Issues

2.Ethical Issues

3.Labour Issues

4.Environmental Issues


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Social & Government Issues

Social and Govt. issues involves rules and behavior ofsociety and Govt. towards a MNC. Some of these issues

are as follows:

The Country with which we do international trade might

be ruled by a corrupt leader or a party.

Military rulers pose a serious threat for international

business.

If the Home country and the trading country are at war. If

two countries are at war then there wont be any

international trade between them


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The Attitude of the host country towards foreigninvestment can be negative and Host countries mayimpose special rules for MNCs.

If the country where we do our International trade lacks

social infrastructure, Inadequate facilities may require acompany carrying on international business to buildhousing, establishing schools and providingtransportation facilities for the employees.

Government Interference is yet another Issue. If thegovernment of a host country insists on becoming apartial owner Of the foreign business.


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Ethical Issues In International

BusinessBusiness Ethics means that the business should be conducted acc to

certain self recognized moral standards. In International Businessfirms often finds that the norms of ethics varies from country tocountry. The Common Ethical Issues are:

1.Employment practices

2.Human rights

3.Work Environment

4.Bribery and Corruption

5.Moral obligation of multinational firms


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6.Product Safety

7.Fair Price

8.Following Local Laws

9.Impact On Local Social Institutions

10.Fair Return On Investment


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Labour Issues include the use and permitance of use oflabour in a MNC as well as the prevailing labour conditionin the Host Country. Some of these issues are as follows:

Child Labor: One of the important social issues in thedeveloped countries in respect of business with the

developing countries pertains to ill treatment of labourand children.Child labour used in the manufacture ofexports from the developing countries is widely criticizedby people in the developed countries. For example, it isalleged that child labour is used by the carpet industry in

India and some other countries and social activist in thedeveloped nations demand ban on the import of goodsembodying child labour. Consumers are called upon toboycott such goods.

Labour Issues In International

Business.


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Sweat Labour:It is that goods are manufactured by

labour working in inhuman/unhealthy working conditionsnot getting fair wages should be banned or boycotted.Creating important developing country, like garments,are alleged to be suffering from such problem.

Low Wages:it is a regrettable feature of many exportprocessing zones that both male and female workersare trapped in low wage and low skilled jobs Thefrequent absence of minimal standards and poor labourmanagement relations have predictable outcomes, suchas high labour turnover, absenteeism, stress andfatigue, low rates of productivity, excessive wastage ofmaterials and labour unrest which are still too common.


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Extensive Work:The Labours working are also forced towork for maximum number of hours in a day and are

also paid only low wages. The Work Environment is

also poor and unsafe and there are also no proper

facilities available in case of any unfortunatehappenings. And There are also reports of these

labourers being tortured both physically and mentally if

they fail to act according to the orders given to them by

the superior authorities.


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ENVIRONMENTAL ISSUES IN

INTERNATIONAL BUSINESS

Use of Environment damaging Technology: Somecountries prohibit the import of goods which causeecological damage. For example, the US has banned theimport of shrimp harvested without turtle excluder devise

because of its concern for the endangered sea turtles.Countries like India are affected by it.

Setting up of Polluting IndustryDeveloping countries are affected by the relocation of

polluting industries from the developed it the developingones. Similarly, several products which are banned in thedeveloped nations are marketed in the under developedworld.


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Waste Mangement:The dumping of nuclear and hazardouswastes in developing countries and the shifting of polluting

industries to the developing countries impose heavy socialcosts on them. The exploitation of the natural resources ofthe developing countries to satisfy the global demand alsooften causes ecological problems.

Society Opposed Works:The next concern aboutenvironmental issues is the role of trade relating to moresocial preferences. Some practices may simply beunacceptable for certain people or societies, so they opposetrade in products which encourage such practice. These caninclude killing dolphins, Whales in the process of catching

tuna, using leg hold traps for catching animals for their furs,or the use of polluting production methods which have onlylocal effects.


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