Question

•Conduct a web search for a current event related to an ethical and financial topic affecting an international business. •Discuss what you uncovered about this event that made it relevant to the topic of ethical and financial business. •Would you consider this event to be a common situation in management? Why or why not? •How did the ethical and financial topic specifically affect international business? Explain.

Answer 1

When McDonalds first tried to establish itself in India, it faced a lot of problems. After suffering heavy losses and doing so much of research, McDonalds realized that it was offering its customers in India food with beef. Little did it know, that Indians considered cow to be a holy animal and therefore, selling beef was a major reason for its losses.

Therefore, McDonalds faced ethical issues there and soon it stopped offering beef products. After that, the firm never saw behind and since then, it has been doing great in India.

It also faced some financial challenges when it had to choose between either picking the potatoes used to make the french fries from the Indian market only, or to get those potatoes imported from outside. After the beef incident, everybody expected that the firm will again have to bend and thus, will get ready to use the Indian potatoes. But McDonalds decided not to bend and not to compromise on the quality, and kept on importing potatoes from outside.

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This case has not only helped McDonalds, but has also helped other firms to first think twice before entering into an international market. It has taught the firms that first they should do their homework, instead of blindly entering into a market wherever they see the prospects of the profit.

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Such incidents, however vague, are very common in the management whenever the firms decide to enter into a foreign market. Whenever a firm goes international, apart from the legal problems, firms also face other ethical and non-ethical challenges, which have become quite common these days with the increased level of liberal markets.

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International business in affected by the ethical topic because without considering the ethics, it becomes very difficult for the firms to establish themselves in the economy. A firm might bear all the challenges but when it comes to ethics, they cannot do anything because the citizens will simply refuse to accept the firm.

As far as financial issues are concerned, they are also very important as in order to take ethics into the consideration, the firms cannot just bear the loss from the increased cost. Ultimately, finance is the source of profits for the firms and finance is all that matters mostly.