International Business_ MBA Module 2 ppt.pdf
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Jul 11, 2024
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About This Presentation
Introduction, Meaning and Components of International Business
Environment, Political Environment, Legal Environment, Economic Environment, Technological
Environment, Socio and Cultural Environment, Ethics in International Business and CSR in International
Business.
Slide Content
International Business (22MBA401)
Module 2
International Business Environment
Dr TSN, JSSATEB International Business
Module 2
International Business Environment
Dr TSN, JSSATEB International Business
Introduction
•The IB environment encompasses all external influences that affect
businesses operating across national borders.
•It is a complex and dynamic field, shaped by various economic, political,
legal, cultural, technological, and environmental factors.
•Understanding these influences is crucial for businesses seeking to
expand and thrive in the global marketplace.
Dr TSN, JSSATEB International Business
•The IB environment encompasses all external influences that affect
businesses operating across national borders.
•It is a complex and dynamic field, shaped by various economic, political,
legal, cultural, technological, and environmental factors.
•Understanding these influences is crucial for businesses seeking to
expand and thrive in the global marketplace.
Dr TSN, JSSATEB International Business
Cont..
•Navigating the IB environment requires a comprehensive understanding of
its multifaceted nature.
•By effectively analysing and adapting to the economic, political, legal,
cultural, technological, and environmental factors, businesses can
successfully expand their operations globally and achieve sustainable
growth.
Dr TSN, JSSATEB International Business
•Navigating the IB environment requires a comprehensive understanding of
its multifaceted nature.
•By effectively analysing and adapting to the economic, political, legal,
cultural, technological, and environmental factors, businesses can
successfully expand their operations globally and achieve sustainable
growth.
Dr TSN, JSSATEB International Business
Meaning of international Business Environment
•The term "environment" refers to the surrounding conditions or factors.
•The IB environment encompasses all the factors and activities that
surround and influence IB operations.
•It includes the various external elements that impact MNCs and
transnational companies.
•These factors can significantly affect how these businesses operate,
make decisions, and achieve their goals on a global scale.
Dr TSN, JSSATEB International Business
•The term "environment" refers to the surrounding conditions or factors.
•The IB environment encompasses all the factors and activities that
surround and influence IB operations.
•It includes the various external elements that impact MNCs and
transnational companies.
•These factors can significantly affect how these businesses operate,
make decisions, and achieve their goals on a global scale.
Dr TSN, JSSATEB International Business
Cont..
•Factors that affect IB include Social and Cultural factors (S),
Technological factors (T), Economic factors (E),
Political/Governmental factors (P), International factors (I) and
Natural factors (N). (STEPIN) .
•William F. Glueck defined environmental analysis as the process by which
strategists monitor various external factors to determine opportunities
and threats to their firms.
•These factors include economic conditions, governmental and legal
regulations, market and competitive landscapes, supplier and
technological advancements, geographic settings, and social trends.
Dr TSN, JSSATEB International Business
•Factors that affect IB include Social and Cultural factors (S),
Technological factors (T), Economic factors (E),
Political/Governmental factors (P), International factors (I) and
Natural factors (N). (STEPIN) .
•William F. Glueck defined environmental analysis as the process by which
strategists monitor various external factors to determine opportunities
and threats to their firms.
•These factors include economic conditions, governmental and legal
regulations, market and competitive landscapes, supplier and
technological advancements, geographic settings, and social trends.
Dr TSN, JSSATEB International Business
Cont..
•This analysis helps businesses understand their external environment and
develop strategies to navigate challenges and capitalize on opportunities.
•Environmental diagnosis consists of managerial decisions made by
analysing the significance of data (opportunities and threats) of the
environmental analysis.
Dr TSN, JSSATEB International Business
•This analysis helps businesses understand their external environment and
develop strategies to navigate challenges and capitalize on opportunities.
•Environmental diagnosis consists of managerial decisions made by
analysing the significance of data (opportunities and threats) of the
environmental analysis.
Dr TSN, JSSATEB International Business
Components of International Business Environment
The IBs environment comprises a variety of external factors that influence
the operations and success of businesses operating globally. These
components can be categorized into several key areas:
1. Economic Environment
•Global Economic Conditions: Factors such as global GDP growth,
inflation rates, exchange rates, and economic stability.
•Trade Policies and Agreements: Impact of tariffs, trade agreements (e.g.,
NAFTA, EU, ASEAN), and economic blocks on trade.
•Economic Systems: Differences in capitalism, socialism, and mixed
economies, which affect business practices.
* NAFTA- North American Free Trade Agreement, EU- European Union,
ASEAN- Association of Southeast Asian Nations
Dr TSN, JSSATEB International Business
The IBs environment comprises a variety of external factors that influence
the operations and success of businesses operating globally. These
components can be categorized into several key areas:
1. Economic Environment
•Global Economic Conditions: Factors such as global GDP growth,
inflation rates, exchange rates, and economic stability.
•Trade Policies and Agreements: Impact of tariffs, trade agreements (e.g.,
NAFTA, EU, ASEAN), and economic blocks on trade.
•Economic Systems: Differences in capitalism, socialism, and mixed
economies, which affect business practices.
* NAFTA- North American Free Trade Agreement, EU- European Union,
ASEAN- Association of Southeast Asian Nations
Dr TSN, JSSATEB International Business
Cont..
2. Political and Legal Environment
•Political Stability: The degree of stability in governments, which affects
business confidence and investment.
•Regulatory Framework: Laws and regulations concerning business
operations, intellectual property, labor standards, and environmental
protections.
•Government Policies: Policies on foreign direct investment (FDI),
taxation, and trade regulations.
Dr TSN, JSSATEB International Business
2. Political and Legal Environment
•Political Stability: The degree of stability in governments, which affects
business confidence and investment.
•Regulatory Framework: Laws and regulations concerning business
operations, intellectual property, labor standards, and environmental
protections.
•Government Policies: Policies on foreign direct investment (FDI),
taxation, and trade regulations.
Dr TSN, JSSATEB International Business
Cont..
3. Cultural Environment
•Cultural Norms and Values: Customs, traditions, and social behaviors
that influence consumer preferences and business interactions.
•Language and Communication: Language differences that impact
marketing, negotiations, and communication.
•Social Structures: Variations in social hierarchies, family structures, and
social mobility.
Dr TSN, JSSATEB International Business
3. Cultural Environment
•Cultural Norms and Values: Customs, traditions, and social behaviors
that influence consumer preferences and business interactions.
•Language and Communication: Language differences that impact
marketing, negotiations, and communication.
•Social Structures: Variations in social hierarchies, family structures, and
social mobility.
Dr TSN, JSSATEB International Business
Cont..
4. Technological Environment
•Technological Advancements: Innovations in technology that affect
production processes, product development, and business operations.
•Infrastructure: Quality and availability of transportation, communication
networks, and utilities.
•Digital Connectivity: Levels of internet penetration and digital technology
adoption.
Dr TSN, JSSATEB International Business
4. Technological Environment
•Technological Advancements: Innovations in technology that affect
production processes, product development, and business operations.
•Infrastructure: Quality and availability of transportation, communication
networks, and utilities.
•Digital Connectivity: Levels of internet penetration and digital technology
adoption.
Dr TSN, JSSATEB International Business
Cont..
5. Environmental and Ecological Factors
•Sustainability Practices: Emphasis on sustainable business practices
and corporate social responsibility (CSR).
•Environmental Regulations: Compliance with international and local
environmental laws and standards.
•Climate Change: Effects of climate change and natural disasters on
supply chains and production.
Dr TSN, JSSATEB International Business
5. Environmental and Ecological Factors
•Sustainability Practices: Emphasis on sustainable business practices
and corporate social responsibility (CSR).
•Environmental Regulations: Compliance with international and local
environmental laws and standards.
•Climate Change: Effects of climate change and natural disasters on
supply chains and production.
Dr TSN, JSSATEB International Business
Cont..
6. Competitive Environment
•Market Dynamics: Understanding the competitive landscape in various
markets.
•Local Competitors: Competition from domestic firms with local market
knowledge.
•Global Competitors: Challenges posed by other multinational
corporations operating in the same markets.
Dr TSN, JSSATEB International Business
6. Competitive Environment
•Market Dynamics: Understanding the competitive landscape in various
markets.
•Local Competitors: Competition from domestic firms with local market
knowledge.
•Global Competitors: Challenges posed by other multinational
corporations operating in the same markets.
Dr TSN, JSSATEB International Business
Importance of These Components
•Strategize Effectively: Develop informed strategies to enter and thrive in
foreign markets.
•Manage Risks: Identify and mitigate risks associated with political
instability, economic fluctuations, and regulatory changes.
•Enhance Cultural Competence: Foster better customer relations and
effective marketing through cultural awareness.
Dr TSN, JSSATEB International Business
•Strategize Effectively: Develop informed strategies to enter and thrive in
foreign markets.
•Manage Risks: Identify and mitigate risks associated with political
instability, economic fluctuations, and regulatory changes.
•Enhance Cultural Competence: Foster better customer relations and
effective marketing through cultural awareness.
Dr TSN, JSSATEB International Business
Cont..
•Innovate and Adapt: Stay competitive by adapting to technological
advancements and environmental challenges.
•Promote Sustainable Growth: Embrace sustainable practices and CSR
to enhance reputation and achieve long-term success.
By analysing these factors, businesses can navigate the complexities
of the IB environment, capitalize on global opportunities, and mitigate
potential risks.
Dr TSN, JSSATEB International Business
•Innovate and Adapt: Stay competitive by adapting to technological
advancements and environmental challenges.
•Promote Sustainable Growth: Embrace sustainable practices and CSR
to enhance reputation and achieve long-term success.
By analysing these factors, businesses can navigate the complexities
of the IB environment, capitalize on global opportunities, and mitigate
potential risks.
Dr TSN, JSSATEB International Business
Political Environment in International Business
•The political environment in IB refers to the political factors and
government actions that can affect the operations and success of
businesses across borders.
•It includes elements such as political stability, government policies,
regulatory frameworks, and international relations.
Dr TSN, JSSATEB International Business
•The political environment in IB refers to the political factors and
government actions that can affect the operations and success of
businesses across borders.
•It includes elements such as political stability, government policies,
regulatory frameworks, and international relations.
Dr TSN, JSSATEB International Business
Key Aspects of the Political Environment
•Political Stability
–Government Stability: Stable governments are more predictable and
attractive to IB.
Political instability can lead to risks such as expropriation, civil unrest,
and changes in laws that adversely affect business operations.
–Regime Change: Changes in government or political leadership can
lead to shifts in policies that impact business environments.
Dr TSN, JSSATEB International Business
•Political Stability
–Government Stability: Stable governments are more predictable and
attractive to IB.
Political instability can lead to risks such as expropriation, civil unrest,
and changes in laws that adversely affect business operations.
–Regime Change: Changes in government or political leadership can
lead to shifts in policies that impact business environments.
Dr TSN, JSSATEB International Business
Cont..
•Regulatory Framework
–Business Regulations: Laws and regulations that govern business
operations, including labor laws, safety standards, and
environmental regulations.
–Intellectual Property Rights: Protection of patents, trademarks, and
copyrights, which is crucial for businesses to safeguard their
innovations and brands.
–Contract Enforcement: The legal systems that ensure contracts are
honoured and disputes are resolved fairly and efficiently.
Dr TSN, JSSATEB International Business
•Regulatory Framework
–Business Regulations: Laws and regulations that govern business
operations, including labor laws, safety standards, and
environmental regulations.
–Intellectual Property Rights: Protection of patents, trademarks, and
copyrights, which is crucial for businesses to safeguard their
innovations and brands.
–Contract Enforcement: The legal systems that ensure contracts are
honoured and disputes are resolved fairly and efficiently.
Dr TSN, JSSATEB International Business
Cont..
•Government Policies
–Trade Policies: Tariffs, import quotas, export restrictions, and trade
agreements that influence international trade flows.
–Taxation: Tax policies, including corporate taxes, VAT, and
import/export duties, which affect the cost of doing business.
–Foreign Direct Investment (FDI): Policies that encourage or restrict
foreign investment, including incentives, restrictions, and requirements
for local partnerships.
Dr TSN, JSSATEB International Business
•Government Policies
–Trade Policies: Tariffs, import quotas, export restrictions, and trade
agreements that influence international trade flows.
–Taxation: Tax policies, including corporate taxes, VAT, and
import/export duties, which affect the cost of doing business.
–Foreign Direct Investment (FDI): Policies that encourage or restrict
foreign investment, including incentives, restrictions, and requirements
for local partnerships.
Dr TSN, JSSATEB International Business
Cont..
•International Relations
–Bilateral and Multilateral Relations: Diplomatic relationships
between countries, including trade agreements and political
alliances, which can facilitate or hinder business operations.
–Sanctions : Government-imposed trade restrictions that can limit
market access and impact business strategies.
Dr TSN, JSSATEB International Business
•International Relations
–Bilateral and Multilateral Relations: Diplomatic relationships
between countries, including trade agreements and political
alliances, which can facilitate or hinder business operations.
–Sanctions : Government-imposed trade restrictions that can limit
market access and impact business strategies.
Dr TSN, JSSATEB International Business
Cont..
•Political Risk
–Expropriation: Risk of a government seizing privately-owned
assets.
–Corruption: The impact of corrupt practices on business
operations, including bribery and unethical practices.
–Bureaucratic Red Tape: Excessive regulatory hurdles that can
delay business activities and increase operational costs.
Dr TSN, JSSATEB International Business
•Political Risk
–Expropriation: Risk of a government seizing privately-owned
assets.
–Corruption: The impact of corrupt practices on business
operations, including bribery and unethical practices.
–Bureaucratic Red Tape: Excessive regulatory hurdles that can
delay business activities and increase operational costs.
Dr TSN, JSSATEB International Business
Importance of Understanding the Political Environment
•Risk Management: Identifying and mitigating political risks to
safeguard business investments.
•Strategic Planning: Developing strategies that align with government
policies and regulations.
•Compliance: Ensuring adherence to local and international laws to
avoid legal penalties and reputational damage.
•Market Entry: Assessing political factors to make informed decisions
about entering or exiting markets.
Dr TSN, JSSATEB International Business
•Risk Management: Identifying and mitigating political risks to
safeguard business investments.
•Strategic Planning: Developing strategies that align with government
policies and regulations.
•Compliance: Ensuring adherence to local and international laws to
avoid legal penalties and reputational damage.
•Market Entry: Assessing political factors to make informed decisions
about entering or exiting markets.
Dr TSN, JSSATEB International Business
Cont..
•Negotiation and Lobbying: Engaging with governments to influence
policy decisions that benefit business operations.
By understanding the political environment, IB can navigate the
complexities of different political systems, mitigate risks, and make
strategic decisions that enhance their competitiveness and sustainability in
the global marketplace.
Dr TSN, JSSATEB International Business
•Negotiation and Lobbying: Engaging with governments to influence
policy decisions that benefit business operations.
By understanding the political environment, IB can navigate the
complexities of different political systems, mitigate risks, and make
strategic decisions that enhance their competitiveness and sustainability in
the global marketplace.
Dr TSN, JSSATEB International Business
Legal Environment in International Business
•The legal environment in IB refers to the framework of laws, regulations,
and legal systems that govern business operations across different
countries.
•This environment is crucial for International corporations (MNCs) and
transnational companies as it associated with the legal obligations,
protections, and constraints they face when conducting business
internationally.
Dr TSN, JSSATEB International Business
•The legal environment in IB refers to the framework of laws, regulations,
and legal systems that govern business operations across different
countries.
•This environment is crucial for International corporations (MNCs) and
transnational companies as it associated with the legal obligations,
protections, and constraints they face when conducting business
internationally.
Dr TSN, JSSATEB International Business
Key Aspects of the Legal Environment
•Regulatory Framework
–Business Regulations: Laws governing how businesses can
operate, including company formation, corporate governance, and
operational compliance.
–Labor Laws: Regulations concerning employment practices,
wages, working conditions, and employee rights.
–Environmental Regulations: Laws related to environmental
protection, sustainability practices, and corporate social
responsibility (CSR).
Dr TSN, JSSATEB International Business
•Regulatory Framework
–Business Regulations: Laws governing how businesses can
operate, including company formation, corporate governance, and
operational compliance.
–Labor Laws: Regulations concerning employment practices,
wages, working conditions, and employee rights.
–Environmental Regulations: Laws related to environmental
protection, sustainability practices, and corporate social
responsibility (CSR).
Dr TSN, JSSATEB International Business
Cont..
•Contract Law
–Contract Formation and Enforcement: Legal principles that dictate
how contracts are created, enforced, and interpreted in different
jurisdictions.
–Dispute Resolution: Mechanisms for resolving contractual
disputes, including litigation, arbitration, and mediation.
Dr TSN, JSSATEB International Business
•Contract Law
–Contract Formation and Enforcement: Legal principles that dictate
how contracts are created, enforced, and interpreted in different
jurisdictions.
–Dispute Resolution: Mechanisms for resolving contractual
disputes, including litigation, arbitration, and mediation.
Dr TSN, JSSATEB International Business
Cont..
•Intellectual Property Rights (IPR)
–Patents: Protection of inventions and technological innovations.
–Trademarks: Protection of brand names, logos, and symbols.
–Copyrights: Protection of original works of authorship, including
literature, music, and software.
–Trade Secrets: Protection of confidential business information and
proprietary processes.
Dr TSN, JSSATEB International Business
•Intellectual Property Rights (IPR)
–Patents: Protection of inventions and technological innovations.
–Trademarks: Protection of brand names, logos, and symbols.
–Copyrights: Protection of original works of authorship, including
literature, music, and software.
–Trade Secrets: Protection of confidential business information and
proprietary processes.
Dr TSN, JSSATEB International Business
Cont..
•Trade and Investment Laws
–Trade Regulations: Laws governing the import and export of
goods, including tariffs, quotas, and trade restrictions.
–Foreign Direct Investment (FDI): Regulations affecting foreign
investments, including ownership restrictions, repatriation of
profits, and investment incentives.
Dr TSN, JSSATEB International Business
•Trade and Investment Laws
–Trade Regulations: Laws governing the import and export of
goods, including tariffs, quotas, and trade restrictions.
–Foreign Direct Investment (FDI): Regulations affecting foreign
investments, including ownership restrictions, repatriation of
profits, and investment incentives.
Dr TSN, JSSATEB International Business
Cont..
•Consumer Protection Laws
–Product Safety: Regulations ensuring that products meet safety
standards to protect consumers.
–Advertising Standards: Laws that govern truthful advertising and
prevent deceptive marketing practices.
–Data Protection and Privacy: Regulations protecting consumer
data and privacy, such as the General Data Protection Regulation
(GDPR) in the European Union.
Dr TSN, JSSATEB International Business
•Consumer Protection Laws
–Product Safety: Regulations ensuring that products meet safety
standards to protect consumers.
–Advertising Standards: Laws that govern truthful advertising and
prevent deceptive marketing practices.
–Data Protection and Privacy: Regulations protecting consumer
data and privacy, such as the General Data Protection Regulation
(GDPR) in the European Union.
Dr TSN, JSSATEB International Business
Cont..
•Antitrust and Competition Law
–Monopolistic Practices: Laws preventing monopolies and
promoting fair competition.
–Mergers and Acquisitions: Regulations governing the
consolidation of companies to ensure they do not create unfair
market dominance.
Dr TSN, JSSATEB International Business
•Antitrust and Competition Law
–Monopolistic Practices: Laws preventing monopolies and
promoting fair competition.
–Mergers and Acquisitions: Regulations governing the
consolidation of companies to ensure they do not create unfair
market dominance.
Dr TSN, JSSATEB International Business
Cont..
•International Legal Agreements and Conventions
–International Trade Agreements: Agreements like the World Trade
Organization (WTO) rules, North American Free Trade Agreement
(NAFTA), and the European Union (EU) regulations.
–Bilateral and Multilateral Treaties: Agreements between countries
that impact trade, investment, taxation, and intellectual property.
–United Nations (UN) Conventions: International treaties and
conventions, such as those concerning human rights,
environmental protection, and labor standards.
Dr TSN, JSSATEB International Business
•International Legal Agreements and Conventions
–International Trade Agreements: Agreements like the World Trade
Organization (WTO) rules, North American Free Trade Agreement
(NAFTA), and the European Union (EU) regulations.
–Bilateral and Multilateral Treaties: Agreements between countries
that impact trade, investment, taxation, and intellectual property.
–United Nations (UN) Conventions: International treaties and
conventions, such as those concerning human rights,
environmental protection, and labor standards.
Dr TSN, JSSATEB International Business
Importance of Understanding the Legal Environment
•Compliance: Ensuring that business operations adhere to local and
international laws to avoid legal penalties, fines, and reputational damage.
•Risk Management: Identifying and mitigating legal risks associated with
operating in different jurisdictions.
•Strategic Planning: Developing strategies that align with the legal
requirements of target markets.
•Intellectual Property Protection: Safeguarding innovations, brands, and
proprietary information from infringement and theft.
Dr TSN, JSSATEB International Business
•Compliance: Ensuring that business operations adhere to local and
international laws to avoid legal penalties, fines, and reputational damage.
•Risk Management: Identifying and mitigating legal risks associated with
operating in different jurisdictions.
•Strategic Planning: Developing strategies that align with the legal
requirements of target markets.
•Intellectual Property Protection: Safeguarding innovations, brands, and
proprietary information from infringement and theft.
Dr TSN, JSSATEB International Business
Cont..
•Dispute Resolution: Effectively managing legal disputes and minimizing
potential losses through appropriate dispute resolution mechanisms.
•Market Entry and Expansion: Assessing legal factors to make informed
decisions about entering new markets or expanding existing operations.
By understanding the legal environment, IB can navigate the complexities
of operating across multiple jurisdictions, ensure compliance, protect
their interests, and strategically manage risks.
This knowledge is essential for achieving sustainable growth and maintaining
a competitive edge in the global marketplace.
Dr TSN, JSSATEB International Business
•Dispute Resolution: Effectively managing legal disputes and minimizing
potential losses through appropriate dispute resolution mechanisms.
•Market Entry and Expansion: Assessing legal factors to make informed
decisions about entering new markets or expanding existing operations.
By understanding the legal environment, IB can navigate the complexities
of operating across multiple jurisdictions, ensure compliance, protect
their interests, and strategically manage risks.
This knowledge is essential for achieving sustainable growth and maintaining
a competitive edge in the global marketplace.
Dr TSN, JSSATEB International Business
Economic Environment in International Business
•The economic environment in IB refers to the economic conditions and
factors that influence the operations, decision-making, and
performance of businesses operating across national borders.
•Understanding the economic environment is crucial for businesses to
effectively strategize and adapt to different markets.
•This environment includes various components such as global economic
conditions, trade policies, economic systems, and market dynamics.
Dr TSN, JSSATEB International Business
•The economic environment in IB refers to the economic conditions and
factors that influence the operations, decision-making, and
performance of businesses operating across national borders.
•Understanding the economic environment is crucial for businesses to
effectively strategize and adapt to different markets.
•This environment includes various components such as global economic
conditions, trade policies, economic systems, and market dynamics.
Dr TSN, JSSATEB International Business
Key Components of the Economic Environment
•Global Economic Conditions
–Economic Growth: Rates of economic growth (GDP growth) in
different countries and regions affect market potential and
consumer spending power.
–Inflation and Deflation: Changes in price levels can influence
purchasing power, cost of living, and pricing strategies for
businesses.
–Exchange Rates: Fluctuations in currency exchange rates impact
the costs of importing and exporting goods, profitability, and
competitiveness in foreign markets.
Dr TSN, JSSATEB International Business
•Global Economic Conditions
–Economic Growth: Rates of economic growth (GDP growth) in
different countries and regions affect market potential and
consumer spending power.
–Inflation and Deflation: Changes in price levels can influence
purchasing power, cost of living, and pricing strategies for
businesses.
–Exchange Rates: Fluctuations in currency exchange rates impact
the costs of importing and exporting goods, profitability, and
competitiveness in foreign markets.
Dr TSN, JSSATEB International Business
Cont…
–Economic Cycles: Phases of economic cycles (boom, recession,
recovery) affect business operations, investment decisions, and
market opportunities.
Dr TSN, JSSATEB International Business
–Economic Cycles: Phases of economic cycles (boom, recession,
recovery) affect business operations, investment decisions, and
market opportunities.
Dr TSN, JSSATEB International Business
Cont..
•Trade Policies and Agreements
–Tariffs and Quotas: Government-imposed taxes on imports (tariffs)
and limits on the quantity of goods that can be imported (quotas)
affect trade flows and market access.
–Trade Agreements: Bilateral and multilateral trade agreements
(e.g., NAFTA, EU, ASEAN) facilitate or restrict trade between
member countries by reducing or eliminating tariffs and quotas.
Dr TSN, JSSATEB International Business
•Trade Policies and Agreements
–Tariffs and Quotas: Government-imposed taxes on imports (tariffs)
and limits on the quantity of goods that can be imported (quotas)
affect trade flows and market access.
–Trade Agreements: Bilateral and multilateral trade agreements
(e.g., NAFTA, EU, ASEAN) facilitate or restrict trade between
member countries by reducing or eliminating tariffs and quotas.
Dr TSN, JSSATEB International Business
Cont…
–Protectionism vs. Free Trade: Government policies that either
protect domestic industries through trade barriers or promote free
trade impact international business strategies.
Dr TSN, JSSATEB International Business
–Protectionism vs. Free Trade: Government policies that either
protect domestic industries through trade barriers or promote free
trade impact international business strategies.
Dr TSN, JSSATEB International Business
Cont..
•Economic Systems
–Capitalism: Market-driven economies where supply and demand
determine prices and production. Businesses operate with a high
degree of freedom.
–Socialism: Economies where the government plays a significant
role in planning and regulating production, distribution, and prices.
–Mixed Economies: A blend of capitalism and socialism, where both
private and public sectors contribute to the economy.
Dr TSN, JSSATEB International Business
•Economic Systems
–Capitalism: Market-driven economies where supply and demand
determine prices and production. Businesses operate with a high
degree of freedom.
–Socialism: Economies where the government plays a significant
role in planning and regulating production, distribution, and prices.
–Mixed Economies: A blend of capitalism and socialism, where both
private and public sectors contribute to the economy.
Dr TSN, JSSATEB International Business
Cont..
•Market Dynamics
–Market Size and Growth: The size of the market and its growth rate
influence business opportunities and investment decisions.
–Consumer Preferences and Spending: Variations in consumer
preferences, spending habits, and income levels across different
markets affect product demand.
–Competition: The level of competition in different markets,
including local and international competitors, impacts pricing,
marketing strategies, and market entry decisions.
Dr TSN, JSSATEB International Business
•Market Dynamics
–Market Size and Growth: The size of the market and its growth rate
influence business opportunities and investment decisions.
–Consumer Preferences and Spending: Variations in consumer
preferences, spending habits, and income levels across different
markets affect product demand.
–Competition: The level of competition in different markets,
including local and international competitors, impacts pricing,
marketing strategies, and market entry decisions.
Dr TSN, JSSATEB International Business
Cont..
•Economic Stability and Risk
–Political and Economic Stability: Stable political and economic
conditions are more attractive for investment and business
operations. Instability can pose risks such as expropriation, inflation,
and currency devaluation.
–Credit and Interest Rates: Access to credit and prevailing interest rates
influence business financing, investment decisions, and consumer
spending.
Dr TSN, JSSATEB International Business
•Economic Stability and Risk
–Political and Economic Stability: Stable political and economic
conditions are more attractive for investment and business
operations. Instability can pose risks such as expropriation, inflation,
and currency devaluation.
–Credit and Interest Rates: Access to credit and prevailing interest rates
influence business financing, investment decisions, and consumer
spending.
Dr TSN, JSSATEB International Business
Cont..
•Infrastructure and Resources
–Physical Infrastructure: Quality of transportation networks, energy
supply, and communication systems affect operational efficiency and
logistics.
–Natural Resources: Availability of natural resources such as
minerals, oil, and agricultural products impacts production costs and
supply chains.
–Human Resources: Availability of skilled labor, labor costs, and
productivity levels influence business operations and competitiveness.
Dr TSN, JSSATEB International Business
•Infrastructure and Resources
–Physical Infrastructure: Quality of transportation networks, energy
supply, and communication systems affect operational efficiency and
logistics.
–Natural Resources: Availability of natural resources such as
minerals, oil, and agricultural products impacts production costs and
supply chains.
–Human Resources: Availability of skilled labor, labor costs, and
productivity levels influence business operations and competitiveness.
Dr TSN, JSSATEB International Business
Importance of Understanding the Economic Environment
•Strategic Planning: Businesses can develop informed strategies to
enter and thrive in different markets based on economic conditions.
•Risk Management: Identifying and mitigating economic risks, such as
currency fluctuations and economic instability, to safeguard
investments.
•Market Entry: Assessing economic factors to make informed
decisions about entering new markets or expanding existing
operations.
Dr TSN, JSSATEB International Business
•Strategic Planning: Businesses can develop informed strategies to
enter and thrive in different markets based on economic conditions.
•Risk Management: Identifying and mitigating economic risks, such as
currency fluctuations and economic instability, to safeguard
investments.
•Market Entry: Assessing economic factors to make informed
decisions about entering new markets or expanding existing
operations.
Dr TSN, JSSATEB International Business
Cont..
•Pricing and Marketing: Adapting pricing strategies and marketing
campaigns to align with local economic conditions and consumer
behavior.
•Investment Decisions: Making sound investment decisions by
understanding the economic environment and potential returns on
investment.
•Resource Allocation: Efficiently allocating resources to optimize
production, distribution, and marketing based on economic
conditions.
Dr TSN, JSSATEB International Business
•Pricing and Marketing: Adapting pricing strategies and marketing
campaigns to align with local economic conditions and consumer
behavior.
•Investment Decisions: Making sound investment decisions by
understanding the economic environment and potential returns on
investment.
•Resource Allocation: Efficiently allocating resources to optimize
production, distribution, and marketing based on economic
conditions.
Dr TSN, JSSATEB International Business
Technological Environment in International Business
•The technological environment in IB refers to the various technological
factors and advancements that influence how businesses operate,
compete, and expand globally.
•This environment encompasses innovations, infrastructure, digital
connectivity, and the rate of technological adoption, all of which
significantly impact international business strategies and operations.
Dr TSN, JSSATEB International Business
•The technological environment in IB refers to the various technological
factors and advancements that influence how businesses operate,
compete, and expand globally.
•This environment encompasses innovations, infrastructure, digital
connectivity, and the rate of technological adoption, all of which
significantly impact international business strategies and operations.
Dr TSN, JSSATEB International Business
Key Components of the Technological Environment
•Technological Advancements
–Innovation and Research & Development (R&D): Continuous
innovation and investment in R&D are crucial for maintaining
competitive advantage, developing new products, and improving
processes.
–Automation and Robotics: The use of automated systems and
robotics in manufacturing and services can enhance efficiency,
reduce costs, and improve product quality.
Dr TSN, JSSATEB International Business
•Technological Advancements
–Innovation and Research & Development (R&D): Continuous
innovation and investment in R&D are crucial for maintaining
competitive advantage, developing new products, and improving
processes.
–Automation and Robotics: The use of automated systems and
robotics in manufacturing and services can enhance efficiency,
reduce costs, and improve product quality.
Dr TSN, JSSATEB International Business
Cont..
•Artificial Intelligence (AI) and Machine Learning (ML): AI and ML
technologies enable businesses to analyze vast amounts of data,
predict trends, and personalize customer experiences.
Dr TSN, JSSATEB International Business
•Artificial Intelligence (AI) and Machine Learning (ML): AI and ML
technologies enable businesses to analyze vast amounts of data,
predict trends, and personalize customer experiences.
Dr TSN, JSSATEB International Business
Cont..
•Digital Connectivity
–Internet Penetration: High levels of internet penetration facilitate e-
commerce, online marketing, and remote work, expanding
business reach and operational flexibility.
–Mobile Technology: Widespread use of smartphones and mobile
applications provides new platforms for marketing, sales, and
customer engagement.
Dr TSN, JSSATEB International Business
•Digital Connectivity
–Internet Penetration: High levels of internet penetration facilitate e-
commerce, online marketing, and remote work, expanding
business reach and operational flexibility.
–Mobile Technology: Widespread use of smartphones and mobile
applications provides new platforms for marketing, sales, and
customer engagement.
Dr TSN, JSSATEB International Business
Cont..
•Cloud Computing: Cloud-based services offer scalable and cost-
effective solutions for data storage, computing power, and software
applications, enhancing operational efficiency.
Dr TSN, JSSATEB International Business
•Cloud Computing: Cloud-based services offer scalable and cost-
effective solutions for data storage, computing power, and software
applications, enhancing operational efficiency.
Dr TSN, JSSATEB International Business
Cont..
•Infrastructure Quality
–Telecommunications Networks: Reliable and high-speed
communication networks are essential for efficient business
operations, coordination, and customer service.
–Transportation Infrastructure: Advanced transportation systems,
including logistics and supply chain networks, support the
efficient movement of goods and services.
–Energy Supply: Stable and sustainable energy sources are critical
for uninterrupted business operations and technological
applications.
Dr TSN, JSSATEB International Business
•Infrastructure Quality
–Telecommunications Networks: Reliable and high-speed
communication networks are essential for efficient business
operations, coordination, and customer service.
–Transportation Infrastructure: Advanced transportation systems,
including logistics and supply chain networks, support the
efficient movement of goods and services.
–Energy Supply: Stable and sustainable energy sources are critical
for uninterrupted business operations and technological
applications.
Dr TSN, JSSATEB International Business
Cont..
•Technological Adoption and Diffusion
–Adoption Rates: The speed at which new technologies are adopted
by businesses and consumers in different regions affects market
opportunities and competitive dynamics.
–Technology Transfer: The process of transferring technology between
countries, often through foreign direct investment (FDI), joint
ventures, and licensing agreements, fosters innovation and
development.
Dr TSN, JSSATEB International Business
•Technological Adoption and Diffusion
–Adoption Rates: The speed at which new technologies are adopted
by businesses and consumers in different regions affects market
opportunities and competitive dynamics.
–Technology Transfer: The process of transferring technology between
countries, often through foreign direct investment (FDI), joint
ventures, and licensing agreements, fosters innovation and
development.
Dr TSN, JSSATEB International Business
Cont..
•Cybersecurity
–Data Protection: Ensuring the security of sensitive business and
customer data is vital to maintain trust and comply with regulatory
requirements.
–Cyber Threats: Businesses must safeguard against cyber-attacks,
hacking, and other digital threats that can disrupt operations and
compromise data integrity.
Dr TSN, JSSATEB International Business
•Cybersecurity
–Data Protection: Ensuring the security of sensitive business and
customer data is vital to maintain trust and comply with regulatory
requirements.
–Cyber Threats: Businesses must safeguard against cyber-attacks,
hacking, and other digital threats that can disrupt operations and
compromise data integrity.
Dr TSN, JSSATEB International Business
Cont..
•Regulatory Environment
–Technology Regulations: Compliance with local and international
laws governing technology use, data protection, intellectual
property, and digital transactions.
–Standards and Certifications: Adhering to industry standards and
obtaining relevant certifications to ensure technology quality and
interoperability.
Dr TSN, JSSATEB International Business
•Regulatory Environment
–Technology Regulations: Compliance with local and international
laws governing technology use, data protection, intellectual
property, and digital transactions.
–Standards and Certifications: Adhering to industry standards and
obtaining relevant certifications to ensure technology quality and
interoperability.
Dr TSN, JSSATEB International Business
Importance of Understanding the Technological Environment
•Competitive Advantage: Leveraging advanced technologies to
enhance product offerings, improve operational efficiency, and
differentiate from competitors.
•Market Expansion: Utilizing digital platforms and e-commerce to
enter new markets and reach a global customer base.
•Innovation and Development: Investing in R&D to foster innovation,
create new products, and adapt to changing market demands.
Dr TSN, JSSATEB International Business
•Competitive Advantage: Leveraging advanced technologies to
enhance product offerings, improve operational efficiency, and
differentiate from competitors.
•Market Expansion: Utilizing digital platforms and e-commerce to
enter new markets and reach a global customer base.
•Innovation and Development: Investing in R&D to foster innovation,
create new products, and adapt to changing market demands.
Dr TSN, JSSATEB International Business
Cont..
•Operational Efficiency: Implementing automation, AI, and other
technologies to streamline processes, reduce costs, and improve
productivity.
•Customer Engagement: Enhancing customer experiences through
personalized services, digital marketing, and seamless online
interactions.
•Risk Management: Protecting against cybersecurity threats and
ensuring data protection to maintain business continuity and
compliance.
Dr TSN, JSSATEB International Business
•Operational Efficiency: Implementing automation, AI, and other
technologies to streamline processes, reduce costs, and improve
productivity.
•Customer Engagement: Enhancing customer experiences through
personalized services, digital marketing, and seamless online
interactions.
•Risk Management: Protecting against cybersecurity threats and
ensuring data protection to maintain business continuity and
compliance.
Dr TSN, JSSATEB International Business
Socio-Cultural Environment in International Business
•The socio-cultural environment in IB refers to the societal and cultural
factors that affect business operations and strategies across different
countries and regions.
•Understanding these factors is crucial for businesses to effectively engage
with local markets, tailor their offerings, and build strong
relationships with customers, employees, and other stakeholders.
Dr TSN, JSSATEB International Business
•The socio-cultural environment in IB refers to the societal and cultural
factors that affect business operations and strategies across different
countries and regions.
•Understanding these factors is crucial for businesses to effectively engage
with local markets, tailor their offerings, and build strong
relationships with customers, employees, and other stakeholders.
Dr TSN, JSSATEB International Business
Key Components of the Socio-Cultural Environment
•Cultural Norms and Values
–Customs and Traditions: Practices and rituals that are prevalent in
a society, affecting consumer behavior and business interactions.
–Beliefs and Values: Core principles and ideologies that guide
behavior and decision-making processes within a culture.
Dr TSN, JSSATEB International Business
•Cultural Norms and Values
–Customs and Traditions: Practices and rituals that are prevalent in
a society, affecting consumer behavior and business interactions.
–Beliefs and Values: Core principles and ideologies that guide
behavior and decision-making processes within a culture.
Dr TSN, JSSATEB International Business
Cont..
•Language and Communication
–Language Barriers: Differences in language that can impact
marketing, negotiations, and customer service.
–Communication Styles: Variations in directness, formality, and non-
verbal communication that influence business interactions and
relationship-building.
Dr TSN, JSSATEB International Business
•Language and Communication
–Language Barriers: Differences in language that can impact
marketing, negotiations, and customer service.
–Communication Styles: Variations in directness, formality, and non-
verbal communication that influence business interactions and
relationship-building.
Dr TSN, JSSATEB International Business
Cont..
•Social Structures
–Family Dynamics: The role of family in society, including family
size, decision-making processes, and influence on consumer
behavior.
–Social Hierarchies and Mobility: The stratification of society and
the potential for individuals to move between different social
classes.
Dr TSN, JSSATEB International Business
•Social Structures
–Family Dynamics: The role of family in society, including family
size, decision-making processes, and influence on consumer
behavior.
–Social Hierarchies and Mobility: The stratification of society and
the potential for individuals to move between different social
classes.
Dr TSN, JSSATEB International Business
Cont..
•Education and Literacy
–Education Levels: The general level of education and literacy rates,
which impact workforce skills, consumer sophistication, and
product demand.
–Educational Systems: Differences in educational systems and their
emphasis on various skills and competencies.
Dr TSN, JSSATEB International Business
•Education and Literacy
–Education Levels: The general level of education and literacy rates,
which impact workforce skills, consumer sophistication, and
product demand.
–Educational Systems: Differences in educational systems and their
emphasis on various skills and competencies.
Dr TSN, JSSATEB International Business
Cont..
•Religion and Spirituality
–Religious Beliefs: Predominant religions and their impact on daily
life, holidays, and consumer preferences.
–Religious Practices: Rituals and observances that can affect work
schedules, marketing strategies, and product offerings.
Dr TSN, JSSATEB International Business
•Religion and Spirituality
–Religious Beliefs: Predominant religions and their impact on daily
life, holidays, and consumer preferences.
–Religious Practices: Rituals and observances that can affect work
schedules, marketing strategies, and product offerings.
Dr TSN, JSSATEB International Business
Cont..
•Lifestyle and Consumption Patterns
–Consumer Preferences: Preferences for certain types of products,
brands, and purchasing behaviors.
–Health and Wellness Trends: Societal focus on health, fitness, and
wellness that can influence product development and marketing
strategies.
Dr TSN, JSSATEB International Business
•Lifestyle and Consumption Patterns
–Consumer Preferences: Preferences for certain types of products,
brands, and purchasing behaviors.
–Health and Wellness Trends: Societal focus on health, fitness, and
wellness that can influence product development and marketing
strategies.
Dr TSN, JSSATEB International Business
Cont..
•Demographics
–Population Size and Growth: The size and growth rate of the
population, which affect market potential and demand for products and
services.
–Age Distribution: The age structure of the population, influencing
market segmentation and product targeting.
–Urbanization: The degree of urbanization and its impact on lifestyle,
consumption patterns, and business operations.
Dr TSN, JSSATEB International Business
•Demographics
–Population Size and Growth: The size and growth rate of the
population, which affect market potential and demand for products and
services.
–Age Distribution: The age structure of the population, influencing
market segmentation and product targeting.
–Urbanization: The degree of urbanization and its impact on lifestyle,
consumption patterns, and business operations.
Dr TSN, JSSATEB International Business
Importance of Understanding the Socio-Cultural Environment
•Market Adaptation: Tailoring products, services, and marketing strategies
to align with local cultural norms, values, and preferences.
•Effective Communication: Developing communication strategies that
resonate with local audiences and avoid misunderstandings or cultural
insensitivity.
•Building Relationships: Establishing strong relationships with customers,
employees, and partners by understanding and respecting cultural
differences.
Dr TSN, JSSATEB International Business
•Market Adaptation: Tailoring products, services, and marketing strategies
to align with local cultural norms, values, and preferences.
•Effective Communication: Developing communication strategies that
resonate with local audiences and avoid misunderstandings or cultural
insensitivity.
•Building Relationships: Establishing strong relationships with customers,
employees, and partners by understanding and respecting cultural
differences.
Dr TSN, JSSATEB International Business
Cont..
•Workforce Management: Creating a work environment that considers
local cultural practices, motivational factors, and management styles.
•Product Development: Designing products that meet the specific needs
and preferences of different cultural groups, leading to greater acceptance
and success in the market.
•Risk Mitigation: Anticipating and mitigating potential risks related to
cultural misunderstandings, non-compliance with local customs, and
societal backlash.
Dr TSN, JSSATEB International Business
•Workforce Management: Creating a work environment that considers
local cultural practices, motivational factors, and management styles.
•Product Development: Designing products that meet the specific needs
and preferences of different cultural groups, leading to greater acceptance
and success in the market.
•Risk Mitigation: Anticipating and mitigating potential risks related to
cultural misunderstandings, non-compliance with local customs, and
societal backlash.
Dr TSN, JSSATEB International Business
Cont..
•The socio-cultural environment is a critical factor in the success of IB
operations.
•By understanding and respecting cultural norms, values,
communication styles, social structures, and consumer behavior,
businesses can effectively navigate the complexities of different markets,
build strong relationships, and achieve sustainable growth.
•This cultural competence is essential for developing strategies that
resonate with local audiences and ensure long-term success in the global
marketplace.
Dr TSN, JSSATEB International Business
•The socio-cultural environment is a critical factor in the success of IB
operations.
•By understanding and respecting cultural norms, values,
communication styles, social structures, and consumer behavior,
businesses can effectively navigate the complexities of different markets,
build strong relationships, and achieve sustainable growth.
•This cultural competence is essential for developing strategies that
resonate with local audiences and ensure long-term success in the global
marketplace.
Dr TSN, JSSATEB International Business
Ethics in International Business
•Ethics in IB refers to the moral principles and standards that guide the
conduct of businesses operating across national boundaries.
•These ethical considerations are essential for maintaining a company's
reputation, building trust with stakeholders, ensuring legal
compliance, and contributing to sustainable development.
•Ethical business practices are crucial in navigating the complexities of
different cultural, legal, and economic environments in the global
marketplace.
Dr TSN, JSSATEB International Business
•Ethics in IB refers to the moral principles and standards that guide the
conduct of businesses operating across national boundaries.
•These ethical considerations are essential for maintaining a company's
reputation, building trust with stakeholders, ensuring legal
compliance, and contributing to sustainable development.
•Ethical business practices are crucial in navigating the complexities of
different cultural, legal, and economic environments in the global
marketplace.
Dr TSN, JSSATEB International Business
Key Ethical Issues in International Business
•Corporate Social Responsibility (CSR)
–Sustainability: Implementing practices that protect the environment and
ensure the sustainable use of resources.
–Community Engagement: Contributing to the well-being of local
communities through philanthropy, volunteering, and economic
development initiatives.
–Ethical Sourcing: Ensuring that raw materials and products are
sourced in a manner that respects human rights and environmental
standards.
Dr TSN, JSSATEB International Business
•Corporate Social Responsibility (CSR)
–Sustainability: Implementing practices that protect the environment and
ensure the sustainable use of resources.
–Community Engagement: Contributing to the well-being of local
communities through philanthropy, volunteering, and economic
development initiatives.
–Ethical Sourcing: Ensuring that raw materials and products are
sourced in a manner that respects human rights and environmental
standards.
Dr TSN, JSSATEB International Business
Cont..
•Human Rights
–Labor Standards: Adhering to international labor standards, including
fair wages, safe working conditions, and prohibiting child labor and
forced labor.
–Discrimination: Promoting diversity and inclusion, and preventing
discrimination based on race, gender, religion, or other factors.
–Freedom of Association: Respecting employees' rights to join or form
labor unions and engage in collective bargaining.
Dr TSN, JSSATEB International Business
•Human Rights
–Labor Standards: Adhering to international labor standards, including
fair wages, safe working conditions, and prohibiting child labor and
forced labor.
–Discrimination: Promoting diversity and inclusion, and preventing
discrimination based on race, gender, religion, or other factors.
–Freedom of Association: Respecting employees' rights to join or form
labor unions and engage in collective bargaining.
Dr TSN, JSSATEB International Business
Cont..
•Fair Trade Practices
–Anti-Corruption: Implementing policies and practices to prevent
bribery, fraud, and corruption in business dealings.
–Fair Competition: Engaging in fair competition practices, avoiding
monopolistic behavior, and complying with antitrust laws.
–Transparent Pricing: Ensuring transparent and fair pricing practices
that do not exploit customers or suppliers.
Dr TSN, JSSATEB International Business
•Fair Trade Practices
–Anti-Corruption: Implementing policies and practices to prevent
bribery, fraud, and corruption in business dealings.
–Fair Competition: Engaging in fair competition practices, avoiding
monopolistic behavior, and complying with antitrust laws.
–Transparent Pricing: Ensuring transparent and fair pricing practices
that do not exploit customers or suppliers.
Dr TSN, JSSATEB International Business
Cont..
•Environmental Responsibility
–Pollution Control: Reducing pollution and minimizing the environmental
impact of business operations.
–Resource Efficiency: Utilizing resources efficiently and reducing waste
through recycling and sustainable practices.
–Climate Change Mitigation: Taking measures to reduce greenhouse
gas emissions and contributing to climate change mitigation efforts.
Dr TSN, JSSATEB International Business
•Environmental Responsibility
–Pollution Control: Reducing pollution and minimizing the environmental
impact of business operations.
–Resource Efficiency: Utilizing resources efficiently and reducing waste
through recycling and sustainable practices.
–Climate Change Mitigation: Taking measures to reduce greenhouse
gas emissions and contributing to climate change mitigation efforts.
Dr TSN, JSSATEB International Business
Cont..
•Product Safety and Quality
–Consumer Protection: Ensuring that products and services meet safety
and quality standards to protect consumers from harm.
–Honest Marketing: Engaging in truthful advertising and marketing
practices, avoiding misleading or deceptive claims.
–Product Recalls: Responsibly managing product recalls and
addressing defects to maintain consumer trust and safety.
Dr TSN, JSSATEB International Business
•Product Safety and Quality
–Consumer Protection: Ensuring that products and services meet safety
and quality standards to protect consumers from harm.
–Honest Marketing: Engaging in truthful advertising and marketing
practices, avoiding misleading or deceptive claims.
–Product Recalls: Responsibly managing product recalls and
addressing defects to maintain consumer trust and safety.
Dr TSN, JSSATEB International Business
Cont..
•Global Supply Chain Ethics
–Supply Chain Transparency: Ensuring transparency in the supply
chain to monitor and address ethical issues.
–Supplier Code of Conduct: Establishing and enforcing a code of
conduct for suppliers to uphold ethical standards.
–Conflict Minerals: Avoiding the use of minerals that fund armed conflict
and human rights abuses.
Dr TSN, JSSATEB International Business
•Global Supply Chain Ethics
–Supply Chain Transparency: Ensuring transparency in the supply
chain to monitor and address ethical issues.
–Supplier Code of Conduct: Establishing and enforcing a code of
conduct for suppliers to uphold ethical standards.
–Conflict Minerals: Avoiding the use of minerals that fund armed conflict
and human rights abuses.
Dr TSN, JSSATEB International Business
Importance of Ethics in International Business
•Reputation Management: Maintaining a strong reputation by adhering to
ethical standards, which is crucial for building trust with customers,
investors, and partners.
•Legal Compliance: Ensuring compliance with international and local laws
and regulations to avoid legal penalties and sanctions.
•Risk Mitigation: Reducing the risk of scandals, lawsuits, and reputational
damage by implementing robust ethical policies and practices.
Dr TSN, JSSATEB International Business
•Reputation Management: Maintaining a strong reputation by adhering to
ethical standards, which is crucial for building trust with customers,
investors, and partners.
•Legal Compliance: Ensuring compliance with international and local laws
and regulations to avoid legal penalties and sanctions.
•Risk Mitigation: Reducing the risk of scandals, lawsuits, and reputational
damage by implementing robust ethical policies and practices.
Dr TSN, JSSATEB International Business
Cont..
•Sustainable Growth: Contributing to sustainable economic growth by
integrating ethical practices into business strategies and operations.
•Stakeholder Trust: Building and maintaining trust with stakeholders,
including employees, customers, suppliers, and the broader community.
Dr TSN, JSSATEB International Business
•Sustainable Growth: Contributing to sustainable economic growth by
integrating ethical practices into business strategies and operations.
•Stakeholder Trust: Building and maintaining trust with stakeholders,
including employees, customers, suppliers, and the broader community.
Dr TSN, JSSATEB International Business
Implementing Ethics in International Business
•Developing a Code of Ethics
–Creating a comprehensive code of ethics that outlines the company's
ethical standards and expectations for behavior.
–Ensuring that the code of ethics is communicated to all employees,
partners, and stakeholders.
•Training and Education
–Providing regular ethics training for employees to reinforce ethical
standards and practices.
–Educating employees about the ethical challenges and cultural
differences they may encounter in international business.
Dr TSN, JSSATEB International Business
•Developing a Code of Ethics
–Creating a comprehensive code of ethics that outlines the company's
ethical standards and expectations for behavior.
–Ensuring that the code of ethics is communicated to all employees,
partners, and stakeholders.
•Training and Education
–Providing regular ethics training for employees to reinforce ethical
standards and practices.
–Educating employees about the ethical challenges and cultural
differences they may encounter in international business.
Dr TSN, JSSATEB International Business
Cont..
•Ethical Leadership
–Promoting ethical behavior through strong leadership and setting a
positive example at all levels of the organization.
–Encouraging leaders to champion ethical practices and address
unethical behavior promptly.
•Monitoring and Enforcement
–Implementing mechanisms to monitor compliance with ethical standards
and address violations.
–Establishing reporting systems for employees and stakeholders to report
unethical behavior.
Dr TSN, JSSATEB International Business
•Ethical Leadership
–Promoting ethical behavior through strong leadership and setting a
positive example at all levels of the organization.
–Encouraging leaders to champion ethical practices and address
unethical behavior promptly.
•Monitoring and Enforcement
–Implementing mechanisms to monitor compliance with ethical standards
and address violations.
–Establishing reporting systems for employees and stakeholders to report
unethical behavior.
Dr TSN, JSSATEB International Business
Cont..
•Stakeholder Engagement
–Engaging with stakeholders to understand their concerns and
expectations regarding ethical business practices.
–Collaborating with stakeholders to develop and implement ethical
initiatives and programs.
•Continuous Improvement
–Regularly reviewing and updating ethical policies and practices to reflect
changing standards, regulations, and societal expectations.
–Learning from past experiences and incorporating feedback to improve
ethical performance.
Dr TSN, JSSATEB International Business
•Stakeholder Engagement
–Engaging with stakeholders to understand their concerns and
expectations regarding ethical business practices.
–Collaborating with stakeholders to develop and implement ethical
initiatives and programs.
•Continuous Improvement
–Regularly reviewing and updating ethical policies and practices to reflect
changing standards, regulations, and societal expectations.
–Learning from past experiences and incorporating feedback to improve
ethical performance.
Dr TSN, JSSATEB International Business
Cont..
•Ethics in IB is essential for fostering trust, ensuring compliance, and
promoting sustainable development.
•By addressing key ethical issues, implementing robust ethical policies, and
promoting a culture of integrity, businesses can navigate the complexities
of the global marketplace and achieve long-term success.
Dr TSN, JSSATEB International Business
•Ethics in IB is essential for fostering trust, ensuring compliance, and
promoting sustainable development.
•By addressing key ethical issues, implementing robust ethical policies, and
promoting a culture of integrity, businesses can navigate the complexities
of the global marketplace and achieve long-term success.
Dr TSN, JSSATEB International Business
CSR in International Business
•Corporate Social Responsibility (CSR) in IB refers to the ethical obligation
of multinational corporations to contribute positively to the societies and
environments in which they operate.
•CSR encompasses a broad range of activities and policies aimed at
promoting social good, environmental sustainability, and ethical business
practices beyond the primary goal of profit-making.
•It involves integrating social, environmental, and economic concerns into a
company's values, culture, and operations in a transparent and
accountable manner.
Dr TSN, JSSATEB International Business
•Corporate Social Responsibility (CSR) in IB refers to the ethical obligation
of multinational corporations to contribute positively to the societies and
environments in which they operate.
•CSR encompasses a broad range of activities and policies aimed at
promoting social good, environmental sustainability, and ethical business
practices beyond the primary goal of profit-making.
•It involves integrating social, environmental, and economic concerns into a
company's values, culture, and operations in a transparent and
accountable manner.
Dr TSN, JSSATEB International Business
Key Areas of CSR in International Business
•Environmental Sustainability
–Eco-friendly Practices: Implementing practices that reduce
environmental impact, such as minimizing waste, reducing carbon
footprints, and conserving natural resources.
–Sustainable Sourcing: Ensuring that raw materials are sourced
sustainably, promoting biodiversity, and preventing deforestation and
other environmental degradation.
–Energy Efficiency: Investing in energy-efficient technologies and
renewable energy sources to reduce reliance on fossil fuels and lower
greenhouse gas emissions.
Dr TSN, JSSATEB International Business
•Environmental Sustainability
–Eco-friendly Practices: Implementing practices that reduce
environmental impact, such as minimizing waste, reducing carbon
footprints, and conserving natural resources.
–Sustainable Sourcing: Ensuring that raw materials are sourced
sustainably, promoting biodiversity, and preventing deforestation and
other environmental degradation.
–Energy Efficiency: Investing in energy-efficient technologies and
renewable energy sources to reduce reliance on fossil fuels and lower
greenhouse gas emissions.
Dr TSN, JSSATEB International Business
Cont..
•Social Responsibility
–Community Engagement: Supporting local communities through
philanthropy, volunteer work, and initiatives that improve local
infrastructure, education, and health.
–Employee Welfare: Ensuring fair labor practices, providing safe and
healthy working conditions, and promoting diversity and inclusion in the
workplace.
–Human Rights: Upholding and promoting human rights within the
company and throughout the supply chain, including the prohibition of
child labor and forced labor.
Dr TSN, JSSATEB International Business
•Social Responsibility
–Community Engagement: Supporting local communities through
philanthropy, volunteer work, and initiatives that improve local
infrastructure, education, and health.
–Employee Welfare: Ensuring fair labor practices, providing safe and
healthy working conditions, and promoting diversity and inclusion in the
workplace.
–Human Rights: Upholding and promoting human rights within the
company and throughout the supply chain, including the prohibition of
child labor and forced labor.
Dr TSN, JSSATEB International Business
Cont..
•Economic Responsibility
–Fair Trade: Engaging in fair trade practices that ensure fair wages and
working conditions for workers in the supply chain.
–Local Economic Development: Contributing to the economic
development of the regions where the company operates by creating
jobs, supporting local businesses, and investing in local infrastructure.
–Ethical Business Practices: Maintaining high standards of business
ethics, including transparency, anti-corruption measures, and
responsible marketing practices.
Dr TSN, JSSATEB International Business
•Economic Responsibility
–Fair Trade: Engaging in fair trade practices that ensure fair wages and
working conditions for workers in the supply chain.
–Local Economic Development: Contributing to the economic
development of the regions where the company operates by creating
jobs, supporting local businesses, and investing in local infrastructure.
–Ethical Business Practices: Maintaining high standards of business
ethics, including transparency, anti-corruption measures, and
responsible marketing practices.
Dr TSN, JSSATEB International Business
Cont..
•Governance and Accountability
–Transparency: Being open and honest about the company’s operations,
financial performance, and CSR activities, and providing regular reports
on CSR initiatives.
–Stakeholder Engagement: Actively engaging with stakeholders,
including employees, customers, suppliers, and local communities, to
understand their concerns and expectations.
–Ethical Leadership: Promoting ethical behavior at all levels of the
organization, with leadership setting the example.
Dr TSN, JSSATEB International Business
•Governance and Accountability
–Transparency: Being open and honest about the company’s operations,
financial performance, and CSR activities, and providing regular reports
on CSR initiatives.
–Stakeholder Engagement: Actively engaging with stakeholders,
including employees, customers, suppliers, and local communities, to
understand their concerns and expectations.
–Ethical Leadership: Promoting ethical behavior at all levels of the
organization, with leadership setting the example.
Dr TSN, JSSATEB International Business
Importance of CSR in International Business
•Reputation Management: Building a positive corporate image and
reputation by demonstrating a commitment to ethical practices and social
responsibility.
•Risk Mitigation: Reducing the risk of legal issues, protests, and boycotts
by adhering to ethical standards and respecting local laws and norms.
•Market Differentiation: Gaining a competitive advantage by differentiating
the company as a socially responsible and ethical business.
Dr TSN, JSSATEB International Business
•Reputation Management: Building a positive corporate image and
reputation by demonstrating a commitment to ethical practices and social
responsibility.
•Risk Mitigation: Reducing the risk of legal issues, protests, and boycotts
by adhering to ethical standards and respecting local laws and norms.
•Market Differentiation: Gaining a competitive advantage by differentiating
the company as a socially responsible and ethical business.
Dr TSN, JSSATEB International Business
Cont..
•Customer Loyalty: Building stronger relationships with customers who
increasingly prefer to support companies that are socially and
environmentally responsible.
•Employee Engagement: Attracting and retaining employees who are
motivated by working for a company that values social responsibility and
ethical behavior.
•Long-term Sustainability: Ensuring the long-term sustainability of the
business by addressing social, environmental, and economic challenges
proactively.
Dr TSN, JSSATEB International Business
•Customer Loyalty: Building stronger relationships with customers who
increasingly prefer to support companies that are socially and
environmentally responsible.
•Employee Engagement: Attracting and retaining employees who are
motivated by working for a company that values social responsibility and
ethical behavior.
•Long-term Sustainability: Ensuring the long-term sustainability of the
business by addressing social, environmental, and economic challenges
proactively.
Dr TSN, JSSATEB International Business
Implementing CSR in International Business
•Developing a CSR Strategy
–Identify Core Values: Establish core values and principles that align
with the company’s mission and vision.
–Set Goals and Objectives: Define clear and measurable CSR goals
and objectives that address the key areas of social, environmental, and
economic responsibility.
Dr TSN, JSSATEB International Business
•Developing a CSR Strategy
–Identify Core Values: Establish core values and principles that align
with the company’s mission and vision.
–Set Goals and Objectives: Define clear and measurable CSR goals
and objectives that address the key areas of social, environmental, and
economic responsibility.
Dr TSN, JSSATEB International Business
Cont..
•Integrating CSR into Business Operations
–Policies and Procedures: Develop and implement policies and
procedures that integrate CSR principles into daily business operations.
–Supply Chain Management: Ensure that suppliers and partners adhere
to the company’s CSR standards, and work collaboratively to improve
social and environmental performance.
Dr TSN, JSSATEB International Business
•Integrating CSR into Business Operations
–Policies and Procedures: Develop and implement policies and
procedures that integrate CSR principles into daily business operations.
–Supply Chain Management: Ensure that suppliers and partners adhere
to the company’s CSR standards, and work collaboratively to improve
social and environmental performance.
Dr TSN, JSSATEB International Business
Cont..
•Engaging Stakeholders
–Communication: Communicate CSR efforts and achievements to
stakeholders through reports, websites, and other media.
–Collaboration: Collaborate with stakeholders, including NGOs,
governments, and local communities, to address social and
environmental issues.
Dr TSN, JSSATEB International Business
•Engaging Stakeholders
–Communication: Communicate CSR efforts and achievements to
stakeholders through reports, websites, and other media.
–Collaboration: Collaborate with stakeholders, including NGOs,
governments, and local communities, to address social and
environmental issues.
Dr TSN, JSSATEB International Business
Cont..
•Monitoring and Reporting
–Performance Measurement: Monitor and measure the impact of CSR
initiatives using key performance indicators (KPIs) and benchmarks.
–Regular Reporting: Provide regular and transparent reports on CSR
activities and progress towards goals, following international standards
such as the Global Reporting Initiative (GRI).
Dr TSN, JSSATEB International Business
•Monitoring and Reporting
–Performance Measurement: Monitor and measure the impact of CSR
initiatives using key performance indicators (KPIs) and benchmarks.
–Regular Reporting: Provide regular and transparent reports on CSR
activities and progress towards goals, following international standards
such as the Global Reporting Initiative (GRI).
Dr TSN, JSSATEB International Business
Cont..
•Continuous Improvement
–Feedback and Evaluation: Collect feedback from stakeholders and
conduct regular evaluations to assess the effectiveness of CSR
initiatives.
–Adapt and Innovate: Continuously adapt and innovate CSR practices
to address emerging challenges and opportunities in the global business
environment.
Dr TSN, JSSATEB International Business
•Continuous Improvement
–Feedback and Evaluation: Collect feedback from stakeholders and
conduct regular evaluations to assess the effectiveness of CSR
initiatives.
–Adapt and Innovate: Continuously adapt and innovate CSR practices
to address emerging challenges and opportunities in the global business
environment.
Dr TSN, JSSATEB International Business
Cont..
•CSR in IB is essential for building sustainable, ethical, and successful
companies that contribute positively to society and the environment.
•By integrating CSR into their core strategies and operations, businesses
can achieve long-term benefits, enhance their reputation, and create value
for all stakeholders.
•In an increasingly interconnected and socially conscious world, CSR is not
just a moral imperative but a strategic necessity for global businesses.
Dr TSN, JSSATEB International Business
•CSR in IB is essential for building sustainable, ethical, and successful
companies that contribute positively to society and the environment.
•By integrating CSR into their core strategies and operations, businesses
can achieve long-term benefits, enhance their reputation, and create value
for all stakeholders.
•In an increasingly interconnected and socially conscious world, CSR is not
just a moral imperative but a strategic necessity for global businesses.
Dr TSN, JSSATEB International Business
Questions
•How does international business differ from domestic business?
•What are the main components of the international business environment?
•How does the political environment affect international business?
•What are some legal challenges that international businesses may encounter?
•How does the economic environment influence international business?
•What are some key economic indicators that businesses should monitor?
•What role does technology play in international business?
•What are some challenges related to the technological environment in IB
•How does the socio-cultural environment impact international business?
•What are some cultural factors that international businesses need to consider?
Dr TSN, JSSATEB International Business
•How does international business differ from domestic business?
•What are the main components of the international business environment?
•How does the political environment affect international business?
•What are some legal challenges that international businesses may encounter?
•How does the economic environment influence international business?
•What are some key economic indicators that businesses should monitor?
•What role does technology play in international business?
•What are some challenges related to the technological environment in IB
•How does the socio-cultural environment impact international business?
•What are some cultural factors that international businesses need to consider?
Dr TSN, JSSATEB International Business
Questions
•Why are ethics important in international business?
•What are some common ethical issues faced by international businesses?
•What is corporate social responsibility (CSR) in the context of international
business?
•How can CSR benefit international businesses?
Dr TSN, JSSATEB International Business
•Why are ethics important in international business?
•What are some common ethical issues faced by international businesses?
•What is corporate social responsibility (CSR) in the context of international
business?
•How can CSR benefit international businesses?
Dr TSN, JSSATEB International Business
Reference
•The International Business Environment: Anant K. Sundaram/ J. Stewart Black-Prentice Hall.
•International Business environments and Operations John D Daniel, Lee H Radebaugh, Daniel P Sulivan- Pearson Education, 10 th edition, 2004.
•International Business (text and cases): P Subba Rao, HPH, 4/e, 2017.
•The International Business Environment Janet Morrison Mac Millan Palgrave, 2004
•International Business Environment by Francis Cherunilam- Himalaya Publishing House, 2004.
•International Business: competing in the global market place, Charles W L Hill, Tata McGraw-Hill., 5th Edition, 2005.
•https://www.khanacademy.org/humanities/world-history/ancient-medieval/silk-road/a/the-silk-road
•https://www.pdfdrive.com/international-business-environment-e56594187.html
•https://www.pdfdrive.com/business-environment-e54194142.html
https://ebooks.lpude.in/commerce/mcom/term_3/DCOM501_INTERNATIONAL_BUSINESS .pdf
•https://www.yumpu.com/en/document/view/63865501/pdf-download-international-business-case-studies-for-the multicultural-marketplace-full-online
•http://elibrary.gci.edu.np/bitstream/123456789/681/1/BM727%20The%20International%20Business%20Environ
ment%20Challenges%20and%20Changes%20by%20Jamie%20Weatherston.pdf
•https://www.taylorfrancis.com/books/edit/10.4324/9780080511306/international-business-case-studies-robertmoran-david-braaten-ph-john-walsh
•https://www.youtube.com/watch?v=3hMNnvd_HbQ
•https://onlinecourses.nptel.ac.in/noc20_mg54/preview
•https://www.coursera.org/learn/international-business
Dr TSN, JSSATEB International Business
•The International Business Environment: Anant K. Sundaram/ J. Stewart Black-Prentice Hall.
•International Business environments and Operations John D Daniel, Lee H Radebaugh, Daniel P Sulivan- Pearson Education, 10 th edition, 2004.
•International Business (text and cases): P Subba Rao, HPH, 4/e, 2017.
•The International Business Environment Janet Morrison Mac Millan Palgrave, 2004
•International Business Environment by Francis Cherunilam- Himalaya Publishing House, 2004.
•International Business: competing in the global market place, Charles W L Hill, Tata McGraw-Hill., 5th Edition, 2005.
•https://www.khanacademy.org/humanities/world-history/ancient-medieval/silk-road/a/the-silk-road
•https://www.pdfdrive.com/international-business-environment-e56594187.html
•https://www.pdfdrive.com/business-environment-e54194142.html
https://ebooks.lpude.in/commerce/mcom/term_3/DCOM501_INTERNATIONAL_BUSINESS .pdf
•https://www.yumpu.com/en/document/view/63865501/pdf-download-international-business-case-studies-for-the multicultural-marketplace-full-online
•http://elibrary.gci.edu.np/bitstream/123456789/681/1/BM727%20The%20International%20Business%20Environ
ment%20Challenges%20and%20Changes%20by%20Jamie%20Weatherston.pdf
•https://www.taylorfrancis.com/books/edit/10.4324/9780080511306/international-business-case-studies-robertmoran-david-braaten-ph-john-walsh
•https://www.youtube.com/watch?v=3hMNnvd_HbQ
•https://onlinecourses.nptel.ac.in/noc20_mg54/preview
•https://www.coursera.org/learn/international-business
Dr TSN, JSSATEB International Business
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