Business Prospects in China Pegasus International Inc Essay

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Total Length: 800 words ( 3 double-spaced pages)

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The Case of the Million Dollar Decision

Pegasus International Inc Company faces a moral dilemma concerning whether it should expand in a new country, China, where bribery and ‘dirty services’ in businesses have been normalized. Despite the bribe-taking norm, a growing company in China is estimated to generate $100 million annually, and this will be a tremendous opportunity or payoff for Pegasus (Hackworth & Thomas Shanks, 2021). Simultaneously, although Pegasus Chief Executive Officer (CEO) wants the company to survive while maximizing shareholder value, he also wishes to maintain ethical leadership. For instance, a CEO’s ideal corporate culture is characterized by honesty, respect for all, integrity, and teamwork.

Should the Company Pay the Bribes to Enter the Chinese Market?

The company should not pay bribes to enter the new market. However, this should not limit them from expanding their investment in China. To deal with this moral dilemma, the company should follow the decision-making model that considers factors like ethical issues, available alternatives, and the involved stakeholders. The nature of the company operations may change as it evolves in a new environment, but the business ethics should remain constant. Pegasus’s ethical behavior is guided by intellectual honesty and integrity; thus, they should remain honest with themselves and others (Hackworth & Thomas Shanks, 2021).

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Bribery is morally evil; hence this is not an option for the company. The CEO should think of all the ways possible to establish the new branch in China without necessarily getting involved in unethical acts. A decision made in this case will have enormous influence not only on Pegasus but also on the people or stakeholders in China.

Is Paying bribery an example of Cultural Relativism?

Cultural relativism involves not judging other people’s culture to own standards or ideal values. Cultural relativism discourages people from perceiving another culture as wrong or right because it matches or not their culture (Global Business Ethics (n.d). Instead, individuals should understand cultural values and practices in the context of the other culture. For instance, bribery is considered normal in the Chinese business community, but it contradicts Pegasus’s ethics and moral values (Hackworth & Pegasus’ refusal to pay the bribe has nothing to do with cultural relativism but instead avoiding the risks associated with bribery, as emphasized in The Foreign Corrupt Practices Act (FCPA) (Jones Day Publications, 2010). If the company pays the bribery, it will accept the moral….....

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