Ethics in a global environment Dialogue Welcome to World Cultures…

Sheilianys1 Ethics in a global environment Dialogue Welcome to World Cultures…Ethics in a global environmentDialogueWelcome to World Cultures Media. In our series “Global Business Leadership”, we are presenting you a topic called “Business Ethics”, principles companies and employees can follow in various situations, industries, and countries. We have two wonderful guests with vast experience in this area. One is Denise Andrews, retired P&G. She worked in Global Diversity for Procter & Gamble. And currently she is working with a company called Legacy Unlimited. We have Manuel Venegas, who works in Procter & Gamble’s Research and Development. He has experience working with various countries and has vast experience in business ethics. Welcome to both of you. Thank you. Thank you very much. Denise, can you tell us what is the definition of business ethics in your experience? Business ethics is really a disciplined approach to decisions and principles to help set the boundaries of good and bad behavior, or moral behavior, which is easily said, but to define it will require quite a bit of work. Yes, I mean, it’s a fairly straightforward concept, which is, what is the right way to  business? The one that treats the consumer, the customer, the employees, in an ethical way. Fairness above all and obedience and adherence to both the spirit and the letter of the law is what I would consider to be business ethics. So it is not black and white at all? There a lot of shades of gray in between that we need to clearly define. Manuel, in your experience, what kind of situations have you come across? And why is business ethics so important as a principle we need to follow in those situations? It is very gray, as you’ve said, so we need some guidance and some guidelines. Procter & Gamble is giving us some fairly straightforward rules, which is really to follow the law. I’ve been involved in business ventures in other parts of the world, Latin America particularly, Asia most recently, where you actually do come across situations that make you fairly uncomfortable, that as a Procter & Gamble employee you would not follow. For example, we’ve had problems getting our products into the trade or into the supermarkets, where we find that competition has been bribing other people not to take our products. And we just refuse to that. We actually believe that long-term doing the right thing will give you the better business result. And so we’ve seen it applied to certain circumstances that are not correct. And we just go ahead and continue to have focus on what’s right, and the business results long-term are better that way. Denise, what’s your take on it? What’s your personal experience in this area? I agree very much with Manuel. There has to be some very specific rules of engagement that respects the country in which you’re doing business in, because some regulation changes around the world. You take, for instance, recruiting and who’s hired. In some countries there’s still some difference around women’s access to the labor market. And how does a company like Procter & Gamble or Legacy show up and be respectful of a country while also making progress on social issues respectfully? So it’s very important, I think, to understand the culture and the country, what is their legal requirements to, as a company, whether it’s an international company or a small company, to say, what is it I want to stand for? What  I want to be proud of? And as Manuel said, fair play, respectful, doing the right thing. And when you hear labels like right, that’s a pretty big word, because you have to really engage a lot of leaders and government officials to codifying what is the right thing, what is fair play, whether it’s access to distribution channels or access for people to have employment opportunities at a company that you’re offering in that marketplace. Denise, you have a lot of experience working with women’s issues. Can you give us a few examples of how you created that fairness, ethical situation for women in other countries and their work environment? Yeah, even here in the US, there’s still opportunities. If you look at wage parity, there’s still a gap between groups of people. Gender– there’s a gap and parity on wages and promotion to the top that’s significant, although, it has been reduced in the last 20 years. People of color– there’s a study that just came out– I think by Rutgers– that shows the darker a person’s skin, the larger the pay gap or the equity gap on promotion. So in all countries, there’s still opportunity to make progress for fair share or fair access to opportunities that a company brings in. Regarding women, I’ve seen Procter & Gamble do very leading edge work to  analysis of what does the group that’s 50% of the population bring to the enterprise on their talent and skill. Are they needed in the labor force? What is the business case to have women in the workplace? That’s proven out to be a good business venture. So when that’s clear, then there’s very clear goals set to hold the standard of recruiting, to bring in talent that is women and have them come into the teams and then very rigorous discipline approach to analysis on pay equity, promotion, and opportunities for advancement. You look at some countries– P&G should be very proud of. They were the first company in Saudi Arabia to bring in two women into marketing there. Today we have 30 women in Saudi Arabia P&G. So again, you can see you have to step back and define what you believe is the right thing, both from a personal perspective– what is your legacy? And what you want for progress in our world, whether it’s local or global? And then as a corporate person, what is it you want your company to be known for? And fairness and access is a good thing the last time I checked. And then, how do you respectfully make progress? Teach people. because people have to agree. And then work on that. Teach people and then hold them accountable. You can’t just say you want progress and then not put systems in place for accountability. So those are some things that I’ve seen work over time. Manuel, you said you worked in Asia and also in Latin America. What are the general issues? What are the toughest issues that you were able to tackle or you have seen make progress over time? I’m sure there are still a lot more things that we need to work on. I would say in Asia right now one of our biggest challenges is– building on the point that Denise made, which is how to get a good representation of the population in our workforce, not just women, but also different cultures, different religions. One of the biggest opportunities we have right now in Asia, for example, is the development of women into our managerial track, especially in countries like Malaysia, where we have a plant, where there’s quite a significant proportion of the population are Muslim women. And it creates its own dynamic. It’s very different than I’ve experienced either in North America, or in Europe, or even in Latin America. It’s a very different perception of the culture and what the expectations are. I was just recently in our plant in [INAUDIBLE], Malaysia and had a meeting with the Women’s Network. And it’s a mixture of Muslim and Chinese women who are the local population of that country. And their barriers and their challenges are similar to what we’ve seen in North America and I would say in Europe in the last 10 to 20 years. But there’s a religious and a cultural aspect that is much stronger than we’ve ever seen– or at least my experience has been– in what I would call either a North American or Western European culture. It makes it more difficult for them. And we’re about all giving them the mentoring, the work processes, the training, such that they can blossom and achieve their full potential. In Latin America, what about the manufacturing side of things? The labor issues, the low wage issues, the child labor issues,  deal with those or have you seen examples of those being dealt well. I mean, environment– we need to be responsible for that too. So there are a lot of other areas that have been consistently a problem. Yeah, so I would say in the area of Procter & Gamble, or what I would call major consumer good companies that have a lot a local manufacturing, things like child labor is not an issue. Most of our jobs are highly technical in one way or the other. And so we recruit locally. And we have a representation. So it’s not as much of an issue as you have, for example, in India, which is a country where you just walk the streets and you see child labor on a day-to-day basis. And likewise in China. Although, we’ve been in China operations for well over 20 years now, I think approaching 25 years. And again, we deal with lots of suppliers. We deal with lots of contract manufacturing. And we ensure– and I think most multinational companies ensure– that child labor, for example, is not part the area that we work with or that we deal with. I know there are other companies that have been accused of using child labor. For most of our manufacturing and sales jobs, et cetera, it’s not an issue for us at this point in time. One of the strategies that I’m seeing with these major companies to lead in the business ethics area, they are developing good relationships with the local government and helping the local communities. So they have goodwill going on. Can you give us any examples of how that’s being done, Denise? Yeah, every company, I think, that wants to be successful needs to get very much in touch with who are the shareholders in that community. One big shareholder is the government. They care about their people. They want to see the right thing done for people. They don’t want their citizens taken advantage of. They want to share in the wealth that’s created from the labor in the work to produce goods. As the world has shrunk, you pretty much can source anywhere today a lot of the products. There’s a whole new conversation needed about what is sharing when there is prosperity. So what’s needed is the shareholders engage. Government, the business that wants to go in, and perhaps some of the community leaders to say, as we come in here, what are we going to agree to play by? We’ll be environmentally respectful. We will be respectful of building skills and self-sufficiency. When a high-tech company decides to invest $40 million in building a plant that’s a high-tech plant, that radically changes the skill base in a community. The money that flows in radically changes the opportunities that those families have. And so it’s very important, I think, to share that, so that we aren’t leaving countries or regions behind and having a huge gap. So the shareholders must get together and talk about what are the rules we will engage to make this a good deal for everybody and have relationship building and trust. Who you form joint ventures with, where you decide to place your business– if you put it in a country that then has a political upset and the currency devalues in half, that’s not good for anyone– the citizens, the country, the business. So forming a team that truly is committed for the long haul versus the short has proven to play out well. There are still major opportunities to better sharing. If you look at the wealth concentration in the world, there are countries– the US being one of them– that have more responsibility, I believe, to figure it out, because of a principle I live by, to whom much is given, much is required. We have a lot of wealth and access to technology and investment. How we use that for good works around the world? Because there’s no country I’ve been in yet that does not want a good life for the families or the citizens. So shareholder engagement, common vision, and then holding hands and saying we’re in this together and let’s figure it out. Yeah, I would build on that. Yes, there is corporate responsibility and governmental responsibility to increase the lives of the citizens of that country. As I’ve worked in different sites for Procter & Gamble, the one thing that’s been the most satisfying and gratifying for me is the personal response of the employees themselves. They are the fortunate ones. We know it. We’re well paid. We’re probably usually the ones that has the highest education in whatever country that we actually are doing operations in. We recruited them. And yet they’re very much involved in the development of that community. You see a lot of P&G involvement. For example, the United Appeal here in Cincinnati really carries all over the world. You see our employees who mount major relief efforts when there’s a tragedy in a country, people visiting orphanages and giving their time, their money, their energy to improve at least a few lives, in response, partly, for the fact that they are the fortunate ones. And we encourage that as a corporation. We encourage that as individual managers. And we get involved on a personal basis to also be a part of that. And that is really a gratifying aspect of having, perhaps, been more blessed than others in this world and then giving a little bit back to the people who are not as blessed. As business ethnics is a big area, a complex area, and it has so much value back and forth. It’s a two-way giving back to the community, and so that way the company prospers. How do we develop training? And what training is available for future business leaders that are in the universities or your new employees or employees going to a new country where they need to establish this kind of business ethics there? What kind of training do they go through or what is required? Denise. It’s a great question. How build values and excellent leadership regardless of where you’re playing in society? And it starts early. I think parents have a huge role to play in teaching good behavior, in caring about others and respecting others. I was blessed with wonderful parents who would have us out picking up trash and buy us an ice cream cone, but very early instilling taking care of and doing the right thing. I think the major institutions like religion also have a role to play on how to be inclusive of all people and coexist peacefully and respectfully and do well by others. And then when you move into the school systems– and I see a lot in the generation that’s around 20 now being– in the US– more socially responsible, because, I think, they’ve seen their parents achieve the dream and now they want to make sure there’s more to life than just the consumerism and capitalism, so they’re doing more programs on outreach to different countries and even in the local cities. So high school programs can do, let’s go to the soup kitchen. Let’s go pick trash up. Let’s go to Honduras and provide service for spring break. Then at the university level, teaching business ethics is critical. I took a program at Xavier. And they had a really good case study of if you were starting up a mining business in South Africa, how would you construct that business to take care of workers, profit, social conditions in the community– so getting folks engaged in what-if scenarios. And then when they join a company, the onboarding process of, here’s what we expect. Procter & Gamble has a business conduct manual that’s done worldwide. Every employee gets this when they come in. It’s things that’s expected when you work for this company. You won’t accept bribes. You won’t have conflict of interest. You’ll have fair play. You’ll respect the country’s practices. And that is renewed with employees annually to make sure that that is sustained. I think individuals on their own should read a lot about how to be an excellent leader. This is, I think, an excellent book that cuts across questions like, what is fair? How do I show respect? And what is good behavior? And then as we are part of a local and global community, get in touch. We’ve got to always be learning about other people, other cultures, other issues, and our own in saying, how we create better for everybody? And it is doable, but one has to engage in caring and then learning and then saying, OK, let’s figure it out together, and show up, and make a difference. The other thing, I think, is a technique they taught us at Procter & Gamble around how you know if you’re being ethical. And they had what they call The Wall Street Journal test, where if you did something and the next day it showed up on the front page of The Wall Street Journal, how would that be viewed? As positive or negative? So it’s a really simple check to say, if this went public, how would it be viewed? The other piece they would use is, what would your mother say or father if you reported back what did you do. So there are two little very simple techniques  just a gut check on, is this the right thing? If it was viewed in the broad daylight by people I respect both in society and in my family, how would they view my behavior? So that’s another technique, I think, to help guide leaders as they make decisions. Yeah, I agree with everything that Denise has said around the availability of either academic or industrial courses on ethics. But I want to make the point it starts with individual and almost ends with the individual. If you’re an ethical person, you will behave ethically in business. If you’re not an ethical person, no matter how much training, no matter how much laws and constraints you have around you, people will stray. One of the first things we do at P&G– and it’s the same with most multinationals or companies that actually are ethical– is you hire people who have inherently good ethics. You hire good people. You don’t hire the kind of people that will do things for their own betterment at the expense of somebody else. And if you live to that standard, then I think you find that you seldom run into major problems of ethics within your normal business day-to-day life. I think the bottom line is it’s the character of the individuals. We have to build character strong leadership, not just this generation, but coming generations who just not only think about themself, their neighborhood, their community, their country, but also in a global perspective. I really appreciate you both coming on our show and telling us about business ethics, which is a very crucial topic for all of us. And it’s timeless. I appreciate you coming. Thank you.Establish the importance of business ethics in a global environment and how ethics help businesses to improve their business presence in society.A. SummaryB. Presentation of the matterC. Author’s point of viewD. Supporting argument (citations from other authors)C. Conclusione. reactionF. ReferencesBusinessBusiness – Other