Ethical Considerations for the Global Expansion of Samsung
Cultural differences are one of the critical ethical issues that can arise when expanding globally. The imagined company could be Samsung, which is willing to build new factories worldwide. When entering a new region, the company should recognize the possible cultural differences and avoid practices that can be offensive to the local population. In this sense, the prevention mechanism is collaborative work with local representatives that will address cultural differences.
Another important ethical issue is preventing labor exploitation. As countries have different working conditions, the company should not maximize profit by exploiting labor in poor countries with low working conditions. This will damage the company’s authority and prevent further expansion. Lastly, environmental concerns will also be an ethical issue. The company should carefully evaluate its production method and area of choice to prevent it from damaging the local environment. It will also avoid harming the company’s public image and facing long-lasting fines and punishments.
Legal Risks Associated with International Business Operations
Concerning the legal risks associated with international expansion, compliance with local laws can be one example. A company needs solid legal representation and professionals in local regions to avoid fines or legal actions against the corporation. Another risk can be the presence of bribery and corruption in the local area where the company is expanding. The corruption will dampen the development and become an artificial barricade for further expansion. In addition, it is associated with the illegal actions in which the company itself would be forced to be part of.
Lastly, there can be a risk associated with contract disputes. Due to the new region of operation, the company can have issues with suppliers and distributors in this country. Legal contracts based on local laws can contradict the company’s principles or facilitate the emergence of court disputes. The risk of losing potential markets will result in facing the costs of these disputes.