In wave blustery of globalization, the international division of labor is more particular and original international division changed as well. During the process of globalization, an unbalanced economic development and the different profits gradually revealed. With the development of our globalization, there appear a number of Multinational Corporations in order to enlarge the economic profit. Thus, the competitive advantage of MNCs will become fiercer; some unstable factor has revealed immediately, such as multinational companies' use of the developing countries in employ child labor, damage across the border and commercial bribery, there were form a vicious cycle. Therefore most of the event would be universal attention by the society. In an increasing globalized world economy, Multi-national corporations have been accelerating their push to shift production of their goods and services from higher cost developed countries to more economically attractive labor markets in the developing world. Developing countries are attractive not only from the standpoint of lower wages, but also because they often lack the means and or the political will hold business accountable for violations of these nation's respective environmental, human and labor rights regulation regimes.
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In this dissertation, it can be assumed that managers of most large corporations would not willingly engage in evil or illegal activities, it can be difficult to explain why so many multinational corporations have been exposed to the action of these same deeds. To sum up, this dissertation will help the MNCs decrease even eliminate some unethical behavior in order to sustainable development in the society.
The purpose of this dissertation mainly focuses on the multinational company between business ethics and profitability, and the impact of Corporate Social Responsibility within MNC. There are three themes in this dissertation. First of all, to realize how importance of CSR affected by multinational company. Secondly, how business ethics and profit affect Multinational Corporation. The third themes concentrate on the use of relevant research methods to deal with existing problems; this theme will utilize some primary and secondary research.
Overview the dissertation
Overall, there are five chapters in this dissertation. The first chapter has introduced a background of existing development of MNCs in globalization. This chapter has showed an increasing number of MNCs in the modern society in order to earn more profit, while some of them ignore the ethics eventually become vicious. The aim of this dissertation is to change into a virtuous circle in order to sustainable development in the long run within the MNCs even the whole society.
Literature review will show the impact of CSR, business ethics and profitability within the MNCs separately. Specifically, the aspect of CSR will demonstrate the history, definition, evaluation of CSR, although the CSR is very elusive. Business ethics will indicate moral theory and culture. Profitability will introduce the interest transmission and how to deal with these problems by government.
This dissertation will use quantitative and qualitative research; also utilize both primary and secondary research. Furthermore, this dissertation will distribute about 150 questionnaires include closed format, open format and contingency format. Also, secondary research uses of relevant journal, books, internet or newspapers. This dissertation will use documentary methods in order to realize information more detail and visible.
There is no denying that some employers would not be willing to talk about profit and individual behavior within MNCs; it is not only involving individual privacy, but also concern about corporate profit. Therefore, this dissertation will provide CSR profit and ethics within MNCs, in order to know which one is preferable to the corporations. To make the MNCs has a good business ethic. First they should be strong supervision and restriction mechanism in the external form, eventually external pressure within the adaptability of the change of the corporation into an active choice.
2.0 Literature reviews
This dissertation is denominated by the impact of corporate social responsibility between business ethics and profitability within the multinational corporations. The purpose of this literature is to realize the importance of ethics and profitability; furthermore, business ethics is based on the profit maximization. This literature will illustrate CSR, business ethics and profitability separately in order to deeply understand the definition, respective function and some problems when the company operating or trading. Specifically, part of CSR will introduce the history in order to realize development and understand CSR successful activities; some frameworks will appear in the following statement in order to demonstrate the level of CSR. The limitation of this literature is that no CSR theory can ensure ethical behavior; also there is no consolidated definition of CSR in articles. Moreover, there are only few articles that reveal the relationship between profit and business ethics within MNCs. This literature will reveal what is CSR, business ethics and profitability bring to the MNCs
2.1 Definition of CSR
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The history of CSR tracked back for 60 years ago; however, there was no fixed definition for CSR, the best information concern about the impact of business on society in the 1950's. The famous Chicago economist Milton Friedman saw CSR benefits, "Business's primary responsibility is to earn money"; however, the integration of this quote was "business in any enterprise is to earn money while conforming to the regulation of society, both those reflected in the moral or ethical (Carroll, 1998).
In 1950s and 1960s, the first definition of CSR was established by Bowen, it was stated that the business operation activities combine objectives with values of society. The first book Social Responsibilities of the Businessman was written by Bowen in 1953. It was stated that the conceptualization is difficult to understand although this research topic was more than 50 years.
There are four part definitions of CSR and research in 1970s and 1980s. There was appealed corporate citizenship with CSR; According to Carroll (1988) stated corporate citizenship as economic, legal, ethical, and philanthropic responsibilities. CSR has emerged with a new model and theory in 1990s. These include corporate social performance, business ethics theory and corporate citizenship. The concept of CSR has evolved considerably since it first emerged in the 1950s. The result appears to debate about what the term means, whether it should be implemented. Established history of CSR was difficult to justice in this review. The important is to realize the origin of CSR, its development and where it might be doing in order to better understand successful CSR activities.
2.1.1 Evaluation of CSR
Most articles define CSR as a corporation should undertake responsibility for society when they are in the pursuit of profit maximization. In this sense, the corporation in the business process especially in decision making, not only should consider their own interests, but also appropriately considers company behavior are closely connected with other interest groups and social interests. It will reveal the whole society interests are greater the individual corporation. A good number of researchers in the subject may even agree that firms must pursue some form of sustainable social responsibilities programs in the long run, particularly as those programs that would benefit the organization in the long run. In this sense, the sustainable social responsibility in the long could become successful; also it will improve the reputation in society.
2.1.2 Integrating CSR with ethics
Some researchers think CSR as part of business ethics. Jouni Korhonen (2003) attempted to link business ethics with CSR. Also, corporate social responsibility has been considered the 'bridge' between organization and society; such a bridge or relationship should be fantastic; this bridge may become more efficient and sustainable development of society. Otherwise the society may ill regard the organization even if it was a most efficient use of its resources and even if it was a remarkable profit generating machine. Thus, an organization must not only conduct its business activities efficiently, but it must also pursue responsible conduct beyond the strict definition of business activities (Yezdi, 2012). This 'bridge' has also addressed the profit motive and often neglected the impact of products, services and interactions within the communities these organizations operate (Arli and Morrison, 2008). It means the role of CSR is to minimize organizational impact on communities within which they operate and generate products and services and engage stakeholders for inclusive development.
Some of researchers believe that CSR can improve profits. They understand that CSR can promote respect for their company in the marketplace which can result in higher sales, enhance employee loyalty, motivation, team spirit, operation and attract better personnel to the firm. Also, CSR activities focusing on sustainability issues may lower costs and improve efficiencies as well (Ron, 2011). However, there is no denying that not all companies can equal contribution to the society. A better company not only can be professionally managed, but also good for the environment and have contributed to the society. They cannot pursuit profit alone. CSR is about understanding the business impact on the wider world and considering how you can use this impact in a positive way (Corporate Social Responsibility, n.d.). It means companies should perceive the limitation of activities and avoid keeping in touch with others who have bad impact on the society and environment.
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Since the company is operating in a society, it must ties with social issues. The society should offer customers and resources to perform the business objectives of the corporate companies (Hawkins, 2006:2). A significant aspect of CSR is to bridge their internal and external stakeholders; employees, customers, public authorities. Any problems happened in the society can affect the organization and hence well being of the society is the responsibility of the organization. It means the company should take care of both internal such as employee welfare and external customer service in order to sustainable development of society.
There is no denying that almost literatures on corporate social responsibility are too broad. There appeared too many issues should be concentrated; for instance, whether CSR focus on either 'business ethics' or 'profit' considerations (Windsor, 2006 cited by Edwards, et.al 2007). There are an increasing number of growing common view that corporations and governments should accept moral obligation for the public welfare and individual interests in their economic transactions, (Amba-Rao, 1993). Some corporations start CSR programs to raise their reputation with the society or government, so that they eventually can earn more commercial benefits. Much of the literature on social responsibilities provides a wide range of activities, from very modest beginnings to a significant involvement in community activities. In contrast, some CSR definitions are narrow: "The problem of corporate social responsibility is of smaller scope than the ethical foundations of capitalism" (Goodpaster, 1983, p.3 cited by Haigh, 2004). Corporate social responsibility has no new concept, such as what is a business and what contribution does it make to society, and it keeps a combining and deep ideal in academics. Due to the scope of contrasting definition and elusive terminology, the conception of CSR has appeared different type of practices.
Some research has shown a CSR framework. It is illustrated that there are three levels of CSR. Individual level; organizational level, CSR as Stakeholder Management; and global level, CSR as sustainable development. Also, some researchers presented a three-domain approach in which the three core domains of economic, legal, and ethical responsibilities are depicted in a Venn model framework (Mark, 2003).
The concept of CSR includes a number of business activities ranging from social, to an economy such as employment, then to the environment such as waste reduction. On the other hand, some articles provide data on the employment dimension of the CSR code, such as Bondy et al. (2004) stated work problems defined as these regulations that seek to employees behavior; this activity always appeared in Canada MNCs. Another issue was "Labor issues/worker rights".
2.2 Business ethics
2.2.1The moral theory
From the development of corporate history, social responsibility and corporate ethics are not the enterprise born mission, the existence of the enterprise is to earn economic benefits and realize the maximization of profit. Milton Friedman also insists the reason of most main social responsibility of the enterprise is to maximize profit in the free and fair competition conditions. However, some researcher have different views, with the corporation's social expectations changing, the company is no longer only for shareholders of responsible of independent entity, it also need to establish and maintain their more social responsible for corporate ethics not only means that corporate employee behavior should comply with the moral standards and ethical standards, and means that the principle of management of the enterprise tenet and management policy also should comply with the society's universal values.
A view of business behavior should be immoral; managers can make selfish behavior, because the market mechanism generally will be automatically regulating their behavior, to make the majority of stakeholders and for the good of society service. The "invisible hand" can guarantee a businessman who often pursuit his own benefit is more efficient than his solid plan to improve the profit of the whole society; this theory called moral theory. It has been widely accepted by people in the early days of capitalism. Managers may not be for those who do not meet their social moral standards of behavior felt guilty at that time. Even now, this theory is still used in some corporations.
Most of publicity for this view has become more difficult to identify, if the purpose of the corporation is to evade social responsibility and damage moral criteria of the excuse, eventually the biggest victims are both consumers and the whole society. Because the influence of economic decisions will be inevitable on around social environment, the corporations should undertake their behavior of social responsibility, corporate ethics cannot override on top of universal moral principles in the society.
It is necessary that ethical requirement appeared in the society. Without it, our plan and aim would be chaotic and confused even damaged. Any flaw in ethics will reduce the ability to be successful in our endeavors. Ethical problem involved in individual corruption, break the law, institutional or social ethics. There is no denying that some business manager wants to remove these lists as much as possible. From the different point of view, the task of ethics to management is to define and give life to an organization's guiding values, to create an environment that supports ethically sound behavior, and to instill a sense of shared accountability among employees. The need to obey the law is viewed as a positive aspect of organizational life, rather than an unwelcome constraint imposed by external authorities (Sankar, 2003). Most of the world does not differentiate between business ethics and CSR. However, within these corporations, these two approaches are being divided into different departments; different authority, various sources of institutional support. For example, a company's decision to voluntarily cut its green house emissions; while the precautions taken to reduce the emissions will likely cost the company more and perhaps decrease production, the reduced emissions will benefit society at large by decreasing pollution. According to Broadhurst (2000) stated that awareness of complex corporate compliance in the dimensions of business ethics motivated corporations to implement their own socially responsible initiatives.
For multinational companies, some problems of corporate ethics even more complex, because the business scope of the corporation beyond the border restrictions, accordingly beyond the law of a single country and the category of culture. There is a hypothetical concern about whether there should be all corporate ethical standards observe generally under different cultural background. For example, bribery is a kind of phenomenon in many countries, government administrative officials got a low salary in some countries, and they used to charge a reward in the public service. Government officials even strictly use a lot of laws in order to stop or prevent proper enterprise behavior until they received the return. Traditional local culture seems to have used this behavior. They do not think use bribes to achieve that goal are a disreputable. However, such behavior is probably hard to accept the other countries.
The above aspect of CSR has been mentioned, most researchers agree that business ethics and corporate social responsibility should be integrated in decision making at the high level of the corporation, also the corporation should be effectively and sustainable. Business ethics are involved in an elimination of business practices in line with some concept of human value; it looks at corporate profits not for the individual also is good for employees even the society.
As Carroll (1981) cited by Michael Bendixen and Russell Abratt (2007) recognizing that CSR includes the aspect of business ethics dimension, distinguishes social responsibility and business ethics is based on the organizational or corporate concern in the primary, and individual manager or business decision maker concerned by the latter. As stated by Ahmad, (2003 cited by Mehwish, 2011) ethics and moral judgment involve the application of societal values. Much of the literature on business ethics focuses on the clear imperative need to know the right from the wrong, and the strong obligation to choose the morally correct choice irrespective of the costs involved or the lost opportunity in making the morally correct choice. A code of ethics represents an explicit agreement among relevant parties that their behavior will comply with stated ethical principles.
Some articles stated that good social responsibility is good business. The reputation of ethical and socially responsible organizations will win in the long run and MNCs will earn the public's respect and admiration. Business ethics and social responsibility are often treated together or, at least considered as allied issues in the literature. The focus of each is often not altogether unrelated, depending upon the scope of the topics under consideration.
Some articles revealed problems of "interests' transmission" within the multinational corporations. Now, MNCs corruption has substantial change happened, not only appeared increasing number of benefit conveying scale, and transmission channel also becomes more complex. Some multinational companies have not satisfied local official's interest exchange. In fact, the United States and some other Western countries formulated the relevant law in view of MNCs "interest transmission" behavior, in order to stop this kind of behavior. There is also a feature of "interest transmission" in MNNs, which is the goal of a long run.
184.108.40.206 Change the behavior by government
In order to prevent this behavior, government should strengthen enforcement mechanism; it means to monitor the management of multinational company production behavior, such as the aspect of profitability regard to "interest transmission; MNCs should take special management measures and management system; establish management mechanism in legal regulation. Some articles state identify major crisis involving an internal control system crisis. For this purpose, some nonprofit folk launched all kinds of accurate business movement; it is a positive behavior design standardized system framework for MNCs, and creates a variety of information system in order to strengthen the transparency of the MNCs behavior.
The aim of the firm as a decision making agent is to maximize profit (Hirshleifer, 1980:265). It is no doubting that CSR will improve the corporation's profit and thus most large corporations are involved in it. Most top management also believes that CSR can improve profits; because CSR activities concentrate on sustainability issues may lower costs and improve efficiencies as well. The strong profit oriented responsibility for the benefit of the stockholders, as a strong mandate from the fundamental economists who would view an organization purely as an economic entity.
Corporate citizenship is more and more significant for sustainable development of corporations although some struggles to reveal a return on their investment from socially responsible activities, some articles have quantitative data, such as the survey of 74 percent of respondents say corporate citizenship can help improve profits as their corporation (Ron, 2012). Some researchers such as Birch, (2003) regarded corporate citizenship as an innovation to or an extension of the CSR concept, in that CC indicates that business sees itself as part of the public culture, and involves not only employees and management but also stakeholders in the organization, whereas CSR takes social responsibility as an external affair.
Almost article that has found demonstrate definition and framework of CSR by different researchers or scholars; also this literature has shown the history of CSR. Some articles intend to bridge the relationship between ethics and CSR; also some articles related to CSR in MNC will make profit. However, few articles refer to the relationship between profit and business ethics within the MNCs.
The company keeps morality and ethics in all its operations in order to fully execute their social responsibilities, then become more sustainable development in the long run. They should never engage in activities which are harmful to the environment. The government should strengthen enforcement mechanism; it means to monitor the management of multinational company production behavior, such as the aspect of profitability regard to "interest transmission; MNCs should take special management measures and management system; establish management mechanism in legal regulation. Corporate social responsibility is a wide topic which includes a company's commitment to the society, stakeholders and the environment in which it operates. The fact that there is a well established journal (Journal of Business Ethics) is no small indicator. The greatest difficulty encountered was how to limit the review and the definition of CSR is elusive. Therefore, this review reflects itself in a substantial bibliography, a synopsis of interesting research and papers, and greater detail of a tight selection. The author grouped his review by elements of emphasis. Social responsibilities of an MNC must be broad and specific; that is, they must be broad enough to be global, and specific enough to be applicable to the unique social responsibilities situation of each of its host countries. The economic or profit performance of the overall MNC and that of the foreign unit must be taken into account. That is social responsibilities action should be after achieving a sustained satisfactory profit performance of a well established foreign unit. Profitability is a measure of evaluating the overall efficiency of the business. The best possible course for evaluation of business efficiency may be input-output analysis. Along with the economic objective of earning profits, a business is also required to perform a large number of social objectives. Besides providing better quality of goods and services, it provides big employment opportunities to the people, better condition of work, fulfill community needs, conserves resources and so on. Profit is of course necessary to provide companies with the resources necessary to effectively impact the evolution of the communities in which they operate. This dissertation supports for the hypothesis that multinational corporation experiences lower profitability.
This dissertation states the impact of CSR between the ethics and profitability within the MNCs. The above literature review has revealed how importance of business ethics and profitability and has revealed some problems within the MNCs, such as different culture and interest transmission. This chapter will use a different type of strategy and method to deal with these problems and use of relevant research methods as follows. The advantage of research is providing a great deal of firsthand behavioral information. The participant's behavior is more unconscious, natural and varied. It may even provide a wealth of hypotheses. It is very useful in forming hypotheses.
There are two general approaches towards a research dominated the inductive and deductive approaches (See Appendix 1&2). The inductive approach starts with a general topic for which a data set is then collected; it moving from the specific to the general. While deductive reasoning works from the more general to the more specific; it follows logically from the premises. After analysis, the researcher will then reach a set of conclusions in order to explain the data. During the process, the findings available use bar chart or SPSS to analyze the data. The deductive approach starts with a fixed hypothesis or theory on which the research then attempts to prove or disprove the hypothesis.
Research is a process through which we attempt to achieve systematically and with the support of data the answer to a question, the resolution of a problem, or a greater understanding of a phenomenon. There are eight distinct characteristics including research originates with a question or problem; research requires a clear articulation of a goal; it follows a specific plan of procedure, usually divides the principal problem into more manageable subproblems; and guided by the specific research problem, question, or hypothesis; also accepts certain critical assumptions; research requires the collection and interpretation of data in attempting to resolve the problem that initiated the research; research is by its nature, cyclical, or more exactly, helical as well.
3.2 Research strategies
There are two types of research, qualitative research and quantitative research. In this dissertation will use both qualitative research and (case study) quantitative research (survey). Qualitative research can be characterized in many ways. The approach is the most appropriate and indeed the only way of achieving some research objectives. Qualitative research approaches including phenomenology, ethnography, grounded theory and case studies; this dissertation will use of the case study approach in order to study in more depth between profit and ethics within MNCs.
3.2.1 Advantage of qualitative research
Some advantages to qualitative research are the dissertation will be detailed and rich data in the form of comprehensive written descriptions or visual evidence. For example, this dissertation will use case study. The real case can understand the seriousness of the event in order to avoid and eliminate to become more sustainable. Fewer restrictions or assumptions are placed on the data to be collected. Also, researchers can be studied in more depth. After thorough data analysis, a comprehensive result is reached. The following findings can be deliberated and published after extensive discussion to ensure they are not errors. Therefore, the findings remain reliable and unbiased.
3.2.2 Disadvantages of qualitative research
Some researchers have criticized qualitative research as being "soft", lacking rigour and being inferior. Sometimes, it is harder to determine the extent of influence that the researcher had over the results. Also, it is more difficult to determine the validity and reliability of linguistic data.
3.2.3 Case study
Case studies are a documented description of a particular person, group, organization, activity or event. The main event or activity is described extensively. This dissertation will present three big events in order to realize the seriousness of existing problems. Case study methods involve an in-depth of an activity or event, referred to as a case. Case studies provide a systematic, way of looking at events, collecting data, analyzing information, and reporting the findings. In case studies, the benefit of research is to provide a great amount of detailed descriptive information. However, the case studied may not be representative of the population; also it may be time consuming
3.3 Quantitative research
Quantitative research is the use of sampling techniques such as (student survey) whose findings may be expressed numerically. This research is based on traditional scientific methods, which generate numerical data and usually seek to establish causal relationships between two or more variables. With quantitative research, this means examining the data to identify and confirm relationships. Before quantitative data can be analyzed, they must be edited, coded, and in some instances transformed to ensure that they can be properly used in statistical analysis. Quantitative data are measurements in which numbers are used directly to show the feature of something.
3.3.1 Advantages of quantitative research
In quantitative methods, the researcher is independent, the goal is to develop generalizations that contribute to theory that enables the researcher to predict, explain and understand some phenomenon. Specifically, survey includes cross-sectional studies using or interviews for data collection with the intent of estimating the characteristics of a large population of interest based on a smaller sample of that population. Quantitative methods ensured high levels of reliability of gathered data. The statistics are used with data collected from similar sources, financial records and questionnaires. This dissertation will conduct the methodology of questionnaire, but it would not open-ended format questions; most answer responded "Yes" or "No". The questionnaire is a set of questions given to a sample of people. In fact, this quantitative method enables respondent easily summarizes a great deal of information sources as well as facilitate good comparisons over time. The purpose is to gather information about people with attitudes, thoughts, behaviors, and so forth. The researchers compile the answers of the people in the sample in order to know how the group as a whole thinks or behaves. According to Denscombe (2007: 169) stated the questionnaire is easier to arrange, the contact can be by email. In the methodology of questionnaire, the respondents would provide open and honest responses. During the process of questionnaire, almost respondents are international students. Selecting for the survey was based on respondent's attitudes and status, and some form of involvement throughout the morals and ethics implementation process.
3.3.2 Disadvantages of quantitative research
Some disadvantages of quantitative research represent collecting a much narrower and sometimes superficial dataset; it is depending on respondent's attitude. The development of standard questions by researchers can lead to 'structural' bias and false representation. Another disadvantage is that a large sample of the population must be studied; the larger the sample of people researched, the more statistically accurate the results will be.
3.4 Research methods
3.4.1 Primary research
Data is collected by means of one or more of the following: interviews, observation and questionnaires. This dissertation will focus on the questionnaire.
This dissertation will use both primary and secondary research. Primary research will be based upon the use of a questionnaire for data collection; collecting data from respondents and then analyzing the results. More specifically, the results should be averaged; using age, proportion of male and female, question answer, thus the use of SPSS or bar chart is significant. This project will make use of sample questionnaires amongst consumer groups so as to ascertain what value consumers place upon good business ethics. This dissertation will distribute 150 questionnaires from international students in order to help MNCs become virtuous cycle and sustainable development in the long run.
A survey is a data collection tool used to gather information about researchers. Surveys are commonly used in psychology research to collect self report data from study participants. It may concentrate on factual information about individuals, or it may aim to collect the opinions of the survey researchers. Such as, this dissertation will survey the impact of CSR between ethics and profitability within MNCs.
3.4.3 Survey characteristics
Surveys are widely used in the social sciences. It follows specific procedures based on survey science. The types are often presented as interviews or questionnaires. In impartial sampling, units are selected from the population without any prejudice or preference. It often shows the quantity, but sometimes can be qualitative.
3.4.4 Benefits of survey
Surveys provide more honest responses than other types of research methodology, especially if it is clear that the answers will keep confidential. Surveys, especially online surveys have a very small cost per respondent. The cost per response is often far less than the cost of running a focus group or an interview, while the responses you receive can number into the thousands. There is fewer restriction or assumptions are placed on the data to be collected. Surveys are relatively inexpensive; it is very useful in describing the characteristics of a great deal of population. They can be administered from remote locations using email or telephone. Very large samples are feasible. Many questions can be asked about a given topic and considerable flexibility to the analysis.
A questionnaire is a prepared set of questions used by respondents or interviewers to record answers. That is, questionnaires are a structured framework consisting of a set of questions and scales designed to generate primary data. Questionnaires are frequently completed without a researcher present. The assumption is that respondents have the knowledge and motivation to complete them on their own.
3.4.6 Benefit of questionnaires
There are some advantages of the methodology of the questionnaire. Questionnaires are very cost effective. This is especially true for studies involving large sample sizes areas. The benefit of questionnaire is enabled a tremendous amount of data to be collected quickly. Also, minimizing and eliminating subjectivity of judgment. Written questionnaires become even more cost effective as the number of research questions increases. The author can be more confident in generalizing findings than can be a case study. Also, a questionnaire provides better data for business to use for making decisions. The use of a questionnaire to a random sample is a good way to find out the attitudes, thoughts, and behaviors of a large group of people. Data entry and tabulation for nearly all surveys can be easily done with many computer software packages. Questionnaires are familiar to most people. Almost everyone has had some experience in completing questionnaires and they generally do not make people apprehensive. In addition, questionnaires are less intrusive than telephone or face-to-face surveys. For example, when a respondent receives a questionnaire in the mail, he or she is free to complete the questionnaire on his or her own time-table.
3.4.7 Limitation of questionnaires
It is no doubting that the questionnaire cannot accurately predict respondent's behavior. Moreover, some respondents who had fantastic and earnest answer on the survey, but the author could not replicate the research. Also, some multiple choices have some limitations, such as when you go shopping, the multiple choices may not include participant answer. Therefore, the author has created an open question in order to deal with this problem. Also there might not be enough international students and employees to complete the questionnaire. Sampling bias may skew results. Then poorly worded questions may lead to responses that are ambiguous so that data results are unclear. On the other hand, inabilities to control the environment were the respondents provide the answers to the questions in the survey.
3.5 Secondary research
Data used for research that was not gathered directly and purposefully for the project under consideration are termed secondary data. Secondary data is available through books, reports, journal or publications, like newspaper, annual report, and website or journal articles. An important part of the paper will be the secondary research which is conducted for the purpose of the project. This dissertation will use the data / information produced by other publications and evaluates the findings. On the other hand, this dissertation also uses three case studies in order to realize the importance of existing problems.
Documentary research is typical of collecting, recording, analyzing interpreting of information from secondary sources such as texts, books, journal and magazine articles, news and newspapers. Other sources include census publications, film, video and the internet. These can be important raw data sources in their own right, as well as storage medium for compiled data. The first advantage of such an approach to doing research is that it is usually readily available. The research can be accessed by browsing the internet. The second advantage is that doing this research is inexpensive as compared to surveys. However, documentary research has the limitation. Information obtained may be biased. Personal biases and prejudices could have influenced past work that was documented by authors. Such information may therefore lack credibility. There are three important cases has appeared as follows.
3.6 Advantages and disadvantages of both primary and secondary research
There are advantages and disadvantage for both methods. Some advantages of primary research include anonymity, relatively low cost, large sample size and high response rate; however, such as questionnaire must be simple, expensive time and may lead to interviewer bias. Secondary data use of resource efficiency, capacity for evaluation, because secondary data sources can be evaluated before being integrated into a research project; and also avoids respondent fatigue. Considerable cost, time and human capital savings can be realized when secondary data are used. However, some disadvantages of secondary data appeared in age of data, cost, lack of familiarity and data collection methods.
3.7 Questionnaire designs
This dissertation will use of the questionnaire method to collect data. The reason to choose the methodology of questionnaire because of wide, it is suitable for age group that from began to work until retire within MNCs; not only are they closely related to profit and ethics every day, but also easily to employ some methodologies to research, such as questionnaire (can distribute questionnaire outside or create relevant questionnaire on the internet and answer some questions online through linking of survey monkey). In addition, the author will provide a reasonable and reliable questionnaire for respondents in order to get more useful information in this research.
3.7.1 Pilot study
Pilot studies can be based on quantitative and qualitative methods and large scale studies might employ a number of pilot studies before the main survey is conducted. The reason for conducting pilot studies is assessing the feasibility of a survey; and establishing whether the sampling frame is effective; also identifying logistical problems which might occur using proposed methods. This dissertation has presented about 15 to 20 questions. Before doing questionnaire, the author has tested out the questionnaire on a small target group about 5 people. This can help the author highlight any ambiguity in the wording of questions. During the process, there are four questions showed unclear, even some respondents cannot understand what the meaning of some questions is. Some respondents suggest the author change or add some questions; because someone finds out that some questions are superfluous. The advantage of conducting a pilot study is that it might give advance warning about where the main research project could fail.
Usually, the population is too large for the researcher to attempt to survey all of its members. The sample reflects the characteristics of the population from which it is drawn. Sampling methods are classified as either probability or non probability. Probability methods include random sampling, systematic sampling, and stratified sampling. Non probability sampling includes convenience sampling, judgment sampling, quota sampling and snowball sampling. This dissertation will select random sampling method. It is the purest form of probability sampling. Each member of the population has an equal and known chance of being selected. This dissertation prepares to select 200 respondents. Most of them are passenger, some of them including international student and employee. It is better to select employee who works in MNCs. And then, randomly select 100 questionnaires from 200 respondents. Fortunately, there are not very large populations. On the contrary, it is difficult or impossible to identify every member of the population.
220.127.116.11 Closed questions
Closed (multiple choice) questions ask the respondent to choose, among a possible set of answers, the respondent is usually asked to tick or circle the chosen answer. The main advantage is respondents are easy and quick to answer. Closed format questions can help the author easily calculate statistical data and percentages.
18.104.22.168 Open end questions
Open format questions are those questions that give a response an opportunity to express their opinions. In these types of questions, there are no predetermined set of responses and the person is free to answer however he or she selected. This dissertation only has one open format question for respondents at the end of the questionnaire. In open questions, it can help the author get true, insightful and even unexpected suggestions.
22.214.171.124 Contingency questions
There is a special case of a closed-ended question in this dissertation. It applies only to a subgroup of respondents. The relevance of the question for a subgroup is determined by asking a filter question. This format may help the author get information more detail.
Totally, there is no denying that this research is confidentiality and anonymity. There are several reasons why it is significant to adhere to ethical norms in research. Firstly, norms promote the aims of research, such as knowledge, truth, and avoidance of error. Second, since research often involves a great deal of cooperation and coordination among many different people in different disciplines, ethical standards promote the values that are essential to collaborative work, such as trust, accountability, mutual respect, and fairness. This dissertation will use the serial number instead of the real name. The anonymity of surveys allows people to feel more candid in their responses. To get accurate data, respondents should be as honest as possible in their answers. As Dane (1990: 39) stated the term voluntary participation refers to the participants' rights to freely choose to subject themselves to the scrutiny inherent in research. This means pure voluntary without coercion, all participants were informed consent. In addition, there is no deception would be exercised.
3.9 Relevant Research
This dissertation will create 10 to 15 questions including one open question to remedy limitation of multiple choices. Subject organizations are those which have completed a formalized process of implementing ethics and profitability within MNCs. There is no custodial control of any submitted or published information, and due to extreme sensitivity and confidentiality of some of the information studied. Company names are not disclosed. The aim of this survey will focus on international students and some employees. The research question will concentrate on age, whether have working experience on MNCs, previously concern about ethics or profitability, if he or she would choose one of them, they would answer the different question, such as if he or she chooses ethic, what is the significant impact of MNCs?
The major limitation of this research will be the time and respondents. The whole process was short; expect time to completion would be five or six months. Some research method is very time consuming. A large sample of the population has to be studied; the larger sample of people researched, and the more statistically accurate the results will be.
In this research, the methodology of questionnaire is suitable for research questions. The aspect of the questionnaire is not an open-end format allows individuals to determine the type and order of response, and give them the opportunity to define their personal constructs (Cassell and Symon 1994:52). In the methodology of questionnaire, some respondents could almost provide open and honest responses.
The strategies of inquiry associated with quantitative research were those that invoke the postpositivist perspectives. These include the true experiments and less rigorous experiments (Creswell 2003: 13), for example, using questionnaires for data collection, with the intent of generalizing from a sample to a population (Babbie, 1990:14 cited in Creswell, 2003). In this research, all audience would be included as population. In qualitative research, the numbers and types of approaches also became more clearly visible (Creswell 2003:14). Such as, the above statement has written three case studies; these cases have clearly demonstrated exist problems within MNCs.
According to Randall and Gibson (1990:468) concluded that 'the methodology in business ethics research is clearly in need of improvement. Business ethics as a field of study, addresses the application of moral principles and ethical standards for human actions within the exchange process. Moral principles imply responsibility. Thus, the judgment of right or wrong ethical business actions involves an evaluation of actions against the responsibilities that accompany a business position. Describing the whole research process from theory, through hypothesizing, conceptualism, operationalzing and sampling to data collection and analysis, they observed that most research in business ethics is lacking in theory, is conceptually confused and shows little concern for validity or reliability, uses predominantly questionnaire methods of data collection which often consist of ambiguous or vague questions and usually uses only one or two variables in data analytic procedures.
Have you heard about the following concepts?
Corporate social responsibility
Multinational corporation "production code"
Do you think Corporate Social Responsibility includes?
The social responsibility
What do you think Corporate Social Responsibility includes?
Public benefit activities
What do you think CSR brings to the corporation?
Improve economic performance
Does your corporation have a charitable contribution?
(If yes please go to the Question 7)
What is donation used for?
Supporting the poor
Does your corporation consider other companies have adopted CSR and improved their image?
Is there a link between CSR and corporation sustainable management
Do you think that CSR improves the corporate image?
Not to matter
Does your corporation benefit from CSR
Can business be both ethical and profitable?
Which one is of the following more important for corporations?
What do you think about the impact of CSR and the relationship with ethics and profitability?
4.0 Case study
Basically, the purpose of most corporations is to earn profit. Even some corporations' pursuit a great deals of profit rather than consider employee. For example, Foxconn event, the certain to bring efficiency and profits, after the abuse is highly centralized, employees will able to fully express the interests of workers demands can be realized, in the management level will certainly form the structure of uneven tension, this tension the structure of the staff demands, but not to achieve, causing the whole process in the management of interpersonal tensions and apathy. However, the society has already accepted the tension between corporate rationality and social responsibility as an inescapable condition of living prosperously.
Another obvious example of BP, which reveals has made a £2 billion profits since last year, and with the oil company providing 8% of the UK's pension funds, the call for more ethical investment has never been greater. Last spring, the United States witnessed one of the worst environmental disasters in its history, when more than 20m gallons of oil from 4.9m barrels spilled into the Gulf of Mexico following an explosion at BP's Deepwater Horizon rig. Such as, deepwater Horizon rig, and the accompanying environmental dire consequences for the Gulf of Mexico as support for this assertion.
For years now, this corporation's track record in the area of public safety has been called into question. There have been accidents that resulted in employee deaths, property damage, etc. In the wake of these accidents, there have been accusations of cost-cutting at the expense of worker safety.
Such a corporation has arguably preoccupied with profit; also not acting with the public welfare in mind, will sooner or later receive a wake up call that cannot be ignored. And the event that is without question the worst consequence to data of BP's habitual cost-cutting, shortcut taking philosophy is the aforementioned explosion and subsequent oil spillage into the Gulf waters. It is time for profit concerns to be put aside and for the public good to take precedence.
Even the most news is Enron event related to profitability and business ethics. This event is even repealed from big five, all over the world shock for this event. Ethics seems less important than making profit, which is the ultimate goal all over the world. Ethics comes a poor second when it comes to doing business successfully. Arthur Andersen was one of the successful businesses in the past. It was not only the biggest electricity and natural gas trader in America; also provide a variety of energy products, broadband services and financial risk management services. The company had approximately $70 billion asset; business income even achieves more than hundred billion dollars every year. However, there was an extreme change after 16th of October. Enron's share price appeared dramatic and unimaginable fall from 16th of October to 9th of November for about $33.84 per share to $8.63 per share (Chinaacc, 2001). It happened because Enron had in reality been hiding its practices and obscuring its finances in dense, complicated contracts and bizarre accounting procedures so that no one could successfully determine the real financial state of the company, and instead had to rely purely on the company's own statements about its growth. In addition, Enron's downfall was characterized by practices focuses solely on profit. In order to pursue maximum profit, wrong doing like accounting fraud will harm the shareholders' interests. Clearly, managers and Arthur Andersen choose betraying the shareholders to maximize their self interests. The chairman of the board, Kenneth Lay, and CEO, Jeffrey Skilling, to allow the CFO, Andrew Fastow, to build private cooperate institution secretly and then transferred the property illegally.
The above statement has shown three cases in order to produce how business ethics and profit influenced MNCs. The common point is to pursue the profit but ignore the ethics. In Foxccon event, the corporation should consider the employee first; they should get the value equal to what they have done. In BP event, they should put safety first, and then consider the profit maximization. The most significant impact of Enron had led to the whole corporation close down; specifically, at the top leadership level, they should consider all employees and Enron Corporation instead of themselves. These events have reminded other MNCs should not consider the individual profit and ignore employee even the society. Therefore, the result of this dissertation will show the general public is greater than individual profit.
These cases have proved the greed is one of the human's original natures. In other words, pursue maximum profit rather than ethics. In this sense, the most victims in this case are investors. Ironically, Enron seems to have implemented this view of morality to enrich themselves, Enron's executives lied to shareholders and cooked and books to produce fake profits, ignoring the company's long-term financial problems. In fact, they did not make money; instead, they bankrupted their company and destroyed their reputation.
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Appendix 1 Deductive research
Waterfall: "Top down" approach
Appendix 2 inductive research
Hill climbing: "Bottom up" approach