The Foreign Corrupt Practices Act
“Differences in cultures, business practices, and laws among countries in the global economy create difficult moral, ethical and legal problems for multinational corporations in today’s global economy” (Lussier & Sherman, 2009, p. 475). When doing business on a global level without a standard or universal code of ethics, many businesses are finding they have to make payments that are be considered illegal in the United States (Lussier & Sherman, 2009). While these payments or bribes are illegal and unethical in the United States and many other countries, there are still countries where it is common practice and expected in order to do business in that country. According to two contrarian articles in a text written by Ciula, Martin, and Solomon (2011) there is a difference of opinion when it comes to ethics and bribes although both believe morals or moral standards are the underlying driver to their points.
A Ethics and the Foreign Corrupt Practices Act
The basis of Mark Pastin and Michael Hooker’s Business Horizon’s article was that “the Foreign Corrupt Practices Act (FCPA), should be grounded in morality, and should therefore be judged from an ethical perspective (Ciulla, et al., 2011, p. 507)”. The FCPA was passed in 1977 to help improve global business ethics. “Under the FCPA, grease payments are not illegal when conducting internation business but bribes are illegal. It is illegal to offer compensation to anyone if it is known that nay or all of the bribe will be used to influence a foreign official, politician or political party (Lussier & Sherman, 2009, p. 475)”. The act also requires that company records will “accurately and fairly reflect the transactions and dispositions of the assets of the issuer (Ciulla, et al., 2011, p. 508)”. Which the article goes on to say, goes far beyond previous Securities and Exchange Commission (SEC) requirements that records display only facts material to the financial position...