Conceptual Assignment #1 (BUS6750 International Business Management)
Chapter 1: How does the Internet affect international business activity and the globalization of the world economy?
Chapter 2: Reread the Management Focus feature: Did Walmart Violate the Foreign Corrupt Practices Act? What is your opinion? If you think it did, what do you think the consequences will be for Walmart?
Chapter 3: What is the relationship between property rights, corruption, and economic progress? How important are anticorruption efforts in the effort to improve a country’s level of economic development?
Chapter 4: Do you think business practices in an Islamic country are likely to differ from business practices in a Christian country? If so, how?
Chapter 5: Milton Friedman stated in his famous article in The New York Times in 1970 that “the social responsibility of business is to increase profits.” Do you agree? If not, do you prefer that multinational corporations adopt a focus on corporate social responsibility or sustainability practices?
Chapter 6: Is free trade fair? Discuss.
The Conceptual Assignment must follow the following guidelines:
1. You must give quality answers that show mastery of the concepts being discussed, using clear logic, and supporting facts. Also, the answers must directly address the questions or discussion topics using chapter readings and research.
2. Conceptual assignments test the understanding of key concepts and elements of International Business, therefore, they must be thoroughly addressed.
3. You must use citations with references to document information obtained from sources. The key concepts and elements of International Business are found in the sources listed in the syllabus (it is your duty to search for them, read, analyze, evaluate, summarize, paraphrase in your answers, and cite the authors who wrote the articles, books, term papers, memoirs, studies, etc. What it means is that you will have not less than 6 references from the listed sources.
4. Grammatically correct paper, no typos, and must have obviously been proofread for logic.
5. Questions must be typed out as headings, with follow up answers in paragraph format, and a summary or conclusion at the end of the paper.
The Assignment must be in APA format
Chapter 2 Management F O C U S
Did Walmart Violate the Foreign Corrupt Practices Act?
In the early 2000s, Walmart wanted to build a new store in San Juan Teotihuacan, Mexico, barely a mile from ancient pyramids that drew tourists from around the world. The owner of the land was happy to sell to Walmart, but one thing stood in the way of a deal: the city’s new zoning laws. These prohibited commercial development in the historic area. Not to be denied, executives at the headquarters of Walmart de Mexico found a way around the problem: They paid a $52,000 bribe to a local official to redraw the zoning area so that the property Walmart wanted to purchase was placed outside the commercial-free zone. Walmart then went ahead and built the store, despite vigorous local opposition, opening it in late 2004.
A former lawyer for Walmart de Mexico subsequently contacted Walmart executives at the company’s corporate headquarters in Bentonville, Arkansas. He told them that Walmart de Mexico routinely resorted to bribery, citing the altered zoning map as just one example. Alarmed, executives at Walmart started their own investigation. Faced with growing evidence of corruption in Mexico, top Walmart executives decided to engage in damage control, rather than coming clean. Walmart’s top lawyer shipped the case files back to Mexico and handed over responsibility for the investigation to the general council of Walmart de Mexico. This was an interesting choice as the very same general council was alleged to have authorized bribes. The general council quickly exonerated fellow Mexican executives, and the internal investigation was closed in 2006.
For several years nothing more happened; then, in April 2012, The New York Times published an article detailing bribery by Walmart. The Times cited the changed zoning map and several other examples of bribery by Walmart: for example, eight bribes totaling $341,000 enabled Walmart to build a Sam’s Club in one of Mexico City’s most densely populated neighborhoods without a construction license, an environmental permit, an urban impact assessment, or even a traffic permit. Similarly, thanks to nine bribe payments totaling $765,000, Walmart built a vast refrigerated distribution center in an environmentally fragile flood basin north of Mexico City, in an area where electricity was so scarce that many smaller developers were turned away.
Walmart responded to The New York Times article by ramping up a second internal investigation into bribery that it had initiated in 2011. By mid-2015, there were reportedly more than 300 outside lawyers working on the investigation, and it had cost more than $612 million in fees. In addition, the U.S. Department of Justice and the Securities and Exchange Commission both announced that they had started investigations into Walmart’s practices. In November 2012, Walmart reported that its own investigation into violations had extended beyond Mexico to include China and India.
Among other things, it was looking into the allegations by the Times that top executives at Walmart, including former CEO Lee Scott Jr., had deliberately squashed earlier investigations. In late 2016 people familiar with the matter stated that the federal investigation had not uncovered evidence of widespread bribery. In November 2017 it was reported that Walmart had settled with the Justice Department and paid a $283 million fine, significantly less than had been expected.