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Inverting the Pyramid of Values? Trends in Less-Developed Countries

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Abstract

The authors discuss the consistency of transnational companies in their home, as well as in less developed host countries, concerning ethics, values and social responsibility. Ethical behavior offers good reputation, credibility and tradition to the corporation. It leads to corporate social, environmental and economic responsibilities, cooperating to the desired sustainability. This paper analyzes the inversion of values that corporate governance systems have suffered. The meaning and implication of the corporate social responsibility is investigated and discussed. A “pyramid of values” is built upon individual ethical values at the basis. Over them, the organizational ethical values should indicate the limits of operations, so that the corporate social responsibility can be sustained, in the top. The authors comment that ethical values no longer lead the organization. Its communication with the stakeholders, specifically through reports, has been gradually replacing the code of ethics and corporate values. These reports have taken the basis of the pyramid leading the organizations to socially irresponsible and unethical behavior. They do not guarantee transparency or communicate the needs of the society. It appears that transnational companies do not behave the same way in their home country as they do in host countries, particularly in less developed regions like Latin America and Africa. Lack of communication and transparency may induce employees to unethical decisions and transform the reporting system into a marketing instrument. In order to guarantee compliance with the codes, transparency and ethical responsibility, communication within the organization is essential.

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Abbreviations

ADC:

Andean Development Cor-poration

CSR:

Corporate Social Responsibility

EITI:

Extractive Industries Transparency Initiative

FIABV:

Ibero-American Federation of Stock Exchanges (our translation)

GPA:

Government Procurement Agreement

IADB:

Inter-American Development Bank

IBGC:

Insti-tuto Brasileiro de Governanca Corporativa

IIC:

Inter-American Investment Corporation

MNC:

Multinational company

NGO:

Non-governmental organization

OECD:

Organization for Economic Cooperation and Development

TNC:

Transnational company

UNICEF:

United Nations Children’s Fund

U.S.:

United States of America

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Authors and Affiliations

  1. FGV-EAESP (Fundação Getulio Vargas, Escola de Administração de Empresas de São Paulo), São Paulo, Brazil

    Maria Virginia Halter & Maria Cecilia Coutinho de Arruda

Authors
  1. Maria Virginia Halter
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  2. Maria Cecilia Coutinho de Arruda
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Correspondence to Maria Cecilia Coutinho de Arruda.

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Halter, M.V., de Arruda, M.C.C. Inverting the Pyramid of Values? Trends in Less-Developed Countries. J Bus Ethics 90 (Suppl 3), 267–275 (2009). https://doi.org/10.1007/s10551-010-0426-0

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