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10 March 2007
Some Thai Challenges To IP Protection
Why is intellectual property seemingly a conundrum in Thailand in regard to copyright violations – much of it en masse – and the rights of the makers of software, medicines, and other intellectual property who have a right, lawful and ethical, to individual benefits from their protected services or products? As it is becoming increasingly clear that individual governments should not be solely responsible for their foreign policy formulation and execution, but should have much wider input from other NGOs, various pro and con interest groups, intellectuals and even representatives from those countries concerned, it is also clear that cultural differences and divergent value systems need to be addressed on lesser issues – but in their way no less important - such as intellectual property protection. These differences are not just in general opinion but also in personal and group willingness, readiness, emotional and ethical capacity to comply with lawful protection of IP. These differences are extremely important in every aspect of IP protection from the point even before a product is marketed in-country or an illegal version of it appears on local shelves, to the entire array of local marketing, contract negotiation, official licensing and final approval to market in the host country as well as commitments from authorities and others that copyright will be respected on the one hand, and protected on the other. Given the unique background of Thai culture and its overall value system, it is incumbent to the copyright owner to understand that intellectual property in Thailand has a much different meaning that it does in the west. The differences may be startling when stated, yet need to be seen and appreciated because they will affect negotiations, legal protection, litigation - even the very ability to enforce IP protection.
The differences are, in part, as follows:
1. Thais generally do not regard confidentiality as a major issue in day to day social interaction. In fact, very personal and confidential matters are readily exposed without any consideration toward feelings or sensitivities. Take, for example, an American woman who visited a well-known hospital in Bangkok with her husband for cosmetic surgery. Because it was physically obvious that the woman was somewhat small in breast size, it was presumed by another visitor to the hospital that the woman was there for breast augmentation. When the visitor asked the station nurse whether this was the case, the nurse replied, “Yes.” In another matter relating to confidentiality (and any consequent right to protection), a local Thai Public Relations department official received a letter addressed to the governor of his province that addressed ongoing litigation with a local radio personality. The letter would easily have exacerbated ongoing civil and criminal litigation and should never have been given to the defendant. Yet the PR official nonetheless gave the entire document to the defendant, at first denying he had done so, but later admitting it by declaring, “I was just doing my duty.” In a third example, a local post office employee, who also worked for a flower seedlings company, received an email from a western company asking for certain types of orchid seedlings. Seeing an opportunity, the employee, although he knew his company had the seedlings, wrote back to the potential customer that the company was out of seeds but that he just happened to have a few of his own and would be glad to discuss terms. Overall, perhaps, these limited three examples may not convince the reader 100% that Thais are not yet even near the ball park in handling confidential information on the one hand, or in acting ethically on the other, they should provide at least a bird’s eye view of the lack of accountability in Thailand that does exist.
2. Telling someone the truth is also viewed as a secondary, minor issue in Thai society. While this may also be increasingly true in the west, in Thailand it has been going on for centuries. This failure to accept the need to be truthful is, of course, disastrous to anyone walking into a contract situation expecting to be treated honestly on the one hand, or hoping that later litigation will resolve problems in either a satisfactory or timely manner. As they say, “It ain’t gonna happen.” Although the Thai media have not pursued the matter to date in much detail, the insurance industry is currently victim of hundreds of thousands of fraudulent claims, many of them made with the assistance of the Thai insurance representatives! For example, suppose you are driving downtown and your car is hit in the rear. It turns out to be your fault, the damage is minor, and the other party shrugs it off and wishes to part company with no questions asked. You agree. Then you take the car to the insurance agent who looks at it and tells you to report that the damage was done in your garage as you were backing out. When you happen to have told him that you had wanted to paint the rocker panel anyway, he says to also put that in the same claim! A local appliance and electronics store has had seven separate fires in the same location. No police or insurance agents have ever pursued serious investigation of fraud against the retailer, and in each case, he has received insurance compensation for stated losses.
3. Others, including the Thai courts, are not going to be overly appreciative of principles involved and larger IP issues or consequential encouragement of further violations. This is not criticism of the Thai courts, although criticism can be made. While Thailand has many times publicly stated that its justice system is second to none, the record tells otherwise. It is not so much the problem of the courts per se as it is general public apathy or selfish interests. Judges, for example, are well aware of formal sentencing guidelines but will generally waive them for what is widely believed to be a sense of pity or sympathy with the plight of the defendant on the one hand, or of Thailand’s and society’s image on the other. Judges will not rule, solely, on points of law, but on perceived seriousness of the crime or civil wrong committed. This is the essential point – that if Thai society as a whole doesn’t regard confidentiality as a major underpinning of social interaction, or if most Thais will treat truth with a measuring stick, or if they regard principles as important but no so important as avoiding harsher than what is considered socially acceptable punishment, no matter what the crime (including murder), then the judgment that comes out of the court is generally likely to be much less severe than it is seen as needing to be in western eyes.
4. There is also a lurking violent streak in many Thais, often coupled with alcohol. There are various reasons for this, social inequity being just one. This boils down into the need identified by management consultants as risk analysis. That is, just how far can you go down the road toward protection, enforcement, prosecution and enforcement of prosecution before you begin to stand out and are exposed as a softer target that may get what he deserves because he is pushing the issue too hard? Currently an example of this can be seen in the uniquely severe sentence given to Sondhi Limthongkul, Thai media baron, who led the way to Thaksin Shinawatra being removed form power. In Sondhi’s case he received what is Thailand’s most severe ever sentence for defamation. (In Thailand it can be prosecuted either in the criminal or civil courts, or both). Sondhi, in this writer’s opinion, violated Thai social mores in criticizing a broad spectrum of Thai figures, inside and outside the government, over an extended period. Thais don’t mind certain careful and guarded criticisms, but do not like being openly identified as a crook, thief, etc. Of course, no one does, but Sondhi chose to elevate the level and scope of his criticism to such an extent that it hit dozens and dozens of high-profile personalities in Thailand, including those in the former and present government, and those associated with certain members of the country’s upper classes in whatever segment of society they are based. This is not to argue that Sondhi’s criticisms were inaccurate or undeserved, but to underscore the fact that he made them against such a wide array of targets. So even as a Thai, Sondhi began alienating those Thais who had more traditional values at heart, and they began to react against him. Thus, in the recent case where Sondhi received a two years’ prison sentence for defamation, it is not likely that the court’s ruling was made on point of law per se, but that the severity of the sentence was made because Sondhi overstepped the line. Thus, he was getting punished not only for what he said, but for daring to say it. Thus we get back to the violent aspect of Thai society, when the line is stepped across and you may not even know it. Sondhi was threatened quite a few times with murder, but it is more likely that high-flyers decided to put him in jail rather than mess around employing other methods. If you are not Sondhi Limthongkul but an ordinary contractor, consultant, business owner or partner, and are considering signing on the dotted line, consider first the cost, real and potential, for your signature. Can you afford to lose 50% of your investment the first few days it is transferred into a Thai bank? Can you be sure that if you proceed with legal action against your Thai partner for fraud that he or she won’t hire someone to kill you? Can you be reasonably confident that if you need to seize your Thai partner’s assets, that those assets will be there? These hypothetical questions are for worst-case scenarios, and not everyone, thankfully, is faced with them. But it doesn’t hurt to hypothesize. Caution is healthy.
5. Thai laws and regulations relating to visas and foreign business investments have been in the news lately, indeed, for a very long time without satisfactory resolution in the view of foreigners. Thai retailers are beset by an old problem we in the west faced well over fifty years ago with the slow strangling of mom-and-pop shops with first strip malls and then mega-malls. Back then it was our own people doing it so we could view it as the wave of the future. Although the same principles apply here in Thailand, it isn’t our own people doing it so much as it is foreigners doing it to Thais. Thailand has a very significant anti-foreigner bias, and the inroads that large foreign retailers have made into the Thai market are not seen as a natural consequence but one of domination – coupled with xenophobic prejudice. In many instances foreigners have been frustrated by what they see as Thai failure to compete (which is a fact) when the Thais see it as a domination issue; that is, non-Thais socking it to Thais. So government regulations and laws get treated not just in relation to international norms or agreements, but in terms of how they will in part protect Thais and in another part help win the next election. This situation is no different from it is in the States and elsewhere in many aspects, but in Thailand the xenophobia is an unspoken social more/taboo. On the one hand xenophobia exists on a wide level and on the other it is denied across most levels of society. No one really wants to discuss the larger issue of human rights and prejudices here in the Land of Smiles. So you have directly opposing forces at work – some of them are compliant with foreign demands, others are resistant, and another part are off on a separate tangent of protecting Thailand from foreign devils – seriously. What does all this mean for intellectual property protection in Thailand? Essentially it means that there will continue to be serious wide-spread, even mass, IP violations in Thailand for the foreseeable future, as well as a corresponding sympathy throughout Thai society - including in the courts - for those who violate copyright protection.Thailand will continue to be a harbor for illegal reproduction and distribution of others’ IP for some time. The cost differentials are too attractive. Why pay $400 for an Adobe disk when you can pick it up for $3? Mitigating factors can and should include legal enforcement, but the issue of education and turning the tables on widely perceived attitudes so that they come around to perceiving that stealing is not just wrong but it is destructive is an issue that has to be better handled. The US State Department, through its embassies, or equivalent agencies of other countries are not the most effective avenue for seeing this change in paradigm, so to speak. Business organizations need to begin an outreach program where they face – literally – the enemy and have a one-on-one dialogue with him or her or them. Honesty isn’t something that will sprout up overnight, but for it to take root here in Thailand companies are going to need to take a bit of a different tact than has been done in the past. It’s nice to network and go to cocktail parties and hand out business cards, but when you realize that your company’s software or drugs are being sold in Thailand without royalties coming to you and without any reasonable control over production or distribution, and that company shareholders are being made victim by the hundreds of thousands, then some idea of the scope of what is needed to be done may be glimpsed.
Frank G Anderson American Citizens Abroad Representative, Thailand
www.thekoratpost.com ethics@loxinfo.co.th editor@thekoratpost.com
7 October 2003
It’s interesting to note that the Assembly of the Poor AKA Forum of the Poor, in protesting against Thai government clampdowns at Sanam Luang during the coming APEC summit, that protests are directed not at Thaksin himself or recent Thai government oppression per se, but instead are directed at capitalism, the United States and globalization. The Forum members are playing right into Thaksin’s hands: they need a target, and instead of the rightful target – Thaksin and his Thai Rak Thai party – the Forum members are planning to protest against one of Thailand’s last bastions against permanent Chinese government-supported oppression – the United States.
So much in Amazing Land of Smiles.
13 April 2002Criticizing the Press
As with any other part of society, the press in its various forms – print media, radio and television, video and graphics, etc. – is deserving of legitimate criticism by anyone, whether it be the prime minister or simply a reader unhappy with an article he read. Further, the press has a unique responsibility in the unique role it plays in society. Often, what the media reports is taken as absolute truth by readers; the people it attacks or reports on are subject to intense review as a result of media coverage. Thus, such reports can have negative impact, as well as positive, on society, politics, and even national stability.
In countries, however, that are yet to become fully democratic, the press is often criticized unjustly by national leadership. Reporters and editors may be accused and made subject of intense investigations because of a less than complimentary reports they may have made on political leaders. Because these political leaders have the political power to do so, they often use it to crack the whip of oppression using a variety of tactics and tools. One of the most useful tools in this regard is general public interest of issues being debated.
It’s true that no one can argue against the benefits of a national 30 Baht health scheme, for example. However, one can, and should, argue against the negative impact such a program can and is already having on many hospitals here in Thailand, and indeed on the national economy in some respects. It is financially unfeasible, for instance, to assume that hospitals can wisely compensate for actual expenses used in treating thousands of patients when those patients are charged only 30 Baht for the treatment. As admirable as near-free health care is, the downside is that financial planning, budgeting, compensation, alternate revenue sources, and a backup plan should all have been developed and agreed to prior to implementing the public health scheme under discussion.
Another populist program launched by the current Thai Prime Minister, the 1 million Baht village fund, has also, if we listen to general reports, been a failure in more than half the cases. The money was spent fruitlessly, recklessly, and sometimes stolen and used for personal gain.
Populist policies have their place in national politics. Every politician born advocates such policies. Cheap medical care, protection for battered women, prevention of AIDS, free schooling for children, and so on are all important public programs. When they are carefully planned and executed, with a full review of resources available and the financing that needs to be done to meet these policies, they can work. But to merely promise success without hard data backing up policies, and even more recklessly, to say things like “If it doesn’t work, we’ll try something else.” Is to impose more ignorance on the already ignorant.
Many people in emerging democracies are feeling the impact of globalization. Those who have jobs might now be working two instead of only one, just to make ends meet. Those without jobs are often left on their own to find their own way to survive. Problems are exacerbated when these people, who are already suffering, are kept in the dark about what it is that is really causing their plight. They are almost always told it is someone else, certainly not the current leadership. Whether this is true or not will never be known to them because they do not have access to adequate information to make proper judgments.
Helping the public make better judgments is one of the primary roles of media, besides the overbearing role of entertainer than seems to have spread across the globe these days. In this role as information provider, the media is an advocate of the general public. It represents public interests to officials and others in seeking answers to everyday issues and problems that confront communities. This role as advocate is near-impossible to fulfill if it is obstructed by behavior that either results in such information being made unavailable or inaccurate, or by behavior that unfairly and unethically calls into question the right of the media to even ask questions.
Nationalism and sometimes an unfortunate anti-foreigner rationale scattered around society is often stoked by officials and their supporters to check democratic moves. At first, local media are accused and blamed for criticizing; they are immediately treated poorly and then given little or no access to accurate information. When international media begins to produce similar reports, then these same official channels use political and military power to silence opposition and to try to ensure uninterrupted administration of policies that may or may not not be in the public’s overall best interests.
This is one of the core issues in the Far Eastern Economic Review’s original article of January 10, 2002. The reaction to the article by those criticized was to grab the biggest hammer available, hold out the flag, stir up anti-foreign sentiment, and use what was clearly viewed outside Thailand (and inside much of the country) as unreasonable and undemocratic threats to force a retreat and apology. It did not seem to matter whether what was said was partly or entirely accurate or not. What mattered was that the criticism was directed at a major player, and he was not going to strike out while still holding the bat. Unlike a normal baseball game, the batter was not going to take another pitch he could not control. He ordered the pitcher off the mound, down to the batter’s box, and made him promise to throw a kinder, gentler ball.
A similar reaction was noted some time ago during a soccer match in Saudi Arabia. A local parent did not like the call an American coach made against his son. Rather than take the call and try next time, the parent went to company management and threatened the American with termination from employment if the call was not reversed.An adult student I was teaching here in Korat once told me that politics in Thailand is a game, and “That’s why they call it playing politics.” For society, however, playing at politics is far more damaging to social order and good morals than any magazine article that falls short of what it was accused – via innuendo - of. Politics is a public trust. Politicians must work with the public, and through their advocate, the media, to promote democratic ideals and constructive changes in society.
30 March 2002
Environmental Ethics
The following is from a legal statute in one state in the United States, which relates to the responsibility of pet owners:
“No person shall own, keep, or have in his possession, or harbor, any dog, cat, other animal or bird which, by frequent or habitually howling, yelping, barking, meowing, squawking, or otherwise, causes loud noises, and creates excessive noise across a residential real property line or within a noise sensitive zone, at any time of day or night.”
Additionally, another provision in the same statue says:
“Unless otherwise herein provided, no person shall operate or cause to be operated, any source of sound at any location in the City, or allow the creation of any noise on property owned, leased, occupied or otherwise controlled by such person which causes the noise level, when measured on any other property, to exceed any of the following exterior noise standards…” (a chart then is provided that shows allowable noise limits, measured in decibels.
The creation of this statute was in the public interest. It was designed to protect all of the city’s residents from undue, unfair, and irritating noises that lead to stress, mental and physical sickness.
Here in Korat, failure to voluntarily or by regulation limit noise levels to date has allowed pet owners (military and civilian) to abuse neighbors, allowed various motor vehicle owners to cause extremely irritating noises in their neighborhoods, making life miserable for everyone.
The general public has, unfortunately, accepted the creation of offensive noises without much objection. Such noises, coming from pets, machinery, loudspeakers, autos, radios, etc., constantly hammer at the ear of every passing person, and do little good to those who are operating the shops and homes these noises originate in. The reason given by those who own or operate the machinery, equipment, vehicles, and pets that make all this stressful noise is generally that the owners and operators need to make a living, or are just indulging themselves, and this is the only way they can do so. How ethical is the behavior of such vendors and marketers? Is it ethical for municipal authorities to permit continual worsening of noise and other pollution in Korat? Is it ethical for elected municipal officials to argue that bringing this matter to public attention and trying to enforce noise levels will create enemies and threaten election chances?
It has been argued, rightly and accurately, that Thailand is not America, that Korat is not New York. But is is argued wrongly and inaccurately that changes that have taken place in the United States and other countries that protect the public interest, and just and fair limitation to personal freedom can not be carried out here in Thailand. Perhaps it would help to roll back the clock a bit to the United States to view what happened in California many years ago with auto emissions.Pollution was becoming so bad that California skies were overcast, as many here in Thailand are, with smog (a mix of toxic pollution from smoke and chemical fumes – associated with emission from auto exhausts). Environmentally concerned Californians banded together, ignoring the surprise and lack of sympathy on the part of most other people in their own state and other states, and worked hard to make sure a law was finally passed that was very severe on all auto operators throughout the state, whether such operators were residents or visitors. It didn’t matter what kind of car you had, how old you were, your sex, your particular excuse for exceeding the limits – if you were found to be violating the emission standards, you were heavily fined. There was no if, and, or but about it. Violate the law, and you were punished. The purpose, once again, was for the benefit of the general public, but the action was taken against particular individuals. The state was saying to auto operators that they have a responsibility and must meet it; that if they failed, they had to accept responsibility by taking punishment. Now we wind the clock forward to the year 2002, and change the location back here to Korat.
Although there is a motto, “Muang na yu,” or “Pleasant city in which to live,” the truth regarding various forms of pollution is far from the motto. Auto emissions are horrible in volume and type of poisonous waste, and noise levels generated by thousands of private citizens, commercial and other agencies cause increasing emotional, mental and physical stress to tens of thousands of city residents and visitors.
In a country where most forms of enforcement are done a little at a time, gradually, so as not to offend those who offend us (which is a double standard accepted by perpetrators and effectively unchallenged by law enforcement officials), it is doubtful that any end is in site – unless some decisions, based on ethics, are made by the public, state officials, and private citizens regarding pollution levels and their own role in producing them.
First, the obvious should be identified and immediately stopped. This is not a difficult task if agencies and individuals wish it to succeed. For example, black smoke emitted from auto exhausts can easily be seen. The offending vehicle should be immediately stopped, given a police citation, and then directed to a local police facility to have emission measurements made, and the vehicle restrained from being operated until corrections have been made and verified. No payoff, no bribing, no arguing that such measures are unreasonable. They are not unreasonable. Likewise for noise pollution. It is relatively simple to judge whether anyone is generating, or allowing irritating noise to be generated. What makes it not so simple in Thailand to correct the problem is that there has been a general public, and official, acceptance that the general public should be forced to suffer from the behavior of the few. Collectively, this results in an almost lawless free-for-all where everyone does as he wishes, and never-mind complaints or discomfort, even ill health, to neighbors. Often mistaken for tolerance, this is merely selfishness in the extreme. The total failure of enforcing vehicle weight limits is one extreme example.
The nation’s highway system, a vital infrastructure element, is under great threat from overweight vehicles. If you have noticed over the past several months, for example, trucks of all shapes and sizes have been modified to take loads far in excess of what the vehicle is designed for. The damage this will cause to the highway is denied by those with vested interests in what is carried, and the taxpayer will be stuck with the road repair bill. To get some idea of how much of a threat this practice is to the highway system, one only need to look at Friendship Highway. Currently, the highway leaving Saraburi and then coming to Korat is deeply grooved by overweight trucks. A similar problem is developing on the Pakthongchai Highway. The highway along the Lamtakhong Reservoir is often broken up. It seems as if people just don’t care on the one hand, and as if “making enemies” is the rationale used by individuals for not getting involved.What one should ask is why single individuals, whether polluters or abusers, should have almost unlimited freedom to cause pain and suffering to others with little or no answerability. This is where the subject of ethics enters the social landscape. See the next installment of “Environmental Ethics.”
This writer welcomes comments, criticism and inquiries in Thai or English, relating to this series of articles on ethics. Please send them to ethics@loxinfo.co.th. Whether pro or con, your letter will receive due attention. Please indicate if you wish it to be published or not. Thank you.
January 16, 2002
Practicing Ethics in Today’s World
The following is a Ph.D. coursework essay, and copyright protected. It may not be produced, copied or disseminated in any manner that violates the principle or practice of such copyright without express written advance approval from the author. I. Introduction.
II. Normative Theories and Current Ethical Practice in Business Settings.
III. Rationalization of Distinctions between Consequentialism and Non-consequentialism.
IV. Incentives for Ethical Behavior.
V. Applying Business Ethics Incentives in a Globalized Society.
I. Introduction
The recent Enron collapse, where the largest energy company in the United States collapsed, is only one high-profile example of the need for more ethical behavior from business and government on the one hand, and on the other, shows the propensity of individuals in both spheres to abuse position and influence for personal gain. Serious erosion of corporate responsibility is also evident in hundreds of companies traded on stock exchanges, with company executives being paid extremely high salaries, receiving raises, while the share price tumbles to new lows. In Enron’s example, stock plunged from a high of $80 per share to near $1.00. A brief look at a single stock on the NASDAQ also sheds some light on potential corporate governance problems. Florsheim Shoes (FLORSHEIM GROUP (NasdaqSC:FLSC)last traded (15 January 2002) at $0.25 per share, from a high in August 1997 of $17 per share. The company’s executives, however, are handsomely paid. Mr. Peter Corritori, Jr., 47, Chairman, CEO, had a FY 2000 pay of $555,000; Thomas Polke, 38, Exec. VP, CFO, has a salary in FY 200 of $186,000; Thomas Joseph, 49, Exec. VP, and Pres of Retail, was $209,000, while that of F. Terrence Blanchard, 47, VP, Controller, CAO, was $169,000. The company is a well-known manufacturer and marketer of quality shoes, but stockholders can easily argue that company executives are not watching out for them.
In such corporate settings, where the potential for individual gain is so large, the risk of serious punishment or personal sanctions for abuse often so minimal, and the array of opportunities for exploiting relationships with government agencies and others is so vast, seriously considering ethical behavior may become a secondary consideration for executives in both business and government. The very theory of consequentialism argues, in such settings, in favor of the corrupt executive.II. Normative Theories and Current Ethical Practice in Business Settings.
Normative theories provide guidelines for ethical behavior by establishing logical arguments in first assuming that it is better to do right than it is to do wrong, by setting forth principles that distinguish right from wrong. The principles are generally held to be based on consequentialist and non-consequentialist theories, although each share similarities. Consequentialists hold that an act is right or wrong depending on whether the consequences it produces are good or bad – a narrow definition by many standards. Non-consequentialists hold that an act is not only right or wrong depending on whether it produces good or bad consequences, but also whether the principles that rationalize whatever action is taken are themselves intrinsically moral or immoral.
III. Rationalization of Distinctions between Consequentialism and Non-consequentialism
In either case, permutations in the social contract partly caused by globalization have produced increasingly challenging arguments in favor of one rationale over another. It often becomes difficult in today’s modern world to successfully and morally argue for a given behavior or principle in the face of contradicting arguments that are often equally logical and defensible. Among such difficulties, it also becomes increasingly difficult to enforce traditional sanctions and laws that are now challenged by other laws and ethical reference systems. Differences in current attitudes by those in the justice system, compared to traditional attitudes, also contribute to erosion of individuals dealing ethically with one another.
IV. Incentives for Ethical Behavior
When individuals are found in gross numbers exploiting position and power for personal gain, and have become role models for others to pursue the same track, on a global basis, what incentives exist, or can be offered, to promote ethical behavior, incentives that provide a satisfactory moral theory for everyone while promoting virtue and ethical business practices? Essentially, as Rachels suggests, “A satisfactory moral theory would, first of all, be sensitive to the facts about human nature.” This principle is paralleled in Des Jardins’ essay when he refers to understanding of ethical theory and subsequent development of moral principles being overshadowed by “almost total disregard of virtues and the ethics of character.” Both authors argue that principles of ethical behavior and morality must come from an appreciation of reality in mankind’s behavior on the one hand, which involve today’s merging of often contradictory cultural and value systems, and merging of basic ethical principles based on traditional values that can serve today’s individual and social needs. Neither author calls for an individual to become a saint, but each stresses the importance of being good and the underlying principle in being ethical and moral. Theravada Buddhism in Thailand, for example, also stresses good behavior as being desirable, although Thai society has been found wanting in this regard. Once again, principles are often not reflected in behavior. Adherence to personal consequentialism seems to too often overshadow ethical decision making.
V. Applying Business Ethics Incentives in a Globalized Society.
James Rachels understated it when he said, “A great many thinkers have approached the subject [moral philosophy] from a wide variety of perspectives and have produced theories that both attract and repel the thoughtful reader.” Rachels’ essay underscores the development of permutations mentioned earlier herein that bring about troublesome and often inhibiting counter-arguments to classical or traditional theories of ethics and moral behavior. It has become increasingly difficult to discover “the truth.” An old science fiction story broached the same issue. The universe was failing, stars dying, galaxies disappearing, mankind becoming extinct. An advanced computer developed by mankind was asked to figure out a solution to the breakdown. The last scientist died with the computer still stating, “Insufficient data.” Finally, aeons and aeons later, after the last stars had died and the universe had collapsed, and everything was in darkness, the computer clicked and said, “Let there be light.” The question raised in this science fiction story and in today’s arguments regarding ethics and moral behavior is whether man needs to become God or God-like to develop the kind of wisdom and judgment necessary for ethical behavior. That question is unfortunately used by many labeled liberals that propose the maxim that there is no right or wrong, no good or bad, than what is good for the individual is thus right, moderated only slightly by murmurings about not harming others.
As is often the case, society does not confront certain issues in a meaningful way until those issues interrupt social interests in undesirable ways. Here in Thailand, for example, the government has basically ceased inspecting trucks for exceeding weight limits on main highways although it is well known that a large number of trucks on the highway is exceeding weight limits by factors or 2-3 or more. The Friendship Highway that connects Korat with Bangkok has shown the effects of this overloading, with often one lane being open rather than the normal two or four in the section of highway concerned. It appears that no regulatory action will take place here to prevent complete closure from overloaded trucks, unless it is after the fact. This is also the point where regulation and enforcement of ethics often enter. As cited earlier, for example, the Enron bankruptcy is a very high profile instance of unethical behavior and irresponsible management of the company’s affairs. The fact that this happened to Enron should also be viewed against the hundreds of other high-profile business and government organizations in the United States and elsewhere that have faced similar - or worse - financial and governance mismanagement. Both authors agree with Aristotle’s approach that recognizes the intrinsic value of virtue ethics when comparing one’s personal behavior against the consequences of that behavior on oneself and others, holding that one’s actions should be governed by the maxim of whether one would hold personal principles and behavior to be ideal for universal acceptance prior to carrying out such action, is absolutely essential in preserving ethics and morality in today’s world.
Mankind is not so disparate that his various cultures can not agree on common underlying moral principles to guide behavior, in society in general or in the global corporate world. It is important, in ensuring ethical behavior and reinforcement of moral principles, that virtue ethics are promoted, not from the aspect of theology, but from one that combines vested interests with virtuous behavior. While a well-known American businessman here in Thailand, a senior partner in a prestigious law firm, has argued that businesses can not be ethical because their objective is to make a profit and this can not be done ethically, a contention is implicit in business administration professor Keith Davis’ statement, …modern business has immense social power…a just relationship demands that business also bear responsibility for its actions in these areas [minority employment and environmental pollution].” To illustrate, for example, the American executive cited above also regularly sponsors, through his company and staff participation, several community improvement projects. Funds are donated and company employees are transported to participate in implementing and monitoring small scale construction projects in economically disadvantaged areas. These activities are obviously not designed to profit the company, but to fulfil some social responsibility felt, and perhaps in some minimal compliance with underlying principles that “it’s the right thing to do.”In conducting corporate affairs, and in meeting social responsibilities, the individual and the organization he or she guides also must be careful not to confuse subjective principles of behavior with what might be called today more objective principles that are developing from the impact of close contact brought upon by globalization. While many still hold to nationalistic, and even racial principles that defend against what is viewed as external interference in internal affairs, these interests are being confronted with near-identical interests from abroad, or even from internal agents affected by more liberal thinking. Rights of others, in this sense, that were never really an issue have become an important consideration in many aspects of corporate and civil governance. Pressure groups, often spearheaded by NGOs, are now able to prevent decision making, and even alter it after decisions have been made. There is a danger, however, in new pressures that are brought about to bear on traditional decision making structures. Anarchy is one danger, and not always remote.
According to Simon Webley, Research Director for the Institute of Business Ethics, London, in a January 2000 paper, “More than 50% of large corporations have corporate ethics policies. A question we would like to ask you here and now is, “Does your corporation/company have such a policy?”
The chances are here in Bangkok that the answer is no, unless you are part of a JV or large foreign corporation that uses a standard ethics policy on a global basis. As a brief experiment, I sent 18 different law firms in Bangkok a query letter asking if the firm had an ethics policy or not, and whether it had an ethics officer. Four answers were returned. Only one came out to state a blunt “No.” Two others said something to the effect that their employees had to be ethical, and a foreign law firm wrote back saying it could not divulge confidential information. Go figure!Over and above having an ethics policy in your business organization, do you have a need for one? In this light, the business executive can conduct an overview of his or her business organization by a SWOT analysis for business ethics: S (Strengths), W (Weaknesses), O(Opportunities), and T (Threats).
Strengths in business ethics involve a wider support locally and internationally for acceptable ethical standards in business. Various business, community, government and NGO groups are now working hand-in-hand in many cases to develop a global consensus on what constitutes ethics, and how to apply that consensus to daily business activities at management and staff levels. While transparency is still sorely lacking here in Thailand, the obligations that a company has in conducting its business operations remain whether an ethics policy is officially in existence or not. Obligations also lead to accountability, and an ethics policy, drafted to both match international accepted standards and individual company needs, should be put down on paper. It serves as an important base document for minimally acceptable standards of behavior, and spells out expectations, cautionary comments and should provide some guidelines to use in case of unexpected unethical events within a company.
Because both management and staff, as well as company customers and clients, all have a stake in the company and its performance, the stakeholder model is often that selected as the one for identifying business ethics issues and mapping out strategies to conform with ethical practices. A newer development in this area is for a company to also evaluate organizations with which it interacts but which it can not control. How ethical or unethical those organizations are will in part determine a company’s own ethical identity and practices.
Here in Thailand/SE Asia, what are some of the weaknesses (W) of the business ethics picture? As indicated in the case cited about lack of response even from law firms to an inquiry regarding business ethics, many businesses see no need for a formal ethics policy, or even to talk to their employees regarding an ethics policy. Often, the only written company rules are those in the employment agreement: the rest “come out” during times of stress, such as when firing (or trying to) an employee. In fact, many company ethics policies are more implied than written. Management expects employees to be ethical, despite a still widespread public belief that corporations and executive officers are, by and large, hardly ethical. Several aspects of corporate behavior reinforce this impression. One is the frequent series of reports in the press regarding company officials who have been charged with massive corruption. The latest reports of some 7 billion Baht being illegally transferred abroad, in part through the acts of one officer of a local Thai bank are reflective of the scale of massive fraud against company interests by company officers. Further, what kind of unethical business practices took place here in Thailand between banking officers and local businessmen that permitted common loans to be extended to VIPs who may have offered no collateral except that of a signature of a friend?
Given the strengths (S) and weaknesses (W) cited above, what then of the opportunities here in Thailand for ethics in business practices? Any opportunity must be accompanied by corporate and public awareness, interaction with the global business ethics movement, and working with financial partners internally and externally to ensure that business operations and company officers conducting them are ethical. How do we increase these opportunities for business ethics here in Thailand?
Providing and disseminating business ethics information is an important part of this element of opportunity. The Internet has many rich resources in business ethics. Individual company officials here in Thailand need to research these sources of business ethics to see what kind of material and training is available and/or recommended. Certainly at the very least all foreign or J.V. companies operating in Thailand need to issue a company code of business ethics if they have not already done so. Corporate HR and executive management officers need to consult with local ethics experts or consultants to determine what their needs are, and how they can be met. For example, is a campaign warranted, or are a few notices enough? What is any code of ethics the company will use supposed to accomplish?What threats (T) are present to business ethics here in Thailand? There are several.
1. Lack of information on business ethics. Texts are not available, nor is a standard corporate ethics policy that companies can build from. Or, the information is not very well known.
2. Cultural challenges to good business ethics exist. Everyone may be aware that Thailand has a well-deserved reputation for corruption. This widespread and grass-roots problem will not easily be eradicated.
3. Public and organizational demands may also be distracting company officials from becoming more responsible early on in the company’s business operations. Day to day operations, existing employee and management attitudes, all may impede efforts to reform current ethics values.
4. Lack of existing business ethics codes also inhibits high quality employee morals. If a company does not provide ethical guidelines to its staff and management, then both will feel they have much more freedom of latitude in behavior than what the company may intend for them to feel, or even what the law will allow.Next article in series: A standard draft ethics code for your organization.
Frank G Anderson
Bangkok, Thailand
9 October 2001
"Ethics in Thailand? You gotta be kidding!" was one comment one of our readers had when I mentioned that I was studying for a Ph.D. program in business ethics here in Thailand. It's no joke. Lack of ethics in both management and staff levels costs corporations, companies, foundations and other NGOs billions of dollars a year.
One short joke illustrates the point. Two friends were at the office, and one invited the other to his home that evening. When they arrived at the house, the owner drove into his garage and the two men got out of the car. The visitor looked around, seeing pencil sharpeners, bulletin boards, pads, a chair, throw carpets, mouse pads, and so on, all with the company's logo.
"How did you get all this stuff?" the visitor asked his friend.
"Well, it all started out with a pencil." the thief replied.
The next section begins introducing the subject of business ethics to readers in Thailand.Business Ethics - Is there such a thing? (in draft as of 7 August 2001)
Mr. David Lyman, Senior Partner of Tilleke and Gibbins law firm here in Bangkok, gave a speech on business ethics to a group back in..... In his address, Mr. Lyman underscored one of the most fundamental differences between ethics and "normal" company behavior: that if companies were completely ethical, they would not make any money. Why not? Pure ethics, it is held, wouild involve telling everything like it is. If you, for example, as a company officer, know that your product is harmful to health, you ethically should not permit it to advertise that product for consumption. Yet, tobacco companies do advertise.