As my major clients becomes more and more engaged in business activities outside their home bases in North America and Western Europe, they seem to be asking increasingly difficult questions about the difference between cultural sensitivity and ethical correctness.  I suppose the question boils down to a simple one – should we always play by the rules of the country we find ourselves operating in?  Those of a culturally understanding nature, as well as those who place the commercial imperative before all else tend to argue that ‘when in Rome do as the Romans.’  But is it really that simple?  Should local norms always trump home country beliefs?

A North American client placed a female employee as the project lead on a project with a certain Asian country.  They received an email from the client in Asia saying they would prefer a man as the project lead.  What should the North American company do?  Should they acquiesce to the demands of the client even though that would contradict both the law in their own country and their own corporate policy of being a gender blind employer?  When I pose this dilemma to clients around the world, responses vary enormously and not just, as might be expected, along gender lines.  I’ve had female managers in the US saying that the client is always right but then being argued with by male colleagues who say that corporate policies should be adhered to regardless of the commercial consequences.

I spend a lot of time explaining the impact of differing attitudes to meetings, decision-making styles etc. on global business and my usual advice is to adapt to the expectations of the client as this can help you meet your goals on time and on budget.  Nobody objects to the idea of adapting to a different meeting style – but condoning gender bias or bribery is a whole different ball game!

These issues are really complex and there is no simple answer to them.  However, I strongly believe that a global company needs to address these issues rather than sweeping them under the carpet.  Organisations need a policy on all of these issues which is effectively communicated and then needs to be strong enough to apply that policy.  It just not fair to say ‘we don’t pay bribes’ but then to punish a sales guy for losing a contract because they didn’t pay a ‘facilitation payment’.  It sounds bizarre but it happens.

I’ve watching events unfold in the global financial markets with a mixture of incredulity and fear – like most other people I suppose.  What has transpired in the last couple of weeks would have seemed unthinkable a month or two ago and nobody seems to be able to call the low point in this whole mess.

What strikes me about it is the way in which certain key cultural characteristics – especially in the USA – may have been to key contributory factors to the problems.  Let me briefly explain what I mean by this:

•    Individualism:  A key US characteristic (seen as a virtue in the States) which leads employees to have less of a sense of responsibility to the company and more of a sense of responsibility to themselves.  This is one of the great strengths of the US economy but is it possible that, if left unchallenged, it can have the consequence of people making short-term decisions to better themselves at the expense of a greater whole?

•    Short-termism:  One of the by-products of economies which are mainly equity financed (USA, UK etc.) is that people are driven by quarterly results.  This again leads to people taking short-term decisions and looking for ‘quick wins’ at the expense of a more coherent long-term strategy.  This short-term outlook is, of course, exacerbated by a bonus culture which rewards people for delivering results NOW.

•    Enthusiasm:  One of the biggest differences in approach to business between employees in the US and many of their European colleagues would be that, whereas people in the US are expected to have a positive, enthusiastic, ‘can-do’ mentality, many Europeans would expect to show a more cautious (even cynical) approach.  This leads people in the States to feel a need to join in enthusiastically with new ideas and to be seen as really positive.  Can this also lead to a lack of rigorous analysis?  Are people afraid to challenge bad ideas because of the risk of seeming negative and a ‘trouble-maker’?

It seems to me that the three strong cultural characteristics outlined above could have been strong contributory factors to a system that allowed trillions of dollars of loans to be made to people who everybody knew would struggle to make the repayments.

Don’t get me wrong, I’m not criticising USA here – we’ve all enjoyed the fantastic ride for the last few years.  These US cultural characteristics led us all into an era of unprecedented growth and prosperity and perhaps we should be grateful for that.

Maybe what we need now is a dose of Asian long-termism and caution!