This chapter (1) introduces the international environment of business; (2) sets forth the methods by which companies may engage in international business; (3) indicates the risks involved in such...

This chapter (1) introduces the international environment of business; (2) sets forth the methods by which companies may engage in international business; (3) indicates the risks involved in such engagement; (4) describes organizations that work to bring down tariff barriers and, thus, encourage companies of all nations to engage in international business; and (5) identifies the means by which disputes between companies doing business in the international arena are settled. Please note carefully that when we use the word companies in an international context, we are referring not only to private-sector firms, but also to nation-state subsidized entities and government agencies that act like privatesector companies. Because of today’s widespread international opportunities and advances in communication, business managers must be aware of the global legal environment of business. As you will soon learn, the political, economic, cultural, and legal dimensions are all important international business considerations.The following questions will help sharpen your critical thinking about the international legal environment of business.

1. Consider the number of countries that might participate in an international business agreement. Why might ambiguity be a particularly important concern in international business? Clue: Consider the variety of cultures as well as the differences in languages. How might these factors affect business agreements?

 2. Why might the critical thinking questions about ethical norms and missing information be important for international businesses? Clue: Again, consider the variety of cultures involved in international business. Why might identifying the primary ethical norms of a culture be helpful?

3. What ethical norm might influence an entity’s willingness to enter into agreements with foreign companies? Clue: How might international agreements differ from agreements between two U.S. companies?