04
Feb
11

Business Standards While Abroad

Adherence to federal regulations by U.S. companies while operating abroad poses the difficult task of maintaining a competitive edge within an industry while still trying to operate within their domestic moral obligations. In such cases, the primary concern of the U.S. government should be in furthering national interests by ensuring a more economically prosperous future for their own people by helping those companies to succeed overseas. In order for a business to remain competitive, there could very well be situations (India, China, etc.) in which they will need to be made exempt from federal regulations. Without such exceptions, the lack of competitive edge by the U.S. may result in decreased GNP and lessened economic standing in the long run. However, despite discrepancies between domestic and foreign regulations, it seems that certain rules and standards in regards to safety could be met by U.S. companies while abroad.

The primary concern of the United States in the overseas operations of domestic companies should be in helping them to be economically successful. If it is determined that adherence to domestic regulations will significantly hinder their competitiveness, then they should be granted exemption in order to succeed and contribute the U.S. GNP. This priority acts in accordance with what should be the overall primary concern of the U.S. government, advancing the values and goals of its citizens. This aim is partially met by maintaining itself as a strong world player so that its private industry can be in a position to take advantage of economic opportunities abroad. By upholding its economic stability first and foremost, perhaps at the fractional relinquishment of regulations while abroad, the U.S. can continue to be in a position in which it can influence other governments to implement standards similar to their own. It is through its influence on the world stage that the U.S. can hope to raise the operating standards of nations across the world.

It seems that there are likely to be many instances in which U.S. companies would find their ability to compete significantly hindered if federal regulations were to be imposed abroad. Such places as India, China, and certain South American locations act as examples of places in which adherence to the full extent of U.S. rules could prevent them from contending with other companies in those markets.  Though U.S. companies could still compete within the U.S. due to the potential for higher profit margins, it could be entirely possible that the costs incurred by adhering to federal regulations could reduce profit to the point where companies cannot compete with other groups within a foreign market. One possible reason is that these companies are able to operate at much lower costs due to much lower standards, thus allowing them to undercut any company that may be operating at higher costs due to, perhaps, higher standards. If likely scenarios such as this exist, it is warranted that U.S. companies should are not made to adhere to federal regulations while operating abroad.

Though the full breadth of U.S. regulations should not apply to the portions of U.S. businesses in foreign lands, they should still be expected to meet a special set of regulations in regards to basic safety. This is because U.S. business overseas contributes to the image the rest of the world has of the United States. Their actions overseas serve as symbols that can potentially legitimize or undermine certain principles the country stands for, such as human rights. In this regard, it would be beneficial for all foreign-operating U.S. businesses to follow a basic set of regulations. These regulations would be in regards to promoting basic safety, such as acceptable air quality, proper job training, fire prevention, and an overall safe environment. Behaving in accordance to such regulations would pose a manageable task that would not reduce the competitiveness of U.S. companies in foreign markets. Having such regulations made official would reflect positively upon the U.S. while providing insignificant negative effects.

The full breadth of domestic federal regulations should not apply to U.S. businesses abroad as it could significantly reduce their competitiveness in certain markets. There are many instances in which adherence to such regulations would prevent them from succeeding and possibly contribute to forcing them permanently out of an industry in a country. Success of these businesses abroad should take priority over adherence to federal regulations. However, as this can appear quite hypocritical and possibly undermine U.S. principles, it would be both feasible and beneficial to create a special set of regulations that all foreign-operating businesses must follow. In this way, the U.S. can both competitive and sincere in its position.

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