Question 1:

*Fictitious scenario

You are the Training Manager of X-Pharm, a large pharmaceutical company with its headquarters situated in Centurion, Gauteng, but which has subsidiaries in both Western Europe and the USA

Compile/Draft a written speech to be delivered to the latest cohort of trainee managers at X- Pharm, at their next trainee management programme on the characteristics of globalisation and the benefits that the pharmaceutical company derives from being a global business. (20 marks)

Question 2: (30 marks)

Refer to the case study below and answer the two (2) questions that follow:

South Africa stagnates on the global Corruption Perception Index, but there are glimmers of hope on the horizon.

In anticipation of the 2022 Corruption Perception Index (CPI) report released by Transparency International on Tuesday, I expected that South Africa’s Corruption Perception score would have changed significantly. My optimism was based particularly on the monumental clean-up investigations relating to the Zondo Commission and the first State Capture trial in the case of the Vrede Dairy Project.

The 2022 CIP report generally displays that the pandemic of corruption will linger for many years and that some countries’ CPI levels have stagnated (the scale used is that a score of 0-10 is “highly corrupt” and 90-100 “very clean”).

For three consecutive years — 2019, 2020 and 2021 — South Africa’s CPI points remained at 44. South Africa was ranked 70 in 2021. It is interesting to note that the country’s CPI point was also at 44 in 2014 and 2015. From 44 it went to 45 in 2015, and 43 points in 2012, 2017 and 2018.

Also, there were differences according to the presidencies of Nelson Mandela, Thabo Mbeki, Jacob Zuma and Cyril Ramaphosa. In 2022, South Africa slipped back to a score of 43, coming in at 72 out of 180 countries.

With a score below 50 on the 2022 CPI, it should be of concern to our government that corruption — or at least the world’s perception of it — is not waning.

Not only is South Africa one of the 124 countries that have stagnant corruption levels, but it has also slipped to 2017 and 2018 levels, while the number of countries in decline is increasing.

“It is particularly galling that South Africa has slipped a point at a time when there appears to be some momentum in bringing the corrupt to book, following the findings of the Zondo Commission reports,” said Karam Singh, executive director of Corruption Watch.
What one thought were incremental improvements from a score of 43 to 44 under the promise of President Ramaphosa’s zero tolerance to corruption is now a deferred dream. Monumental anti-corruption efforts such as the Zondo Commission are yet to have a great impact on lessening levels of corruption in South Africa.

I might have set myself up for disappointment by expecting an improved score for a country that has gone through major corruption scandals that include the notorious arms procurement deals in the late 1990s, the rot at state-owned enterprises such as Eskom, Transnet and South African Airways, and the collusion of auditing firms like KPMG, McKinsey, Deloitte and others in enabling State Capture.

No country is completely free of corruption.

Even Denmark, which continues to top the CPI list (tied with New Zealand) as the world’s least corrupt country in the world — followed closely by Finland and Norway — has experienced some notoriety concerning corrupt practices.

South Africa is not doing particularly well in the CPI, and there has always been concern about the country’s enforcement of its laws against foreign bribery. It is common knowledge that South Africa has internationally comparable anti-corruption laws. The question then is: What is wrong, or what has gone wrong, and where exactly, because its CPI ranking is seeing no significant improvement almost yearly?

Many developing countries, in particular from Africa, are considered “cleaner” than industrialised countries. A glimmer of hope is that there are still African countries that are doing their best to combat corruption — countries like Botswana and Cape Verde, which are tied with Spain and Saint Vincent and the Grenadines at 60.

Perhaps South Africa went into a state of complacency after the 2021 CPI rank of 44. Even Rwanda is performing much better than South Africa, with an index of 51.

My reading of the 2022 CPI is that South Africa continues to bear the heavy economic and social costs of corruption. It would seem that the legacies of geographical morality — and colonialism, as some may argue — are keeping us in the corruption dam.

If we are not careful, the country might slide to the bottom and fight for positions with the most corrupt countries in the world.

As economists, politicians, journalists and other commentators dissect the 2023 CPI, it would be interesting to know if South African businesses, investors, politicians and government officials — particularly those in corruption cesspools like Eskom and Prasa — pay attention to the index and work towards the betterment of how corrupt they are perceived to be.

It would seem the CPI is failing to change the behaviour of agents of corruption, in particular when they are political and economic policymakers. It’s as if the country has resigned itself to an image and life of corruption.

Despite politicians and the government wanting the ordinary person to believe that corruption is under control and being firmly arrested, the 2022 index displays beyond any reasonable doubt
that we have stagnated and that corrupt practices are like a plague in our country.

Law enforcement agencies, ministerial policymakers, civil society members, advocacy groups and academics have talked endlessly about corruption.

Much as I had a melancholic feeling when reading about corruption almost daily in the news — over and above the recent CPI performance of South Africa and other African countries — I still hold a firm belief that corruption does not always have to be with us.

Unfortunately, what is becoming clear is that insignificant fortitude is shown when dealing with corrupt practices.

It is only fair to acknowledge that under the current ANC-led government, South Africa’s anti- corruption campaigns have achieved unprecedented momentum. There are good stories to tell, including closer collaboration between the National Prosecuting Authority’s Asset Forfeiture Unit (AFU) and the Special Investigating Unit (SIU), as part of the National Anti-Corruption Strategy to fight corruption.

The CPI points to the importance of improving perceptions of corruption. Clean and good governance fosters a sense of fairness and trust by the public in the government of the day. Thus, the CPI should nudge the country to deal with public sector corruption decisively.

The effects of public sector corruption are far-reaching and can be devastating. Among other things, it affects economic and financial outcomes such as GDP growth and foreign direct investment. Thus, the spillovers from perceptions of public sector corruption should never be underestimated by nonchalantly dismissing international indexes on corruption perception.

Where there is corruption, human rights are casualties. Interestingly, President Ramaphosa said on Monday that we need to mobilise society to fight crime. I could not agree more that civil society ought to play a greater role in taming the beast of corruption.

We can mobilise society to help fight corruption to improve South Africa’s CPI performance in 2023, but our leaders also need to do their part.

Our parliamentarians must be role models for the anti-corruption crusade, since in democracies, parliaments should be at the forefront of curbing corruption by fulfilling their oversight responsibilities and holding the government accountable.

For the 2023 Sona, we need to hear about how the war against corruption has been practicalised and a report card with tangible successes should be read out to the public.

Delia Ferreira Rubio, Chair of Transparency International, wrote that “corruption has made our world a more dangerous place. As governments have collectively failed to make progress against it, they fuel the current rise in violence and conflict — and endanger people everywhere. The only way out is for states to do the hard work, rooting out corruption at all levels to ensure governments work for all people, not just an elite few”.

And Karam Singh observes that “it is hardly comforting that we have leaders paying lip service to the anti-corruption agenda in an environment that is not just hostile, but extremely dangerous for whistle-blowers and those activists seeking to address the huge inequality and injustices wrought by corruption.”

Source:

Sibanda, S. 2023. South Africa stagnates on the global Corruption Perception Index, but there are glimmers of hope on the horizon. Daily Maverick [website]. Retrieved from https://www.dailymaverick.co.za/opinionista/2023-01-31-south-africa-stagnates-on-the-global- corruption-perception-index-but-there-are-glimmers-of-hope-on-the-horizon/
[Accessed: 21 August 2023].

2.1 Analyse the role performed by the Corruption Perceptions Index (CPI) in terms of conducting business activities in developing countries. (15 marks)

2.2 With reference to the above case study, debate whether or not South Africa is stagnating in terms of the global Corruption Perception Index (CPI), and whether or not there exists any hope in terms of South Africa’s situation in terms of the Corruption Perception Index (CPI). (15 marks)

Question 3: (20 marks) Read the case study below and answer the two (2) questions that follow:
The Volvo Motor Corporation of Sweden has recently been acquired by the Chinese car manufacturer, Geely. This has created certain challenges that must be addressed in terms of adapting to the different cultures that prevail at both Volvo and Geely.
Source:

Bissmarck, L. and Henricksson, O. 2015. An investigation of the cultural differences and reactions towards organizational change in the post-acquisition process – A case study of Zhejiang Geely Holding Group and Volvo Car Corporation. University of Gothenburg [website].

3.1 Investigate the cultural dimensions as proposed by Hofstede on how they influence strategic decisions, leadership styles and human resource practises of international businesses that operate in more than one (1) country. (15 marks)

3.2 Indicate which of Hofstede’s cultural dimension/s you believe is/are applicable to the Volvo– Geely relationship. (5 marks)
Question 4: (15 marks) Read the fictitious scenario below and answer the question that follows:

*Fictitious scenario

You are a student studying your Bachelor of Commerce in Management Marketing at a globally recognised university situated in Stellenbosch. You have been tasked with delivering a report to your tutorial group on the role performed by Ford Motor Company in the context of global business practice.

Compile a report to be presented at your tutorial group describing the nature and role of multinational companies such as Ford Motor Company in terms of global governance practices.

Question 5: (15 marks) Read the extract below, and answer the two (2) questions that follow:
Innovation is the introduction of an invention or the new application of an existing product or service in the marketplace by an organisation, thereby adding new or additional value to customers (Aregbeshola, 2021: 102).

5.1 Explore the role that innovation performs in global business activities. (10 marks)

5.2 Conduct your own research to identify two (2) innovations that have impacted global business in recent years and provide motivations for your choice. (5 marks)

Answers to Above Questions on Business Management

Answer 1: As a training manager of X Pharm, I am going to shed light on the characteristics of globalisation and the benefits that are achieved by the company from its global presence. Globalisation is a process of expanding business to another territory from one’s own territory. It is the process of interaction among people, companies and governments of different nations. Its main characteristics include interconnected markets, cultural diversity, technology integration and international regulatory compliance.