One way I believe American standards should influence multinational businesses is in ethical practices. While the US has had some hiccups, like Enron, regulators (SEC) and the government quickly stepped in with oversight activities to mitigate this happening again. The norm in the US is for ethical and even environmentally friendly business operations and practices. There are some foreign countries that could learn from the US practices, such as countries where bribes are the norm, and required, to transact business. This would be considered unethical and illegal in the US. Class, would you be able to do business in a foreign country that required these types of practices?

 

Political risk is the greatest risk. I am not sure how to address and mitigate political risk. This is something hard to prepare for, and thus presents a greater risk to me. It is a risk that would keep me up at night. You really have little control over political risk and may just have left the country depending on the situation. While you can certainly research and only invest in countries that are politically solid, the political situation in any country can change quickly.

 

1. What ideas and methods would you suggest to handle and prepare for political risk? Certainly, there is political risk in and surrounding Russia right now?