Future Market Conditions

Czech Republic Profit repatriation better after EU membership Reasonably wealthy (retained most assets after Czech/Slovak break-up) Good location Strong ties to Germany/Austria Tourist income potential Manufacturing-oriented

Russia Questionable political stability Friction between Moscow and the Provinces Improved profit repatriation Significant cost of infrastructure upgrades Huge resource base

Russia as an Economic Partner Very large country with European and Asian populations Extreme differences rural/urban Inefficient production and government support only for favored firms Erosion of economic influence in the region; potential EU member candidate Crime uncontrolled, bordering on domestic terrorism

Russia: Geographic Presence 49% of population attracted 90% of FDI in 1997 Moscow, St. Petersburg and Nishny Novgorod attracted 75% of total FDI Moscow gets 66% of total FDI

Problems for Investments Russia’s political and economic culture Taxation and legal system Crime and corruption Limited national privatization Failure of domestic firms Inability of managers to adapt to competitive market conditions

Ethics Examples Japan France/Germany Bribery scandals Emerging corporate ethical standards Aggressive discrimination and racial stereotyping Large corporate spending on lobbying France/Germany

Ethics Examples Japan France/Germany No laws against bribery Overt discrimination against foreigners Ethical test: 39% of US managers passed 12% of French managers passed 0% of German managers passed

Ethics Examples US Short-term reporting cycles shorten the planning cycles Incentives for managers are inconsistent with stakeholder benefits Explosive effects of Enron, Worldcom, Arthur Andersen Worldwide credibility crises for US business and its participants

Management Opportunities Focus on Gender Consider country-wide myopathy Map out a future for the firm, the country and the region

Barriers for Women Culture Education Legal Traditional role differentiation Males usually attributed dominance Religious beliefs constrain women in many situations Education Women generally under-represented in worldwide business schools Legal Switzerland: Voting since 1972 UK: Anti-discrimination laws 1976

Women in Parliament Source: DER SPIEGEL, 12/99

Example New Zealand (prior) Prime Minister: Helen Clark Frmr Prime Minister: Jenny Shipley Fmr Governor General: Dame Cartright Chief Justice: Dame Elias Fmr Attorney General: Margaret Wilson Speaker of the House: M. Wilson

Pressing Worldwide Problems War Poverty War Poverty 42 35 18 27 Poverty War Poverty Crime 21 26 18 17 Ecology Ecology Ecology War 11 10 8 12 Bosnia Crime Bosnia Drugs 10 7 8 7 Germany Britain Japan US Source: DER SPIEGEL, April 1994

The “Jens Issues” List A commitment to education? Are government regulations simple and supportive of business interests? Is there a policy to balance the need to protect the unemployed with the need to encourage self-sufficiency?

The “Jens Issues” List Is the population without large demographic gaps? Does the country actively promote female participation in business? Is there a commercialization of technologies? Is the inevitability of business failures accepted?

The “Jens Issues” List Are markets open and can competition emerge? Are social/cultural norms oppressive?