Political Aspects of International Business

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Political Aspects of International Business National Research University - Higher School of Economics Faculty of World Economy and International Affairs Course Syllabus and Description Political Aspects of International Business Master of International Business Program 38.04.02 Management Author: Ekaterina Entina The Program cannot be used by other departments of the University and other universities without prior permission from the Program authors’ department. Moscow 2016-2017 1 Political Aspects of International Business Instructor: Ekaterina Entina, PhD in Political Science Department: World Politics Email: [email protected] COURSE DESCRIPTION Pre-requisites: World Economy International Relations International Business Research The Course is designed for Master students from Russia and abroad and concentrates on Management Studies, Political Science and International Relations, with a special interest in doing business abroad, strategies of new business establishment and relations between business society and authorities. It is preferable, though not compulsory, if the students have basic knowledge of Management and Marketing Studies, as well as the structure of international organizations, principles of functioning of modern state. Course type: elective Abstract: The course consists of three main groups of issues. They concern governmental policies towards private business; the influence that private business may exert on governmental policies; and the art to adopt your business strategy and behavior to existing and changing political and legal frameworks. The first part of the course shows how state authorities use wide spectrum of instruments they have at their disposal in twofold purposes. One of them is to make national economy more dynamic and viable seeking at the same time social peace and higher standards of life. Another one consists of protecting and promoting private business interests on national and international scale. The second part of the course helps students to understand how multilevel governments are exercised, political and legal decisions are prepared and approved. On the example of numerous case-studies it is explained in what way interdependence between mass-media, associations of businessmen, trade unions, local, national and supranational authorities could be used for the benefit of launching small and large scale infrastructural, industrial and service-oriented projects. It is explained to the students that even in that cases when state authorities take decisions violating their rights and interests they may, nevertheless, withstand the political pressure, protect and develop their businesses. The third part analyses how to reach high competitiveness using peculiarities of political and legal framework and relationship between state authorities and civil society. It is important to know what the rules of the game are today, how they will be shaped tomorrow and how to change behavior and strategy in accordance with evolving patterns. These topics are discussed with students on the basis of practical case-studies explained by Russian and foreign CEOs. 2 LEARNING OBJECTIVES The main goal of the course is to persuade future businessmen and managers that their company’s relationship with state authorities, NGOs and civil society should be treated as one of the key elements of their strategic planning, that they should construe this relationship in a positive way because their social partners are interested in economic growth, better life conditions and greater amount of taxes. All those are provided by private business. Students will learn that in majority of cases described in the course state authorities create political and legal framework to protect and promote private business’ interests. That’s why it is very important to make this interdependence serve them. Students will study how to influence legal developments in the way compatible with their views and perceptions. They will learn that competition and anti-trust law is there to protect them from unfair treatment. Thus, they should be aware on what’s going on locally, regionally and internationally. LEARNING OUTCOMES When students have completed their study of this course they will be able to: 1. make a systematic analysis of different business strategies, including estimation of legal and mass-media strategies; 2. analyze the options for dealing with risk in an international project or business; 3. discuss the basics of business strategies of cost advantage and differentiation; 4. explain some of the reasons why marketing strategies can succeed or fail according to the conditions in different countries; 5. list and define the types of political risk involved in establishing a business in another country; 6. analyze the legal basics of promoting business interests in public sphere; 7. estimate fair risks and opportunities for starting-up a business in modern Russia. COURSE PLAN №№ Topics Course Academic/Co Self-study Hours ntact Hours Hours Lectures Seminars 1. Public Authorities and Private Business: 4 4 0 interdependence, instruments for mutual influence 2. Private Business in lobbying and providing 6 2 4 necessary legal decision 3 Private Business and State Authorities in 6 2 4 interaction with social groups and networks: struggling of interests, promoting results 4. Starting-up the new Business: 4 2 2 different approaches in different countries 5. Political and legal aspects of foreign 4 2 2 business activity in modern Russia 6. Special Guest Lecture for the year: 4 2 2 “Guardian” (industrial glass production), 3 the Head of Guardian Russia 7. Special Guest Lecture for the year: “Allen 4 3 1 and Overy” (legal supporting of business start-up abroad), Partner of Allen & Overy Russia 8. Special Guest Lecture for the year: 4 1 3 “Gazprom Export”, Communications Director In sum: 36 Curriculum (by topics) Topic 1. Public Authorities and Private Business: interdependence, instruments for mutual influence Content: This lecture provides students with knowledge on how state authorities promote business interests inside the country and abroad. It is explained how wide spectrum of administrative negative and positive tools are used to create best investment and favorable business climate. Students will get abilities to design legal, political and economic measures to impose on private business the mode of behavior which is favored by political power. Topic 2. Private Business in lobbying and providing of necessary legal decision Content: The lecture gives students a systematic vision of interdependence between business and mass- media, business and different types of associations and semi-governmental/semi-independent structures, business and authorities of all levels. Explanations are provided on how business should protect and promote interests in its relationship with state and supranational powers. Case Study: All of you are CEOs of a large Spanish-French company. Your company field of activity is fishing. It specializes in fishing codfish. It uses big modern vessels. There is a float of these vessels in its possession. The area where these boats are used is Biscay gulf. It means that fishing is done all around the border of France and Spain. All vessels are equipped with small-cell nets. They are designed to use only them. This equipment can’t be changed. It has never occurred that anybody raised the issue of unlawful, damaging or inappropriate nature of small-cell nets. Your company is successful. It has no problems at all. It doesn’t have any difficulty in selling fish or developing its business, or having troubles with good relationship with trade unions and state authorities. It has good relations with everybody. It creates jobs. It pays high salaries. It looks after its employees. It pays taxes. It pays a lot of taxes. It does it in a regular way. Local leaders are dependent on them. The company is one of the leaders of the national economies. But doing business is a risky thing. From time to time business is confronted with challenges nobody could envisage. France and Spain are members of the European Union. For the institutions of the EU, especially for the European Commission and European Parliament all the details we have described don’t matter. What matters is the preservation of nature and fishing species, in our case the preservation of precisely that fish population and especially in waters around the EU borders. They comprise first of all waters of Biscay gulf. The European Union has exclusive powers in this sphere. The state-members of the EU delegated to the EU institutions their sovereign prerogatives in the field of preserving biodiversity of the Ocean. The role of the EU institutions consists in drafting and approving common EU legislation. State-members are under obligation to apply this legislation fully, thoroughly and fairly. The power to initiate development of new pieces of common legislation is vested to the European Commission. It is up to the European Commission to elaborate these new pieces of legislation or not. It is under her discretion when to push ahead with this work. After they are approved and enter into force the body supervising 4 their application is once again the European Commission. In our case European Commission launches an initiative to draft a regulation concerning preservation of varieties of fish which are vital for the activity of your company. The essence of the European Commission initiative is to make forbidden for a couple of years or forever the shipping of codfish by technologies used by your company and to ban small-cell nets. The ban is to be applied in all areas of the Biscay gulf. You are experienced CEOs. You have got the best quality education. You are graduated from the University “High School of Economics” (Vyshka) or some other prestigious European or American university. You know quite well how the EU works. The idea of the European Commission as far as your company concerned is entirely unfortunate. It will kill your business. So, you should do your best to talk the EU into dropping this idea. You should impede the European Commission to pass this piece of legislation. Our case is a special one. At the same time the situation we have described is very common.
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