Here you are, visiting the ever beautiful London, when you come across a shop with the most beautiful pair of shoes in the window. You notice they’re designer, vintage even, and in the perfect condition, and look, the price says £150. That’s reasonable you say, until you get to the counter to pay for the shoes, only for your mom to point out that £150, is actually $200 in U.S. dollars. This is called an “exchange rate”.
H.E. Claudia Fritsche
Ambassador extraordinary and plenipotentiary
When I met Prof. Michael Czinkota in 2003, it had been less than 2 years since I had the privilege to establish the Liechtenstein Embassy in Washington. He immediately was very generous in offering to share his knowledge and experience. Since the field of economics is not my expertise, I was immensely grateful for his support in not only raising the profile of the Embassy but also helping me become acquainted with the many nuances and layers of the U.S. economy and its global impact. Since Prof. Czinkota was born and raised in Germany and was partly educated in an Austrian school very close to Liechtenstein, he is familiar with my country, with its history, its economic system as well as the trans-Atlantic cultural differences, therefore able to understand how the U.S. economy is viewed even from the perspective of a small country. Professor Czinkota further broadened his engagement with my country by teaching at the University of Liechtenstein.
Porter and Kramer distinguish between shared value and corporate social responsibility by claiming that the latter mostly focuses on corporate reputation rather than on directly improving a company’s profitability and competitive position. This distinction can be misleading. Many companies have certainly used their CSR 血tiatives to build their reputations through marketing communications, but that is not inimical to a strategic approach to CSR. Crucial is the CEO’s commitment to a holistic CSR program. If the CEO takes up the flag in leadership, the company is more likely to rally to the cause and integrate it deeply into the very fabric of the operation. Some deeply committed companies, like GE, reflect this approach by embedding CSR initiatives into their marketing programs as The International Marketplace 1.1 in the opening chapter illustrates.
How companies communicate their involvement and commitment to CSR is very important. Edelman advocates that companies should “practice radical transparency.” This can be done by communicating effectively with various stake holder groups, especially employees, about their CSR goals and their progress towards me叫ng them. Enabling employees to take that conversation further with others, individually and through the increasingly important social media channels, can be particularly convincing to other audiences.(See the Edelman report on trust in social media at http://trust.edelman.com/social-media-and -trust.)
The most common means of formal communication is through regular dedicated reports. Most large companies issue annual or periodic reports on their CSR pactices. The reporting procedure and the quality of the reports are a good lens to view the actual commitment of the company to responsibility programs. KPMGhas analyzed the CSR reporting practices of companies. In its ” International Survey of Corporate Responsibility Reporting 2011,” KPMG reported that “while CSR reporting was once seen as fulfilling a moral obligation to society, many companies are now recognizing it as a business imperative. Today , companies are increasingly demonstrating that CSR reporting provides financial value and drives innovation, reflecting the old adage of what gets measured gets managed.”
International inventory can be used by the international corporation as a strategic tool to dealing with currency valuation changes or hedging against inflation. By increasing inventories before an imminent devaluation of a currency, instead of holding cash, the corporation may reduce its exposure to devaluation losses. Similarly, in the case of high inflation, large inventories can provide an important inflation hedge. In such circumstances, the international inventory manager must balance the cost of maintaining high levels of inventories with the benefits accruing to the firm from hedging against inflation or devaluation. Many countries, for example, charge a property tax on stored goods. If the increase in tax payments outweighs the hedging benefits to the corporation, it would be unwise to increase inventories before a devaluation.
Despite the benefits of reducing the firm’s financial risk, inventory management must still fall in line with the overall corporate market strategy. Only by recognizing the trade-offs, which may result in less than optimal inventory policies, can the corporation maximize the overall benefits.
On April 11, our class got the pleasure of having a distinguished guest speaker -Her Excellency Claudia Fritsche, Ambassador of the Principality of Liechtenstein to The United States .
Madam Ambassador addressed current international economic issues and presented the position of the Principality of Liechtenstein regarding politico-economic changes in the international environment.
We are very grateful for the inspiring thoughts and valuable experiences she shared with us.