by// Gregory Unruh and Fernanda Arreola

This regular section of Ethisphere Magazine focuses on compliance and ethics in global business. Each issue spotlights a different country, with excerpts from Ethisphere Council research.

The Hashemite Kingdom of Jordan, officially known as the Al Mamlakah al Urduniyah al Hashimiyah is at the cultural and religious crossroads of the Middle East. This country, recognized for its hospitality and serenity, is host to millions of immigrants escaping years of conflict in neighboring countries. Politically, Jordan is a constitutional monarchy governed by King Abdullah II, who is supported by a Prime Minister and an elected Parliament. The country faces the challenge of establishing business and development opportunities while responding to ongoing regional strife in a land with no oil, little access to water and limited natural resources. It should not be surprising, then, that Jordan has the lowest gross domestic product in the Middle East. Most recent economic growth has its roots in subsidized aid projects and foreign investments from oil-rich provinces. The current economic downturn will pose a major challenge to Jordan and to foreign companies operating there.

THE ETHICAL CLIMATE FOR FOREIGN ENTERPRISES

Jordan’s long history of independence can be traced back over two thousand years to the founding of the Kingdom of Petra. Today the monarchs of the country are derived from the Hashemite dynasty, which traces its lineage directly back to the Prophet Muhammad. Recently the country has been opening up economically by pursuing liberalized trading policies and reform. Examples of progress can be seen in Jordan’s acceptance into the World Trade Organization in 2000, and the Free Trade Agreement signed with the U.S. in 2001. To support the new economic openness, the country has been investing infrastructure enhancements like the modernization of the country’s port.

For managers seeking to work in Jordan, most of the compliance issues likely to be confronted are related to one of four factors: the current political process, the impact of religion in society, the country´s geographical situation and the predominance of foreign aid programs. In the first factor, political processes like economic reform are moderated between the westernized Monarch King Abdullah and the more traditionalist parliament. Although the King has the authority to influence internal and external decisions; political polarization has not favored a rapid reform of the political system or a modernization of bureaucracy. Bureaucratic inefficiencies and informal processes foster potential compliance pitfalls for businesses operating in Jordan. Likewise, strong religious traditions can challenge business policy. For women managers and workers, for example, the religious views in the country (around 96% of the population is Sunni Muslim) can inhibit an environment conducive to female development, advancement and independence.

Compliance Issues in Jordan Are Likely to Be Related to One of Four Factors: the Current Political Process, the Impact of Religion in Society, the Country’s Geographical Situation and the Predominance of Foreign Aid Programs.

Given Jordan’s geographic proximity to Iraq and other zones of social and military conflict, the country is the third largest recipient of aid from the United States. The political and economic policy conditions that often come with U.S. aid and trading agreements have benefited and improved the country’s compliance environment. However, enforcement and institutionalization of new regulations has been uneven. Foreign investors in Jordan often complain, for example, about the lack of transparency when it comes to negotiation and contract enforcement. Statistics reinforce this perception—Jordan’s market infrastructure and supervisory systems received a score of 27.5 out of 100 by the Standards Compliance Index. Thus, while some recent trends have been favorable for the business environment, international managers will still have to pay close attention to compliance issues while operating in the country.

ETIQUETTE TIPS YOU SHOULD KNOW BEFORE YOU GO

Greetings
In Jordan, most greetings between businessmen are done with a handshake and sometimes a hug. It is also common for well acquainted men to kiss on both cheeks in both business and non business settings. Female visitors will be expected to shake hands for which they should offer their hand first. The standard salutation in Arab is “salaam alaykum”, meaning “peace be with you.” English is widely spoken so visitors do not need to pay any special consideration to using Arabic words, although it will be highly regarded if you do so. Men will always be introduced first and sometimes women accompanying your host might not even be presented during the business meeting. Since honor and titles are very important, always try to use the full professional title to address your new acquaintance. After the first meeting, subsequent encounters can prove more effusive including prolonged handshakes and questions about one’s personal life.

Business Cards
Business cards are exchanged during introductions with no formal rituals. Color business cards will be especially appreciated although not required. Do not forget that titles are important and therefore try to use them at all times.

Gift Giving
Gifts have special meanings in Jordan and therefore foreigners should pay special attention to their practices. This sensitivity comes from the moral obligation that wealthy individuals have to give gifts to the poor. To avoid an inappropriate perception of a gift, never give gifts in public and try to give gifts that are rather simple, or alternatively provide gifts only for the children of your new business partners. It is also recommended that you wait until the completion of a negotiation process to exchange gifts. In any case, waiting until your Jordanian counterpart offers a gift (commonly at farewells) and then presenting a gift similar in value or from your host country is a wise move. When attending a private party, always bring a gift for the host, preferably sweets. These should be given in silence or offered to your host’s children. Because Jordan is mostly a Muslim country, avoid giving alcohol or pork products.

Business Meetings
Although the punctuality of meetings can vary, Jordanian’s will expect foreigners to show up on time. If you are running more than fifteen minutes late make sure to notify your counterparts. Introductory meetings will be formal and lengthy and therefore scheduling more than two meetings in your business day might be counterproductive. Introductions will be done by your host first and then follow in order of seniority. Business in Jordan runs from Sunday through Thursday between 9:00 am and 7:00 pm. Public institutions have shorter working hours and may close around 4:00 pm. Lunch takes place between 1:00 pm and 3:00pm. The slowest times for business are the Islamic holiday of Ramadan, which spans over a period of one month, usually between October and February depending on the lunar calendar. During Ramadan, business hours are shortened with shops and offices closing around 2:00pm.

The business attire for men should be a basic dark suit or in hotter weather a sport shirt and dress pants. Women need to be very careful about their attire. A conservative dress or suit that covers knees and elbows is recommended. A good model for women’s attire is the style of Jordan’s Queen Rania. The Kuwaiti born wife of King Abdullah, Queen Rania is a globally recognized spokeswoman on female rights and board member of several international foundations including the United Nations Foundation, International Youth Foundation and Clinton Foundation.

Dinners and Social Events
Social events allow Jordanians to show visitors their unique hospitality and build personal relations. Most business entertainment will tend to be lengthy and informal with wives and children often invited to attend. There are two important things to keep in mind about such events. The gathering is an opportunity to get to know each other better and therefore conversation should be casual and focused on topics that are relevant for Jordanians. It is also an opportunity to talk about family, and for visitors to explore Jordanian culture and traditions. Good guests show curiosity about the topics of conversation and should be ready to try any food they are offered. Sometimes dining will be done with the hands in which case you must use your right hand only. Compliment giving is frequent and visitors should find ways of reciprocating kind remarks.

FIVE COMPLIANCE AND ETHICS ISSUES TO CONSIDER

WOMEN IN PROFESSIONS
The role of women in Jordanian society has been evolving at a slow pace and some social preconceptions can inhibit the work of women managers. In addition, lack of equal opportunity employment laws and some specific norms, like those that prohibit nighttime employment, can be constraining for female workers.

Deal with it
The Jordan Constitution presents men and women as equal and this should be used as the basis for employment opportunities. Equal access to education is broadening the professions that are practiced by women. When confronting conservative attitudes to female employment you should advise the participants that Jordan’s policies consider this discrimination.

RELIGIOUS DISCRIMINATION
According to the constitution Islam is the state religion. Christianity is also recognized as a religion and therefore its practice is allowed. However, the Government does not recognize the Druze or Baha’i faiths as religions, but nonetheless allows the practice of these faiths. Baha’is have been known to face both official and social discrimination, such as prohibitions from registering schools or places of worship.

Deal with it
Although some religions and churches might not be recognized, there is usually a tolerant attitude toward them. In order to avoid discrimination issues at work, it is best not to encourage any religious practice (such as praying hours) and ensure the respect of workers individual preferences.

PRICE HAGGLING
Foreigners often complain about the wide price ranges that exist in the formal and informal economies. Haggling and bargaining are techniques often necessary in Jordanian business settings, something which can create discomfort or foster distrust among those unaccustomed to the practice.

Deal with it
This specific practice is embedded in the cultural traditions of the nation. Although there is no single simple solution for it, formal processes such as tenders and foreign aid contract requirements can force competitors to be more transparent in terms of costs and prices. It can also be helpful to recognize that the bargaining process is an opportunity to understand the business style of your potential partners and to establish mutually understood relationships with them.

POLITICAL PROCESSES
As discussed, Jordan´s political system has processes and bureaucratic elements that can concentrate decision making and provide opportunities for abuse. The representation of minorities in the country is an area of special concern for some international organizations.

Deal with it
Most managers will not have direct dealings with the political processes, but being informed about political issues is important for businesses operating in the country. Outside of local information sources, managers can look to IMF and World Bank reports to follow political trends and issues in the country.

PROSECUTION PROCESS
Many foreigners and visitors are unaware that the Jordanian constitution allows for the detention of suspects for up to 48 hours without a warrant and without the presentation of formal charges.

Deal with it
To avoid unfair detentions it is important to stay in contact with your embassy and seek the advice of a trusted local legal expert while negotiating business. At all times it is important to seek assurance that business transactions are not benefiting sectors or political groups that have been previously accused of illegal actions such as terrorism.