Alternative Views Of The Ethical Behaviours Commerce Essay
Ethics, compared to corporate social responsibility is on a more individual business level. "A business is part of society and, just as society requires a certain standard of behaviour from individuals; it also expects businesses to abide by similar standards" (Dooley, D., 2007 pg220). A business which wishes to portray a good ethical stance will make sure that they are not involved in any 'dodgy' or morally wrong business deals. Instead they would want to show the public how 'concerning' they are and how much they care. For example a business might make all of their plastic bottles 100% recyclable. When a business makes an ethical decision, it may not always seem beneficial to the company, especially in the short-term. Ethical decisions are normally made to contribute to society and for a business to show that they aim to make society a better and safer place. Consumers are now looking for more ethical companies to choose from and consider it a big factor in choosing where they shop and do business.
Corporate Social Responsibility
Businesses today take Corporate Social Responsibility (CSR) very seriously. CSR within a business is essentially how the business works and interacts with their stakeholders, environment, economic and social issues. For example a business might aim to make all of their products 100% recyclable. Company's now are aiming to improve their CSR because they know that it is important and also that customers now care more about how and where the products are manufactured and where they originate from. Another example is that a hundred years ago things like slave labour, poor working conditions and child labour were common and big companies didn't care, as long as it was kept quiet and customers didn't find out. Companies simply cared about keeping costs down and production cheap, even if it meant using child labour. Even today there are still cases of child labour in Chinese and Indian sweat shops, with the public accusing companies like Primark using manufacturers who employed children to work on a very poor wage and a very young age. Due to globalisation and technological advances the public are now more aware of where their products are coming from and with changing public concerns and opinions, companies now know that they need to be more ethical or risk losing money and respect. With the general population becoming richer they can afford to care more about their products.
"The ways in which companies address issues beyond their ' bottom line' i.e. their profit. In many firms CSR may be an important, positive aspect of the business culture; in others it may be a cynical way to respond to - or prevent unfavourable publicity" - (Lines, D., 2006 pg51)
Businesses now realise that improving their CSR is not only good for their reputation but it can also help improve sales, this is because they know there are customers are prepared to spend extra for products, for example; locally sourced meat. Another example is bottled water, where 5p from every bottle you buy goes to help Africa build water pumps. Corporate and social responsibility is defined as "a concept whereby companies integrate social and environmental concerns into their business operations and in their interaction with their stakeholders, on a voluntary basis." (Financial Services Authority, 2007, p.3). Businesses now make CSR a top priority within their business even if they know it will cost them a lot of money. An example of the above quote is that fast food restaurants are now starting to include a healthier option on their menus. For example; salad, fruit and bottled water. A lot of this is in response to pressure put on them by the public and government to encourage healthier eating. Although these changes were not forced companies recognise that they need to keep good relations with the public. Corporate Social Responsibility applies more to a whole industry whereas ethics focuses on a single organisation.
The individualism view basically means "what is best for the individual" and also "long term self interests". The Individualism View is also referred to as the 'Philanthropic'. Examples of businesses showing a good philanthropic view are when companies make donations to certain charities which may concern them. Another example is different supermarkets teaming up with local schools to promote reading and making sure that the school facilities is of a good standard and that the school has enough books. Acts such as these are not expected or required but simply done by the company to improve their ethical stance and to show how much their business 'cares' about their employees or communities. Companies with a poor individualistic view often only care about the short-term and maximising their profits, even if it means lying and cheating and pushing the boundaries of the 'law' to the limit and do whatever they can do to succeed even if it is morally wrong. If a company mainly focuses on their short term objectives, of maximising profits and making as much money as possible using strategies which are not moral and unethical, this may be ok in the short term. However the long term affects of this might affect the business in a negative way.
Developing countries are more susceptible to bribes. This is because these countries are normally poor and often corrupt. Allot of the world's oil is situated in developing countries and this means that developed countries try to take advantage of the weaker developing countries. Officials in these developing countries often accept bribes to cover information up. Countries such as Angola have been caught 'misusing' bank assets. Corrupt oil companies and officials that are accepting bribes only have the short-term goal of making as much money for themselves. This short-term view might benefit the oil companies and corrupt officials at the time, but in the long-run it doesn't always pay off. Various laws are now enforced where companies have to publish any payments made by governments. (Griseri, 2010)
"Social responsibility. This type of organisation tries to go beyond the requirements of society. The organisation will, therefore, accept responsibility for solving current environmental problems and will attempt to maintain current standards of both the social and physical environment. In order to achieve this organisation must be accountable to a range of stakeholders and this assumes that profit, although the dominant motive, is not the only one"(Worthington and Brittton, 2006).
The above quote explains that companies with a good individualistic view with long-term concerns considered show that although profit is very important it is not the only factor to consider.
A utilitarian view mainly focuses on delivering the best thing possible for as many people as possible.
An example of a utilitarian view is a manager of a company deciding to cut 30% of their factories workforce. This may sound harsh and possibly as if the company care more about their finances than their workforce but on the other hand it might of been a necessary decision to make in order for the rest of the workforce for that company to keep their jobs and prevent the company from shutting down. This shows that the manager expressed a utilitarian view "greater good for most people".
A lot of businesses now pride themselves on having good ethics and publicise this as much as they can. The Co-operative is one company that lead the way when demonstrating good ethics. One way they do this is by stocking a large range of fair trade goods in their supermarket. Although usually more expensive, fair trade ensures that farmers are fairly paid and have good working and that they see the money they have earned farming their products, instead of manufacturers taking advantage of them. Fair-trade products often originate from developing countries such as Ghana where they farm coco for chocolate. This shows Co-op having a utilitarian view and ensuring that as many people as possible see the benefits of good ethics. Deciding to introduce Fair-trade products into their stores has enabled Co-op to have a competitive edge and is widely known as very ethical company. People are willing to pay more for products they know are Fair-trade. This shows that what Co-Op and Fair-trade are doing does the greater good for the most people."
(Fair-trade, No date)
"Social responsiveness. This organisation exhibits a proactive strategy, actively seeking future social change. The policies of the organisation are followed with a fervent zeal, the business seeks to lead the field in terms of promoting a corporately responsible attitude. It accepts public evaluation of its policies and procedures and is prepared to impinge upon profit to maintain the high profile it has established through its corporately responsible actions."
The above quote explains 'social responsiveness'. It explains that companies such as Co-Op want to set a good example of corporate social responsibility to other businesses and how a company with ethics can be successful if not more successful than businesses who are unethical and mainly concentrate on their profit.
It is important for businesses to conduct good business ethics and a good justice view if they want to be a respected company. An example of a company showing a good justice view is by demonstrating fairness and equal rights regardless of personal characteristics, race, gender and age. One way some companies show this is that they employ a variety of workers; young, old and of a variety of races, this shows that they promote fairness within their business and are impartial to discrimination. There are many examples of un-just organisations. One current situation is the diamond mining in certain South African countries such as Sierra Leone. Sierra Leone is a country rich in diamonds, but the illegal sale of diamonds is paying for weapons to fund a civil war. Companies with an un-just view are exploiting the industry and buying the diamonds illegally for cheaper, cut prices, some may have been smuggled. The organisations that then smuggle and exploit the diamond industry then use the money to buy weapons to aid them in the civil war. This is why the terminology 'Blood diamond' is used, because the diamonds are funding the war that is killing and injuring people. The businesses responsible for buying diamonds in this way are being extremely unethical and can be partly to blame for deaths of many people. (Griseri, 2010)
Carrolls four part corporate social responsibility pyramid links justice view with legal responsibilities, which along with economic responsibilities are the foundations of the pyramid. It explains that these responsibilities are required by society and not just expected or desired. Therefore it shows that the justice view is one of the most important ethical stances a business needs. (Carroll, A.B. 1991)
A lot of ethical responsibility is now expected of businesses. Businesses now feel compelled to make the effort and show that they care what the general public and their customers think, as well as the possibility to give them a competitive edge over competitors because of a better ethical stance. Moral rights are what are expected by society, for example in the UK businesses are expected to give rights to privacy, freedom of speech. Primark is one company that has been accused of using child labour. Children as young as eleven have been reported manufacturing clothes for Primark, which then are sold in the UK. Many companies similar to Primark are using manufacturing companies abroad, in places like India and China. This is mainly because it is cheap to produce abroad, but this tends to come at a cost of that these countries are not bothered or don't enforce laws on any unethical behaviour that some companies may show. In response to the child labour accusation, Primark then cut their ties with its two main manufacturing business links in India. Child labour in India is extremely high and one way that the figure could be reduced is if companies in the UK stopped working with manufacturers that used child labour. Primark know that the general public want products as cheap as they can; one way of making products cheaper is to cut a business's production costs. "Pressure on Indian suppliers to deliver fast fashion at rock-bottom prices has made sweatshop labour inevitable," said Simon McRae. Therefore the demand for very cheap products has increased the chances of child labour.
"The suppliers you choose and the way you deal with them. For example, trading with suppliers who pollute the environment could be as irresponsible as doing so yourself."
(business link, No date)
The above quote relates well to Primark. This is because although it is their manufacturers that supply them with their products, it is still important for Primark to conduct all the relative checks and make sure that their suppliers are as ethical as possible. The UK public didn't sympathise with Primark with protests outside of their stores. Primark were quick to resolve the problem and try and restore customer loyalty and try and increase public relations.
In conclusion it is clear that more businesses are now understanding why ethics is so important and implementing it now into everyday running of the business. Ethics and corporate social responsibility is now a main priority, not for all companies, but a vast majority of businesses now are seeing that it is paying off. With the advancement of technology the public are now more aware than ever about what is going on around the world and knowing how their products are being produced and where they are coming from. Businesses have now identified the increased public concerns about a company's ethical behaviour and have used this to their advantage. There is money to be made in products that have been ethically produced, for example; Fair-trade products. Because of the increased attention of business ethics it is now very hard for a company not to implement the essential requirements of ethics and corporate social responsibility; they simply wouldn't survive in business, especially in the developed world.
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