Introduction
In the commercial world, ethics and social responsibility in business is a system that is utilized as a procedure for moral principles. Business ethics is a new area in science as it is a combination of politics and theory as well as historical and philosophical documents. Business ethics gives guidelines that are acceptable for behavior in organizations during the day to day operations and formulation of strategies. A positive image and the success of an organization are important, and that is why it is important to have an approach that is ethical. Corporate social responsibility is the epitome of all ethical cases that businessmen can follow in an organization with efficiency. Operating principles and coming up with codes of conduct, is how most businesses choose to make their public commitments in as far as business ethics is concerned. In doing this, they are able to put in place concepts of corporate governance, corporate giving, corporate accountability and personal accountability.
Business ethics
Business ethics is a term that has been defined in various ways: business ethics tests the ethical and moral issues as well as the ethical principles that come up in an environment in business (Solomon, 1991); business ethics can be referred to as a form of applied ethics (Broni, 2010); business ethics refers to all aspects of conduct in business and business ethics as a relevant conduct of individuals in organizations of business in general (Broni, 2010). Applied ethics is a field of ethics that has to do with questions that are ethical in various fields of ethics like medical, business, legal and technical (Philips, 2008). Business ethics is made up of a set of values and moral principles that monitor the organization’s behavior with respect to what is wrong or right (Philips, 2008). Business ethics has in place actions that are prohibited in the organization, and it pinpoints the priorities and basic philosophies the organization needs to uphold in firm terms.
There are four basic concepts of business ethics that help form the framework that an organization can be ruled by and they are: utilitarianism, egoism, relativism and deontologism (Borgerson and Schroeder, 2008). This paper will shed some light on the mentioned concepts as well as look at the main principles of business ethics. As a behavior, business ethics in a business adhere to everyday dealings with the world (Borgerson and Schroeder, 2008). In every business depending on its nature the ethics can be quite wide, in that they do not only appeal to the way the business intermingles with the world at large, but they also handle how it mingles with individual customers singularly (Borgerson and Schroeder, 2008).
Most businesses just by being in business have acquired a bad reputation and to some people, they think that businesses are only interested in making money and nothing else (Solomon, 1991). This thinking can be seen to be capitalism in its real form, in as much as it is not wrong to make money. However many would argue that the manner in which businesses choose to make this money and how they carry themselves in the process will bring about the question of ethical behavior (Broni, 2010). There are many factors to put in mind in every business for there to be proper business ethics in existence (Borgerson and Schroeder, 2008). For example, if an organization that is ethical decides to do business with another that is seen to be unethical is it correct to assume the first organization is not ethical through association? Most people would concur that the first organization has a responsibility, and it is automatically associated with being a company that is unethical.
Eventually, the public has a social responsibility to ensure that the company follows the proper business ethics because if the company happens to be making huge profits, then it is more likely that they will not be willing to pay attention to their behavior ethically (Broni, 2010). The demand for more action and ethical business processes in the 21st century is increasing. On and on, pressure is being put on the industry to enhance business ethics through new laws and public initiatives such as an increase in tax for sleek cars.
Ethics in business can be a descriptive as well as a normative discipline (Heath, 2006). As far as career specialization and corporate practice is concerned the field is first and foremost normative. In academics, approaches that are described are also allowed. The quantity and range of issues in business ethics show the degree in which business is viewed to be at odds with social values that are non-economical. An example of today is that many of the corporate websites put a lot of emphases on the commitment they have to the promotion of social values that are non-economical and which can be linked with several headings such as charters of social responsibility and codes of ethics (Borgerson and Schroeder, 2008). In other cases, companies have transformed their core values in the event of considerations in business that is ethical.
General business ethics in various fields
There is an overlap of philosophy in this area of business ethics and one of its main goals is to determine the real purpose of the company and its fundamentals. If the fundamental purpose of the company is to maximize the shareholder returns (Heath, 2006), then it would be unethical for the same company to focus on the rights and interests of others instead (Borgerson and Schroeder, 2008). The purpose of corporate social responsibility is to guard the duties and ethical rights of both the society and the companies that have an existing relationship.
Finance fundamentally is a discipline of social science (Borgerson and Schroeder, 2008). Finance as a discipline is in line with management, accounting, economics, sociology and behavioral science. Finance is often mistaken to be a discipline that does not have any ethical burdens due to its involvement with technical issues such as an alternative evaluation of investment projects, dividend policy, and equity financing and optimal mix of debt. As much as economic meltdowns have frequently brought to the fore ethics of finance due to business cycles being unable to come up with explained theories, there are other reasons finance is overlooked such as issues of this field being handled as matters of law instead of ethics (Solomon, 1991).
Economics is viewed conventionally as a philosophy and moral science that is directed at a good life that is shared (Solomon, 1991). A section of economists, however, interprets that the main aim of economics is the maximization of growth that is financed through heightened production and consumption of goods and services (Solomon, 1991). This interpretation is through an ideology of neoliberalism through its influence, business finance as a component of economics is promoted to form the basis of economics that is neoliberal.
Supporters of this ideology believe that the redemption of financial flow from the chains of financial repression can be put to good use for the well being of nations that are impoverished. It is believed that financial systems and their liberation would enhance growth economically through capital market systems that are competitive and that ensure the promotion of less corruption, welfare, inflows of foreign capital, productivity, employment, investments and high level savings (Philips, 2008). Hence the recommendation to governments of impoverished nations was for them to open up to the global market their financial systems with little regulation of the flow of capital. However, this recommendation was followed by a lot of criticism.
Individuals engage in this game known as a business and as with all games, the end result for any person is to win. Winning in this case is a factor that is measured by material wealth. No one questions the rationality of this concept within the discipline, and this has indeed been the case in any organization. Ethics of finance are lowered to the function mathematically of the wealth maximization of a shareholder. For the building of robust models in the field of finance, simplification of such assumptions is crucial (Borgerson and Schroeder, 2008). These calculations allow the finance expert to come up with proper justifications. Ethics as viewed from the perspective of the stakeholder is the advantage of the remote and the immediate stakeholder as much as it still is an obligation of the organization towards them. An issue that may crop up involving the employer-employee relationship is what the HRM-human resource management ethics department covers in a firm. These issues may be the duties and rights owned by the employee and the employer (Philip, 2008). Other issues may have to do with discrimination in the workplace either on the basis of religion, gender or age (Solomon, 1991; Machan, 2007).
Marketing spreads beyond the confines of gaining information on a product seeking instead to manipulate one’s behavior and values (Machan, 2007). Society somehow finds this to be agreeable, but where does one draw the line on ethics. Ethics in marketing are a subset of business ethics as it deals with the values and principles that marketers ought to abide. The market is responsible for the consumers as much as the stakeholders are responsible for the shareholders. Discussions of ethics in marketing are still in a nascent stage, and the biggest issue is being able to pinpoint the agency responsible for ethics and its practice (Machan, 2007). Ethics in marketing is not restricted to marketing only as it is found in other fields, as well. It requires a lot of observations; therefore, it should not be restricted in stereotypical ways. This area of business has to do with the duties of an organization to make sure that the production processes and the products do not cause any harm (Philips, 2008). The World Wide Web and the computers are the most crucial inventions of the 20th century and many issues of ethics do arise due to technology as it is now easier to get information and access that may lead to invasion of privacy, monitoring of workplaces and mining of data.
Ethical issues and approaches
Business ethics can be viewed from different perspectives, including that of the employee, the society and the commercial enterprise. Most times situations arise between one or more parties that cause conflict and being able to serve one party without attending to the other may bring about problems and conflicts to the respective parties. Ethical issues come up when organizations need to abide with the many conflicting cultural and legal; standards, especially with the varying practices found in the different countries (Philips, 2008). It has been claimed that the application of the Gresham’s law of ethics where the practices of bad ethics drive out the good ones is a good way to deal with these issues (Philips, 2008). A competitive environment in business leads to the survival of companies that recognize that their only choice is to maximize their profits.
Corporate ethics policies
As part of an ethics program and comprehensive compliance, many organizations have come up with internal policies that have to do with the ethical conduct of employees. These policies can be more detailed policies or simple exhortations that include particular requirements of one’s behavior (Broni, 2010). The purpose of these policies is to identify the expectations of the company’s workers and give proper guidance on the best way to handle common issues of ethics that may arise in the process of conducting business (Broni, 2010).
Social responsibility and corporation
CSR- corporate social responsibility refers to the ethical, legal, economic and discretionary expectations of the society on an organization at any given point in time (Heath, 2006). This means that organizations have a philanthropic, ethical and moral responsibility on top of the one they have in the process of earning a fair return from investors and abiding by the law (Heath, 2006). Corporate social responsibility relates to business ethics but is not identical to it. The expectations of the society that the organizations will come up with proper services and goods needed by consumers and at a reasonable price is what economic responsibility is all about.
Conclusions
When businessmen talk about business ethics they usually refer to not breaking criminal law with work related activities, avoiding actions that may lead to company civil lawsuits and staying away from actions that could impress upon a bad image for the company. With these three factors businesses feel, they are saving money and avoiding a bad reputation for the company. However, it is hard for philosophers teach any person how to be ethical, and as much as moral companies may be safe from moral issues in the business and public and legal relations nightmare, a morally upright company should be keen on humane working conditions, thorough marketing and attention to safe environments and product safety as well as truthful advertising. These factors may be a way above what a tightly budgeted company has bargained for, but it is not easy to handle the conflict between businessmen who are money minded and ethical interests along with the ideal minded philosopher. Economic viability mostly cancels out where issues of business moral principles and ethics come in to play. Corporate social responsibility as an ambitious notion emphasizes on the roles firms play in reshaping their legal disputes, the outcomes and the legal rules.
Reference
Borgerson, J. L. - Schroeder, J. E. (2008). Building an Ethics of Visual Representation: Contesting Epistemic Closure in Marketing Communication. Cutting edge issues in business ethics. M. P. Morland - P. Werhane. Boston, Springer: 87-108.
Broni, G. (2010). Ethics in Business. Teaching Business Ethics, Vol. 6 (1) / February Springer link: Springer.
Heath, J. (2006). 'Business ethics without stakeholders. Business Ethics Quarterly, 16 (4), 533-557.
Machan, T. R. (2007). The Morality of Business: A Profession for Human Wealthcare. Boston: Springer.
Phillips, K. (2008). Bad money: Reckless finance, failed politics, and the global crisis of American capitalism. New York: Viking.
Solomon, R. (1991), Business Ethics, In: Peter Singer (Ed.), A Companion to Ethics, Malden, MA: Blackwell, 354-365.
