Free «Managing Ethics in the Workplace» Essay
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Ethics in business is a central constituent of business practice today. Irrespective of the fact that the concept of business ethics varies from one business to another or from one industry to the next, the general ethical expectations from the business practitioner both by the customers and other businesses whether competitors or not are rather homogenous. In effect, ethics in business are greatly grounded both on the moral and legal principles and greatly shaped by the environmental expectations of the business due to the ever increasing need for good reputation for competitiveness. Despite the fact that observing business ethics is not autonomous, it is a necessity in business today because it can not only have great cost on the part of the business in terms of lost reputation but also stern legal penalties if an organization is found guilty of infringing business ethics (Garry, 2009) . However, in global business today, ethics in business continues to be diluted by business practitioners as competition intensifies coupled with the ever increasing need to make money or rather putting the profitability concern before ethics and morals. Pragmatically, ethics in business context is rather a diverse phenomenon and which involves series of ethical decision-making. This paper therefore provides an insight on the issue of business ethics, explain social responsibility in the contexts of business ethics and discusses the varied approaches to ethical decision making in business.
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What is Business ethics?
According to Garry (2009), business ethics basically refers to the morally desired or legally prescribed code of behavior that an organization member adheres to and which dictates/ guides the business actions and activity in its day to day interaction with the environment in which is exists. As such, business ethics refers to the business behavior and actions towards the customers as well as other business within and without the industry the latter of which greatly tone up the interpersonal relationship between them (Manuel, 2005). Irrespective of the fact that the business ethics concepts and laws may differ among business inclusion, the degree of complexity and application of business ethics principle the underlying factor behind business ethics is mutually accepted code of conduct in the business world the latter of which shape business interpersonal relations i.e. customer -business relationships and business - to - business relations.
As a matter of facts, existence is healthy of such relationships and which are greatly grounded on the existence of good business ethics that are critical for good business and success. In effect therefore, the need for ethics in business cannot be overemphasized. In fact, business ethics do not only ensure good relationships and interactions between the business and the world in general but they also help institute good relationships and guided interactions between the business and individual customers the latter of which yields great business success (Serenko & Bontis, 2009). According to Alan (2001), although individuals have tended to idealize business ethics as a rather complex phenomenon, the fact is that ethics in business ranges from the minute things that many business practitioners tends to overlook such as refraining customers exploitation, being just to the firms human resources, deforestation in search of business raw materials to complex form of business ethics represented in legal statutes such as which governs advertising
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Due to lack of ethics or what is often referred to as bad business, scores of organization have gotten a bad name or rather bad reputation by the virtue of being in unethical business. One of the major reasons why many of these businesses are engaging in unethical practices is barely the big greed for money thus disregarding and failing to abide by the business moral and legal doctrines or what can be regarded as pure capitalism (Serenko & Bontis, 2009). Although making money and craving for high level of profitability is inherent and health for a rational business, the manner in which some business carry out their activities or behave points lack of morals, business ethics, and often leads to disrepute; the latter of which can cost the organization both in terms of customers loss or attract a fine if the organization is legally convicted of such ethics breach. While endeavoring to increase profitability therefore, it is important for businesses to well understand that ethical standard or good business is critical. Furthermore, the business environment continues to grow in competition every other day. As business attempt to outdo each other in the market place, ethics in business have been greatly compromised. For instance, current trends in marketing exhibited by comparative advertising, business sabotage, uses of sex in advertising, and use of vividly immoral advertisements to sell brands are examples of steadily deteriorating ethics in business. As a result, the unethical practices in the business today trickle to the great concern and craving to make more money as well as the great drive for increasing profitability.
Ideally, there is as great need for all business to entrench good business ethics as part of the business culture. According to Manuel (2005), unethical practices by a single business are likely to escalate the vice to many other businesses thus forming a chain of bad/ unethical businesses. The latter asserts that just by the virtue of an organization entering into unethical business relations/ interactions with another business, the latter becomes unethical too by association since it is the responsibility of the first business to decline to associate with the other company thus helping to cut down the chain. Examples of such unethical business practices are quite vivid in the business world today across the world as business aims to make big monies via engaging in unethical business practices. Major world organizations while endeavoring to make money have at times witnessed to flout business ethics laws often costing them millions of shillings as fine for the same. In the United States of America for instance, ethics in business have been greatly necessitated by the business environment and more so by the stern ethics laws that have been duly instituted to guide ethical business practices ranging from consumer protections laws, business laws, competition decrees to laws governing advertising. Consequently, in circumstances where businesses breach the business ethics leading to flouting of anti-trust, ethical laws, and environmental laws are often inflicted in millions of dollars (Carter, 2008).
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However, some companies have turned the whole scenario into a business itself since the amount of fines that such breach of business ethics attracts falls far below the amount of money that such company makes from the unethical business practices. Furthermore, even the people themselves cares less about business ethics hence companies have been encouraged to engage in unethical business practices. The fact is that some companies are in huge money business but they don’t place so much on good business ethics. In the United States including renowned soft drink and first food businesses for instance have been inflicted huge fine as a result of flouting business ethics but they have ideally continued with the vice. The underlying factor behind such scenario is that the companies are making millions of dollars in profits after all that is incomparable with the fine that they are charged. In effect, such companies consider the fine as a normal cost of doing business and not a penalty of an unwanted behavior that they should refrain from.
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Business ethics and corporate social responsibility (CSR)
More often that not, ethics and social responsibility have been viewed as synonymous (Carter, 2008). Despite the fact that the two are very close in meaning and application; making them almost undistinguishable, the fact is that corporate social responsibility is just but one constituent of business ethics in the wide business context. Ideally, the concept that was born in the late 1960s and which has continued to grow in vibrancy and application as well as entrenching itself as a central part of business ethics, is greatly responsible for the ever increasing public awareness concerning the responsibilities of business in aiding to establish and build up high levels of ethical business behavior in its relationship with the society especially in matters that concerns the natural environment (Carter, 2008). As such, social responsibility as part of business ethics guide business practices in regard to issues such as environmental conservation concerns, anti environmental pollution concerns and giving back to the public in appreciation of their support through sponsorship of public events. Just like the need for entrenchment of ethical business practices for business today, corporate social responsibility has found its way at the core of business practices both as a moral standing and an ideal strategy for competitiveness.
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Models to ethical decision making in business
Although business ethics are often rooted in the pre-established organization culture, entrenchment of and successful adherence to good ethics in business involves a challenging decision making process not only by the managers but also by all the members of the organization. Quite often, manager or business owners are faced with a daunting challenge state of confusion in making decisions that concern ethical practices. As a matter of facts, some situations that managers are faced with within the business context are tempting and may compromise the managers or business practitioners’ ability to make appropriate ethical decision; a scenario that would lead to engaging in unethical business practices. For instance, production decisions that are faced with a tight deadline requirement may tempt a manager to compromise quality in order to meet deadlines. Also, a manager due to his quest to enhance profitability may be tempted to consider laying-off some workers or paying low wages as options the latter of which would be unethical. However, managers have been presented with approaches that they can use to make appropriate ethical business decisions irrespective of the situation that they are faced with.
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The concept of ethics in business is itself multifaceted. Consequently, different business practitioners look at business ethics from different perspectives thus leading to variation in what different business people considers ethical or unethical and approaches to making ethical decisions (Alan, 2001). As a result, the approaches to ethical decision making are not unilaterally applicable to all situations but considerations of different alternative of such approaches can aid business managers and owners to make appropriate ethical decisions. Such approaches includes utilitarian approach, the moral right approach, the universalism approach and cost benefit approaches to ethical decision making (Manuel, 2005). In using utilitarian approach the manager or the decision making central focus is to engage in a business practice that he or she believes that it will maximize the utility of good for the maximum number of people that the action taken affects either directly or indirectly. For instance, if the dilemma is on the low wages of the foreign employees, the manager should make his decision on a clear analysis of the effects to make sure that he settles for a decision that does the greatest good for the employees. For instance, if increasing the wages means the organization being forced to lay off some workers, then the decision will not be ideal under the utilitarian approach.
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Under the moral right approach on the other hand, the manager’s main concern is the adherence to the established moral principle and conscious irrespective of the repercussion that the decision may attract. As such, the manager refrains from doing what is universally considered as wrong and does what is considered as right. Consequently, if actions such as paying low wages are considered to be morally wrong then ethical managers must refrain from doing it and cannot use competition and business survival as mere justification to pay low wages. Under this approach therefore being ethical on the part of the manager or the business owner would be to pay his/ her workers healthy wages or close down the business if he cannot (Manuel, 2005, Alan 2001). Under the universalism approach to ethical design making, the golden rule principle is applied. First the manager makes decisions based on the consideration of whether the decision would appeal to all the affected parties as well as himself if he was to be literally in the shoes of the other party. For instance, if manager or a business owner wants to make decisions on payment of low wages to be ethical he should first consider whether the decision would be good to the workers themselves as well as to him in circumstance where he is himself in the shoes of the worker with no other alterative source of livelihood.
The cost benefit approach on the other hand is an approach to ethical decision making in which managers settles on decisions by striking the balance between the costs and benefits that would accrue as a result of taking or not taking a certain course of action (Garry, 2009). For instance, payment of very low wages to workers might cost the organization in terms of loss of reputation but increasing the wages may lead to increased competitiveness by the firm. A decision on whether to increase the wages therefore would include weighing the cost and benefits.
Business ethics is the idea behind good business practices and the sole determinant of existence of healthy relationship between the business and the world as well as good business customer’s relations. In fact they are to a greater extent attributed to good business publicity and reputation while unethical business practices often culminates to negative publicity leading to loss of business and failure. Although some people may argue otherwise, good ethics in business leads to great business success. Basically, business ethics are grounded in moral and legal principles although such may not be homogenous across the world. As a result, flouting of business ethics may attract penalties in form of court fines in an organization if duly convicted of engaging in such vice. Basically, business ethics involves even the often overlooked thing such as customer exploitation, underpayment of employees, and environmental pollution by business enterprise among other unfair business practice. Business ethics means being fair to all parties that the business interacts with, including concerns for the natural environment.
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Although there are some businesses that are committed in adhering to the ethical business practices, the ever increasing competition and opportunities to make big money via breaching business ethics have seen many companies’ compromise business ethics. After all, fine as a penalty for not flouting such ethical principle is not near commensurate to the amount of money that a company makes out of the unethical business (Garry, 2009). However, ethics in business involves strategic decision making with challenges on the part of the managers but the various approaches can aid in making ethical decisions. Concern for large monies and competition increases making many businesses to drift further and further from the ethical business principles coupled with the ineffectiveness of fine to curb unethical business practices, it is only the people that can force the business to adhere to business ethics and corporate social responsibility.