Business ethics

First of all it is important to give a definition of Business Ethic. So,

Business ethics (also known as corporate ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals and business organizations as a whole. Applied ethics is a field of ethics that deals with ethical questions in many fields such as medical, technical, legal and business ethics. Business ethics is exactly the same as normal ethics, and that is knowing what is right or wrong, and learning what is right and what is wrong in a business environment. The concept of business ethics has been seen to mean various things to different people, but usually it's knowing what is right or wrong in the workplace and doing what's right in regard to effects of products, services and relationships with stakeholders.

But why do we need to know about Business Ethics? Discussion on ethics in business is necessary because business can become unethical, and there are plenty of evidences today on unethical corporate practices. Any decisions made by businesses need to be made with an informed awareness of the specific situation and then act according to some sort of system of principals which is Business Ethics.

Therefore, there are no clear morals to guide today's leaders through difficult problems about what is right or wrong, just vague perceptions of what should and has already been done. A focal point on ethics in the workplace shows and alerts leaders and staff on how they should act. An attention to ethics in the workplaces helps ensure that when leaders and managers are struggling in times of crises and confusion, they retain a strong moral focus. However, attention to business ethics provides numerous other benefits, as well. Note that many people believe that business ethics, with its continuing focus on doing the right thing, only asserts the obvious be good, don't lie,, and so these people don't take business ethics seriously. For many people, these principles can go right out the door during times of stress. Business ethics can be a strong preventative medicine.

There are also some issues in business ethics, for example: Ethics of finance, Ethics of human resource management, Ethics of sales and marketing, Ethics of production, Ethics of property, property rights and intellectual property rights.

I think, I need to mention about International business ethics. Many new practical issues arose out of the international context of business. For example: The search for universal values as a basis for international commercial behavior; Comparison of business ethical traditions in different countries; Comparison of business ethical traditions from various religious perspectives; Issues such as globalization and cultural imperialism; Varying global standards – e.g., the use of child labor.

Benefits of Business Ethics. Ethics programs help maintain a moral course in turbulent times. Ethics programs cultivate strong teamwork and productivity. Ethics programs support employee growth and meaning. Ethics programs promote a strong public image.

I want to give example of business ethics. I’ll speak about Nestle. Nestle, like many other businesses have created what they believe to be a comprehensive ethical policy or codes of ethics, in plain they are lists of what they believe is ethical behaviour and how they should behave. Nestle have got an ethics policy from legislation to child labour, they have covered every single topic they believe comes under the word of ethics. Nestle believe that every single area of their business needs to have an ethics policy in which they should be able to follow, as they are a global company and their arms stretch to many different area's. Nestlé learned very early to respect the social, political and cultural traditions of all countries in which the products are produced and sold. Quality is the cornerstone of the success of the Nestlé Company. Everyday, millions of people all over the world show their trust in the company by choosing Nestlé products. This trust comes from a quality image that has been built up for over a century. Nestlé carries out its global social responsibility, firstly, by taking a long term approach to strategic decision making which recognizes the interests of its consumers, shareholders, business partners, and the world-wide economies in which they operate.

So, in conclusion, I want to say that, in common, business ethics is the choice between right and wrong. The concept has come to mean various things to various people, but generally it's coming to know what it right or wrong in the workplace and doing what's right -- this is in regard to effects of products/services and in relationships with stakeholders.

Дополнения, перепечатывала из учебника Market Leader.

Corporate social responsibility. or CSR, is fundamentally about the obligations of a company to society and the ways in which it can affect society and the environment. CSR has recently become a fashionable item on the corporate agenda.

However, the demands and expectations of government and society have become grater, many think that business need to show a stronger commitment to issues such as social responsibility., sustainability and transparency.

The fashion business particularly faces significant challenges. in the 1990s, Nike hit the headlines with allegations that some of its products were made in sweatshop conditions and by child labour. In 2005, Nike published the names and locations of more than 700 suppliers that manufacture its goods in an attempt to highlight the sportswear group’s ethical working practice in developing countries. Companies are now seriously considering the commercial viability of ethical fashion.

The tendency to switch production frequently, to achieve the cheapest prices, means that relationships between brand owners ant their producers in developing countries are often short term. Nevertheless, many believe the time is right for companies to market their ethical stance and that brands can leverage their position internationally by being ethical. A brand’s value nowadays may not just be about profit and loss, but also accountability – being able to demonstrate clearly where and how a product is made.

Brand owners also risk being criticized for exploiting the concept of being ethical for commercial gain. Some would argue that the product comes first and ethics will always be secondary to the consumers' self-interest. Nevertheless, evidence suggests that consumers, specially younger ones, do care about where and how the clothes they buy are made,

Companies need to be specific and transparent about every aspect of their business. Transparency has always been an important aspect of corporate responsibility, and a growing number of companies are struggling with the challenge of reporting on social, environmental and economical issues, encourage by governments and regulatory authorities. The Netherlands, Denmark and Norway have required environmental disclosures for several years.

A growing numbers of companies are voluntarily producing CSR or sustainability reports about non-financial issues and impacts that could significantly affect the business. But there are many multinational which say nothing about issues such as carbon-dioxide emissions, suppliers’ labour conditions or community relations.

The nature and standards of CSR reports varies widely/ Sustainability experts say that companies should integrate financial and non-financial reporting and that many reports are too vague to provide useful information, but that is beginning to change.

Such companies, such as Andersen, Enron and Worldcom, have suffered from allegations of unethical corporate governance or financial irregularities at management level, demonstrating that business ethic play a role on both the macro and micro level.

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Organizations which make ethical marketing decisions will probably be trusted by consumers and respected by the business community. Unethical marketing activities can damage sales and destroy a company’s reputation.

The Italian clothes manufacturer, Benetton, caused a lot of controversy when it ran series of advertisements that were designed to highlight “global concerns”. The company chose a picture of an AIDS victim – who died soon after the photograph was taken – for one advertisement. In another one it used a new-born baby – it also raised many objections. In 1991 – an advertising campaign – includes an ad picturing a not-so-platonic kiss between a priest an a nun dressed in old-fashioned habits. That was offensive to Catholics. The explanation of Benetton – the firm tries to distance its ads from boring old commercial considerations. They aim to capture people’s attention, provoke reflection and break through the barrier of indifference.

Benetton reckons its campaigns address the major social issues of our time including AIDS, overpopulation, environmental problems and racial harmony. An old Benetton ad showing a black woman breastfeeding a white child created uproar among American blacks. Another ad depicts an angelic-looking white child embracing a black one whose hair has been shaped into devil’s horns.

Companies should operate within an established code of ethics. On the other hand, marketing ethics is too subjective to make certain standardization possible.

The methods used to promote and sell drugs are under attack, putting Glaxo, the world’s second-biggest pharmaceuticals company right in the line of fire. The industry stands accused of conducting promotional drives disguised as educational and fact-finding campaigns; of offering doctors hard cash; of distorting data to suit its promotional needs; of blurring side-effects; of bad-mouthing rival products and unnecessarily alarming doctors and patients. Even Glaxo long admired for its marketing shocked the industry when announced that it had conducted tests on a rival product made by Sweden’s Astra, which had shown that it causes cancer. That was a taboo beforehand.

In Britain critics believe that relations between drug firms and the Medicine Agency is too cosy. All information that passes between them about the approval of a drug is confidential. Doctors are highly dependent on the industry’s marketing men for information, which means that an appropriate debate on potential side-effects can never really take place.

Unethical behavior – taking bribes in business (or so-called “gifts”).

Holiday companies and travel agencies sometimes give misleading descriptions in their holiday brochures. No one is responsible for monitoring the activities of travel agents or tour operators. They can promise close proximity to the beach, to the center, national dishes served in the hotel, miles of empty golden sands. But in fact they send the tourists to overflowing with tourists resorts far from the center, bars, nightclubs and the beach