HC2121 Comparative Business Ethics And Social Responsibility

Introduction

Following a report released by the Newdaily, various sectors differ in terms of the manner in which they exercise ethics in their business operations. According to the Newdaily (2018), Australians are most concerned about the unethical behaviors associated with banking institutions and other financial institutions during the shocking revelations of misconduct in the banking royal commission. However, there is an ongoing cause for concern in failure of leadership in addressing the identified complex ethical dilemmas, particularly on disclosure and conflict in the institutions which were reported as most unethical.

Recent research indicates that ethics education is progressing slowly but unevenly. While innovative programs have been introduced by prominent individual ethicists and ethical centers, narrow vocalization takes precedence still over management curriculum and personal values in the business (Scott 2018, p. 234). In this article, we will look at the ethical issues affecting the business and their social responsibility. We are also going to look at arguments made about business ethics; also we will take a look at some moral philosophies as studied in earlier lectures.

Summary of the arguments made.

People feels like they have been let down by their leaders as the degree of moral confusion in the country is quite high. The collective sense of disappointment, shock and even shame is quite strong (Tabetha 2015, 45). There is also a sense of uneasiness that not much is being done to make sure that it doesn’t reoccur because of the relatively low number of people in senior positions who are fluent, compelling and frequent when they speak out about ethical issues. There is still a sense of equivocality on top executives about their leadership roles which betrays the little understanding on how the cultures are changed or shaped.

But on the positives, from the perspective of senior management, there has been a strong view that ethical issues of businesses have become much more important over a period of five years (Ali 2013, p. 67). And whereas most of the top executives point to the measures of deregulation in the 1980s as watersheds, accounting professionals highlights that the crash in 1987 was the catalyst for creation of new ethical responsibilities.

It has been increasingly acknowledged that rapid spread of our countries businesses regionally and globalization has become complicating factors (Rita & Albert 2013, p. 34). For that reason, as most business activities become broadly-based more, cultural and ethical considerations come into play and organization managers spend their time dealing with them. Over the past ten years, professionals like teachers, dentists, doctors and pharmacists’ job ratings have improved steadily those of their counterparts in business-related occupations like lawyers directors, accountants and executives have declined steadily showing that business ethics in the country has clearly been prioritized. Sanctions might cause some serious problems morally and also the imposers of the sanctions might take advantage of the situation and discriminate some organizations. Also sanctions tend to sometimes cause a lot of harm to the victim and also sometimes to the innocent.

Key ethical issues

Newdaily (2018) reports clearly indicates that many of the government’s and businesses’ senior people were involved in the culture of greed, abuse of power and opportunism. This led to the imprisonment of prominent corporate leaders and politicians which led to the period of national reassessment and introspection extending. Ethical guidelines and standards have become significant issues on the agenda of many organization managements since then. But still, confusion on where ethical line should be drawn is of high degree. In some cases, senior government and chief executives are finding accepting the responsibility of being role models by upholding higher standards more than the rest of the society, difficult.

It’s clear that the some of the sectors are highly unethical and therefore there is a call for corporate governance to be setting good framework higher accountability standards for senior directors and managers. This is due to the increasing community demands for more accountability and transparency with regard to shareholders’, management’s, and the wider community’s relationship. Quite a number of corporations have identified specifically, the rising political and community expectations on environmental protection, to being a major catalyst in the corporate values reshaping, social responsibilities and relationships and also prompting greater commitment to long-term planning. When organizations fail to withstand the extremely strong commitment to social responsibility and ethical standards may lead to severe environmental damage.

Good governance has wider impacts as it is fundamental about improving accountability and transparency within existing systems. One of the most interesting developments to occur in the previous years is the way corporate governance label is been used in describing accountability and governance issues beyond business sector. This can be misleading and confusing as corporate governance is developed and built to deal with listed company entities’ governance and it is not designed for all organizational types which might have different structures of accountability.

Opinion on whether appropriate ethical decision has been made.

In my opinion, appropriate ethical decisions are being progressively made as there are a number of measures taken to strengthen professional, individual and corporates ethics through revising the code of ethics in country. In highlighting professional responsibilities and duties to the public, colleagues and clients, the code of ethics gives the public clear precedence placing a heavy responsibility upon individuals to meet highest ethical standards even when not defined clearly as it is stated in the code that the code’s provisions haven’t exhausted ethical and moral considerations governing an individual. However, they act as a guidance to the individuals in the ethical practice (Stipe 2016, p. 736). Also changes in the Companies Act in the country makes directors of the company more accountable to the shareholders, and with the new management code of ethics, it provides for suspensions, reprimands and expulsions for the directors breaking them.

But despite these initiatives, there are still some serious worries continuing about disclosure rules and also the inadequate takeover procedures in our country. However, notwithstanding absence of formal institutional mechanisms to maintain and develop ethical standards, and also business ethics’ external perception in our country is extremely favorable (Justin 2014, p.35). This was according to a recent comparative rating that was conducted by Transparency International that ranked Australia as among the world’s least corrupt countries.

It’s only a few of the organizations in our country that are addressing the issue on ethics as a corporate issue that is to be strategically monitored and managed by the top management. However, senior executives acknowledging the business community’s need to provide more leadership in the area of ethics is an encouraging sign. The few organizations that see business ethics issue as a management issue relates it to the thrust of the current strategy around customer service, quality and excellence. For this reason, there is recognition that ethical value system very much depends on the leadership of the organization and that managing personal relationships with employees and the customers sensitively is an important corporate ethics indicator.   

Also managers recognize that there is need to communicate and try to shape core values to ensure they are aligned with the organizations’ strategies and goals. Following several transgressions experience in earlier years, professional bodies have prioritized education and ethical assurance. For instance Australian Society of professionals created an Ethics Centre of Excellence (Frank 2012, p. 547). Organization are establishing training courses, codes of conduct and committees as a way of dealing with situations of conflict and of building obligations to ethical practices. Another example, in Western Australia, innovative initiatives have being undertaken with the aim to improve ethical standards through community education and better public sector management.

And if sanctions were to be imposed, it won’t be reasonable in my opinion because they might cause some serious moral problems as some serious moral questions might be raised and cause some unwanted economic pressure. Also burden of moral justification shifts from the ones who impose it. Economic sanctions also take a extended time to effectively work preferring military intervention instead of the sanctions as it is a faster way of ending human rights abuse causing the least harm overall. They also might cause the innocent some harm, those who bear no responsibility, morally, for the illegality at hand (Tipkorn 2013, p. 132). There might also be the issue on discrimination when imposing the sanctions which has been a problem for a long time now.

Moral philosophies

Corporate social responsibility (CSR) comes into place when an organization is committed to perform ethically while benefitting the stakeholders and the community and to boost the economy as well (Wu 2014, 56). Corporate social responsibility assists an organization in hiring and keeping the right employees and to also contribute to its business performance. Both ethics and CSR can affect the strategy of the company closely (Chuck 2012, p. 57). The company’s management should come up with good ethics as the other organization’s members follow it. Also CSR’s ethical approach argues essentially against morally business practices that are indifferent, favoring the expansive public policy and social advantages of stakeholder management practices that are morally sensitive (Thomas 2012, p. 35). Many stakeholders’ expect ethical behavior to go beyond legal compliance which is mandatory with the managers involving themselves in impartial reflection, morally, and extend beyond the law.

The use of ethical dilemmas- business ethics trainers teaches the basics of moral philosophy by using situations of ethical dilemmas so as to inspire students doing business to examine some automatic stances in business management areas. Also as commerce is increasing globally, this effort is done from cross-culture ethics perspective.

Corporate culture- from the perspective of ethical system, creation and sustaining an ethical culture that is strong is key to creating a company that supports people behaving ethically every day and making effective ethical decision (Kurt 2012, p. 67). There are so many factors and forces that make individual take ethical shortcuts. But when all organizational systems are directing individuals in the same path, ethically, ethical failure declines. Ethical culture is seen as a framework of multisystem including informal and formal system that is aligned so as to support ethical action and judgment (Agnieska 2011, p. 67). Leadership is key to driving the culture of ethics from an informal and formal perspective. Leaders provide with all the resources required to implement programs and structures for ethical support. Formal systems include policies and codes, selection systems, authority structures, orientation and training programs and formal decision processes.  

Conclusion

Determining whether corporate governance being practiced by organizations should continue is very important. In my view, it is a very good practice being practiced by business today. Corporate responsibility being accepted by the businesses can be effective if the companies embrace it and not use it as a marketing exercise aimed at attracting more customers. The government should be involved and should change the code of corporate responsibility to mandatory from voluntary so that all the business are compelled to adopt it. Also a code like that needs to be exercised more strictly so that there are lesser chances of paying below minimum wage to their employees. Also, profiting using any means may lead to chaos and certain ethical aspects are not only required but they are badly needed.

References

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