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You need to choose a business sector to focus on, and address how business ethics is managed within that sector (e.g. Financial; Mining; Agriculture; Retail; Service; Education; Tourism etc.).

The list of sections below provides the issues that you need to consider:

(1) Discuss major challenges, relating to business ethics, facing the sector. You are expected to focus briefly on the following issues:
a. ethical issues facing the sector
b. sustainability focus of the sector
c. major stakeholders in the sector

(2) Explain what factors are driving the sector to manage the business ethics more effectively.

(3) Elaborate how managing business ethics has helped the sector. 

Challenges of Business Ethics in Retail Sectors

Business ethics is the form of applied ethics and professional ethics, which examines ethical principles and ethical problems in the business environment (Su 2014). The business managers need to be high concerned about such business ethics in enhancing business performance. This study will choose retail sector and assess the major challenges relating to business ethics in this sector. It will also examine the sustainable focus and major stakeholders of this sector. Apart from that, the study will also explain the factors, which drives this sector in managing business ethics. Moreover, this study will also describe the benefits of business ethics in retail sectors.

The objectives of the study are the followings:

  • To assess the major ethical issues in Retail Sector
  • To examine the factors driving the retail sector in managing business ethics
  • To recognize the benefits of business ethics on business performance

Safety is considered to be the basic consumer right. Such consumer rights are safeguarded by product safety act, which ensures that safe products are available in the market. It is denotes the risks associated with the product (Michaelson et al. 2014). Retail sectors should always be aware of the products, which they sell to the consumer. However, in some case, retail sectors are more inclined to sell unsafe products having low quality to the consumers. It is actually unsafe for the consumers and leads to ethical issues for the retail sector.

Ethical advertisement should always be promise the thing, which a product or service actually provide. However, Wang and Calvano (2015) stated that with an intention to attract huge numbers of customers, some retail sectors are more likely to use false claims in the advertisement about the products. For example, Woolworth uses the promotional tagline “fresh food people”, where it is actually not always true. Therefore, false advertisement is actually creating ethical issues in the retail sector.

Organizations should always be fair and ethical to the workplace and with the employees. However, Vitell (2015) opined that most of the retail sectors are now being unethical to the employees for gaining more productivity and profit. Moreover, such sectors are actually unethically exploiting the labor by enhancing their working time and reducing their compensations. For example, 7-Eleven is unethically exploiting its labors by increasing their working hours and provide them less compensation (Ferguson and Danckert 2017) .

Retailers should set the pricing at a level, which will not exploit consumers, producers and competitors. Moreover, the retail sectors should set price for all the suppliers, producers and consumers with a reasonable profit margin. However, some retail sectors set excessively high price for their product for gaining high level of profit margin (Keller, Chandler and Mezias 2014).

Sustainable Focus and Stakeholders of Retail Sectors

Retail is highly focused on maintaining their economic sustainability, where they feel that they are on good ground. Such sustainability ensures that the retail sectors are economically sound enough for meeting all their liabilities. Moreover, Fassin and Drover (2017) pointed out that when an organization is economically sound, they ensure adequate return on investment to the shareholders and other stakeholders. In this way, fair return on investment to the shareholders attracts more shareholders to invest in the retail sector. Therefore, economic sustainability ensures long term profit level of the retail sector.

Retail sectors also focus on social sustainability, where the retail organizations are highly concerned with social development of the society and community. Moreover, the sectors are always engaged in development of community people, employees and other stakeholders. Retail sectors ensure social sustainability through find raising, sponsorship and public investment for community good. According to Fernando and Moore (2015), social sustainability actually enhances the corporate image of the retail organizations to the customers. Therefore, it ensures long-term profitable business for the retail organizations through enhanced sales. For Instance, Woolworths in Australia is highly engaged in the social development of the community charities and other sponsorship.

Retail sector is also focused on environmental sustainability, where they are engaged in protecting the environment. It actually ensure corporate image in the society and enhance customer loyalty. Moreover, the sectors are highly engaged through reducing carbon footprint, packaging waste, water usage and others. For instance, Wesfarmers is Australia provides has reduced 20% carbon footprint from their business for protecting the environment (Leiva, Ferrero and Calderón 2016).

The major stakeholders of Retail sectors can be analyzed through Stakeholder priority matrix. As per this matrix, stakeholders are prioritized based on their power and interested in organizational project. Moreover, stakeholders are prioritized based on the following four quadrants:

These types of stakeholders in retail sectors have high power and high interest in the organizational projects. For instance, the company owner, board members and shareholders are included in these types of stakeholders. They have high power on taking business decisions and have high interest on the profit level of the projects (Ruiz et al. 2015). Therefore, they always need to be kept satisfied.

Such Stakeholders have high power in the project of retail sector, but they have comparatively less interest. These are such types of stakeholder are like Government Agencies, Social media team and others (Neesham and Gu 2015). However, they have high level of power in the success level of the retail sectors. Therefore, they need to be kept satisfied in the organization.

Factors Driving Business Ethics in Retail Sectors

Such types of stakeholders in retail sector have high interest in the organizational project, but they have low power in the organizational project. These types of stakeholders are employees, community and others. However, they interest in the organizational project can lead to retail success. Therefore, such stakeholders should be kept informed about the organizational projects.

These types of stakeholders have low interest and low power in organizational power. Such types of stakeholders are consumers and competitors. They need minimum efforts to maintain from the organization.

As per Vitell (2015), Government always intervenes and enacts laws for retail sectors for keeping them away from unethical and selfish activity. Such laws support Government regulations regarding product safety, working condition, statutory warning and others. These provide some guidelines to the business managers and drive them in determining the ethical business practice.

Large scale organizations are always associated with certain code of ethics. Avoidance of such code of ethics can lead to disruption of corporate image and goodwill. Therefore, the retail sectors should be highly cautious about such ethical code of conduct. These codes of conduct drive the business managers in managing the business ethics.

Social pressure and forces have considerable influence in managing the ethics of the retail sector. According to Neesham and Gu (2015), consumers can be indifferent about the retail sectors, when they get involved in providing sub standard products and unethical activities. Therefore, such pressured drive the business managers to maintain business ethics.

Contemporary retail industry is working in most competitive atmosphere. In such competitive atmosphere, ethical adherence is highly necessary in maintaining the profitable business over the rivals. Therefore, such ethical standard drive business managers in managing business ethics.

Managing business ethics have fostered enhancing customer loyalty in the retail sector. Fassin and Drover (2017) opined that maintenance of business ethics builds corporate image and good will in the society.  Such positive image brings new customers through positive word-of-mouth. In this way, business ethics have enhanced customer loyalty.

Business ethics maintains code of conduct in the workplace. In this way, it creates positive work environment in the retail organizations. Therefore, business ethics have enhanced the satisfaction level of the employees and increased the productivity of the sectors.

According to Ruiz et al. (2015), business ethics have driven the retail sectors in complying with environmental laws, labor laws, employment laws and others. In this way, retail sectors have become able to avoid the legal complications. Therefore, such business ethics have helped in advance business growth of the retail sectors.

Benefits of Business Ethics in Retail Sectors

Management of business ethics builds corporate image and goodwill in the society. It actually enhances customer loyalty and increased sales. Moreover, Su (2014) stated that adherence to government rules and regulations have enhanced the government support to the retail sectors, which have enhanced business success level.

Conclusion

While concluding the study, it can be said that retail sectors are facing ethical issues for product safety, unethical advertisement, unethical labouring and unethical pricing. Providing sub standard products, false advertisement, unethical pricing can lead to ethical issues in retail sectors. Unethical business practices can destroy reputation of the retail sector in the market and hamper business sustainability. However, government rules and regulations have set the business practice form protecting the stakeholders from unethical businesses. Such rules and regulations drives retail sector in managing the business ethics. On the other hand, social pressure also drives the retail business managers towards adhering with the business ethics. Retail sectors have actually gained high level of business success through maintaining business ethics in the business practices. Moreover, business ethics have built corporate image and goodwill of the retail sectors in the market. It has actually enhanced business performance of the retail sectors.

Reference List

Fassin, Y. and Drover, W., 2017. Ethics in entrepreneurial finance: Exploring problems in venture partner entry and exit. Journal of Business Ethics, 140(4), pp.649-672.

Ferguson, A. and Danckert, S. 2017. 7-Eleven's wage fraud sparks $170 billion blow back. [online] The Sydney Morning Herald. Available at: https://www.smh.com.au/business/retail/7elevens-wage-fraud-sparks-170-billion-blow-back-20160826-gr264h.html [Accessed 8 Aug. 2017].

Fernando, M. and Moore, G., 2015. MacIntyrean virtue ethics in business: A cross-cultural comparison. Journal of Business Ethics, 132(1), pp.185-202.

Keller, J.W., Chandler, D. and Mezias, J., 2014, January. Consensus and Clustering: Shared perceptions of ethics practices across an organizational field. In Academy of Management Proceedings (Vol. 2014, No. 1, p. 13236). Academy of Management.

Leiva, R., Ferrero, I. and Calderón, R., 2016. Corporate Reputation in the Business Ethics Field: Its Relation with Corporate Identity, Corporate Image, and Corporate Social Responsibility. Corporate Reputation Review, 19(4), pp.299-315.

Leonidou, L.C., Kvasova, O., Leonidou, C.N. and Chari, S., 2013. Business unethicality as an impediment to consumer trust: The moderating role of demographic and cultural characteristics. Journal of Business Ethics, 112(3), pp.397-415.

Michaelson, C., Pratt, M.G., Grant, A.M. and Dunn, C.P., 2014. Meaningful work: Connecting business ethics and organization studies. Journal of Business Ethics, 121(1), pp.77-90.

Neesham, C. and Gu, J., 2015. Strengthening moral judgment: A moral identity-based leverage strategy in business ethics education. Journal of Business Ethics, 131(3), pp.527-534.

Ruiz, P., Martinez, R., Rodrigo, J. and Diaz, C., 2015. Level of coherence among ethics program components and its impact on ethical intent. Journal of Business Ethics, 128(4), pp.725-742.

Su, H.Y., 2014. Business ethics and the development of intellectual capital. Journal of Business Ethics, 119(1), pp.87-98.

Vitell, S.J., 2015. A case for consumer social responsibility (CnSR): Including a selected review of consumer ethics/social responsibility research. Journal of Business Ethics, 130(4), pp.767-774.

Wang, L.C. and Calvano, L., 2015. Is business ethics education effective? An analysis of gender, personal ethical perspectives, and moral judgment. Journal of Business Ethics, 126(4), pp.591-602.

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My Assignment Help. (2021). Essay: Challenges & Benefits Of Business Ethics In Retail Sectors - An Assessment.. Retrieved from https://myassignmenthelp.com/free-samples/mmh733-ethics-for-managers/business-ethics.html.

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My Assignment Help (2021) Essay: Challenges & Benefits Of Business Ethics In Retail Sectors - An Assessment. [Online]. Available from: https://myassignmenthelp.com/free-samples/mmh733-ethics-for-managers/business-ethics.html
[Accessed 29 March 2024].

My Assignment Help. 'Essay: Challenges & Benefits Of Business Ethics In Retail Sectors - An Assessment.' (My Assignment Help, 2021) <https://myassignmenthelp.com/free-samples/mmh733-ethics-for-managers/business-ethics.html> accessed 29 March 2024.

My Assignment Help. Essay: Challenges & Benefits Of Business Ethics In Retail Sectors - An Assessment. [Internet]. My Assignment Help. 2021 [cited 29 March 2024]. Available from: https://myassignmenthelp.com/free-samples/mmh733-ethics-for-managers/business-ethics.html.

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