Business in the News: Ethics and Social Responsibility - Case Study Example

Business in the News: Ethics and Social Responsibility s affiliation Business in the News: Ethics and Social Responsibility Introduction Business ethics is perceived as a professional or applied ethics, which scrutinizes ethical standards and morals (Stanford Encyclopedia of Philosophy, 2008). Ethics is applied in all areas of business operations and is pertinent to individual’s actions and the organization/ Company at large. In the modern world, ethics is neither a choice nor a luxury. For instance, Hewlett Packard is a Company that prioritizes integrity. In this regard, the CEO, Carry Fiorina who worked in the Company for 6 years stated that the best decision he ever made was to dismiss workers who were not behaving with integrity. This as a result made the Company successful (Brimmer, 2007). Leaders in most organization have a lot going on in their mind because of the stiff competition in the world. In this regard, they ought to keep up with any upcoming technological progress, impacts of globalization, competitor’s services and products, opportunities and threats within their Company, among others. Despite all these aspects, leaders should prioritize ethics, which is usually incorporated in the Company’s mission. Ethics not only affects the culture of a Company, it also affects the decision making. To attain this idea, the top management ought to come up with an alignment process that incorporates business ethics with values, strategies, goals and mission of the Company. Integration of ethics within a Company results to good relationships between employers, employees and clients. More so, businesses are expected to adhere to federal, environmental and civil rights laws so as to avoid any legal laws that may subject one to lose of time, employees and money. Thus, the paper will intensively and extensively discuss the role of ethics in business, impacts to the corporate world and a number of ethical concerns in the world. Importance, roles and application of business ethics: Starburst Company For Starburst to be successful, it should know the benefits of ethics and business social responsibility. According to The Times 100 (2014), such aspects encourage employees to stay in the Company, which in return reduces the turnover rate, thus increase in productivity. More so, ethical behavior attracts investors, which makes the Company have a large number of shareholders, thus protect it from disclosure. Ethical behaviors attract customers to purchase its products, which may heighten the sales margin. Starburst Company ought to know that business ethics is essential because it holds employees and employers accountable for any actions put into place. This incorporates both external and internal behavior. Ethics make professionals and Companies be conscious of the impacts of their behaviors, thus pursue success responsibly. More so, business ethics deals with behaviors that cannot be dealt by the government laws. There are so many legal actions that are harmful to particular groups of the society such as employees and individuals of a given society. Thus, if a business incorporates code of conduct in its operation, it can self- regulate its actions and ensure that it acts properly. Additionally, business ethics ensures that the Company acts in honest manner. Despite many unethical behaviors being legal, they may result to unlawful acts. In this case, having code of ethics may motivate workers of to be honest and stay away from potential unlawful behaviors (Bruning, 2003).Maintenance of powerful business can result to success of the Company. By being sensitive to others, a Company can improve its profile within the community and industry. Companies that prioritize ethics in their operations obtain loyalty and trust from individuals, thus encourage them purchase their products. For instance, the ‘13th Annual Edelman Trust Barometer’ clearly shows the effect fiscal scandals have on the public trust. For instance, the banking industry in the United Kingdom scored an overall public trust of 29% compared to nations such as Canada, United State and Australia that score higher percentage in relation to public trust. Once a Company’s brand is spoilt by ethical scandals, it can be very hard to bring back trust from the already existing consumers, and attracting new ones. More so, such poor ethical reputation exposes a Company to attacks from potential competitors. In this case, Starburst Company should instill code of ethics in its operations so as to be successful. In addition, the Company should train its employees on ethics because they are the ones who determine how consumers perceive the Company (Doodson, 2013). In order to be successful, Starburst ought to put into consideration the ethical fashion aspect. As established by fibre2fashion. Com (2014), ethical fashion is viewed as the production of textile goods with a sense of knowing what is right and wrong. Most businesses all over the world are emphasizing the importance of ethics and protection of the environment in their endeavors. Fashion industries are no exemption. In this regard, most fashion designers and producers of textile are doing their best to ensure that goods being produced are not harmful to the environment. Producers and consumers of textile ought to adopt the ethical fashion. This because the human, animal and environmental activists have raised the ethical issues related to the clothing industry. In this regard, the activists are concerned with how the cotton is produced. In this case, it entails the utilization of an enormous amount of pesticide that is detrimental to people’s health and the environment. Statistics show that approximately 2 billion U.S. dollars’ worth of pesticides is utilized by producers every year. In addition, the World Health Organization has declared that pesticide worth $819million is poisonous. Employees who spray pesticides in cotton fields and individuals who live around such regions can have health issues. For instance, they may suffer from pesticide poisoning that is characterized by nausea, headaches, seizures, loss of consciousness and depression. The utilization of pesticides results to pollution of water, air and soil (fibre2fashion. com, 2014). The Starburst Clothing Company ought to know the issue of cruelty towards animals. In this case, the production of fur coat entails the slaughter of animal, which is viewed by animals’ activists as a cruel act. The production of a single fur coat requires 40 stables, 100 chinchillas, 11 lynx, and 30 rabbits. The pain subjected to such animals during trapping and extracting their fur is unbearable. More so, unthinkable suffering is still caused to animals that produce wool and leather essential for the production of boots and shawls. Most clothing industries usually prefer cheap workforce to as to make more profits. Women and children are usually part of such work force, in which they work for long hours and paid less wages. The inhuman practices are common in under –developed nations where foreign investors’ production Companies have been relocated so as to benefit from the cheap workforce. Despite creation of jobs to the developing nations, the quality of work, pay and social impacts is highly criticized by worker’s rights activists. According to Gardner and Dent (2010), the minimum wage does not fulfill the needs of workers. More so, some developing nations have reduced the minimum wage so as to attract foreign investment. Starburst Company should ensure that the health and safety of workers is maintained. A safety program can help it focus on improving the work environment, which is essential for the prevention of illnesses and injuries among employees. As established by Maine. Gov (2013), Companies have different ways of imposing health and safety programs. For instance, a small business can simply create a schedule where the management listens to employees’ concern and offer prospective solutions. On the other hand, a large Company can have notebooks that constitute a number of written procedures and policies, and a permanent safety director. In order to establish an appropriate safety and health program, a Company should find out factors that may bring about health hazards, survey or inspect employees whenever they report to work and review records of injuries, accidents and diseases. To continue being successful, Starburst should maintain a mutual beneficial relationship with its key customers. Loss of key customers can bring about negative effects on the Company’s financial performance. More so, the Company should respond to the latest trends such as internet marketing, lowering costs in case the demand of the particular product is low. This as result will enable the Company increase its sales. In addition, starburst should embrace information technology in its operations. As stated by PEPSICO. Inc (2010), information technology is essential as it enhances effectiveness and ensures that the financial aspect is accurate and efficient. If the Company fails to manage its technological infrastructure properly, it may lose some of its essential transactions, be subjected to mistakes, loss of consumers, among others. Starburst’s idea of outsourcing labor to other nations is incredible as it will be able to increase profits, obtain individuals who are willing to work and reduce costs of production. For instance, Economists Gregory states that the net income of a particular nation increases from 12 to 14 % for every dollar spent in other nations. Some economists argue that Companies ought to outsource, and if they fail to do so, they may end up wasting their essential resources such as professionalism, capital and time. However, Starburst ought to know the ethical issue related to outsourcing of labor. More so, outsourcing is critical as it improves efficiency of the Company. In this case, it allows the Company place much emphasis on higher level strategy, which would result to creation of more jobs. In addition, Starburst ought to know that outsourcing makes products less expensive and more available to customers (Cited in International Center for Ethics, 2013). More so, in the process of outsourcing business to other nations, Starburst needs to be careful when it comes to choosing a partner because the relationship may have an intense effect on the Company’s reputation. If the Company makes wrong choices, it can tremendously be damaged especially if the complains become extreme and decide to purchase from other Companies. On the other hand, if the Company makes the right choices, it may enjoy increased sales margin and profits (Software- Russia. Com, 2012) On the contrary, there are a number of critiques related to outsourcing. In this case, some Companies that have relocated some of their jobs to other nations pay their workers less amount of money. They also provide employees with less benefits and poor conditions of work. For instance, when IBM dismissed its workers based on Canada and United States, it encouraged them to move to nations such as Nigeria, China and India, which are characterized by strict monitoring of work performance (International Center for Ethics, 2013). Outsourcing obliterates production skills and capacities in addition to innovation at one’s own nation. Steve Denning states that United States of America has lost essential industries because of outsourcing, and it no longer functions in some manufacturing areas. He further states that most Companies have lost the skill of innovation because of the short term effort of reducing costs (Cross, 2014). Conclusion It is vivid clear that most producers around the globe are embracing the idea of ethical fashion. The idea is widely accepted in some nations, while in other nations the idea is still new and they are in the process of embracing it. However, ethical fashion has forced most clothing Companies to use inorganic materials in production. In addition, the Company should ensure that the workers’ health and safety is maintained so as to avoid injuries and illnesses. Also, the Company should ensure that workers are well paid in order to maintain and motivate them to work hard. Employees should adhere to the stipulated codes of Ethics so as to maintain the Company’s reputation. Application of ethics at work makes a Company earn trust and integrity from clients, which is essential in maintaining its reputation. References Brimmer, S. (2007). The Role of Ethics in the 21st Century Organizations. Retrieved on 6 February, 2014 from http://www.regent.edu/acad/global/publications/lao/issue_11/brimmer.htm Bruning, K.C. (2003). What is the Role of Business Ethics? Business Ethics Journal. Vol. 33:12- 15 Stanford Encyclopedia of Philosophy (2008). Business Ethics. Metaphysics Research Lab; Stanford University Cross, S., (2014). Clothing Industry’s Morals and Ethical Aspects. Retrieved on 6 February, 2014 from http://smallbusiness.chron.com/clothing-industry-moral-ethical-aspects-15220.html Doodson, R., (2013). The Role of Ethics in Everyday Business. Retrieved on 6 February, 2014 from http://www.economicvoice.com/the-role-of-ethics-in-everyday-business/50036180/ Fibre2fashion. Com, (2014). Ethical Issues in Fashion- the what, when, how, why and who. Retrieved on 6 February, 2014 from http://www.fibre2fashion.com/industry-article/3/280/ethical-issues-in-fashion1.asp Gardner, D. & Dent, K. (2010). Labor Rights and Ethical Manufacturing in the Footwear and Garment Sector. On 6 February, 2014 from https://www.oxfam.org.au/wp-content/uploads/2011/08/oaus-labourrightsfaq_0311.pdf International Center for Ethics (2013). The Ethics of Outsourcing labor. Retrieved on 6 February, 2014 from http://www.brandeis.edu/ethics/ethicalinquiry/2013/April.html Maine. Gov (2013). Managing Safety and Health in your Business. Retrieved on 6 February, 2014 from http://www.safetyworksmaine.com/safe_workplace/safety_management/ PEPSICO Inc. (2010). Our Business Risks. Retrieved on 6 February, 2014 from http://www.pepsico.com/annual10/financials/mda/our-business-risks.html Software- Russia.com (2012). Eight Factors to Consider when Selecting an Offshore Outsourcing Company. Retrieved on 6 February, 2014 from http://www.software-russia.com/in_focus/issues/8-factors-to-consider-when-selecting-an-offshore-outsourcing-company The Times 100 (2014). The Importance of Ethics in Business. Retrieved on 6 February, 2014 From http://businesscasestudies.co.uk/cadbury-schweppes/ethical-business-practices/the-importance-of-ethics-in-business.html#axzz2sXq94oZz Read More