In the UK, ethical businesses are not as successful as less ethical businesses. Discuss - Coursework Example

Overall ethical businesses in the UK are more successful than less ethical businesses Introduction Business Ethics is a popular word among the consumers; but it is an unpopular word among the business people. While doing business in an ethical manner, consumers get more benefits whereas the business people get less profit. That is why consumers and business people have contrasting views about business ethics. For business people, making profit is the number one agenda. They wanted to make the shareholders happier rather than the consumers since shareholders may have huge investments in their company.

“Business has a duty, a legal obligation to deliver returns to shareholders over every other consideration – paying tax, contributing to the communities it operates in. Even the Co-op, the bastion of ‘good’ business, has had to surrender its banking arm to corporate and capitalist forces in order to stay afloat” (Discuss, 2014). Despite of the huge popularity of ethical business in the UK, statistics show that many of the big companies that are following unethical business practices taste big success in UK’s market.

At the same time, many of the companies that are following ethical business practices struggle to develop properly. This paper argues that only those companies which follow ethical business standards have future in UK’s market. Ethical and unethical business in the UK According to Bryan (2012, p.21), “small organizations are often more susceptible to fraud schemes than larger organizations”. However, the above argument seems to be wrong considering the fact that some of the big companies in the UK are engaged in unethical business practices.

Starbucks is a good a example to prove the above argument. “COFFEE giant Starbucks has been named the most unethical cafe chain in Britain by a leading consumer magazine. Ethical Consumer ranked brands on 19 different categories and found Starbucks far and away the worst due to its stance on workers’ rights and its political activities” (Herald Scotland, 2014). Starbucks has a bad reputation in most of the countries in which it operates. Even in the United States of America, the company has faced many allegations against the supply of genetically engineered growth hormones in the milk.

Moreover, the company did everything possible to prevent the coffee farmers in Ethiopia from getting more prices for their coffee products. Above all sexual abuse is common in Starbucks’ work places and the company is doing nothing to prevent it. “Starbucks would try to buyout all other coffee shops near them. They would also sign leases for 3 times as much as the market value so that landlords wouldnt rent to other coffee sellers” (Eckert, 2013). It is impossible for small coffee business owners to function in the vicinity of Starbucks.

The company would try to purchase all such coffee shops as a measure to decrease the competition and to monopolize the market. If they fail to purchase such coffee shops, they will cause all types of problems to the safe functioning of such coffee shops. Despite of all these unethical business practices, Starbucks is growing rapidly in the UK’s market. According to Kris Engskov, Starbucks president of Europe, Middle East and Africa, “The UK is the most competitive espresso market in the world.

In the UK Starbucks now has 730 stores and 12,000 employees once partners are included. The coffee powerhouse is in the midst of a programme to add another 5,000 staff by 2016” (Boles, 2013). It is evident that British consumers are not bothering too much about the unethical business behaviors of Starbucks Company. At the same time, there are many big companies which are struggling in the UK because of unethical business practices. The News Corporation scandal reminds us about the vulnerability of unethical business practices in the UK.

Rupert Murdoch was once a hero in the UK, but he is a big zero in the UK’s corporate world now. Rebekah Brooks, News of the World’s former chief executive, was arrested for allegedly bribing senior UK officials, and has since testified that she not only regularly met politicians for lunch and dinner, but that she also socialized with them at cocktail parties, birthdays, summer outings and Christmas celebrations, and accompanied them on yacht trips to Greece (Wrage, 2013). The unholy relationship between business and politics as well as its potential to destroy a business has been well documented in the News of the World scandal.

Everybody knows that politicians take contributions from business people for election campaigns and they accept bribes for doing favourable things to the business people. This is what exactly happened in the UK. Rupert Murdock never expected that his business will suffer setbacks because of his unholy relationships with politicians. However, the history has proved him wrong. Even Prime Minister David Cameron was one of Brooks’ best friends. Brooks was able to send even private SMS to Cameron.

However, she was unable to escape from punishment despite of her sound her relationship with the Prime Minister. Cameron and his company or the politicians have washed their hands and the ultimate sufferer was Murdock and his company. Apart from Rebekah Brooks, some of the other employees involved in the scandal were Andy Coulson, the former editor of the newspaper and onetime government spokesman for David Cameron; Stuart Kuttner, the paper’s longtime managing editor; and Greg Miskiw, an assistant editor who ran the paper’s news operation (Wrage, 2013).

None of them were able to save the company using their political relationships once the company started to face many allegations. At the same time, there are many UK companies which are growing rapidly because of their strong commitments to ethical business practices. According to Websdale (2013), seven UK firms make it onto World’s Most Ethical Companies list. Some of these firms are Premier Farnell, Northumbria Water Group, Ethical Fruit Company, Thomson Reuters and Marks & Spencer. Conclusions To conclude, unethical business practices may bring short term benefits to a company.

However, long term benefits will be received only by those companies that are following ethical business practices. The success of Starbucks in the UK need not be sustained for a longer period. It can expect the same fate as that received by Murdock and his company. Ethical business companies would receive strong public support whereas unethical business companies would fail to do so in future. Without public support, it would be difficult for a company to develop properly in the UK or in any other countries in the world.

References Boles, T. 2013. Starbucks savours the UKs growing love of coffee. [Online] Available at: http://www.express.co.uk/finance/city/427708/Starbucks-savours-the-UK-s-growing-love-of-coffee [Accessed 25 November 2014] Bryan, C.S. 2012. The role of leadership in fraud deterrence. Financial Executive March 2012 Discuss, 2014. Big business is unethical. [Online] Available at: http://www.discuss.org.uk/discussion/big-business-is-unethical/ [Accessed 25 November 2014] Eckert, K. 2013. Starbucks Scolded for Stifling Competition (2006).

[Online] Available at: http://businessethicscases.blogspot.in/2013/02/exchange-inc-v_3188.html [Accessed 25 November 2014] Herald Scotland, 2014. Starbucks named most unethical cafe in UK. [Online] Available at: http://www.heraldscotland.com/news/home-news/starbucks-named-most-unethical-cafe-in-uk-1.1087515 [Accessed 25 November 2014] Websdale, E. 2013. Seven UK firms make it onto World’s Most Ethical Companies list. [Online] Available at: http://blueandgreentomorrow.com/2013/04/05/7-uk-firms-make-it-onto-worlds-most-ethical-companies-list/ [Accessed 25 November 2014] Wrage, A. 2013. 5 Compliance Lessons from the News Corp Scandal. Forbes. 4/3/2013.