Moral Values as a Part of Every Growth-Oriented Enterprise - Term Paper Example

? Business ethics Table of Contents Table of Contents 2 History of business ethics 3 Absolute and relative ethics 4 Ethical issues in the operationalactivities of a business 5 Business Ethics 5 Ethical activities 6 Values of business 6 Professional ethics 7 Conclusion 7 History of business ethics 'Business Ethics' is a concept that has gained importance in the modern business environment and is studied academically for researching the various perspectives of the term. The term in the simplest form had become important commercially in the 1960s; however, the history would vary according to the manner in which the term is conceived by different individuals. It also depends on the researcher who is studying the history of business ethics, his predefined perceptions and the relative significance attached by the historian to the facts unfolded; on how the history is portrayed to the rest of the world (George, 2012). The mid 1900 brought a remarkable change in the attitude of the people of the United States towards society and business. Towards the end of the decade, dramatic acceleration of interest towards business ethics can be found within the big corporations as well as within academia. After the World War II the United States rose to the position of a dominant economic power in the globe. Multinational corporations based in America were expanding in size and increasing in importance. The public image of the business world steadily got altered with big businesses replacing small and medium-sized businesses. Corporations progressively started to find them more subject to public scrutiny and open criticism. This led them to respond to this changing scenario by turning sincerely to the needs of the society and developing a solid impression of social responsibility. With this initiative, corporate organizations started to launch various programs encompassing their responsibility towards the society. Companies began to spend considerable sum of money for advertising these programs and for the promotion of the social benefit produced by these programs (George, 2012). All companies come into business and function with a profit maximization objective. However, it is important for corporate organizations to acknowledge that this objective has to be fulfilled along with the fulfilment of the social responsibility of the organizations; this necessitates the adherence to business ethics. Although providing high returns to the company’s shareholders remains the prime objective for any business firm, the concept of business ethics advocates that these objectives cannot be achieved at the cost of moral, environmental and social considerations. A long-term business can only prosper if it successfully satisfies the needs of the other stakeholders in the society, such as employees, customers, communities and the governments. Also, long term goals of the organization can come true if its activities are sustainable and do not contradict with the requirements of the environment. Absolute and relative ethics The concepts of 'absolute' ethics and 'relative' ethics are defined with respect to morality. Theory of absolute ethics indicates that it would not alter with change in time. Therefore, absolute ethics are universal and ever-unchanging. Theory of ethics allows ethical issues to be judged with reference to the respective environment in which the theory is applied. Relative ethics is hence flexible and context specific (Spencer, 2010). According to some experts, in the real world, there is no such existence of the concept of absolute ethics (Francis and Mishra, 2009). Ethics reveal the characteristics of an individual and therefore the ethical considerations of a firm reflect the characteristics of the firm, which is actually a collection of several individuals. Since ethical inquiry seeks justification of the actions of the firm’s actions, and because every action has an outcome that are often found to be varied in varied environments, business ethics is relative in nature (Agalgatti and Krishna, 2007). It is important for large corporations to shape their ethical culture thoughtfully in order to manage their overseas business with more elan. In the modern business world, ethical considerations are crucial, but there is no deterministic way of following a set of ethical rules. The culture and practices existing in these countries would be different from the country in which the company is based (Mohamad, 2010). Organizations therefore have to be sensitive enough to stick to the right action with respect to the context of judgement. Companies should also see when domestic work culture is brought to the new business environments; they are implemented in such a way that they do not in any way hurt the sentiments of the host country. For relativists there is no concrete action that is right or wrong. But absolutists define many things as right and others as wrong. However, in corporate decision making neither of these two extreme considerations reveals the real phenomenon decision making. Firms often find the true answer by taking a middle path between these two possibilities (Mohamad, 2010). Ethical issues in the operational activities of a business Several issues on the business front intercept the profit objective and raise ethical justification questions. Organizations should justify their business policies and employee manual in a way to comply with the tradition of these countries. Specific sensitive issues include exploitation of natural resource reserves, maintaining low carbon footprints and running the business in corruption free way. Workers’ living and working conditions raise strong ethical questions. Besides, the price paid for the raw materials obtained for the manufacturing processes and the remunerations paid to the workers are in many developing countries a matter of rift between the management and the staff (Mathis and Jackson, 2010). Strategic human resource policies help to bring satisfactory outcomes to such problems. Any action that violates the traditional and cultural aspects or exploits the resource base of the region is expected to hinder business activity. Business Ethics Business Ethics is a concept that has been generally defined as “the critical, structured examination of how people and institutions should behave in the world of commerce” (MacDonald, n.d.). To narrow down the meaning of the term, business ethics is said to involve the examination of the most relevant constraints that play significant role in the fulfilment of the self-interest of an economic agent, i.e., the profit of the corporate firms. Activities of the individual firms often affect the operations of the other firms and external stakeholders to the organization. For every growth oriented business enterprise certain moral principles underline the business activities and guide the way in which the business performs. These principles are derived from the same basic principles that are applied to the social entity of human beings and are applied to the business activities so as to make the commercial activities synchronized with the responsibilities of the organization towards the society (Business Case Studies, 2013). Ethical activities Ethical activities are those activities that are distinguished from other activities by way of marking the activities as “right” or “wrong” activities and then choosing those activities that are identified as the “right” alternative. Activities that are marked as wrong activities, if practiced by businesses, are considered “unethical business practices” (Business Case Studies, 2013). Examples of unethical business practices are the use of child labour in business operations or usage of animals in the research and development department of organizations. Also the unlawful use of copyrighted materials in business processes or acceptance of bribes indicates unethical business practice. Values of business Values of businesses are the basic fundamentals that underline the questions of any business organization; the social standing of the business, the philosophy supporting the business and the reasons boosting the business enterprise. Business values help the leaders to steer the business in the right direction, through proper management of the stakeholders and the employees (Menard, 2013). Values of business can be classified into three levels: Firstly, personal values of the organization’s leaders, such as, integrity, respect, fair-mindedness, perseverance, innovation, determination and passion. Secondly, the belief and the outlook of the management and the staff, that is commonly shared in the workplace. These attitudes affect the way people within the organization behave and treat each other and the way the work in accomplished. The third level lies in the behavioural standard of the organization in business practice. Acceptable behaviour is determined from the society’s standpoint, according to the type of service expected by the social stakeholders and the actual service received by them when they come into any transaction with the business. Professional ethics Professional ethics facilitates a professional to select the right activity when the individual faces a problem at the workplace that is related to some moral issue. These ethics are certain responsibilities that allow professional to continue with their practice satisfactorily. These ethics are not derived from the moral code of any society or any organization in particular. These ethics are developed with respect to the purposes of the organization and its mode of action (Thompson, 1997). In certain professions such as Law and Medicine, ethics are so crucial that any one failing to do so might lose membership to these associations and might be permanently abrogated from practicing any further. Conclusion Moral values are a part of every growth oriented enterprise and are the underlining force of commercial activities. Businesses pay attention to their social values and this in turn establishes trust of the society on these companies. Therefore, emergence of business ethics is not a passing trend but an outcome of the values rooted in the heart of these organizations (Menard, 2013). Hence the companies are required to identify the “truths relative to the to the culture context in which they exist” (Mohamad, 2010, p. 151). Reference List Agalgatti, B. H. and Krishna, S., 2007. Business Ethics. New Delhi: Nirali Prakashan. Business Case Studies, 2013. Business ethics and corporate social responsibility. Available at: [Accessed 15 June 2013]. Francis, R. D. and Mishra, M., 2009. Business Ethics. New Delhi: Tata McGraw-Hill Education. George, R. T. D., 2012. A History of Business Ethics. Available at: [Accessed 15 June 2013]. MacDonald, C., n.d. Definition: "Business Ethics". Available at: [Accessed 15 June 2013]. Mathis, R. L. and Jackson, J. H., 2010. Human Resource Management. Connecticut: Cengage Learning. Menard, D., 2013. Business is developing real social values – passing trend, protective instinct or what? Available at: [Accessed 15 June 2013]. Mohamad, S., 2010. Ethical Corporate Culture and Guidelines for Ethical Leadership. International Journal of Trade, Economics and Finance, 1(2), pp. 151-154. Spencer, H., 2010. Absolute and Relative Ethics. Montana: Kessinger Publishing. Thompson, M., 1997. Professional Ethics and the Teacher: Towards a General Teaching Council. Staffordshire: Trentham Books. Read More