Ethical and Social Responsibilities - Essay Example

Ethical and Social Responsibilities Name: Student Number: Course Code: 31st August, 2012. Table of Contents Table of Contents 2 Introduction 4 Employee welfare 5 Work life balance 6 Conducive work environments 6 Job security 7 Ethical marketing 8 Ethical competition 9 Employment non discrimination 10 Corporate social responsibility 11 Philanthropic approach 11 Sustainable business approach 12 Conclusion 13 Recommendations 14 Executive summary Businesses rely on society for them to achieve their goals. It is therefore paramount that business goals responsibility and it involves concern for the environment and support for the society. It involves a business modeling itself in such a manner as to attain sustainability. Sustainability is vital in order to ensure that a business attains its goals now and in the future. Business goals are set with the concerns of the society in mind. The primary goal of a business is to achieve economic success and fulfill its obligation to shareholders. Businesses have however evolved so much so that the businesses are under obligation to fulfill certain responsibilities in the society. The responsibility that a business must fulfill to the society is referred to as corporate social responsibility. Business modeling in order to satisfy the community in which it operates involves the business reviewing its strategy and policy so as to work along ethical standards. Ethics can be described as the morals and values that the society seeks to uphold. This entails the conformation of employees and the managers alike to ethical standards. For this to be achieved, HR must adopt the right policies in order to employ and train employees and their managers to conform to high ethical standards that are in line with those of the society. Moving forward, businesses must accept that times have changed and that it is a must for all businesses to not only focus on profit making but also focus on ethics and corporate social responsibility. This will be vital in ensuring long term success and stability of business. Introduction The report below attempts to show the importance of ethics in the running of successful businesses and looks at formulation of policies by Human Resource department that will help to maintain ethics in the business. The report chooses to focus on formulation of HR policies in order to address ethics in business and corporate social responsibility. This has been necessitated by the recent change in business strategy regarding how businesses and companies at large go about their activities. Not too long ago, businesses focused solely on generating profit without regard to ethics, values, sustainability and corporate social responsibility. Businesses would set out at maximizing profits perhaps due to the pressure on them from the shareholders. It was the view of many managers and business owners that businesses that attempted to balance between high return on investments and ethics would fail economically. Economic failure of the business would then translate to tough economic times for the community. Researchers back then were content that there was no meeting point between business and ethics and they were categorical that the business of business was business. This tradition has been on the decline owing to among many reasons the realization that long term prosperity and success of business can be achieved by ensuring that businesses are ethically set up without regard for the short term financial success of the business. Allowing the business to prosper hand in hand with the community eliminates the propensity of such adverse effects to the community as pollution to the environment, corruption and embezzlement and poverty. This ensures the long term stability of business. Key areas of concern include how businesses conform to ethics, corporate social responsibility, values and sustainability through strategic human resource plans and policies. The report refers to ethics in business and corporate social responsibility from a generic case. The report looks at ethics and HR policies with regards to both employees and managers and the impact it has on business. The scope of the research focuses on ethics with regards to work life balance, employee welfare, marketing ethics, competition ethics and finally looks at corporate social responsibility with regards to business organizations. Employee welfare Human resource department in a company is tasked with the responsibility of managing the workforce in a company by luring, screening training and rewarding the employees. Needless to say, the policies adopted by a company’s human resource department determine the decision making and leadership of the company as they are responsible for hiring competent decision makers for the company. Schwartz (2011) states that employees should be trusted to responsibly identify and resolve issues ethically due to the training they receive. Human resource policies should therefore focus on hiring and training employees who are aware of the importance of ethics in business. Business ethics can be considered to be the art of businesses and companies to identify what practices are morally right and base their goals to in order to adhere to this ethical practices. HR should from time to time organize seminars and workshops to continually emphasize on the importance of business ethics to its employees. It should as well carry out strategic reviews to policies with regards to labor, office, marketing, competition and financial management in order to keep up with the ever changing trends in the world today. Work life balance One of the major ethical concerns in the business environment today is the need to strike a balance between work and life. HR policies should ensure that the employees have time for their social lives as well as taking responsibility for the social welfare of their employees. This is vital in reducing the work related stress of the employees which is a key factor in determining the productivity of an employee at work. Psychologists have remarked that the lack of a balance between work and life is the result of pressures that arise from job insecurity. HR policies that can help achieve such a balance include the introduction of a schedule that ensures employees put in the right amount of hours at work and still have time to live and enjoy their personal lives. This can be achieved through the use of such programs as the introduction of flexible working hours, setting of maximum working hours, compulsory leaves and work at home programs. (Pride, Hughes & Kickapoo 2008) HR should encourage employees to find creative and innovative ways of making their work flexible so as to curve out time for their personal lives. Other policies that allow for team working and clear communication pathways within an organization can allow employees to have flexible work schedules through perfect time planning and job sharing among employees. Conducive work environments HR policies should also thrive to eliminate hostile working environments. Provision of basic social amenities comes at a cost to the company but is vital in creating a conducive environment at work. Such amenities as clean drinking water, recreational centers, and first aid and sanitation facilities canteen services can help ease the work place environment. Employers can also go a step further and provide for social amenities such as social clubs, book clubs, yoga and gym membership for employees as well as creative and flexible office design and patterns. Such trends have been on the rise with companies such as Google, Twitter and Facebook offering such amenities in a bid to attract employees (Schepp, 2011). The ethics involved in such practices is unquestionable as such employers have the interests of their employees at heart. As stated earlier, such amenities come at a cost but the benefit to business is realized in the long run. Employers should also have retirement package schemes and insurance plans that cater for employees in their line of work as a form of employee welfare package. This ensures that employees are well taken care of if they suffer injury or acquire a disease in their line of work. Pension schemes ensure that employees who retire from serving the company continue to lead normal lives and are not subjected to deprived living standards as a result of retirement. In this way, employers contribute to the well being of the community and society at large. Other ethical welfare concerns that a company should look into include parental leaves, maternal leaves Job security Companies should also strive to guarantee job security for their employees not only due to the benefit this has on employee efficiency and performance. Companies should take up zero lay off policies and adopt strict regulations to adhere to for hiring and firing employees as a form business ethics. Zero lay off policies are however accompanied by other cost cutting measures such as a reduction in employee benefits and allowances. Companies that pride themselves in zero layoff policies accrue the benefits of improved employee efficiency and a higher level of dedication to their work (Jeon and Shapiro 2006) as well as reduced levels of work related stress. The adverse effects that lay-offs have on the society such as reduced earnings and a decline in the spending ability of persons can therefore be avoided. The core value of ethics in business is to avert any adverse effects to the society and zero lay off policies help in reducing such effects. Telecommuting is an up and coming trend that companies such as Cisco systems Inc pride themselves in. it is a recruitment procedure that allows the employees to work away from the traditional workplace. This type of hiring approach however requires stringent supervision which might represent higher operational costs and most companies only apply it for their highly valued employees and thus must be practiced with caution. It has several benefits to business such as reduced labor and operational costs due to reduced office support expenses as well lowered commuting expenses. High efficiency from the employee’s results from the friendly working environment of an employee’s choosing. Such an approach also offers a flexible working schedule for the employees and as such is a vital approach for companies that aim to help their employees achieve a work life balance. Due to the diversity of the employees, the company has a boosted global appeal as well. Ethical marketing Businesses should also desist from dubious marketing practices that mislead consumers for the purpose of profit maximization. Ethical businesses should thrive to maximize on offering the best products to consumers and hence attract high profit from sales triggered by the preference of the consumer. Though marketing should be used as a competitive edge, there is a difference between misleading consumers to promote sales and informing consumers of the quality of a product. HR policies should also be keen when recruiting marketers for their products so as to recruit the employees with high ethical standards as well as high competence in marketing their products. Marketing ethics dictates that marketing and promotion practices should meet the ethical standards of the stakeholders, the individual marketer’s morals and values as well as those of the consumer (Whitey, 2007). Common unethical marketing practices include presenting misleading information regarding the benefits accrued from using a specific product, selling substandard products, contacting potential buyers without their consent especially on social media sites, ignoring customer complaints among many others. Ethical competition Ethics in business should also help companies desist from unscrupulous competition practices in trying to attain the edge over other companies in the same line of business. Companies should hire competent employees to come up with creative and ethical ways to achieve this. Sims (2009) is of the opinion that fair competition is devoid of unethical practices. Most scholars are convinced that competition results to unethical practices. Common unethical competition practices include the use of child labor in order to lower production costs below those of competitors, the use of corruption in order to influence decisions towards a company’s favor, manipulation financial results to indicate higher profits. Provided that employees use ethical means to obtain data and information regarding competitors, then competitive analysis is a more ethical practice. In this type of approach HR is tasked with hiring personnel whose work is to identify the strengths and weaknesses of competitors with a view of coming up with a strategy to outcompete them. This type of approach is vital in offering critical information on a competitor and thus helps a company in formulating strategies on how to offer the customers a higher value than their competitors. Profiling is done with regards to a company’s background, financial management strategies, production capabilities, marketing strategies, human resource strategies and overall management policies (Kolk 2008). With regard to competition within employees in an organization, transparency and a reward system based on merit should guarantee that promotion and rewarding of employees is fair and that only those who deserve to are rewarded. HR policies for rewarding and promoting employees should also be clear on the assessment mechanisms of the employees in order to encourage them to compete ethically and desist from unethical behavior. Desirable qualities such as dedication, integrity, accountability and collaboration should be the basis of employee reward and promotion systems. Such policies should also be clear on measures to be taken on employees who engage in competition malpractices. Common unethical malpractices that employees might be tempted to engage in include offering bribes to supervisors in order to sway decisions in their favor, stealing and presentation of another employee’s research, plagiarism and laying claim to another employee’s ideas, offering of sexual favors in exchange for promotion and reward and wrongful framing of employees to propagate a bad reputation for them (Crane, Abagail, Dirk, Jeremy & Donald 2008). Employment non discrimination Businesses that adhere to ethics should also practice non discriminatory laws when hiring and firing of employees. Screening with respect to gender, race, tribe, sex, religious background or political views should be avoided at all costs. It is the duty of a company’s HR department to adopt policies that hire based on merit rather than on discriminatory policies. With the advent of consumer pressure groups on the internet, businesses are subjected to more scrutiny than ever before. Reports of companies that discriminate while recruiting are likely to have adverse effects on business. Businesses that tend to recruit from diverse cultures are likely to attract consumers from a wider base as well, especially in the current global market. Discrimination amongst the workers in a company should also be checked. HR policies should be stringent on employees who discriminate against other employees at the place of work in order to avoid such occurrences. Cases have been documented of companies that have had to pay hefty compensation fees as a result of discrimination at the place of work. Corporate social responsibility Corporate social responsibility is a business practice in which a business strives to strike a balance between achieving their set goals while also impacting positively on society. Werther and Chandler (2006) describe it as the dedication by business to strive to achieve economic development while also improving the lives of the stakeholders; the workforce and their families, the society and community at large. Business experts differ on how to go about corporate social responsibility. Philanthropic approach Some businesses use a philanthropic approach where they donate part of their profits to charitable causes. In this line of thought, the norm is that the company expects no reciprocated benefit from such charitable causes. This can range from donations to help fund medical research into developing cures for diseases, donations to organizations that combat hunger in areas most affected around the globe most notably developing nations, to donations that help promote the plight of the oppressed or those whose rights are denied from them. Other notable charitable causes support such groups as military ex-servicemen and women, the homeless, persons with disabilities, the elderly and disaster response and relief programs (Sims 2009). Sustainable business approach Those who differ from philanthropy as a concept of corporate social responsibility support a cause that advocates for sustainable business and a concern for the environment. Sustainability of business can be defined as the purposeful setting up of business in such a manner as to achieve its economic goals without harming the ability of future generation to meet their economic goals (Arbogast and Thornton, 2012). HR department should strive to help employees in a business towards adherence to sustainable business. They should consistently insist that employees adhere to such green initiatives as water and energy saving, maximum use of computers and digital technology to reduce the use of paper, encouraging the employees to use greener means of transport such as walking or riding and public means. The employees should also be encouraged to dedicate time and effort into volunteering into such activities as cleaning of the environment in the local community, charitable causes such as caring for senior citizens in elderly homes and tree planting. On the part of the business, green initiatives include the construction of greener offices that make use of solar power and maximize on the use of natural lighting in order to reduce on the use of non-renewable energy sources. The business can also procure furniture and office equipment that is non organic in nature. For businesses in the production line, sustainability can be achieved by use of non- toxic raw materials, recycling and reuse of materials, clean and safe disposal of waste products, and production of goods that have no negative impact on the environment such as those with no green house gas emission. Such policies adhere to the sustainable business model and are examples of corporate social responsibility. The benefits of corporate social responsibility to business are also profound. Businesses that invest in technology that reduces the negative impact on the environment incur high initial operational costs but products costs over the long run. Involving the employees in changing their behavior at work in line with observing environmental awareness has the advantage of increasing their efficiency at work in the use of such resources as water energy and paper. This ends up reducing operational cost of doing business. Human resource recruitment becomes easier for companies that adhere to sustainable business practices due to the attraction it offers to the current generation. Employees are proud to be associated with such companies. Consumers are more likely to identify with such companies too and hence corporate social responsibility becomes a competitive edge of doing business (Crane, Abagail, Dirk, Jeremy & Donald 2008). There is also the possibility of reduced risk to a business that observes corporate social responsibility. Companies are able to avoid problems with lawmakers, human rights activists the media and other such bodies that might attract negative publicity to the company. Corporate social responsibility presents a company as open an operating under all the required legal requirements. This helps avoid unwanted suspicion and acts as a license to operate as well as a benchmark for other companies. Conclusion Businesses today are putting in efforts to work along ethical standards not only due to the benefits this has on performance but also due to concern for community and society at large. More than ever before society and business are so intertwined such that the interests of one have to be in line with those of another. Ethics is about doing what the society considers right and hence economic prosperity must conform to ethics. Hence businesses now agree upon concern for the society in their bid to generate profits. Initial operational costs are overshadowed by the long term success and prosperity accrued by business. Adherence to corporate social responsibility is for the purpose of sustainability so that future generations too are able to attain their economic goals. Recommendations That businesses can function without regard for society is an old and out of date school of thought and as such businesses must conform to new ways of doing business. Due to the relationship between business and society, the economic goals of businesses must be met within societal expectations which include ethics and corporate social responsibility. Human resource department should be on the fore front of guiding businesses towards attaining high ethical standards through formulation of policy that guides businesses and companies appropriately. Due to the ever changing nature of society, policies must be reviewed from time to time so that businesses always conform to societal expectations. References Arbogast, G., & Thornton, B 2012 A global corporate sustainability model journal of sustainability and green business, available at www.aabri.com/jsgb [accessed 31st august 2012]. Crane, A., Abagail, M., Dirk, M., Jeremy, M. & Donald, S. S 2008 The Oxford Handbook of Corporate Social Responsibility. Oxford, England; New York, NY: Oxford University Press. Jeon, D. & Shapiro, J 2006 Downsizing and job insecurity. Mimeo: univeritat pompeu fabra. 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