Business Law and Ethics - Essay Example

?Running Head: Business Law & Ethics Business Law & Ethics [Institute’s Business Law & Ethics As the globe has entered into thetwenty first century, the world is in a phase of experiencing salient transformation and breakthrough in the field of science, technology, and the business community. The advancement and innovation in the technology has emerged the concept of globalisation and brought a boom to the industrial revolution. With the passage of time, the globalisation ascended to an unprecedented rate, and made the world of commerce and the businesses congregate under one roof. In addition, the globalisation has also given rise and augmented the level of competition between the business people. Therefore, by entering into the global, mutually dependent, and supporting trade market, the enterprises have moved towards the success with the adaptation of the novel environment and business culture (Gerber, pp. 1-4, 2009). The concept of effectiveness in business community has also changed for a big proportion of the industrialist and business owners, yet a small faction still believe in the conventional methods and means of business effectiveness. In the contemporary world, one of the major concerns that have come under several arguments, debates, and conflicts is whether profit maximisation is the only realistic criterion by which business organisational effectiveness can come under reasonable judgment or not (Robins, pp. 34-38, 2009). Although the trading industry and its functioning is lucid, explicable and coherent to comprehend, yet the primary and principal features that permits and endure the corporations to be in an apparent position in the marketplace lies in their performance, effectiveness and success. There has been several studies and researches conducted to find out the essential components that contribute to the effectiveness of the organisations and the outcome has appeared to be conflicting, contrasting and diverse by different experts in the field (Woodside, pp. 141-142, 2003). According to the experts’ opinions and perspectives the organisations can enhance and boost their effectiveness and through a number of approaches and techniques that include improvement and enhancement in process structures, proximity to customers, carry out the corporate social responsibility (CSR), employee participation plans, and several others (Kotler & Lee, pp. 249-253, 2005). However, the modern market environment has altered the true essence and fundamental nature of competition and has given a shape of cruel war and fight amongst rivalries where everybody existing in the global market wants to gain the competitive edge over others. In addition, their prime motive had turned out to generate profit with acceleration at any cost and has become the leading cause of organisational effectiveness. This shifting in the global economies and recession on a worldwide basis has become one of the dominant reasons of the changing perceptions and mindsets of the business (Maheshwari, pp. 30-31, 2005). As profit maximisation has become their primary source of organisational effectiveness due to utter competition in the recent times, therefore, enterprises are moreover focusing and emphasising on business process reengineering and through innovative ideas and strategies developing their products and services into an exclusive and inimitable one (Kotler & Armstrong, pp. 293- 300, 2008). Furthermore, business owners also view the profit as a valuable and powerful source of judgment, assessment, and analysis of the organisation’s effectiveness. While living in a society or a community, people comes under coercion to follow some norms and rules, which becomes their part of their inheritance, in the same manner, ethical principles or business ethics are also congenital in the world of commerce. In addition, these norms and values come under the definition with right and wrong and the people in the business community have to peruse a couple of elementary and vital ethics of impartiality, fairness, and reciprocal and shared value (Crane & Matten, pp. 4-11, 2007). The performance, actions and the conduct of the people in the business community comes under dominance and supremacy by the morality and the values of the business ethics. One of the facets of the professional ethics, business ethics, or corporate ethics highlights the significance of moral values, conducts, conventionalities, issues, and difficulties that may emerge and derive in a trading situation or climate (Jones & Parker & Bos, pp. 12-18, 2005). As the corporations and business mark an indelible imprint on the society as a whole, therefore the administration of the actions, conduct, and ethical values of the businesses turns out to be imperative and increasing at a tremendous rate. Corporate Social Responsibility comes under the definition as “A concept whereby companies decide voluntarily to contribute to a better society and a cleaner environment. A concept whereby companies integrate social and environmental concerns in their business operations and in their interaction with their stakeholders on a voluntary basis” (Pennings & Konijn pp. 50, 2008). As the world entered in the latter half of the twentieth century, the multi-national corporations came into emergence and the formation of the concept and terminology of Corporate Social Responsibility (CSR) came into existence. This concept started to come into widespread and universal practice by the organizations with the increasing familiarity and recognition and gradually came into practice on the community level (Banerjee, pp. 1-10, 2007). Although Corporate Social Responsibility is a concept that has come under several descriptions and explanations that are diverse and dissimilar from each other, however, the quintessence and basis have a substantial amount of similarity in it. The principal idea that lies behind this concept elucidates and illuminates the piece of information that businesses and corporations not only comes under obligation to perform business ethics and augments the economic growth and advancement by adding value to it. Rather, they should also carry out and endeavor practices that facilitates their employees towards the betterment of their standard of living in order to promote and elevate the society to a considerable level (Trevino & Nelson, pp. 322-325, 2010). Moreover, the businesses and enterprises are also accountable and liable to not only broaden and capitalize on the affirmative and constructive consequences but also to curb and alleviate the pessimistic outcomes. Social responsibility includes scores of elements and components, out of which business ethics is one of it (Griseri & Seppala, pp. 5-10, 2010). The aim is to shed the functions of the corporations that are according to the social requirements and they keep a check and balance on their performances that should accomplish their social responsibilities while carrying out their business processes. This is the key emphasis and the focal point of the European market framework in comparison to the other markets of the world (Rendtorff, pp. 383-386, 2009). The business owners have developed a conception and viewpoint that the fundamental feature that lies behind all of their activities is the social responsibility, which leads and governs to the enrichment of the effectiveness of the corporation and business, and have profit maximisations as an outcome of it. According to some schools of thought, corporate social responsibility and translucency of the business practices not only boosts and enhances the profit for the organisation, but it also contributes and facilitates in establishing a trademark and status for the organisation in the local, regional and global market place. Furthermore, this will also ascend and intensify the society at a substantial level (Habisch, pp. 260-262, 2005). This concept of Corporate Social Responsibility (CSR) can come under well understanding by one of the largest and leading producers of beauty and skin care products; Body Shop. They were the firm believers of the concept of CSR and the social responsibility was a mean that could bring advantage to them in a number of forms (Johnson & Tuner, pp. 331, 2009). The benefits include the employee withholding and their loyalty towards the organisation, the organisation, and its products played an important an influential role for the customers who were morally and principally aware and followed of the social responsibilities. Consequently, this results into amplified prosperity and effectiveness for a longer time-period in the future occasions and will give them an edge over their competitors due to their uniqueness (Johnson & Tuner, pp. 331, 2009). While looking at the other broad side of the coin, several experts and economists present in the marketplace contradict and disagree with this opinion and believe that businesses are not responsible to oversee and direct the issues and problems of the society and community, as they are only concerned with their business processes and moneymaking. According to their stance and perceptions, the key function of any enterprise in the free marketplace is to sell the products and services and generate money out of it (Horrigan, pp. 91-93, 2009). In addition, the utilisation of human resource in order to bring rise to the profits is the only social responsibility that any organisation would hold. These business owners mull over the concept that highly skilled labors and employees lead to the maximisation of the corporation, therefore by remunerating employees with high salaries will increase their productivity and profitability, and will lead to the betterment of the living standards (Horrigan, pp. 91-93, 2009). Numerous strategies and guiding principles available can come under adoption and application while administering, maintaining, and implementing the Corporate Social Responsibility. Recruitment of employees on equal opportunity basis and excluding the discrimination factor in conjunction to employees with multifariousness skills and abilities is one of the essential and key components that an enterprises and businesses considers (Benn & Bolton, pp. 164-166, 2011). In addition, the organisations that come under felicitous commitment for the social responsibilities deem their employees and labors as their treasure resource that brings value to them and a mean for increased productivity, rather than expenditure for the organization (Benn & Bolton, pp. 164-166, 2011). Such organisations also introduce and implement employee involvement programs and employee reward plans that catch the attention of the company staff and a loyalty with the company comes under development. Corporations design and acclimatize functional and operational policies that utilise the most out of the resources in a natural form such as reprocessed products or raw materials (Horrigan, pp. 91-93, 2009). According to the early and premature concept of Corporate Social Responsibilities, the prime focus was only on the improvement of the living standards of the employees and workers, of the organisation and the local communities where the businesses came under performance. However, with the passage of time, this concept experienced a shift and in the modern times, it is applicable to all the facet and vicinity of the business functions. These functions embrace recruitment of employees, acquisition of supply chain, effects on the environment from the resources and many more (Sims, pp. 275-279, 2003). In the today’s time where the world is undergoing a number of major concerns that include the global warming, terrorism, competition and many others on a universal platform, it has become vital and crucial to preserve the environment and social well-beings of the entire populace of the world. Therefore, many of the organisations have twisted their focus and equally limelight the importance of the safeguarding and perpetuation of businesses towards their social responsibilities coupled to the protection of the employees and their living standards (Hawkins, pp. 251-254, 2006). Since European market positions the key emphasis on the Corporate Social Responsibility, therefore, many of the organisations do not approach for profit maximisation as the only criteria of achieving the business effectiveness. One of the examples clear illustrates the piece of information that CSR plays a more apparent and persuasive role and corporations considers their responsibility towards the community as their uppermost priority. One of the leading, appreciated and esteemed companies in UK, specializes in beach cafe are amongst the business owners who strongly implements and sustain the social and environmental responsibilities and has set moral principles that add benefit to the community (Solomon, pp. 233-236, 2007). According to studies, it has come under observation that the effectiveness of the organisation depends upon several approaches and techniques to great extent that constitutes the achievement of organisations’ aims and objective will eventually lead to the success and effectiveness of the business in association to the consummation of the social and environmental responsibilities (Hawkins, pp. 251-254, 2006). While on the other hand, the malicious certainty and reality also prove the phenomenon that the global competition has created a rivalry conflict that businesses are just running after the profit maximisation and has made it a primary, chief and core objective of the organisation. This trend has come under surveillance in the private sector of the businesses. As an outcome of it, the businesses have got least bothered and concerned about the quality of the products that they are producing. In addition, they also show a distress attitude towards their behavior with the utilisation of their resources. This is creating a negative and unconstructive impact on to not only the society and environment on a long-term and comprehensive basis, but it also creates a level of disloyalty from the employees for the organisation and a negative impact of the brand name to its consumers (Aras & Crowther, pp. 489-492, 2010). Marks and Spencer, another leading and prominent brand name in the UK industry that produces a great deal of classy and trendy clothing also fulfills their social responsibility, although profit maximisation is one of their primary objectives, yet they accomplish this goal through the customer satisfaction by meeting their demands and needs. By producing the products at an extremely high quality, they are able to gain the competitive advantage over other competitors present in the market as well as they experienced a boom in their sales that led to profit maximization (Werther, Chandler, pp. 198-200, 2010). According to the perspectives of some of the economist and experts business and its processes and functions comes under relation to the economic sector and social sector is not a relevant feature on which any criteria should fall. Therefore, the businesses should only follow and cater the economic components while judging the criteria for the effectiveness of the organisation and they are not liable to follow or be socially responsible. According to these experts, the profit maximisation should be the only and principal objective for the enterprises, as any other aspect except this would escort the organisation to plunge and abate their profits profoundly. However, this perspective does not prove to be fruitful on a long-standing basis, as the organisations have appeared to be more successful and effective while they have been socially and environmentally responsible (Free, pp. 785-788, 2010). One of the arguments presented by experts also provides the detail that businesses are not the key responsible aspects for the maintenance of the social responsibility as they might not be completely aware and familiar as to what is more beneficial for the society when compared to the governmental bodies. In addition to it, they also quarrel and dispute about the fact that it is a capital and wealth wasteful activity to make effort to elucidate and solve the social problems and concerns in an inefficient and unskillful way. In contrast to these statements, experts explain clears the information that individual businesses are not capable enough to resolve the social issues, however, if the businesses come under one roof and have a mutual and shared liaison and alliance with each other, these social issues and problems can come to end (Mullerat, pp. 48-51, 2009). With respect to all the above presented arguments, details and facts, it can come under well conclusion as being a socially responsible citizen of my country, I totally disagree to the statement that profit maximisation is the only realistic criterion by which business organisational effectiveness can come under reasonable judgment. As this globe is one of the precious gifts bestowed by the nature; therefore, to sustain and preserve the beauty and magnificence of the environment in a natural way, everybody whether an individual or a business should act and perform as a socially responsible being (Cramer & Bergmans, pp. 1-4, 2003). The Corporate Social Responsibility (CSR) is one of the concepts that will ensure the businesses and enterprises to behave in an appropriate manner that facilitates the employees and workers of the organisation to have a better standard of living and promotes the welfare and interest of the environment and the society where the business comes under situation. This in the due course will make the organisation grow, prosper and be effective in the long-term and will support the organisation in profit maximisation, increased customer loyalty and employee retention (Cramer & Bergmans, pp. 1-4, 2003). References Aras, Guler & Crowther, David. 2010. A handbook of corporate governance and social responsibility. Gower Publishing, Ltd. Banerjee, Subhabrata Bobby. 2007. Corporate social responsibility: the good, the bad, and the ugly. Edward Elgar Publishing. Benn, Suzanne & Bolton, Dianne. 2011. Key Concepts in Corporate Social Responsibility. SAGE Publications Ltd. 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