Business ethics - Dissertation Example

?BUSINESS ETHICS Law Introduction The relationship between business ethics and the law has in the recent past become a controversial issue necessitating the need for further research in this area. This is since empirical evidence illustrate that when businesses aim at garnering a competitive edge, they are predisposed to performing practices that are contrary to the business ethics. Is it therefore viable to believe that businesses that have been able to maintain a competitive edge act unethically? Consequently, can businesses that have upheld their ethics be referred to as being anti-competitive? It is in the wake of these research questions that this essay will illustrate the influence that business ethics has on the performance of an organization and the relationship between business ethics and law1. Research Questions: 1. Is there any relationship between business ethics and the law? 2. Does competition influence the business ethics of an organization and how is this related to law? 3. Is social responsibility related to the business ethics of an organization and the law? 4. What is the way forward to enhancing the synergy between business ethics and law? Prior to answering the research questions delineated above, it is important to understand what ethic means and why business ethics is important in law. Ethics is a moral principle that determines the conduct of behavior of various professionals as pertains to how they conduct their business and in the decisions they make. As pertains to the utilitarian theory of justice, professionals need to make decisions that are aimed at meeting the greater good of the society and not out of their inner selfish motive. This therefore means that there is need for businesses to uphold their ethics as pertains to how they conduct business. Business being aimed at prevailing above the competitors and making profit, there is need for business men to adhere to ethical principles but still remain competitive. How then is business ethic related to law?2 The law is a combination of rules and regulations that govern a group of people and violation of the law leads to criminal offence. The law is made from sanctions and principles that have been developed by people and more often than not, the law depicts the public opinion of people as pertains to various issues. With reference to business ethics, the law is sought when a business acts in an unethical manner that harms another organization or harms the general public of the organization. The law acts as leverage in disputes resulting from claims that one business did not act ethically and violated the moral principle required in business. Having understood what business ethics entails and the relationship it has with the law, it is important to evaluate how business ethics can be violated as businesses conduct their business and the implications of these violations with reference to the law.3 Models of public policy have been developed in an attempt to illustrate business ethics and what it encompasses: moral manager and the moral market. With reference to the moral manager model, it is upon the managers to engage in morally upright decisions as pertains to the decisions they make and the influence of these decisions to the performance of the organization. This therefore means that the goal of business ethics entails training managers so as to develop morally upright behaviors that re translated to decisions made and the influence they have on the performance of the organization. An organization therefore needs to institutionalize a design that monitors the performance of individuals involved in the business. Moreover, markets also serve as a concern as pertains to business ethics and the law. The forces prevalent in the market influence the performance ethics of individuals in an attempt to counter these forces or to adapt the organization to these forces.4 As businesses attempt to advance in comparison to their competitors, more often than not, business ethics are violated. Every business in its quest to advertise its products and services should not in any way jeopardize the name and the integrity of its competitors. However, for businesses to succeed and to woe customers, they at times engage in behaviors and advertisements that tarnish the name of their competitor. This is an unethical behavior and leads to intervention by the law especially if the other business sues for defamation. This illustrates the need for a law student to comprehend business ethics and possible violations that may result from unethical behavior and how a lawyer can competently address these unethical behaviors.5 Internet is another issue that has led to the need to discuss business ethics and the relationship with law. Currently, any business that needs to remain competitive needs to invest in technology since advancement in technology has led to the development of global marketing. However, despite the benefits that the internet has in the business world, it is also responsible for majority of the unethical businesses in the business community. This is especially where advanced technology is used to access information pertaining to other business by hacking into another business. This is not morally upright and is termed as unethical since it violates the autonomy, and privacy of the other business. In the wake of widespread internet use, there is need for the law students to understand how business ethics can be incorporated to inculcate the advanced technology and available remedies involving breach of business ethics.6 Business entails contractual agreements between two parties where the medium of exchange is money. This means that businesses in the running of day to day activities enter into various binding contracts both with business partners and with the general public. Formation of contracts leads to establishment of legally binding obligations where upon breach litigation arises. Moreover, business ethics will ensure that the contractual agreements between the involved parties are not violated and breach of contract does not ensue. In case of breach of contract especially where business ethics were violated, a lawyer needs to know the possible litigation and possible remedies that may arise. It is in this view that it is important the business people are made aware of the contractual agreements that exists and the repercussions of not adhering to these agreements. Moreover, the legal consequences of unethical behavior need to be addressed and this will be achieved following the integration of business ethics and law.7 Social responsibility is another avenue that encompasses business ethics and a major concern as pertains to law. Every business has a responsibility to the society in which it operates. This means that a business is responsible to its consumers as pertains to the production of goods and services. A business should produce goods of high quality that will not harm the consumers and that translate to the satisfaction of the consumer. So as to meet the needs of the consumers effectively, it is of paramount importance that the business conducts its operations in an ethical manner and does not in any way hamper the consumers. However, failure to uphold integrity and consider the consumers in the production of goods and services translates to lawsuits and hence the involvement of the law. This therefore illuminates the need for law students to comprehend responsibility of the organization to their consumers and possible litigation ensuing from unethical business.8 Community is the other social responsibility that business ethics upholds. A business owes a duty of care to the community where it sells its products and generates its raw materials. Business ethics entails that the business should not in any way harm the community members where it is performing its operations as pertains to pollution, waste management and security of the community. The popularity of the community is dependent on the opinion that the public has as pertains to the organization and this is dependent on the responsibility of the organization to the community. This therefore calls for the organization to maintain its responsibility to the community by upholding its business ethics failure to which the law sets in since the business becomes a threat to the survival of the community.9 Debtors and creditors are the other entities where business ethic encompasses the social responsibility of businesses. As pertains to the creditors, these are mainly financial institutions where the business outsources funds to enlarge its capital base in the performance of business. This means that businesses need to uphold its ethics as pertains to the payment of debts to its various debtors. Failure to pay money to the debtors leads to unethical behavior and thus necessitating the law to come in and save the situation, this therefore entails that business ethics revolves upon businesses owning up to payment of their debts to their creditors, failure to which the law gets involved. Moreover, debtors are businesses or individuals who owe money to the organization and hence the organization expects that these organization pay up at the ideal time agreed between both parties. Business ethics expects the organizations to uphold their word and await the payment form their debtors and not to harass them. Also, business ethics expects that the business will not extenuate the interest rates in order to gain more from its debtors. However, in situations where businesses have not adhered to their social responsibility pertaining to their debtors, this accounts for unethical behavior that needs to be sorted by the law. This therefore further exemplifies the need for law students to comprehend social responsibility, its relationship to business ethics and litigations that can ensue from unethical business behavior.10 Subsequently business ethics is emulated in the way businesses relate with their governments. A business that earns profit has the ethically responsible to fill tax returns to the government. This therefore means that a business should find the duty of filling and paying taxes to the government and not merely evading taxes. This means those businesses which do not file tax returns to their governments act unethically, necessitating the need for the law to intervene. Consequently, businesses need to adhere to the rules and regulations set by the government as pertains to how business should be conducted in an ethical manner. An example is the rules governing preparation of financial statements. Failure of businesses to adhere to these rules results to unethical behavior and hence possible inclusion of the law as a result of litigation ensuing. This therefore necessitates the role that business ethics plays in adhering to the provisions set up by the government as pertains to running business. 11 Conclusion Ethics is based on the moral principles set by the society upon incorporation into the law; they govern the performance of individuals within a certain profession. Business ethics are the rules and principles governing the operations of businesses failure to which the law sets in to restore the norm that resulted from unethical behavior. It has been outlined that it is important for businesses to teach their managers on ways to uphold their ethics in the performance of their business activities. This is since failure of a business to be ethical leads to legal pursuits and failure to garner a viable public opinion. Competition is one issue that has delineated the thin line between business ethics and the law. This is since for a business to remain competitive, it at times calls for certain unethical behaviors that lead to legal litigations resulting from lack of upholding business ethic. Moreover, social responsibility is another field that challenges the ability of businesses to uphold their ethics. This is since the businesses are socially responsible to their creditors, debtors, consumers and the community and hence the need to uphold their business ethics. Since business ethics determines the ability of a business to remain competitive in an ethical way, there is need for lawyers to learn the relationship between business ethics and the law and especially pertaining to the legal cases that can ensue from unethical behavior. Bearing in mind the wake of advanced technology and the use of internet leading to global marketing, there is need for further research to investigate the relationship between business ethics and the law. References M. A. Dima, and M. Radu, 2010, “Business ethics and anti-competitive behavior,” The Business Review, Cambridge 15, (2): 178-184, .Accessed March 13, 2012. H. S. William, 2009, "Marxism, Business Ethics, and Corporate Social Responsibility." Journal of Business Ethics 84, no. 4: 565-576, Accessed March 13, 2012. Read More