Business Ethics is an Oxymoron - Essay Example

Business Ethics is an Oxymoron Business ethics is a relatively new addition to the business studies family and has been the target of much satire andwitticism from several quarters (Madhu 2010, p.83). This is the result of generations of the perception that businesspersons must be shrewd, cunning and competitive and often leading a flexible relationship with the truth to benefit their business. David Liss claimed that a man of business lied all the time and with a plethora of reasons, which he articulated as follows, to put trades to his advantage, to manipulate circumstances, to improve the perception of his position or depreciate it depending on his particular ambition. Liss then tries to justify this by saying that, these lies are not simply lies but the rules of business hence making it appear as if a business cannot thrive in the absence of lies. Such and similar comments, which a substantial number ascribe to have given rise to a saying that business ethic is an oxymoron. Focus on this particular branch of business studies can be accredited to recent business scandals (Nyberg 2008, p.587). In order to understand that, business ethics is an oxymoron, it is imperative that one defines the meaning of the terms both from a sematic and pragmatic point of view. Semantically they are not opposites hence the oxymoron cannot be an overt one. However, when the contextual pragmatics is taken to consideration, one cannot fail to notice some reasonable degree of logic in the assumption. Business ethics are defined as a critical and structured examination of how people engaged in business should behave in relation to their customers, neighboring society, the environment labor and any other individuals or institutions likely to be influenced by their action or inactions. This point of view is, {"status":"TOOLBAR_READY", "toolbarId":206720000} however, not a true representative of the fats on the ground since business and ethics do not always contradict each other. Nonetheless, several aspects of the business of making profit directly contradict what is considered moral, or ethical. This paper will discuss what aspects of business practice contradict business ethics using various examples to show the polarity that sometimes exist, but with the view of demonstrating that business and ethics do not have to be in contradiction. This is so since ethics are in existence not to make businesses profitable, but to make it fair for all stakeholders including consumers, the society, employees and competing business. According to Professor David Armor, many people are actually unethical while under the illusion that are objective in what he calls illusion of objectivity (Banaji, Bazerman and Chugh, 2003). For this reason, it is noteworthy that one considers all aspects of ethical behavior and ensures they do not engage in unethical behavior while under the illusion of objectivity. Ideally, business ethics take over from where the law ends what makes the issue so contentious is the fact that many of the things considered unethical in business are not necessarily legal. For example if someone cheats on their spouse, they are not breaking any law, but it is immoral, ergo, unethical. The same applies to business ethics, laying off workers so that a company can outsource to another country, may be unethical but law if of little help. However, today firms have increasingly become more accountable to their stakeholders and community (Rasche 2009, p.196). Environmental issues such as pollution are one of the most heavily discussed ethical dilemmas where industrial firms are required to dispose their waste responsibly and protect the environment and residents. However, the process of treating waste especially chemical waste is often a time staking and expensive one, as a result, many firms have taken to dumping toxic waste in water bodies and this often culminate in health problem for both the aquatic life but surrounding human and animal residence. However, several companies have taken up the initiative some like Alcoa the world chief aluminum producer started a system to curb, GHC emissions from its factories internationally (Hoffman 2005, p.15). In the year 2006, Trafigura, multinational trading in base metals and energy caused health crises that affected over 100,000 people. This happened when one of their ships, en route to a waste processing plant in Netherlands realized the cost of disposal would be 20 times higher than the origin estimates. To save on the cost, they had the waste illegally dumped in the coast of Ivory Coast starting what later came to be a marine catastrophe and leading to thousand s of people who came to contact with the water falling sick. Despite the company’s fervent denials on the media, it was proven through a wiki -leaks release that the UN found their actions were the cause of the problem (Hynes, 2012). This is a clear case of conflict between a company’s social responsibility and after examining it is easy to understand why people claim ethics are an oxymoron in business. When firms are faced with the option between human lives and financial gain, they pick the latter and such reprehensible behavior gives credence to the joke although jeopardizing human lives is not a joke. When it comes to multi- nationals, it is crucial they have clear and predefined guidelines on ethics as well as a comprehensive code of ethics. This is because the impacts of their actions are often globally felt, and can have dire consequences as demonstrated above (Banai and Sama 2000, p. 224,). As aforementioned, the unethical business practices have a long history; classic case was that Thomas Edison’s RCA (Radio Company of America). This company was known for exploiting inventors and abusing the system for profit. To deal with competition, especially upcoming film companies, the firm would charge outrageous amounts for the use of camera technologies, and this is attributed to be one of the main reasons why the filming industry is based in Hollywood. The firm would often bully inventors into using their inventions without paying for patents and often leading to large legal battles, which many of them could ill afford. This is evidence of highly unethical behavior, and it was tantamount to exploitation and abuse of intellectual freedom (Hynes, 2012). Not surprisingly, this company to a large extent is representative of many modern firms which in their zest to eliminate competition are willing to engaging myriad of underhand tactics boarding on illegal to gain an edge over less influential competition. The organization culture is the basis from which firms ought to construct their codes of ethics, however, many firms to that have a culture that allows for brutish techniques of dealing with competition such as hostile takeovers just to mention a few (Valentine and Fleischman 2004, p.391-392). Among the most common unethical business practices, is setting prices way above the retail price in a business when one knows the customers have nowhere else to go, or they are the only seller of a given product within a geographical area. Several retailing outlets also have people hoarding goods when they speculate a shortage is imminent. Apart from being unethical this is also illegal, to apply since it is hard to get a warrant to search someone’s store for hoarded goods. Furthermore, if one was caught, they could simply claim to have been reserving them for a customer or personal use, therefore, they could hardly be prosecuted. Most countries have rules on disclosure, where firms are obligated to notify the consumers of all the chemical constituents of a product before mostly on the label. Companies, however, sometimes ignore these provisions and either under or misinform the consumer about the content of their products hence running a risk of harming their health. In the quest to make profits, cigarette companies are examples of businesses whose existence and profit depends on the consumption of a product directly proved to cause harm to one’s health. Indeed, they have been given a variety of names including cancer stick, which is particularly appropriate. In their defense, most tobacco firms claim their consumers are fully aware of the risks when they consume their products hence they are not committing any immoralities. However, from a moral standpoint, manufacture and of cigarettes is an archetype of profits taking precedence before safety. It is claimed that there been a warning on the effects of cigarettes on the packet the consumers are aware of what they are getting into. However, the fact that the cigarettes contain nicotine means they are additive and one does not just stop. This is especially so, because majority smokers begin to smoke at around age 13 meaning before they are old enough to decide what is appropriate for them or to understand the implications. By the time, they are old enough, they will be hooked, and evidence of this is in the fact that cigarette companies use teen icons to advertise their products. In conclusion, today, many corporate bodies have taken up their roles and they have engaged in various forms of, social corporate responsibilities with perceived gallantly. While these social initiatives are often associated with business strategy, their long-term effects ultimately structure to reflect on the firms long-term strategies (Rogovsky, Hess and Dunfee 2002, p.123). Many firms have also updated their codes of ethics to make them relevant to prevailing circumstances or due to the demands of their customers and other stakeholders (Jones 1991, p.366). Ultimately, it is evident that for the term business ethics to be an oxymoron, one would have to be dealing with unscrupulous business people who gave little regard for their environment customers or any of the other stakeholders. It makes sense that firms, which make billions in profits, should use some of it in improving the situations of the world’s poorest and suffering groups whether or not it translates into profit of popularity for their firms and the products (Margolis and Walsh 2001, p.368). References Nyberg, D. (2008). The morality of everyday activities: Not the right, but the good thing to do. Journal of Business Ethics, 81, pp. 587-598. Jones, T.M. (1991). Ethical decision making by individual in organizations: An issue-contingent model. Academy of Management Review, Vol. 16, No. 2, pp. 366-395. Banaji, M.R., Bazerman, M.H., and Chugh, D. (2003). How (un)ethical are you? [WWW] Harvard Business Review Available from: http://hbr.org/2003/12/how-unethical-are-you/ar/1 [Accessed 7/09/2012]. Banai, M. and Sama, L. M. (2000). Ethical dilemmas in MNCs’ international staffing policies: A conceptual framework. Journal of Business Ethics, Vol. 25, No. 3, pp. 221-235. Hess, D., Rogovsky, N., and Dunfee, T.W. 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Valentine, S. and Fleischman, G. (2004) Ethics Training and Businesspersons’ Perceptions of Organizational Ethics. Journal of Business Ethics Vol 52, No 4, 391-400. Read More