How to Balance Social Responsibility with the Economic Performance of a Company - Coursework Example

Management Name: Tutor: Subject: Date: There are several challenges which face the contemporary business world. Business companies are facing ethical dilemmas which are complex and most of the time affects decision-making process of the company. Many companies ask themselves is, “how ethical can we be?” Sometimes, management may think that they are answering such a question correctly and that they are making the correct decisions but in most of the cases, this is wrong. This is because most of the perceptions depend on things such as time frame, the situation, and expectation of others. What is done in a company is well judged by the observers than the operators. In the companies, the management expects the employees to behave in a certain manner but in the real sense, they are not practicing it. A good leader should establish expectations and strategies of meeting them. When the management led by example, the trust will be established among the employees and the production will be enhanced enabling the organization to survive in the competitive environment (Wang, Ying, George Cheney, and Juliet Roper, 2015). According to Rothaermel, Frank T., (2015), companies have a wide range of responsibilities to pursue and they try to choose the best to pursue but most put them in an ethical dilemma. Despite this, the companies should prioritize profitability and shareholder value, but they should engage in such a way that social and environmental responsibilities are met. This is because there are no universal set of ethical principals exists. Normally, companies found themselves in dilemmas when money and morality clash. When this happens, most of the companies solve the issue by believing that such clashes are imagined, and they are not real. What has caused the ethical issues is mainly associated with technology on issues such as genetic modification and the internet. Economic pressure also complicates ethical issues in an organization. This is because a company can find itself in economic dilemmas. Economic pressure affects both the employees and the employer. For example, an employee may be tempted to do something which is unethical in the company such as stealing for his/her economic reasons. This could be because the employee is unsatisfied or for his selfish reasons. When a company is facing economic crisis, sometimes they engage in activities which are considered unethical like corruption of bribery. For example, when a company does not have enough capital to purchase a product or an asset, they can obtain it by crooked means such as bribing the supplier. The issue of trust and human relations in most of the companies are becoming difficult to handle. This is because issues driven by individual interest are becoming difficult to be addressed. In some companies in South East Asia have been firing employees who are HIV positive without any explanation and most of American companies scan the emails of their employees to find out if there is any disloyal material all these issues of human relations are unethical, but most of the companies are doing this because they interfere with the rights of the employees (Rothaermel, Frank T., 2015). In this era of technology, some of the companies are engaging in e-businesses, but others are not there yet. Technology is associated with some ethical dilemmas. Since new technologies are created every day, there is a question of protection and customer privacy. Most of the customers would like their products deliver through the internet and therefore the companies should practice e-commerce which is 24/7. The main problem is that use of technology and internet has never been tasted if it is ethical or not. The companies only focus on satisfying their customers and not ethics. Globalisation also causes ethical confusion in business companies. This is because they are confused whether to follow the local environment standards or the global one and this has created debate in the field of business. Social responsibility is the balance between the economy and the ecosystem and companies need to ensure that this balance exists. The management of business companies makes a decision which incorporates environmental protection. In most of the time, government agencies are responsible for establishing guidelines for emissions of pollutants and the decision should adhere to them. In the present world, most of the companies emphasize success, and this brings competitive pressures on ethical principles. To achieve the success, the companies are forced to hire more employees, and this affects the employment ethics of the company. in other cases, the success can be gained through means which hurt other people and moreover, in other businesses, decisions are made by those who have autonomy over others. Management ethical choices, therefore, have more repercussions than the ethical choices of the employees. Some business analysts have concluded that business managers are likely to ignore ethics in decision-making process especially those in America. The emphasis on financial return to the shareholders has contributed to the lack of social responsibility in the working environment. Such companies recognize only one social responsibility, and that is to use the company’s resources and to engage in activities which are directed to a profit of the company. This is a misconception of the character and nature of a free economy. Management of a good company is to ensure that the interests of the stakeholders and its members are served. The management should also focus on measures such as clean up of emissions, recycling or contributing to charities because this is part of social responsibility (Reddy, Bucha, 2015). Organizational pressures also contribute to complication in the ethical issues in the companies. In large companies, ethical issues are difficult to manage because they are more diffuse. Sometimes, the companies impose their employees to engage in activities which tempt the workers to engage in behaviours which are questionable. For example, a corporate system can be so fixed on cost controls that production managers may find it impossible to fulfil orders without using inferior materials. In such cases, the employees are exposed to situations where should engage in something wrong for the success of the company. Most of the time, the employees found themselves in the dilemma of either to choose morality or the career. Business people found themselves in situations where it is difficult to distinguish between right and wrong because, on one hand, there is ethics to be followed and on the other one, the business should advance financially (Wang, Ying, George Cheney, and Juliet Roper, 2015). Business experts have pointed out that it is possible for managers and business owners to shape their business down to the ethical path. A business manager who wishes to develop an ethical company should be proactive, and then the employee will follow him/her. This is because the employees follow the lead of the leaders in executing their practices and responsibilities. The other way companies can establish ethical behaviour in their companies is by establishing a statement of organizational values. This will guide the employees and the whole company by providing a specific framework of the expected behaviours. Through the statement of values, the portrait of the company is reflected not only in the company employees and management but also to the community as a whole. It portrays how the company intends to carry out, what it believes in and why it was established. The company can also make active reviews on strategic plans and objectives so that they ensure that they are not in conflict with the organizational ethical standards. On top of this, the management should also review performance measurement and standard operating procedures. This will help in ensuring that they are not in any way encouraging unethical behaviour in the company. when the managers and the owners of the business treat the employees, competitors and customers in a fair and honest manner, then there is a reward for that. He or she is likely to have an ethical workforce which will reward him with pride. Some of the business analysts argue that ethical companies are advantaged over the competitors. Ethical companies have loyal customers because to them; they gain satisfaction not only from the products (Karsaklian, Eliane, and Anthony Fee, 2016). Those who violate ethical principles in the corporate world should receive social penalties. Companies have developed special incentives which promote virtue in the companies and therefore the employees will stick to them to avoid any penalties. The other motivator which makes the companies ethical is to avoid embarrassment. When any company becomes unethical, international televisions stations such as CNN will air the whole story, and the company will be embarrassed globally. In summary, the main challenges which face most of the business companies in the present competitive world include: how to balance social responsibility with the economic performance of a company. The emphasis on financial return to the shareholders has contributed to the lack of social responsibility in the working environment. Such companies recognize only one social responsibility, and that is to use the company’s resources and to engage in activities which are directed to a profit of the company. Organizational pressures also contribute to complication in the ethical issues in the companies. In large companies, ethical issues are difficult to manage because they are more diffuse. Sometimes, the companies impose their employees to engage in activities which tempt the workers to engage in behaviours which are questionable. A business manager who wishes to develop an ethical company should be proactive, and then the employee will follow him/her (Rothaermel, Frank T., 2015). Reference Grant, Robert M. Contemporary Strategy Analysis 9e Text Only. John Wiley & Sons, 2015. Karsaklian, Eliane, and Anthony Fee. "From Green to Ethical Consumers: What Really Motivates Consumers to Buy Ethical Products?." Looking Forward, Looking Back: Drawing on the Past to Shape the Future of Marketing. Springer International Publishing, 2016. 192-201. Reddy, Bucha, Radha Krishna, and Vidyadhar Reddy. "Ethics and Social Responsibility-A Study in India." Proceedings of the 1997 World Marketing Congress. Springer International Publishing, 2015. Rothaermel, Frank T. Strategic management. McGraw-Hill, 2015. Wang, Ying, George Cheney, and Juliet Roper. "Virtue Ethics and the Practice–Institution Schema: An Ethical Case of Excellent Business Practices." Journal of Business Ethics (2015): 1-11. Read More