Essentials of Business Ethics - Assignment Example

CODE OF ETHICS (ASSIGNMENT 3) REPORT Name Course Tutor Date Executive summary This report is based on Tata Steel Company in Europe and a range of associated firms that venture into the steel production business. The core of the report lies on the moral agency of the company and the ethical perspectives of the organization. The major ethical challenge as at now is the issue of air pollution that has various implications on the organization. There are recommended alterations that once made in the code of conduct will ensure that the ethical dilemma is well dealt with. At the end of the report is a reflection and a conclusion that sums up the entire report. Table of Contents Executive summary 2 Task One 4 3.1 Role of Tata Steel Company Acting as a Moral Agent 4 Task Two 6 3.2. Development of Mechanisms for Employee Involvement and Empowerment 6 Task Three 7 4.1. Ethical Issue Affecting 7 4.2. How Tata Steel Can Improve the Ethics of its Operations 7 Task Four 8 4.3. Advantages of Ethical Code and Factors Considered when Designing a Code of Conduct 8 Clause 8 (Amended): Health, Safety and Environment 10 Task Five 10 4.4. Reflection and Conclusion 10 Bibliography 11 Appendix 12 Introduction Tata Steel Company is a multinational steel company headquartered in London, UK. The company is the second largest in terms of steel production in Europe with its main plants being in Holland and UK (Tata Steel, 2015). Tata Steel specializes in supplying steel products and services to other major industries such as vehicle producing industries and the construction industry. The European branch is a subsidiary of the mother company; Tata Steel Group, that boasts of over 580, 000 employees and is among the top steel producers worldwide (Tata Steel, 2015). As an ideal company that deals with production, there are a number of ethical considerations that must be adhered to (Tata Steel, 2015). The breach and therefore adherence to these standards determines the success of the company or the development of negative reputation. This paper explores Tata steel in ethical dimensions first looking at it as a moral agent, then a series of ethics related mechanisms within the organization as well. Task One 3.1 Role of Tata Steel Company Acting as a Moral Agent A moral agent refers to any person or organization thereof that has the capacity to make any form of ethical decisions and implement them (Mack, 2015). In this case the organization is legally viewed as a person and is thus accountable for all the predictable outcomes of every action that it undertakes (Mack, 2015). In a nutshell, this basically means that any business organization regardless of its size has a moral obligation of being responsible to the public just by acting ethically (Mack, 2015). When looking at an organization as a moral agent, it is necessary to have a sneak peak the openness and fairness in the recruitment processes, the contractual responsibilities whistleblowing, any psychological construct and moral obligations of both the employer and the employee relationships (Mack, 2015). Tata Steel has a code of conduct that guides all its practices (Tata Code of Conduct, 2015). The most speculative thing about Tata Steel is that all employees, regardless of their backgrounds are given equal opportunities within the organization. When the applicants are being selected and recruited their race, gender, origin, physical appearance and marital status among others is not of importance. Tata Steel has developed human resource policies that promote diversity and equality at the workplace as well as compliance with all the labour standards and regulations (Tata Code of Conduct, 2015). This means that as a moral agent the company is responsible and has some effect being felt at the work place that are positive for its workforce. Tata Steel also has a whistle blower policy covered under its clause 25 that entails reporting of concerns (Tata Code of Conduct, 2015). Here each and every employee has a go-ahead of promptly reporting to the management as well as other third party ethics help lines when they feel there is any breach of the code of conduct of Tata Steel. The employee has the choice of making a protected disclosure as guarded by the whistle blower policy of the organization, especially when reporting to the audit committee or chairman of the board of directors (Tata Code of Conduct, 2015). When sufficient evidence has been compiled, the report is then forwarded for consideration alongside a cover letter that bears the identity of the whistle-blower, whose protection then becomes the work of the code of conduct to keep off intimidation. The company is founded on five core brand values that further sets a moral ground through every operation (Tata Steel, 2015). These core values are shared by the conglomerate of Tata Steel companies worldwide, a dynasty that has over 580,000 employees (Tata Steel, 2015). The values include understanding, excellence, responsibility, integrity and unity that sets pace for the company reflecting it as a corporate agent. Task Two 3.2. Development of Mechanisms for Employee Involvement and Empowerment Employees are a very useful resource of any organization. This means that there has to be mechanisms in place to ensure that they are involved and empowered. Employee involvement refers to the process of engaging the support and seeking for any form of contribution by the employees in an organization especially in crucial matters. On the other hand, empowerment refers to the process of allowing the employees of an organization to exercise some control over their work and have input at the same time allowing them to share their suggestions on the organization and the work environment. By the mere fact that Tata Steel is an employer of choice is an indication that its employees are committed and empowered. The core principles in the HR policy include equal opportunities to all, continue personal development of the employees, fairness and integrity in all HR processes, teamwork and mutual trust (Tata Steel, 2015). This coupled with the five core values make the workforce of the organization committed and involved at the same time. The organization ensures that all parameters that relate to the well-being of the employees are well catered for. For this matter, the company is committed to safeguarding the physical, mental and the social well-being of its employees (Tata Steel, 2015). This is achieved through safe working conditions with measures to control hazards. The company has also rolled out a Zero Harm campaign that is aimed at sensitizing the employees about their safety (Tata Steel, 2015). Task Three 4.1. Ethical Issue Affecting Tata Steel has been recognized as the most ethical company for quite some time (Tata Steel, 2015). However, as a steel processing firm, there are ethical challenges that the company is likely to face. The most contentious issue of ethical concern is air pollution contributed by Tata Steel Company in some of its firms. The air pollution has been attributed to outdated machinery and structure causing health related problems to the locals leaving and working around the firms. An example is the Port Talbot plant where black dust fell in homes (Piggott, 2013). The residents have been diagnosed with respiratory cancers, bronchitis and other lung diseases such as COPD. The air polluting particles exceed the set EU limits and thus a breach on the set legislations. Even Tata Steel itself has accepted that there has been some technical issues making the claims true (Piggott, 2013). Similarly, the Scunthorpe plant has also been faced with claims of air pollution due to obsolete systems and structures (Telegraph, 2014). The bosses claim that the £500 million bill is expensive. This is unethical being that life has no spare neither is it valuated (Telegraph, 2014). 4.2. How Tata Steel Can Improve the Ethics of its Operations There are proposals for the company to improve its operations and thus avert any future ethical dilemmas. First off, the company should comply with the set EU limits by complying with the recommendations that are made and the associated costs as well (Telegraph, 2014). This will ensure that all the ethical issues are addressed amicably (Telegraph, 2014). The first mechanism should be the installation of coke-quenching towers that will cost the company £21.1 million in amount (Telegraph, 2014). The second mechanism is to install bag filters in the plants at an estimated cost of £60 million. Thirdly, the company should part with £350 million, for the replacement of the aged coke ovens (Telegraph, 2014). Lastly, there should be the inclusion of this in the code of conduct so that there is sustainability in addressing the ethical challenges that are identified herein. Task Four 4.3. Advantages of Ethical Code and Factors Considered when Designing a Code of Conduct The benefits of code of ethics or conduct are far reaching in an organizational setting. It is an integral component of an organizational or company culture altogether, that when fully implemented has positive outcomes (Smith-Worthington & Jefferson, 2011). Whether viewed as an administrative formality or a comprehensive guideline, the level of awareness of the employees matters in leveraging on the associated advantages (Collins, 2009). Code of ethics is very important in strategic decision making in that it forma a basis upon which decisions are examined with reference to the employees, stakeholders and the external and internal environments (Smith-Worthington & Jefferson, 2011). It helps organizations maintain their reputations through reducing any chances of ethical issues or dilemmas (Collins, 2009). The code of ethics also has some legal importance especially when a company is entering into a contract. It spells all the necessary requirements prior to making a deal between the company and the suppliers or distributors (Collins, 2009). Additionally, the code of ethics offers grounds for opening up a case for an employee or a manager who has in any way breached the terms therein (Smith-Worthington & Jefferson, 2011). This offers a good example to others who might be or are in the process of propagating any form of misconduct. The code of ethics being unique to a given organization, gives it a competitive advantage over its competitors in the market. Every client or partner would like to transact with an organization that is ethically fit and has no any issues relating to ethics that can taint its image. In this way, the reputation of an organization is also represented in its code of conduct (Smith-Worthington & Jefferson, 2011). This again makes a company an employer of choice as is the case with Tata Steel Company. The code of ethics also builds internal and external trust for the organization (Collins, 2009). The code also increases the level of awareness of the obligations of each and every individual and the ethical issues (Smith-Worthington & Jefferson, 2011). The code of conduct also ensures that whenever there are vital issues, a consensus is reached. The employees once aware of their obligations are able to seek guidance and advice as stipulated by the code of ethics (Smith-Worthington & Jefferson, 2011). The ultimate benefit is the building of a strong positive organizational culture thus productivity and increased performance of the workforce. Code of ethics offers a basis for the solution of ethical dilemmas. There are a number of factors to consider when making the code of ethics, especially the approach that will be taken. First off, the extent to which there is ethical infrastructure in place to offer a basis. Second, the extent to which the tradition of public values are in agreement with the stakeholders (Collins, 2009). Thirdly, there should be a statement of an affirmation of compliance of the employees with relevant procedure, policies and laws (Smith-Worthington & Jefferson, 2011). Fourth, the values of the organization should also be of important consideration as they are a foundation for the code of ethics. Fifth, there should be a consideration of how the codes will be enforced (Smith-Worthington & Jefferson, 2011). Still on the same factor there should be a consideration of the existence of a strong control such as an internal or external audit. The other factors include the ethical dilemmas that are likely to affect the business and its environment (Smith-Worthington & Jefferson, 2011). The methods used to get employee input should also be considered. The code of ethics should also address some work related ethical issues such as cynicism and nepotism among others. Lastly, there should be a consideration of the available resources that are at the disposal of the organization to roll out the code of ethics to implementation stages. To amicably address the ethical issues identified earlier there is need to amend clause 8 of the code of conduct: Health, Safety and Environment as follows. Clause 8 (Amended): Health, Safety and Environment Tata Steel Company and its associated firms will ensure safe, ergonomic working environment for the employees while still addressing the environmental health concerns. The company shall be responsible for upgrading all its machinery and contaminant reducing systems so as to prevent the emission of wastes and greenhouse gases that harm the environment. Tata steel company is aware of the EU legislations and a myriad of other policies that govern the environment and will strive to comply. Any employee is welcomed to offer useful and innovative solutions on how to solve any potential environmental related problems. Task Five 4.4. Reflection and Conclusion The process of compiling this report was quite tiresome and required a lot of analytical skills and critical thinking as well. I first had to make a choice of the organization that would form the foundation for this report, a process that was confusing given little information online and offline. Tata Steel is an ethical company and finding the ethical challenge meant a more refined search in the internet. I am pretty sure that as at now the report meets all the requirements stated in the assignment brief. In conclusion, the code of ethics has different advantages in an organization. Tata steel despite having a code of conduct and being the most ethical in the steel business, still has some ethical issues as have been seen in the paper. The amendment of the clause 8 of the code of conduct will take care of the ethical issues. Lastly, there are different mechanisms that must be put in place by Tata Steel to completely address all other potential future ethical issues, including monetary allocations. Bibliography Collins, D. (2009). Essentials of business ethics: Creating an organization of high integrity and superior performance. Hoboken, NJ: John Wiley & Sons. Mack, S. (2015, February 23). What Is Organizational Moral Agency? | Chron.com. Retrieved from http://smallbusiness.chron.com/organizational-moral-agency-34385.html Pigott, P. (2013, September 28). Health study call on dust from Tata Steel, Port Talbot - BBC News. Retrieved from http://www.bbc.com/news/uk-wales-south-west-wales-24308823 Smith-Worthington, D., & Jefferson, S. (2011). Technical writing for success. Mason, OH: South-Western, Cengage Learning. Tata Steel. (2015). About us | Tata Steel in Europe. Retrieved from http://www.tatasteeleurope.com/en/about-us Tata Code of Conduct. (2015). 1st ed. [ebook] London, UK. Available at: http://www.tatasteeleurope.com/static_files/StaticFiles/Functions/HSE/Tata_Code_of_Co nduct.pdf [Accessed 14 Aug. 2015]. Telegraph, S. (2014, April 11). Tata Steel given deadline to control air pollution in Scunthorpe. Retrieved from http://www.scunthorpetelegraph.co.uk/Tata-Steel-given-deadline-control-air-pollution/story-20928623-detail/story.htmlv Appendix Read More