Success of Structure and Operations in Business - Assignment Example

Business Ethics - The key to Success! Business Ethics - The key to Success! Introduction Business ethics Business ethics can be defines as the moral principles that control and guide the way a business conducts and carries its operations. In so many ways, the same principles that determine and control an individual’s actions end up to be applied to a business. Operating in an ethical manner entails distinguishing between what is right and wrong and after that taking a decision based on what is right. In simple terms, if a business decides to work with the wrong choice, it is considered to be involved in unethical business practices. According to Miller & Cross (2013) every business is obliged to carry out its operations in accordance to the set regulations and codes within their industry. It is important to mention that when we talk of business ethics, it does not necessarily focus on the business as an entity only but rather it involves also the behaviour and practices from the top management and all the employees. Every industry has its codes of ethics. The government and other institutions play the role of coming up with this principles and guidelines. Each of these codes is aimed at protecting the consumers, the industry as well as all the stakeholders. Business ethics ensure that the rights of the stakeholders are not violated and that the expectations from both the business and the external environment are met in the right way. In reference to Information Resources Management Association (2015) the government has a very crucial role to play in protecting and controlling the corporate world and one of the ways this is done is through implementing codes of conduct and ethics. Business ethic vs. Corporate Social Responsibility (CSR) Whereas business ethics is considered to be more concerned about businesses making ethical decisions in commercial set up, corporate social responsibility (CSR) is more narrowly concerned with a company’s social obligation; an obligations to the society. With this understanding, it therefore means that business ethics is not just concerned with social obligations and responsibilities, but rather obligations to clients, employees, customers, the government, suppliers, unions, competitors and all the stakeholders. According to Griseri & Seppala (2010) business ethics is so wide and entails allot of activities of a business including CSR. CSR is limited most of the times to areas where a particular carries out its operations. As a way of winning the society and participating in the development of the society, CSR is effectively used to achieve these goals. One might argue that most of the business use CSR as a marketing strategy rather than an act of developing the society and the community. However, the benefits of CSR to the communities are equally greater than just the marketing of a business. The aim of CSR is primarily to develop and benefit the society. Wherever a business uses CSR for other benefits, then its business ethics immediately comes into question. This is the paradox in the relationship of these two concepts. Simpson & Taylor (2013) says that in the recent years, the corporate world has invested millions in CSR related activities as a way of improving a business image other than benefit the community around. All businesses aim at making more profits and getting high revenues. However, businesses should still focus on social responsibility towards its community. This is what social responsibility is all about. The concept is more of an obligation and duty to the people who are affected by the business. A good instance is where a business helps in reducing environmental pollution and more especially if that business is the one causing all the pollution. Implications of business ethics for business Customer loyalty and confidence Any business that works within the stipulated ethics and codes is likely to win the confidence of the customers as well as their loyalty. This is due to the fact that they trust the business not to manipulate them or violate their rights as consumers. Wherever a business is reported to be involved in unethical practices, fear and mistrust starts to grow among the customers. The unethical practice may not necessarily involve the customer directly but the effect of the practice will be taken with equal magnitude by the customers too. According to Ferrell et al. (2010) the confidence and loyalty of customers is created by working up to the ethical expectations. These guarantees the customers that their protection as consumers and as stakeholders. Competitive advantage In any given industry, each business strives to have a bigger market share. Each business develops different strategies to remain relevant in the market. One of the ways that businesses are able to have a better competitive advantage is by operating ethically right. CSR is part of business ethics and many businesses have been able strengthen their competiveness through CSR. In general, a business that has unethical practices is considered to be at risk within the industry and this kills its competitive advantage. According to Bowie (2013) unethical business practices tarnishes the reputation and image of a business making it less competitive. On the other hand, a business has a higher probability of winning a bigger market share wherever its practices are found to be ethically right. Employee performance and productivity There have been reports of business that were found to have treated their employees in ways that can be considered to be rather offensive. The success of most business largely depends on the performance and productivity of their employees. Employees are more productive whenever they have all their needs and interests met. Every business has duties and responsibilities to its employees and these form part of the business ethics. Employee remunerations, working conditions and other rights are all part of what a can be used to measure and rate a business ethical practices. Whenever the interests of employees are met, they tend to commit their energies and skills to the business hence improving productivity and performance of the business as whole. Treviño & Nelson (2011) says that a business may be very successful in ensuring it is able to keep up with ethical practices with its customers but it would only be right if the employees and staff of the business are equally treated in an ethical way. Financial implications A business is likely to save allot of money that would rather be lost in fines and penalties from unethical practices. In same line, unethical practices may seem as a short cut to quick success for a business but the long term implications bring more harm. Businesses that are connected directly to pollution and degrading of the environment may decide to work unethically and pollute or degrade the environment. Whether noticed or not, the effects will reflect to the company in one way or another. The other financial implication is where a business is involved in unethical practice leading to damaged reputation and credibility, subsequently giving the business a less appealing image to stakeholders. This consequently will lead to low profits. Implementation of key principles of business ethics Employee Working Hours and Remuneration There are international, national and local wages as well as working hour’s laws including the minimum wage for employees. Every company must comply with these laws. This can be done allowing employees work within the hours required. The normal working hours in Australia should not exceed 48 hours in a week with at least one day off. Employees who report for overtime should adequately be compensated for their work. Companies should also ensure that their employees are well paid and that it is within the minimum wage stipulated. According to Palmer (2015) there are companies that have been involved in making high profits for the business shareholders by paying employees less than expected. This is unethical practice as it goes against the rights of the employees. Health and Safety Companies should work to ensure protection of health and safety of the employees and the customers too. This can be done by creating a safe working condition for the employees. Setting up emergency and response systems in the workplace as well as ensuring that they are safe from accidents. The customers can be protected by ensuring that the products and services offered have no risks of harm to their health or their general well being. According to Coff (2008) companies that deal with food processing play a very crucial role in ensuring that the health and safety of their consumers have been protected. Majority of the consumers do not give much attention to the content and ingredients of whatever they buy or eat. Companies should consider health and safety of their employees by ensuring fire prevention, set up of safety equipment, emergency evacuation, first-aid and the right use as well as disposal of hazardous and toxic waste. Fight Abuse and Discrimination Companies should ensure that employees are treated with the dignity they deserve as well as respect. No employee should be subjected to cruel and unusual acts of disciplinary or discrimination during employment or hiring on the basis of their race, origin, origin, political affiliation, religion, age or gender or sexual preference. The same case would apply to the customers and the rest of the stakeholders. According to Mullerat (2010) the international labour laws protect employees against discrimination of any kind from their employers. There are companies that have been found in trouble for failing to protect their employees from such abuses. Compliance with industry Laws Every industry is guided by specific laws and policies. Companies need to comply with the all the industry laws within the country in which they carry out their business. All regulations and standards that are applicable to their business must be adhered to. This will ensure that a business is not in conflict or battle with the controlling bodies and institutions. Laws protecting the environment and other practices like the use of green house need to be considered by companies in the industries. According to Gurran (2011) Australia has legislation that limits companies on the emissions from their activities that may have an effect on the ozone layer as well as the synthetic greenhouse gas. The laws are to be followed by all the companies with tough penalties to offenders. The laws are also there to ensure that the industry is protected from manipulation and extortion. The marine and fisheries sector particularly needs keen monitor. The fishing activities if not controlled will lead to greater harm than expected. According to Worm (2006) about three-quarters of fish stocks in the world are currently being harvested at a higher rate than they are being reproduced. Among this, 88% have been exploited fully or already declining, while 90% of all the large predatory fish are gone. It is predicted by scientists that if humans continued with the current trend, the global food fisheries are likely to collapse completely by the year 2050. Participating in CSR Every company has an obligation to the community in which they carry out their business. Their obligation is to develop the social well being of the community. This can be done by protecting the environment, donating to charity groups, setting up and funding community based projects among others. According to Simpson & Taylor (2011) CSR is one of the most important component of business ethics that has multiple benefits to a business. It does not just meet the needs of the community but also helps in boosting the company as a brand. Developing and understanding of best practice of business ethics The leadership and management in general of every company have a duty in ensuring that the business is able to utilize all the ethical practices. This can be done in many ways some of which include; Use of business structure Every business has its structure and operations. The structure illustrates the different departments of a business and their duties and responsibilities. A manager can use this structure to ensure that the best practice is put into place. The ethical issues can be tackled by setting a line of authority and monitoring system. By having supervisors and heads of departments, the business is able to implement and also monitor the best practices. A manager may also use best performing employees in regard to best practice to promote them up the business structure. Incorporation of business ethics with company culture Every company has a unique culture that distinguishes it from the rest of the competitors. By incorporating best practices with the company culture would ensure that the employees are able to pick up the practices easily. According to Fernando (2006) if a company is able to combine its culture with some of ethical practices, it will have overcome a great challenge as most companies tend to have cultures that do not necessarily comply with the ethical practices. Employee recruitment and hiring A companys best ethical practices are primarily determined by its employees. With that in mind, then it is significantly important to ensure that the employees being employed or hired have the capacity to work to the best ethical level. A thorough scrutiny should be carried out for interviewees to ensure that there are no cases of controversy or history of unethical practices. According to Treviño & Nelson (2011) for companies that use human resource companies as well as recruiting companies need to give guidelines that will be used to ensure that they acquire individuals who posses very high level of integrity. This integrity will be transformed into the operations of the company. Conclusion Business ethics is entails guidelines as well as principles that are used to control the business activities to ensure that the business does not violate the rights of any of the stakeholders. CSR is part of business ethics and can be used to achieve the goals of business ethics as a concept. Business ethics is very crucial to any business as it is does not only control the business industry but also helps build the business as an entity, help develop the community, protect the rights of the employees as well as the customers and consumers. Business ethics can be practiced on different levels in a business starting from employee working hours, their compensation among others. Every business manager and the management have a role in ensuring that their business is only involved in the best practices in relation to business ethics. References Top of Form Miller, R. L. R., & Cross, F. B. (2013) the legal environment today: Business in its ethical, regulatory, e-commerce, and global setting. Mason, Ohio: South-Western Cengage Learning. Top of Form Information Resources Management Association (2015) Business law and ethics: Concepts, methodologies, tools, and applications Bottom of Form Top of Form Griseri, P., & Seppala, N. (2010) Business ethics and corporate social responsibility Australia: South-Western Cengage Learning. Bottom of Form Top of Form Simpson, J., & Taylor, J. R. (2013) corporate governance, ethics, and CSR London: Koran Page. Bottom of Form Top of Form Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2010) Business ethics: Ethical decision making and cases: 2009 update. Mason, OH: South-Western Cengage Learning. Bottom of Form Top of Form Bowie, N. E. (2013). Business ethics in the 21st Century. Dordrecht: Springer. Bottom of Form Top of Form Treviño, L. K., & Nelson, K. A. (2011) Managing business ethics: Straight talk about how to do it right. New York: John Wiley. Top of Form In Palmer, D. E. (2015) Handbook of research on business ethics and corporate responsibilities Top of Form Coff, C. (2008). Ethical traceability and communicating food Berlin: Springer. Top of Form Mullerat, R. (2010). International corporate social responsibility: The role of corporations in the economic order of the 21st century. Austin: Wolters Kluwer Law & Business. Top of Form Gurran, N. (2011). Australian urban land use planning: Principles, systems and practice. Sydney: Sydney University Press. Top of Form Fernando, A. C. (2009). Business Ethics: An Indian Perspective. Prentice Hall Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Bottom of Form Worm, et al. (2006) Impacts of biodiversity loss on ocean ecosystem services. Science, 314 (5800) Read More