Benefiting the Whole Society: Business Ethics and Corporate Social Responsibility

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Table of Contents

Introduction
Corporate Responsibility and Ethics
The Main Objectives of Management
Importance of CSR and Its Influence on Stakeholders
Conclusion
References

Introduction

In this essay, I will argue that business ethics and corporate social responsibility should reassure people that businesses are managed in ways that benefit the whole society for three reasons. To begin with, adhering to the principles of business ethics and corporate social responsibility implies consideration of the people from the external environment in cooperation with development groups and local communities.

Further, Corporate Social Responsibility involves responsible investment and governance of the resources in an efficient and effective way, as well as demonstrates extreme concerns with welfare of employees, customers, and suppliers. Finally, ethical principles of an organization should provide concern with environmental issue and ecological protection to meet the existing standards of handling an ecologically friendly business.

All these aspects prove the fact that society has a major impact on the welfare of an organization and, therefore, business ethics should work on managing techniques that would bring in the benefits for the entire society. In order to provide evidence to the importance and role of social corporate responsibility, the essay will be divided into three sections.

In Section One, it is purposeful to discuss the main principles of corporate social responsibility and ethics, that are highlighted by Morgan (2006), Parker (2002), Roberts (1984), and Rosen (1988) discussing consequences and pre-conditions of introducing corporate culture to an organization.

Section Two will deal with the main objectives of management to define the connection between business and ethics. These perspectives are highlighted in the studies by Michelson and Kramar (2003), Pocock (2005), Morgan and Spicer (2009), Thomson and McHugh (2003), and Willmott (1993).

The final section will involve consideration of importance of corporate social responsibility and its influence on stakeholders. Within this context, the analysis of the works by Roberts (2001), Burgess et al. (2009), and Watson (2003) is required.

Corporate Responsibility and Ethics

As it has been mentioned previously, socially responsible managers should be concerned with the environmental issues, as well as with the welfare of the territories surrounding an organization. As a proof, Morgan (2006) enumerates evidence supporting the negative consequences of negligence of organizations towards ecological situation, as well as toward the relationships between managers and their subordinates.

In this respect, the author argues, “organization has been associated with processes of social domination where individuals or groups find ways of imposing their will on others” (Morgan, 2006, p. 293). Similar problems relate to the way employers deal with their employees.

So far, workers were considered as important units whose productivity and performance take the first place whereas other cultural and social backgrounds were of secondary importance (Morgan, 2006). Such an attitude, however, is not appropriate in a modern organization and each manager should adhere to ethical and moral principles to motivate employees and encourage them work with higher productivity.

With regard to the above-presented pitfalls of management, specific attention should be given to the problem of managing diversity and eliminating discriminating policies against various social groups. In particular, management should definitely involve dominance and control, but in a specific context and under certain conditions. To define the main purposes of social corporate responsibilities, it is purposeful to define the concept of management and its place in society.

According to Parker (2002), the idea of management is confined to three assumptions. The first one postulates that management is a progressive tool for promoting scientific discoveries by means of which human beings can take control of the surrounding processes. The second concept of management is defined as an instrument for controlling humans and their action. In other words, “management can shape and shepherd human being toward a more productive future” (Parker, 2002, p. 4).

Finally, management also concerns the development of strategic plans and policies for controlling things, processes, and personnel. All three assumptions identify ways and approaches by means of which management covers all spheres of control and governance. It is a complex system that allows supervisors to monitor various spheres of control and encourage progress and invention.

Better understanding of the concept of management widens the explanation of its moral dimension. The idea of moral neutrality in managing people seems to be questionable as far as the effective of management and organizational performance are concerned. In this respect, Roberts (1984) introduces a comprehensive conclusion based on personal observations and case study analyses:

The importance of acknowledging the communicative character of interaction between managers and staff is that it points both to the inadequacy of technical versions of management practice and to the possibility of moral forms of social control – that is control grounded in inter-subjectively negotiated and shared understanding (p. 301).

Thus, effective functioning of organization, as well as successful establishment of relationships between managerial staff and its subordinates, is possible through integration of moral and ethical dimension permitting to articulate social and cultural problems.

In addition, in order to ensure effective performance of the personnel, people must have a deep sense of reality to be able to act under various circumstances. Rosen (1988) emphasizes, “Rites and ceremonials thus presumably have explicit and latent functions in recreating these shared meaning systems of an organization’s culture” (p. 464). They also contribute greatly to the formation of a reliable organizational culture.

Social corporate responsibility relies heavily on managerial strategies, concepts, and dimensions through which supervisors are able to control people and carry out business effectively. In particular, it has been discovered that management cannot exist without moral and ethical issues because neutrality in communicating and articulating organizational goals does not enhance the overall organizational culture.

In this respect, corporate responsibility implies constant development of moral and ethical values within an organization, as well as creation of a favorable environment for the employees.

The Main Objectives of Management

Corporate social responsibility correlates strongly with strategic management of human resources. Therefore, focus on human resources management is essential to understand which objectives and goals are pursued by corporate culture and management.

By defining the main goals and objectives of management, it is possible to highlight the importance of organizational culture and business ethics in shaping strong organizational values. HR departments, therefore, have now increased their popularity because of integration of strategic approaches and analysis of person-centered approaches to managing organizations.

In this respect, Michelson and Kramar (2003) believe that human resource management should become an inherent component of effective control of organizational processes. This is of particular concern to large, multinational organizations where the issue of cultural diversity comes to the forth. However, the tendency of prioritizing human resources practices is less popular in Australia because line managers are more reluctant to introduce changes and accept distribution of responsibilities among the personnel.

Consequently, firms, particularly those referring to multinational market “…had a greater tendency to implement ‘innovative’ work practices including teamwork and quality initiatives” (Michelson & Kramar, 2003, p. 137). In this respect, the main objective of management is to implement strategic practices that would enhance strategic decision-making and contribute to organizational culture and performance.

Due to the rise of the globalization, HR field is expected to provide greater contributions to the overall organizational effectiveness. In particular, Michelson and Kramar (2003) have defined that the strategic and change planning, industrial relations, and shared decision-making constitute the basis of effective human resource management approach. More importantly, HR practices should increase the competitiveness of an organization.

Organizational change is also an important outcome of effective management techniques. In fact, the main aspect of management points to the way an organization can adapt to the changes in the external environment. In this respect, Morgan and Spicer (2009) argue that effective change management contributes greatly to establishment of economic stability because of increased level of adaptability to the unforeseen complications and contingencies.

In this respect, the task of managers and supervisors is to provide employees with the corresponding training programs that would enhance their flexibility in the workplace, which is also part of social corporate responsibility. Judging from the above-presented assumptions, management should be based on business ethics and corporate social responsibility because these principles foster understanding of the personnel concerning the mission of an organization.

In order to define approaches to fulfilling organizational changes, Morgan and Spicer (2009) refer to this concept as to a union of three features – performance, reflexivity, and struggle. These features are applicable to basic components, including organizational processes, identities, societal processes, and interorganizational fields. To begin with, the researchers approach the concept of identifies change that “…explores the introduction of culture change programs into organizations” (Morgan and Spicer, 2009, p. 255).

As per organizational processes, specific attention should be paid to technological innovations and tools shaping effective management in the workplace. In addition, organizational processes involve the way managers look at their actions in future.

In other words, senior managers tend to integrate new narratives and discourses about the organization for employees to accept those and build up new approaches to facing those strategies. Finally, organizational processes are highly affected by the dynamics of the external fields and, therefore, specific emphasis should be placed on the development of successful international relations.

The success of management lies in thorough consideration of political, social, and cultural undercurrents of carrying out business. In this respect, the role of management is to strike the balance between labor distribution and social and bonus schemes for employees. Pocock (2005) attains much importance to work-life balance because it concerns such important stakeholders as enterprises, individuals, and larger communities.

Interest in striking the balance between work and life is explained by the fact that no consistent strategies have been found to control these stakeholders in regard to place, time, and process. Despite the problem, Pocock (2005) reassures, “…retaining a good balance will assist the retention, productivity and recruitment of good staff, and allow enterprises to recoup a return on the investment they make in their employees” (p. 201).

Once again, effective management is confined to successful consideration and distribution of human resources which are in congruence with the principles of corporate social responsibility as well.

Apart from management of human resources, the actual scope and objective of management should be defined. The nature of management relates closely to the role of managers and their place in controlling organizational power. To define the dimensions of management activities, considerable focus should be made on relationship between leadership, management, and decision-making.

The concepts reveal a remarkable difference between managers and leaders because not all leaders have sufficient managing qualities and vice versa, not all managers are potential leaders. A decision-making process relates closely to the ability of employees to self-control and self-direct their actions and thoughts. The above-presented concepts are interconnected because they identify various styles and types of management and leadership.

According to Thompson and McHugh (2003), “democratic leadership is better, both increasing moral and productivity, and for improving the quality of decisions” (p. 107). Thus, decision-making is an inherent component of leadership and management in case organizations are regarded as decision-making systems. Moreover, management activities belong to the decision roles imposed on organization’s leaders.

In order to make the right decision, it is necessary to acquire efficient skills and techniques to meet organizational goals. Thus, the goal of an organization is to motivate employees to take part in making decisions and problem solving. This method is successful because it increases employees’ productivity and engages them into the management process.

Considering the concepts of change, distribution of human resources, employees’ flexibility and engagement provides a wider picture concerning how organizational culture should be acted out. In this respect, Willmott (1993) claims, “the guiding…concern of corporate culturism…is to win ‘hearts and minds’ of employees: to define their purposes by managing what they think and feel, and not just how they behave” (p. 516). Thus, such an approach is important because it enhances the quality of production, which is another important purpose of management.

Importance of CSR and Its Influence on Stakeholders

The issue of ethics and its relation to business has long been disputing over years. However, current tendencies in handling organizations prove that ethical codes are strongly associated with successful management strategies. Roberts (2001) claims that ethics depends largely on identity formation because various cultural backgrounds influence the character of the established norms or morality and ethics.

Considering identities as decisive factors in shaping organizational culture leads to analyzing of workforce diversity in companies. In this respect, Burgess et al. (2009) attains importance to cultural diversity in the workplace because its successful management will definitely influence the overall organizational culture.

To highlight the importance of the role of corporate social responsibility, Burgess et al. (2009) state, “…population and workforce diversity, and tolerance and acceptance of diversity, may in themselves be factors that generate community returns beyond returns to the individual and the employing organization” (p. 19). Acceptance of the difference in the organization is the key successful coordination of management activities.

In the pursuit of excellence, managers and leaders strive to introduce new strategic paths that would enhance organization’s competence. They are aware of the fact that strong corporate culture is the underpinning of establishing powerful network of control and coordination. They should also realize that efficient communication should be at the core of the production process.

In this respect, Parker (2000) focuses on anthropological dimensions of organizational culture because it ensures high level of productivity. Therefore, the conception of culturalism should be inserted into the mission and vision of a company. Integrating anthropology and social psychology into corporate dimensions produces positive outcomes for an organization in terms of employees’ greater engagement and motivation.

According to Parker (2000), cultural movement can be regarded “as an attempt to intervene in the identity of the employee just as all organizational control strategies” (p. 25). The application of governance techniques can allow an organization to benefit and increase benefits.

Contrary to the conventional wisdom, senior managers are not able to follow absolute neutrality in communicating ideas and making decisions. Moreover, they should rely on a set of moral and ethical value before addressing employees. In this respect, Watson (2003) agrees with the idea that “…managers cannot, therefore, act in an ethically deaf, dumb or blind manner” (p. 183).

Rather, ethics and moralities are important elements of the context of business corporations and, therefore, leaders should be agents of those corporations who are responsible for sustaining success of their businesses.

The above-presented evidence proves that absence of corporate social responsibility could have negative consequences for other dimensions of management. This is of particular concern to human resources management and change management because these fields cannot exist normally once specific ethical norms are provided.

Each manager, therefore, should bear a specific ethical responsibility for his/her employees to be able to define how their cultural and social background can contribute to performance and productivity of an organization. Therefore, management and morality are interconnected components, because its synthesis influences the welfare of the entire organization’s network.

Conclusion

Analysis of literature and evaluation of the proposed arguments have revealed a set of important conclusions. It should be stressed that business ethics and corporate social responsibility should reassure that business is managed for the benefit of the entire society. This thesis has been proved as soon as the purposes and importance of business ethics and morality have been defined.

The point is that business organizations cannot exist without a vision and mission which are based primarily on socially and morally predetermined policies. For instance, while selling a specific product, a manager should pay attention to customer demands, employees’ awareness, motivation and engagement.

The latter is impossible in case treatment and organizational culture are not introduced. Second, modern understanding of management comes in congruence with morality, which is an essential component of successful management of human resources. This is of particular concern to the issue of cultural diversity in the workplace, which is especially typical of multinational organizations.

References to history and anthropology of management have also provided important answers to the role of corporate culture in sustaining competitive organizational development. Specific attention should be given to the analysis of management is a powerful tool of controlling people.

Human factor is crucial for a manager to build up a set of ethical and moral principles in an organization and, therefore, denial of ethicality is not reasonable. In general, the main purpose of business is both receiving profits and contributing to the welfare of society.

Importance of introducing effective leadership through participative decision-making can also create new values in a business world and develop new managerial schemes for managers to apply. Therefore, business ethics gains greater significance in the globalized community.

References

Burgess, J., French, E., & Strachan, G. (2009). Workforce Diversity in Australia. In: J. Burgess, E. French, & G. Strachan (Eds.) Managing Diversity in Australia: Theory and Practice. Australia: McGraw Hill. pp. 17-38.

Michelson, G., & Kramar, R. (2003). The State of HRM in Australia: Progress and Progress and Prospects. Asia Pacific Journal of Human Resources, 41(3), 134-147.

Morgan, G. (2006). Images of Organization. US: SAGE.

Morgan, G., and Spicer, A. (2009). 12 Critical Approaches to Organizational Change. In: H. Willmott, T. Brigman, & M. Alvesson The Oxford Handbook of Critical Management Studies. US: Oxford Press. pp. 251-264.

Parker, M. (2000). Organizational Culture and Identity: Unity and Division at Work. US: SAGE.

Parker, M. (2002). Against Management: Organization in the Age of Managerialism. Australia: Wiley.

Pocock, B. (2005). Work/Care Regimes: Institutions, Culture and Behavior and the Australian Case. Gender, Work, and Organization, 12(1), 32-49.

Roberts, J. (1984). The Moral Character of Management Practice. Journal of Management Studies, 21(3), 287-301.

Roberts, J. (2001). Corporate Governance and the Ethics of Narcissus. Business Ethics Quarterly, 11(1), 109-127.

Rosen, M. (1988). You Asked For It: Christmas At the Bosses Expense. Journal of Management Studies, 25(5), 463-480.

Thompson, P. B., & McHugh, D. (2003). Work Organizations: Critical Introduction. US: Palgrave Macmillan.

Watson, T. J. (2003). Ethical Choice in Managerial Work: The Scope for Moral Choices in Ethically Irrational World. Human Relations, 56(2), 167-184.

Willmott, H. (1993). Strength is Ignorance; Slavery Is Freedom: Managing Culture in Modern Organizations. Journal of Management Studies, 30(4), 515-552.

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