Category: Business Ethics

The Peculiarities Of Business Ethics In Modern World

Business ethics is the study of suitable business policies and practices that influence behaviour. Business ethics, if adhered to, ensures a certain level of trust between consumers and corporations, guaranteeing the public fair and equal treatment (see Alexandra Twin, 2019).

The concept of business ethics began in the 1960s as corporations became more aware of a rising consumer-based society that showed concerns regarding the environment, social causes, and corporate responsibility. Business ethics goes beyond just a moral code of right and wrong; it attempts to harmonise what companies must do legally while maintaining a competitive advantage over other businesses. Fordham professor Robert Hurley suggests that customers or employees may well think that certain people or companies are ethical; that is, moral, honest, and fair: but that does not mean they should trust them. Trust, says Hurley, “comes from delivering every day on what you promise, as a manager, an employee, and a company. It involves constant teamwork, communication, and collaboration.” Trust comes from asking how likely the people you’re dealing with are to serve your interests, how much they have demonstrated concern for others, how well they delivered on their promises, how much they try to keep their word, and how effectively these skills are communicated.

Firms display business ethics in several ways including; equality or discrimination at workplace, racial or sexual harassment, corporate sustainability, corporate governance, corporate citizenship, insider trading, bribery, corporate social responsibility, and fiduciary responsibility. The law often sets guidelines for business ethics, however, other times business ethics provide a basic directives that businesses can choose to follow to gain stakeholders’ approval. These major ethical perspectives are discussed below.

All businesses have basic ethical and legal responsibilities; however, the most successful businesses establish a strong foundation of corporate citizenship, showing a commitment to ethical behaviour by creating a balance between the needs of shareholders and the needs of the community and environment in the surrounding area. These practices help bring in consumers and establish brand and company loyalty. many companies around the world are voluntarily adopting and implementing a broad range of sustainability practices as a response to emerging challenges and stakeholder expectations across the environmental, social and governance (ESG) domains. In doing so, they try to integrate corporate sustainability into their strategy, business models, and organizational processes and structures (Eccles, Ioannou and Serafeim, 2014). These domains are further explained below.

Adam Hayes defines corporate citizenship as a company’s responsibilities toward society. The goal is to produce higher standards of living and quality of life for the communities that surround them and still maintain profitability for stakeholders. There is a growing demand for socially responsible corporations, encouraging investors, consumers, and employees to use their individual powers to negatively affect companies that do not share their common values. Companies go through different stages during the process of developing corporate citizenship. Companies rise to the higher stages of corporate citizenship based on their capacity and credibility when supporting community activities, a strong understanding of community needs, and their dedication to incorporate citizenship within the culture and structure of their company.

Corporate governance is the system of rules, practices, and processes by which a firm is directed and controlled so that the interests of corporate owners and other stakeholders are protected. Corporate governance essentially involves balancing the interests of a company’s many stakeholders, such as shareholders, senior management executives, customers, suppliers, financiers, the government, and the community. Since corporate governance also provides the framework for attaining a company’s objectives, it encompasses practically every sphere of management, from action plans and internal controls to performance measurement and corporate disclosure. Good corporate governance is an essential foundation for achieving a strong ethics culture within an organisation. A company’s board of directors is the primary force influencing corporate governance. Bad corporate governance can cast doubt on a company’s reliability, integrity, and transparency; all of which can have implications on its financial health.

Environmental sustainability is defined as economic development that meets the needs of the present without compromising the ability of future generations to meet their own needs. Our economic system has brought prosperity, but it has also led to unsustainable business practices because it has assumed that natural resources are limitless, which they are not. At present, when the companies’ aim is creating a high market value, their management must focus on all the aspects of the company’s impacts that will, in turn, provide a comprehensive view of the company. Such impacts include the company’s environmental behaviour in the meaning of responsibility for the environment (Kocmanová, A., Dočekalová, M. 2011, pp. 203–208).

In the United States, the U.S. Chamber of Commerce, which is supposed to represent the views of business, has been resistant to climate change legislation. However, several companies like Levi Strauss, Apple, Tiffany, Exelon, Pacific Gas & Electric, PNM Resources, and Mohawk Fine Papers have resigned from the Chamber in protest. Perhaps, then, business can begin to take the lead. After years of being slow to address climate change, major corporations including industrial giants that make products ranging from electricity to chemicals to bulldozers have begun to call for limits on global warming emissions.

The Equality and Human Rights Commission defines diversity as “where many different types of people are included”. Workplace diversity relates to age, disability, gender, race, religion and belief, sexual orientation and other protected characteristics identified in the UK Equality Act 2010(3). Significantly, it also includes differences in areas such as values, thinking and viewpoints, socio-economic background, experience and knowledge. Companies that are committed to diversity are making an ethical undertaking to recruit and treat employees fairly and without discrimination. Diversity in the boardroom sets a leadership example and sends a powerful signal to all employees about the company’s approach to equal opportunities.

Another factor that exerts its toll on an organizations human resource and eventually negate business ethics is sexual harassment. Sexual harassment can be defined as unwanted sexual attention that creates an adverse work environment. This means obscene gestures, sex stereotyped jokes, sexually oriented posters and graffiti, suggestive remarks, unwanted dating pressure, physical nonsexual contact, unwanted touching, sexual propositions, threatening punishment unless sexual favours are given, obscene phone calls, and similar verbal or physical actions of a sexual nature (Rotundo, Nguyen, & Sackett. 2001). The harassment may be by a member of the opposite sex or a member of the same sex, by a manager, by a co-worker, or by an outsider.

Globalisation or the global economy refers to the increasing tendency of the economies of the world to interact with one another as one market instead of many national markets. The global economy has primarily been enhanced by global transportation in form of air travel and instant electronic media exchange made easy by the emergence of the internet and the world wide web. The arrival of the web quickly led to e-commerce, or electronic commerce, the buying and selling of products and services through computer networks. This has led to world economies increasingly being tied together, connected by information arriving instantaneously through currency traders’ screens, CNN news reports, twitter feeds, text messages, and other technology. Money, represented by digital blips, changes hands globally in a matter of keystrokes. The global economy refers to the increasing tendency of the economies of the world to interact with one another as one market instead of many national markets. Air travel, the internet and world wide web allows everyone to be global resulting in rapid business start-ups, company mergers etc.

Corporate sustainability is a corporate strategy whose objectives are towards long-term company growth, efficiency, performance and company competitiveness; achieved by the incorporation of economic, environmental and social aspects into corporate management (Beattie. A, 2019). Beatie urges that corporate sustainability in investment falls under the terms ESG for environment, social, and governance or the acronym SRI (chen. J. 2019) which stands for socially responsible investment. It has three main pillars: economic, environmental, and social. They are informally referred to as people, planet and profits.

The environmental pillar is most critical. Companies are focusing on reducing their carbon footprints, packaging waste, water usage and their overall effect on the environment. Companies have found that practices that are beneficial to the planet can also have a positive financial impact. Lessening packaging material usually reduces overall cost on those materials, for example Walmart’s zero-waste initiative.

A sustainable business should have the support and approval of its employees, stakeholders and the community it operates in. considerations include child labour, fair wages, racial and sexual harassment, and safety at work environment.

To be sustainable, a business must be profitable. That said, profit cannot trump the other two pillars. In fact, profit at any cost is not at all what the economic pillar is about. Activities that fit under the economic pillar include compliance, proper governance and risk management.

In conclusion, business is a growing field of concern as organizations continue to expand and economies tending to a globalized environment. A critical understanding and Adherence to the pillars of business ethics benefits the organization, environment and communities alike. However, neglecting these practices often lead to legal battles, mistrust from stakeholders and unhealthy financial returns.

References:

1. Beattie. A. (2019). Business: Business essentials. Business ethics. Corporate sustainability. Retrieved from https://www.investopedia.com/socially-responsible-investing-4689738
2. Chen. J. (2019). Business: Business essentials. Business ethics. Corporate social responsibility. Retrieved from https://www.investopedia.com/terms/c/corp-social-responsibility.asp
3. Hayes. A. (2019). Business: Business essentials. Corporate citizenship. Retrieved from https://www.investopedia.com/terms/c/corporatecitizenship.asp
4. Hurley. R. (2011). The Decision to Trust: How Leaders Can Create High-Trust Companies “Trust Me,” The Wall Street Journal.
5. Kinicki. A., Williams. B. K. (2016). Management: A Practical introduction (7th ed.). McGraw Hill Education.
6. Kocmanová, A., Dočekalová, M. (2011). Corporate sustainability: environmental, social, economic and corporate performance. Acta univ. agric. et silvic. Mendel. Brun.
7. Rotundo. M., Nguyen. D.-H & Sackett. P. R. (2001). “A Meta-Analytic Review of Gender Differences in Perceptions of Sexual Harassment,” Journal of Applied Psychology, pp. 914–922.
8. Twin. A. (2019). Business: Business essentials. Business ethics. Retrieved from https://www.investopedia.com/terms/b/business-ethics.asp.
9. United Kingdom. UK public general acts. (2010). Equality act 2010. Retrieved from http://www.legislation.gov.uk/ukpga/2010/15/contents

The Importance Of Business Ethics Among Stakeholders, Employees And Clients

Introduction

Ethics alludes to a set of accepted rules that aides a person in managing others. Business ethics analyze moral issues that emerge in a business situation. Ethics is connected to all controls of the executives, for example, human asset the board, creation, deals, advertising, and worldwide business. Moral conduct is significant when managing any partners who have a case on and a stake in an organization. The primary partner gatherings are investors, supervisors, representatives, providers and wholesalers, clients, network, society, and country. Partners can legitimately profit or endure misfortune by the organization’s activities.

In my view, one of the real organization’s partners are supervisors. Supervisors ought to make a working environment where colleagues certain and ready to raise ethical issues. Additionally, they should realize how to impact workers’ conduct in a ethical heading. I accept that supervisors have a genuine obligation to show representatives what they need to know to perceive and manage moral issues, which they are probably going to look at work. What’s more, administrators’ choices ought to mirror their own ethical guidelines of lead. Besides, their code of ethics should set up moral lead between not just the executives and workers, yet in addition the organization and its different partners. Directors settling on choices in universal business face various explicit moral issues, which are because of certain components, for example, the decent variety of political and legitimate guideline frameworks, the decent variety in types of efficient association and levels of financial advancement and inadequate guidelines or debasement in certain regions of the world.

Business ethics is basic in structure an organization’s picture which intensely influences the business itself and the general public encompass it. While numerous organizations have synonymized it with simply standing the laws, others are endeavoring to work morally and build up codes of behaviors for representatives to pursue. Acting morally doesn’t guarantee a productive result while untrustworthy business act doesn’t mean the business will be rebuffed. Notwithstanding, in the 21st century, organizations are being administered all the more cautiously and ethical business acts are normal from the open. Over the long haul, acting ethically additionally acquires the organization a bigger number of favorable circumstances than organizations that work unethically.

Business ethics thinks about what is good and bad (Velasquez 2006); it is the consolidated comprehension of the ethical standard, theory, legislative issues and law (Velentzas & Broni 2010). It gives a rule to company to work morally and an ethical standard to administer corporate conduct.

Importance of business ethics

The impact of business in the public eye is more noteworthy than at any other time. Numerous individuals from the network are uneasy with such advancements. Business ethics encourages us to get it why this is going on, what its suggestions may be, and how we may address this circumstance. Likewise, business acts of neglect can possibly deliver huge damage on people, on networks and on the earth. Through helping us to get it progressively about the causes and results of these acts of neglect, business ethics looks for, ‘to improve the human condition’. Besides, the requests being set on organizations to be moral by their different partners are always winding up progressively unpredictable and all the more testing. Business ethics gives the way to acknowledge and comprehend these difficulties all the more obviously, so firms can meet these moral desires all the more adequately. At last, business ethics is additionally incredibly intriguing in that it furnishes us with learning that rises above the conventional system of business examines and faces us with probably the most significant inquiries looked by society. The subject can accordingly be luxuriously compensating to consider in light of the fact that it furnishes us with information what’s more, aptitudes, which are not just accommodating for working together, but instead, by helping us to comprehend current social orders in a progressively deliberate manner, can propel our capacity to address life circumstances a long way past the study hall or the workplace work area (Part A. Understanding 2006).

Stakeholders and Ethics

The individuals and gatherings that have an immediate or backhanded stake in an association are called its partners. The fundamental partner gatherings are: investors, supervisors, representatives, providers and wholesalers, clients, network, society and country state (chapter 5 business ethics.) stakeholders. An investor (or investor) is a foundation or person that lawfully possesses any piece of a portion of stock in an open or private enterprise. This stock awards them the privilege to acquire a portion of the organization’s benefits as profits. Investors consistently need to accomplish greatest benefits. Along these lines, they focus on the organization and its directors so as to make sure that they are working viably to expand the organization’s gainfulness. In addition, investors need to guarantee that administrators carry on morally and that they care about organization’s notoriety.

Administrators are a critical partner bunch since they are in charge of utilizing an organization’s monetary capital and HR to build its gainfulness (Chapter 5. Business ethics). They should not carry on wrongfully or dishonestly or to seek after objectives that compromise investors’ or workers’ interests. They need to act morally as to the necessities of individuals in the association and the network. They ought to likewise give a working condition that ensures the wellbeing and security of representatives and limits worry at work.

Then again, chiefs are all the time gone up against with ethical issues in the work environment including representative burglary, deceiving or lying. There are numerous ways, wherein directors can impact the individuals in their organizations to carry on ethically. Initially, they can advance virtues that representatives use to decide. They can exhibit those values by carrying on with a particular goal in mind –, for example, by being straightforward. Supervisors have a genuine obligation to train workers what they have to know to perceive and manage ethical issues they face at work. Direction with respect to ethical lead is a fundamental part of controlling their activities. It can give significant data about hierarchical principles and approaches, and direction about conduct that is viewed as proper or wrong in various circumstances. As per Manning and Haddock (1990) there are five stages that must be taken by supervisors to build up a moral working environment:

1. Express your corporate qualities and ensure every one of your workers understand them.
2. Ensure your promises are never broken. Act with trustworthiness and anticipate workers also, partners to do as such too.
3. Express your appreciation. Exhibits of appreciation reinforce the ethical establishment of your office and support moral conduct from others.
4. Make others effective.
5. Settle on sure the entirety of your choices mirrors your ethical guidelines and qualities.

Employees.

Employees are likewise an essential partner bunch in light of the fact that the organization can’t exist without them. They work for that organization for monetary benefit. Chiefs frequently set various conditions to business, for example, a clothing regulation and conscious conduct. Representatives must be faithful to the organization they work for. Ethical direct empowers them to incorporate their own objectives with the organization’s points. Organizations with a ethical methodology accept that their workers are progressively dedicated to their prosperity thus. Furthermore, in that sort of organization representatives work more earnestly so as to accomplish hierarchical points. Moral associations additionally accept that they will be better ready to enlist well-qualified and propelled workers.

Providers and wholesalers.

Associations cooperate with their providers and merchants. A provider is an organization, which supplies parts or administrations to another organization. Ethical providers supply astounding items and look for long haul productivity. A wholesaler is an organization, which sells and conveys product to retail locations or goes about as a go-between in business. Providers hope to be paid reasonably and immediately for their sources of info while merchants hope to get astounding items at settled upon costs. The most significant issues associated with the installments or the characteristics of items are represented by the terms of the legitimate contracts, though numerous different issues are reliant on business ethics. The organization should treat the providers with reasonableness and respectability and assemble commonly useful connections, paying little heed to the estimation of the exchange or the length of the affiliation.

Clients.

Business ethics is particularly significant in managing clients. It is said that clients are the most basic partners. In this way, the organization’s primary goal ought to be consumer loyalty. At the point when clients are fulfilled, they will be faithful to the organization and return for re-obtaining. On the off chance that the shoppers are not fulfilled, at that point there will be no deals and no benefits either. Buyers will be fulfilled just if the organization pursues all the moral standards and qualities. Clients have more trust and trust in the businesspersons who pursue moral standards. In this manner, the best way to get by in business is to be completely forthright and reasonable. The organization’s essential obligation is to give customers great worth furthermore, top notch items that are dependable and safe.

Conclusion

Taking everything into account, business ethics is basic in working a business. It a major factor that business chiefs consider before settling on any choice. Deceptive organizations will undoubtedly have less preferences contrasting with ethical organizations when searching for coordinated effort, association also, even clients. Business ethics not just make work fulfillment, propel representatives and energize working morally inside, additionally influences how one’s business is seen by others. Keeping the moral business soul is significant, since exploitative business probably won’t be rebuffed by law, it contaminates the business culture, structure negative response inside and remotely. Despite the fact that how one perspectives ethics is extraordinary, business ethics will undoubtedly affect emphatically to the business adventure and the general public encompass it.

Business Ethics For Companies In Canada And Abroad

What is Ethic?

“Ethics or moral philosophy is a branch of philosophy that involves systematizing, defending, and recommending concepts of right and wrong conduct.” (1) They influence how individuals settle on choices and lead their lives. Morals is worried about what is useful for people and society and is likewise depicted as good way of thinking. Morals thinks about people and their connection with nature and with different people, on opportunity, on duty and on equity. Its subject comprises of the key issues of commonsense basic leadership, and its significant concerns incorporate the idea of extreme worth and the models by which human activities can be made a decision about set in stone.

What is business ethics?

“Business ethics is a form of applied ethics or professional ethics, that examines ethical principles and moral or ethical problems that can arise in a business environment.” (2) Business ethics is the examination of appropriate business courses of action and chips away at with respect to possibly questionable subjects including corporate organization, insider trading, gift, separation, corporate social obligation, and watchman obligations.

Business ethics in company in home country

“Carry out their responsibilities honestly and with integrity, exercising at all times their best independent judgment.” (3) Sobeys is working very honestly and with integrity in the Canada. As i mentioned their ethics in Canada in lower paragraphs:

• Working Environment: As Sobeys “Promotes a safe workplace.” (3) We endeavor to make a workplace described by trust and regard for everybody we manage – clients, individual representatives, providers and different partners in our business. The Company is focused on making a workplace which empowers all representatives to contribute dependent on their presentation and capacity. It perceives the pride and worth everything being equal and it empowers everybody to work without being hassled, threatened or confronting segregation.
• Insurance from Harassment and Discrimination: “Harassment means a course of conduct that is known or ought reasonably to be known to be offensive or unwelcome to the recipient.” (3) Each representative has a privilege to a work environment free from segregation and badgering. The Company restricts a wide range of unlawful segregation and provocation in the work environment, regardless of whether coordinated at an individual or a gathering. This incorporates segregation dependent on race, ethnic starting point, spot of inception, shading, religion, age, sex, sexual direction, conjugal status, family status and handicap. It can likewise be a course of lead or conduct that incorporates verbal, physical and psychological mistreatment which makes a scary or hostile workplace for the beneficiary.
• Confidential: “Confidential Information means commercially or competitively sensitive, proprietary or private information concerning the business and affairs of the company or suppliers.” (3) Unapproved exposure of Confidential Information can seriously harm the Company. The chiefs, officials and representatives of the company are denied from unveiling or utilizing Confidential Information aside from in the normal course of business. Workers who are not approved spokespersons must not react to request from the venture network, the budgetary media or different people, except if explicitly requested to do as such by an approved representative. Confidential Information must not be unveiled to anybody, inside or outside the organization, aside from in the essential course of business.

Business ethic plan for target country

• Worker Privacy: The Company regards all employees‟ protection and just gathers data about workers for legal reasons significant to the business. Data in work force documents and medicinal records is carefully secret. Access is accessible just to approved people. Accordingly, all solicitations for references or work data must be alluded to the Human Resources Department.
• Work environment Health and Safety: The Sobeys is focused on giving a sound, protected and secure work environment. To maintain this objective, we should all:
• Comply with all pertinent well-being and security enactment and guidelines.
• Comply with all ecological well-being guidelines.
• Comply with all Company well-being and security approaches.
• Wear or potentially utilize the well-being gear, materials and gadgets required by enactment and additionally Company arrangements.
• Take fitting activities to take out, control or report unsafe conditions when watched; we should never put our own well-being in danger in endeavoring to address a dangerous condition.
• Follow safe work strategies in doing our activity obligations.
• Keep personal life away from professional life: Now and then our own and business lives cover and we may discover ourselves in a place of considering a business association with a relative, life partner or dear companion or their boss. On the off chance that an issue settles, or on the other hand makes the appearance or impression of bargaining, our capacity to act in the Company’s best advantages, we should talk about the issue with our HR team. Issues that require dialog include:
• Hiring of a relative or close companion
• A relative is utilized by a contender at a senior level
• An individual with whom we have a nearby close to home relationship is a noteworthy investor or an official with a contender
• Purchasing merchandise or administrations for Company use from a relative or on the other hand dear companion
• Honesty: Ethics officials are straightforward and honest in the entirety of their dealings and they don’t intentionally delude or bamboozle others by distortions, exaggerations, incomplete facts, specific exclusions, or some other methods. Sobeys will always stay honest about price and qualities to customers and will never play a game with supplier about payments.
• Law abiding: Ethic officials keep laws, principles and guidelines identifying with their business exercises. As Sobeys are going to deal with medicines too on our store. We will always keep take care that our employees sell the powerful medicine to customer after checking the age of the customers and make a proper record of the customers.

Steps to build and implement ethic plan

• Define code of conduct.
• Hire ethics leader.
• Hire ethics committee.
• Ethics training and development to employees
• Ethics helpline to discuss issues and complaints.
• Time to time monitoring.
• Periodic Evaluation.
• Rewards to employees for excellent performance

Conclusion

The nature and objectives of business ethics should be comprehended with the end goal for people to comprehend their rights in the present society. Business ethics is an investigation that goes a lot further than the idea of deceiving or unscrupulousness. Themes including dependability, desires, and pessimism have an incredible influence in the investigation of business ethics. Along these lines, ethics may likewise be characterized as a lot of good standards. Our company will take care that every employee follows rules and regulations of the company. As smoking is prohibited in the stores.

Reference

1. https://en.wikipedia.org/wiki/Ethics
2. https://en.wikipedia.org/wiki/Business_ethics
3. https://corporate.sobeys.com/wp-content/uploads/2014/09/Business_Code_of_Conduct.pdf
4. https://www.canada.ca/en/treasury-board-secretariat/services/values-ethics/code/what-is-ethics.html
5. http://www.bbc.co.uk/ethics/introduction/intro_1.shtml
6. https://www.britannica.com/topic/ethics-philosophy
7. https://www.investopedia.com/terms/b/business-ethics.asp
8. https://corporate.sobeys.com/wp-content/uploads/2014/09/Business_Code_of_Conduct.pdf
9. https://josephsononbusinessethics.com/2010/12/12-ethical-principles-for-business-executives/
10. https://www.workforce.com/1997/09/01/12-steps-to-building-a-best-practices-ethics-program/

Ethical Aspects Of Nike Company

Introduction

Nike is an American-born company that is heavily involved in the designing and making of footwear, clothing, sporting-equipment and services. Its primary headquarters is located near Beaverton, Oregon and it is the world’s largest corporation in terms of sports related sales. The company was founded in 1964 and initially named ‘ Blue Ribbon Sports’ collaboratively by Bill Bowerman and Phil Knight however it was later renamed ‘Nike’. The company is globally renowned for sponsoring celebrity athletes such as Serena Williams, Michael Jordan and Tiger Woods, with its very recognisable slogan, ‘Just Do it’. Whilst Nike is perceived as a highly reputable and innovative corporation, their reputation has not always been maintained to the highest standard.

Nike’s success in sales and marketing

As a small and amateur company that started with 1200 dollars, no one could foresee Nike’s growth and success. So how is this growth “good” or beneficial? More than many other companies, Nike has developed a powerful and universally recognisable brand, thanks not only to its product offerings but also to a rich history of partnerships and sponsorships involving many of the world’s greatest athletes. While Nike is responsible for designing, developing, and marketing many different types of sports apparel and equipment, the vast majority of the company’s manufacturing is outsourced to independent contractors. This strategy has not only benefitted Nike financially ( as it is cheaper to manufacturer goods overseas, in countries such as Vietnam or China), it has also promoted the company’s products to many other countries in the world. These strategies conserve finances for Nike and increases sales significantly. According to Nike’s 2018 annual report, the company generated 36.4 billion American dollars in revenues or just under 16 billion dollars in gross profit. This record revenue for the company marks a 6% increase over 2017 figures. However, Nike’s success is not purely beneficial for the company itself, it has also helped innovate the shoes, apparel and sporting equipment industry significantly, which in turn benefits costumers.

Nike creates more jobs

Without question, a large-scale company like Nike would bring substantial numbers of jobs in all locations in the world however, what Nike has done in terms of increasing job opportunities is incredible. In the United States only, Nike has 76,700 retail employees alone. This does not include the designers, office-workers, delivery staff and so on. It is estimated that in the whole of Asia, Nike employs more than 80,000 workers, whether that’d be factory-workers, retail-staff, delivery-staff and office-workers. You can imagine how many Nike staff there are in the world. From the above statistics, it is proven that Nike has created many job opportunities in all locations of the world, and even helps out the disadvantaged ( by assigning them to factories).

Nike isn’t ethical

Although Nike have recently improved its reputation and dominated the shoes and sportswear industry, some of its practices are still questioned and completely not transparent. ‘The International Labour Rights Forum’ has stated that Nike has ‘turned its back on its commitment to the Worker Rights Consortium ( WRC)’, which effectively blocks labour rights experts from independently monitoring Nike’s supplier factories.’ ( Quoted from TILRF Website) Nike only managed to score 36 out of 100 in the ‘Fashion Revolution’s 2017 Fashion Transparency Index’, showing that the company is nowhere close to being transparent with its consumers. However, recently, Nike has made some positive alterations to its environmental practices by using sustainable and recyclable materials, including organic and recycled cotton and polyester whilst cutting down on water wastage. It has also made a public commitment and statement to decrease its carbon emissions by over 50% by 2025. Nike has joined ‘The Sustainable Apparel Coalition’, however, the corporation has not done much in terms of making their factory conditions healthier for their workers, which creates an immense problem for workers who are exposed to them and for those who choose to purchase Nike products. Greenspace, a credible organisation that deals with environmental issues, have voiced their concerns and disappointment in regard to Nike’s waste-release into water bodies. However, the company is ‘Fair Labour Association (FLA) Workplace Code of Conduct certified’ and managed to get the top score in the ‘2017 Ethical Fashion Report for its Supplier Code of Conduct’. ( However, this was questioned by many) Nike seems to give their factory workers very little power to speak up about their concerns in their personal safety and wellbeing, which should be a basic human right; especially in a corporation as large-scale and recognisable as Nike.

Conclusion

The discussion above may seem too balanced to ultimately decide whether Nike is ‘Good or Evil’ however, it seems to me that it is more good than evil. Even though currently, Nike may subject its factory employees to some hazardous materials, or their wages may not be high enough, they are working to improve this. However, Nike’s impact on the global economy and its innovative designs and products have not only benefitted themselves financially but has also satisfied their customers whilst improving the apparel and sportswear industry. Therefore, I believe that Nike is ultimately more good than evil.

Ethical Relativism Issues In Business

What is business ethics?

Ethics is the part of reasoning worried about the importance of all parts of human behavior. theoretical ethics, sometimes called normative ethics, is about delineating right from wrong. It is supremely intellectual and, as a part of the reasoning, rational. It is the reflection on and meaning of what is correct, what’s up, what is simply, what is uncalled for, what is acceptable, and what is terrible as far as human conduct. It causes us to build up the standards and by which we judge and guide significant basic leadership.

What is Ethical Relativism?

Ethical relativism is the hypothesis that holds that ethicists are comparative with the standards of one’s way of life. That is, regardless of whether an activity is correct or wrong relies upon the ethical standards of the general public where it is polished. A similar activity might be ethically directly in one society yet be ethically off-base in another. For the ethics relativism, there are no all-inclusive good gauges that can be all around applied to all people groups consistently. The main good principles against which a general public’s practices can be judged are it’s own. If ethical relativism is right, there can be no normal structure for settling ethics debates or for agreeing on ethics issues among individuals from various social orders.

Most ethicists dismiss the hypothesis of ethical relativism. Some cases that while the ethical acts of social orders may contrast, the key good standards hidden these practices don’t. For instance, in certain social orders, butcher one’s folks after they arrived at a particular age was normal to work on, coming from the conviction that individuals were in an ideal situation in existence in the wake of death if they entered it while still genuinely dynamic and lively. While such a training would be censured in our general public, we would concur with these social orders on the basic good standard – the obligation to think about guardians. Social orders, at that point, may vary in their use of crucial good standards yet concede to the standards.

THREE ISSUES OF ETHICAL RELATIVISM IN BUSINESS

Child Labour

The fundamental ethics issue in due regard is that under the umbrella of widely acclaimed brands, nearby providers are deceptively applying youngster work considering house-to-house destitution and the staggering residential conditions in Africa and East Asia wherein most families regularly view their posterity as the sole wellspring of pay. Thinking about this, it is fairly hard to state where the issue of ethics should start. Henceforth, the investigation of pertinent hypothetical methodologies is important to completely appreciate the reality of the issue. Fundamentally, ethics hypotheses depend on the center establishments, for example, standards foreordaining shared objectives planned to be accomplished by each ethics hypothesis, including however not constrained to least mischief, usefulness, equity, and self-rule. The abuse of kid work doesn’t agree to both of the previously mentioned ethics standards. Neither does it produce a constructive outcome on youngsters as per the ethics rule of usefulness. As indicated by the ethics guideline of least damage, it is evident that while organizations are dealing with their momentary trading and business worries at the expense of the creating scene, they are devastating a great many youngsters by denying them of the ideal for a better future. In such a manner, managers show an absolute lack of regard for kid’s self-sufficiency, including their interests, inclinations and real inspirations. At last, youngster work is a genuine case of treachery practice which expects in general unfavorable effects to kid workers and economy all in all. This shows the worldwide economy will keep on contracting since the hole among rich and poor is quickly extending, and barely any association needs uneducated as well as unfortunate representatives either today or later on.

Animal Testing

The Canadian approach t animal testing incorporates limiting creature enduring at whatever point conceivable and utilizing options where pertinent. While perceiving that upgrades in numerous meds and medicines for infection, immunizations and other wellbeing helps are to a great extent because of creature testing, Canada despite everything bolsters refinement, substitution and decrease methods in creature testing. In Canada, the Canadian Council of Animal Care (CCAC) guarantees that creatures are utilized under moral and appropriate conditions. They refer to that creatures utilized for testing purposes must get ideal consideration inside the domains of the exploratory use. Moreover, they should be dealt with compassionately and deferentially over the span of their utilization. This utilization happens in colleges inside Canada just as in government and private offices the nation over. Rules made by the CCAC that oversee the test utilization of creatures necessitate that creature use human comprehension of science or to the picking up of information with the end goal that creatures or people can profit. It additionally refers to the significance of experts who can affirm that the exploratory use is to the greatest advantage of human or creature welfare.

There are, be that as it may, even now numerous associations and individuals from the open who do restrict creature testing in Canada. These are contained principally of the individuals who contradict beautifiers testing however on the other hand, bolster the utilization of creatures just when totally essential and just for the improvement of ailments and related medical problems. Because of open interest for a conclusion to creature testing in the beauty care products industry, a few beautifying agent’s makers have reacted by abrogating creature testing on beautifiers and solidly expressing their position on this kind of creature testing. Notices and item flyers are utilized to unmistakably show when an organization is against creature testing, which has improved deals for certain organizations in Canada.

In the same way as other different nations, Canada is available to stopping creature testing if a practical option is found or created. Until further notice, in any case, no such elective exists that is proportional to a whole life form. This implies creature testing in Canada will proceed however that it will do as such under guidelines and guidelines that guarantee creatures utilized for testing are dealt with morally and sympathetically.

Discriminations

The United Nations 1948 Declaration of Human Rights promoted the concept that “All human beings are born free and equal in dignity and rights”. Unfortunately, in the workforce, people are often a victim of discrimination.

The discrimination made by companies toward their employees is considered to be unethical incorporate behaviors. The term discrimination describes a large number of wrongful acts in employment, housing, education, medical care and other important areas of public life. Discrimination in employment generally arises from the decisions employers make about hiring, promotion, pay, fringe benefits, and the other term and conditions of employment that directly affect the economic interest of employees.

Discrimination at work could be sex discrimination. The Sex Discrimination Act 1975 makes it unlawful for an individual to be discriminated against in the workplace to selection for a job, training, promotions, work practices, dismissal or any other disadvantage such as sexual harassment.

Discrimination is divided into two main categories, direct and indirect discrimination. Direct discrimination occurs where a person is treated differently on the grounds of their gender. Indirect discrimination is where an employer applies a requirement or policy, which though on the face of it has nothing to do with gender, in practice tends to affect one sex rather than another.

SHOULD MORAL THEORIES BE RELATIVE TO THE NORMS OF ONE’S CULTURE OR SHOULD IT BE ACCEPTED BY UNIVERSAL STANDARD?

The Abortion Debate

Some fetus removal rights advocates, in light of ace life contentions, act out such guard sticker mottos as: ‘Professional decision, however by and by restricted,’ ‘Don’t care for premature birth, don’t have one,’ or ‘Foetus removal is against my convictions, yet I could never fantasy about overwhelming my convictions on others.’ These trademarks endeavor to express in a basic manner a typical road taken by legislators and other people who need to stay away from the slings and bolts that normally follow an inflexible stance on fetus removal. It is an endeavor to discover ‘a trade-off’ or ‘a center ground’, it’s a method to abstain from being named ‘a fanatic’ of either camp. During the 1984 presidential crusade when inquiries of Geraldine Ferraro’s Catholicism and its evident clash with her premature birth rights position were noticeable in the media. New York Governor Mario Cuomo, in a talk, conveyed at the University of Notre Dame, endeavored to give this ‘center ground’ scholarly decency. He attempted to give a philosophical establishment to his companion’s position, however, he bombed wretchedly. For one can’t engage the way that we live in a pluralistic culture (portrayed by ethics pluralism/relativism) when the very inquiry of who is a piece of that society (that is, regardless of whether it incorporates unborn youngsters) is itself the point under debate. Cuomo made one wonder and lost the contention. The professional abortionist’s unaged suspicion of good relativism to understand the fetus removal banter uncovers a gigantic numbness of the master life position. For the truth of the matter is that if one accepts that the unborn are completely human (people), at that point the unborn conveyed in the bellies of ace decision ladies are similarly as human as those conveyed in the bellies of ace life ladies. For professional life, an unborn kid is no less a human individual basically because the youngster happens to be living inside Whoopi Goldberg or Cybil Shepherd. Philosophy doesn’t change character. Expert decisions should put probably some exertion into understanding the ace life position. At the point when they tell star lifers (as they regularly do) that they reserve a privilege to accept what they need to accept, they are accidentally advancing the extreme strategies of Operation Rescue (OR). Consider it. On the off chance that you accepted that a class of people was being killed by strategies that incorporate evisceration, suffocation, and consuming bringing about unbearable torment, as a rule, wouldn’t you be confused if somebody attempted to facilitate your shock by disclosing to you that you didn’t need to take an interest in the homicides on the off chance that you would not like to? That is actually what genius lifers hear when premature birth rights supporters let them know, ‘Don’t care for fetus removal, don’t have one,’ or ‘I’m ace decision, yet by and by restricted.’ In the psyche of the professional life, this resembles telling an abolitionist, ‘Don’t care for subjugation, don’t possess one,’ or disclosing to Dietrich Bonhoeffer, ‘Don’t care for the holocaust, don’t kill a Jew.’ Consequently, to demand that ace lifers ‘shouldn’t constrain their star life conviction on others’ while simultaneously guaranteeing that ‘they reserve an option to accept what they need to accept’ is to uncover a staggering numbness of their position. In opposition to mainstream thinking, the supposed ‘expert decision’ position isn’t unbiased. The premature birth rights lobbyist’s case that ladies ought to reserve the ‘privilege to pick’ to slaughter their unborn embryos adds up to denying the expert life position that the unborn are deserving of assurance. Furthermore, the ace lifer’s certification that the unborn are completely human with a ‘right to life’ adds up to denying the premature birth rights position that ladies have a central right to end their pregnancies since such an end would bring about a murder. It appears, at that point, that speaking to ethics relativism (or good pluralism ala Mario Cuomo) to ‘explain’ the fetus removal banter is a scholarly inconceivability and illuminates nothing.

Conclusion

It appears that ethical relativism must be false. Ethnicity is not subjective. The ethics status of actions like rape or murder is not merely a matter of taste. It is simply not true that things are wrong only because most of us presently disapprove of them, or that they would become permissible if our society suddenly started finding these actions to be acceptable. No, it seems obvious that actions like rape or murder are wrong not just because most of us find them distasteful but rather because there is some objective ethics truth of the matter about the ethical status of such actions.

Business Ethics Issues Of Volkswagen

INTRODUCTION

This essay will provide a detailed discussion on the emission scandal of Volkswagen which has involved legal as well as ethical issues. Suitable recommendations will be provided for the organisation based on theoretical models to avoid such issues in future.

UNETHICAL BEHAVIOUR OF VOLKSWAGEN

Volkswagen has been accused of violating the emission-related regulations in its cars. The company has installed emission software on its 10.5 million of its diesel cars. These are known as ‘defeat devices’ tends to detect if they were tested. It manipulates the performance and changes the results as per the limits set by the Environmental Protection Agency. However, under normal driving, the software gets switched to another mode which alters the exhaust gas recirculation, injection timing and fuel pressure. This model emits nitrogen oxide that is said to pollute the environment and cause lung cancer. The emission is higher by the federal limit by 40 times (Atiyeh, 2019). Earlier, Volkswagen has been performing marketing activities for its diesel cars at a huge level boasting the low level of emissions. EPA has found that Audi, Jetta, Beetle, Passat and golf are some of the models which have this emission software that includes 11 million cars in countries such as US, UK, Italy, France, Canada, Germany and other countries. Volkswagen has admitted that it has cheated the EPA regulation with the defeat devices. As a result, the company has lost the trust of the public and its customers. The scandal has made the environmental groups, regulators and politicians throughout the world to question its legitimacy. Volkswagen has to recall the affected vehicles in all the countries and the scandal has made the market shares to fall drastically (Hotten, 2015). Therefore, it could be understood that Volkswagen was involved in cheating the regulations. Emissions can affect the health of people and can affect the environment. The scandal has resulted in the loss of market share, trust and reputation of the organisation.

Ethical issues in business happen due to lack of awareness on the importance of ethics. The foundational values for identifying ethical issues are integrity, honesty and fairness. Fraud is one of the ethical issues in business which includes purposeful communication which manipulates or deceives and results in harm to others. It can also be a crime and usually includes accounting fraud, marketing fraud, fraud triangle, puffery and implied falsity (Said et al., 2017). Legal actions have been taken against Volkswagen and consumers have been seeking compensation for cheating on the emissions. More than 470,000 car owners of these diesel-powered vehicles are involved in the case. Already the company has spent over 30 bn for legal activities, compensation and fines after the scandal. Top management of the company has been accused to be involved in fraud for their approvals to fit the cheating devices in the vehicles (Jolly, 2019). Hence, it could be understood from the above scandal of Volkswagen that its leadership has failed to realise the importance of ethics where the values such as integrity, honesty and fairness have been lacking in the activities of the company. This has resulted in ethical issues as it has purposefully misled the consumers by fitting the cheating devices. Also, the regulatory standards have not been met and it has falsified information on emission values. Such activities have harmed the environment as well as society. Therefore, Volkswagen has to avoid involving in such unethical practices in future to ensure its survival in the industry.

RECOMMENDATIONS FOR FUTURE

Ethical decision making

Normative perspectives of ethics can be influential in aspiring followers with ideal goals. To ensure ethical decision making, it becomes important to recognise any ethical issues in a situation before making decisions. The facts are to be obtained, alternative actions have to be evaluated, and decisions could be made. It has to be then tested and the outcomes have to be reflected (Selart & Johansen, 2010). The management of Volkswagen has to incorporate normative perspectives of ethics in its decision making so that such issues could be avoided in future.

Incorporate Ethical values

Volkswagen has to enforce ethical values in its further practices. It can produce zero-emission cars that can reduce the emission levels by a considerable value. The company can emphasise on investing in electric cars with high power batteries. Several manufacturers established around the world for producing batteries could be influential in creating jobs. The EPA regulations have to be followed strictly without any cheating devices and have to be communicated with transparency (Mansouri, 2016). Volkswagen has to incorporate ethical values and strive to avoid any negative behaviour that can affect its reputation. It can involve creating electric cars that can serve the interest of society.

Ethical leadership

Ethical leadership makes the leaders demonstrate conduct by responsible and unselfish behaviour by the following integrity. The importance of ethics has to be realised and the leader has to spread the word to his followers. 4V model of ethical leadership emphasises on values, vision, voice and virtue to influence the actions of followers towards the common good by aligning the internal beliefs and external behaviours (Ahmad, Gao & Hali, 2017). Therefore, Volkswagen has to ensure that the leadership team is ethical with responsible conduct. Stringent measures have to be enforced for assuring the accountability of the leaders in senior management since the approvals for the cheating devices has involved their role as well. Thus, the 4V model could be useful for Volkswagen to ensure that the leaders serve as a guide for the practices in the organisation and prevent such issues in future.

CONCLUSION

From the above analysis, it could be concluded that the Volkswagen emission scandal is a major ethical issue which has compromised all the elements of ethics and acted in the interest of profit maximisation. The cheat devices installed have manipulated the values against the EPA standards and is legally accused as criminal behaviour. Such ethical issues could be avoided by Volkswagen in future through ethical decision making, ethical values and ethical leadership.

REFERENCES

1. Atiyeh, A. (2014). Everything You Need to Know about the VW Diesel-Emissions Scandal. Retrieved 08 Feb 2020 from, https://www.caranddriver.com/news a15339250/everything-you-need-to-know-about-the-vw-diesel-emissions-scandal/
2. Ahmad, I., Gao, Y., & Hali, S. (2017). A Review of Ethical Leadership and Other Ethics-Emission Test. International Journal of Science and Engineering Applications, 5(4), 211-216
3. Hotten, R. (2015). Volkswagen: The scandal explained. Retrieved 08 Feb 2020 from, https://www.bbc.com/news/business-34324772
4. Jolly, J. (2019). Volkswagen emissions scandal: mass lawsuit opens in Germany. Retrieved 08 Feb 2020 from, https://www.theguardian.com/business/2019/sep/30/volkswagen-emissions-scandal-mass-lawsuit-opens-in-germany.
5. Mansouri, N. (2016). A Case Study of Volkswagen Unethical Practice in Diesel Related Leadership Theories. European Scientific Journal, 13(29), 10-22.
6. Said, J., Alam, M.M., Ramli, M., & Rafidi, M. (2017). Integrating ethical values into fraud triangle theory in assessing employee fraud: Evidence from the Malaysian banking industry. Journal of International Studies, 10(2), 170-184.
7. Selart, M. & Johansen, S. (2010). Ethical Decision Making in Organizations: The Role of Leadership Stress. Journal of Business Ethics, 99, 129–143

Business Ethics: Ethical Issues, Common Business Objective And Whistle Blowing

Question: 1

The introduction:

Ethical issues:

Ethical issues in business are a situation where a moral conflict arises and must be addressed. In other words, it is an occasion where a moral standard is questioned. Ethical issues occur when a given dec you obtain or create in connection with your activities for ICICI Group, in accordance with the applicable law. Your obligation to protect ICICI Group’s proprietary and confidential information continues even after you leave the Group, and you must return all proprietary information in your possession upon leaving ICICI Group.

• Proprietary and confidential information include any system, information or process (sensitive in nature) that gives ICICI Group an opportunity to obtain an advantage over competitors; nonpublic information about ICICI Group businesses, its customers and its employees, any other nonpublic information received.
• Proprietary and confidential information about ICICI Group, a customer, supplier or distributor, should not be disclosed (even with best of intentions) to anyone (including other employees) not authorized to receive it or has no need to know the information, unless such disclosure is authorized by the customer or is required by law, appropriate legal process or appropriate internal authorities.
• Intellectual property of ICICI Group such as trade secrets, patents, trademarks and copyrights, as well as business, research and new product plans, objectives and strategies, records, databases, salary and benefits data, employee medical information, customer, employee and suppliers lists and any unpublished financial or pricing information are some examples of proprietary and confidential information that need to be protected.
• Unauthorized use or distribution of proprietary information violates the internal policies and could be illegal. Such use or distribution could result in negative consequences for both ICICI Group and the individuals involved, including potential legal and disciplinary actions.
• Acts of ignorance that could lead to leakage of such proprietary information, especially through electronic means – like e-mails, web uploads, removable media (e.g. CD/DVD/pen drive) etc., may lead to investigation and probe against the employees.

The conclusion:

ICICI Group is committed to adoption of fair employment practices. It ensures diversity of workplace through efforts to recruit, develop and retain the most talented people from a diverse candidate pool. It upholds the principle that advancement is based on talent and performance and there is a commitment to equal opportunity. ICICI Group is committed to prohibition of harassment and intimidation of employees in the workplace. ICICI Group discourages conduct that implies granting or withholding favours or opportunities as a basis for decisions affecting an individual, in return for that individual’s compliance. Such action is an easier form of harassment to identify because it takes the form of either a threat or a promise, whether explicit or implied.

ICICI Group has a Sexual Harassment Policy that prohibits unwelcome advances, requests for sexual favours, or other verbal or physical conduct where such conduct has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile or offensive working environment.

ICICI Group considers safety of employees as the primary concern. ICICI Group is committed to safety of employees and expects its businesses and employees to comply fully with appropriate laws and internal regulations

Question: 2

The introduction:

Common business objective:

Business objectives are the specific and measurable results companies hope to maintain as their organization grows. Entrepreneurs and business leaders must track performance in every part of their business to make sure they’re moving in the right direction.

Business objectives act as a compass for the modern company, dictating how the organization should allocate strengths, weaknesses and opportunities that may be available. Most of the time, objectives remain the same until the company’s circumstances change.

Examples of popular business objectives include:

• Revenue objectives: Maintaining consistent profitability is essential for any business. Companies cannot be profitable without consistent profit. Measuring revenue is a great way to track the sustainability of a firm.
• Operational objectives: Operational objectives include making sure that the logistical elements of your business are up to scratch. For instance, it might mean ensuring your supplies will arrive from a manufacturer at the same time each month. These objectives keep the company running smoothly.
• Productivity and performance: Employees are the lifeblood of a business. Making sure that employees remain productive drives revenue and improves customer satisfaction. Measuring employee satisfaction and setting goals for each team ensures efficiency and productivity.
• Customer satisfaction: The customer is always a top priority in any business. Some organizations regularly survey their clients to ensure that they’re making the right impression and driving loyalty.

Concepts and application:

All internal departments worked together to overcome the allegation and re- launch the same product in a way that it would earn the trust of its key consumers and stakeholders:

In the last three decades Maggi has grown drastically because it did not have any serious competition. Maggi has grown exponentially to become a generic brand, and has single-handedly taken the instant noodles category from being almost non-existent to a Rs. 1,200 crore one, of which it currently has, as per industry estimates, a 70% share, approximately. Initially Maggi only had to face competition from the Japan based Nissin

Group’s ‘Top Ramen’, and the Nepal based CG Foods ‘Wai-Wai’ Noodles. Wai-Wai, till recently, was restricted to the eastern market of West Bengal and Sikkim, where it controlled 70% of the market. Its strategy was to first build-up the distribution network, which it successfully did, the brand was available on the shelves of super stores, as much as in the local Kirana stores.

1. Innovative Promotion Techniques Creative methods of promotion should be employed in order to attract the attention of the public. Promotion should be done at public places, games should be organised, prizes should be given out, road shows should be done, mascots should be used, etc. Doing this will help Maggi to create a new image in the mind of the public.
2. New Packaging As Maggi is coming back into the market, it should come back with a change. It should change the packing design, so that the people also think that it is something different. New design will also lead to creation of brand and will have a positive psychological impact on the public. Public would always want something new or some variation in the product which it is using.
3. Campaign Maggi should use this issue as an opportunity and start a campaign with the title ‘Maggi is Back, Back with a Bang’. This would help them gain the popularity and would help in regaining the lost image among the customers. A campaign for positive publicity is required to counter the negative publicity campaign which has happened in the past. However, the campaign will not be able to show immediate results but would take time.
4. File a Case against the FSSAI Nestle should file a case against Food Safety and Standards Authority of India (FSSAI) as they have wrongly frame and were pulled to the court. They should also claim for damage of their brand name in the market. It is also said that Baba Ramdev is behind the Maggi ban. As he has close links with BJP, he has played the role of a catalyst, so that Maggi could be banned, for some reason or the other, and during this course of action he could introduce his noodles, which is called ‘Atta Noodles’. After it launch, it is also in news for the wrong reasons.
5. Corporate Social Responsibility Brand image is built when the customers and public have a good and positive opinion about the brand and company. Nestle should initiate certain activities relating to social responsibility under the banner of Maggi. This would ultimately help the company to come in contact with the general public and would help in developing a positive image about the brand. The CSR campaign would not should immediate results, but would gradually add value to the brand and company as a whole. However the objective of Corporate Social Responsibility is not to build brand it would be part and parcel of the activity.

The conclusion:

Maggi has become the most relevant, trusted and valuable food brand in India. It has understood the changing lifestyles of generations, provided products that the family enjoys and constantly innovated products that add value. Maggi the hot favourite among all the children in the country, noodles have come a long way since their introduction in 1983. It was considered as snacks in many households and a basic diet in many other homes. As people became busier and busier day by day, packaged and readyto-eat foods also began to gain quite a formidable share in the Indian food industry. It is because of Maggi that instant noodles have become a part of the food habit of Indian homes. Maggi has moved from being a 5 pm snack, to being a part of breakfast, lunch, and dinner, of the average Indian household. But in the recent past, the ban on Maggi has created a negative impact of Nestle and has created waves in the fast food industry. The case study is an effort to explore the various issues, possibilities and opportunities for Maggi.

Question: 3(a)

The introduction:

Whistleblower:

Whistle blowing refers to the act of organisation members, either former or current, disclosing information on illegal and unethical practices within the organisation to parties internal or external to the organisation, who can take action. It is becoming increasingly common as more and more employees speak out about their ethical concerns. It cannot be denied that whistleblowing is accompanied by a range of problems, for both the whistle-blower and the organisation. However, it can be argued that whistleblowing is an important and valid method of endeavouring to control possible unethical behaviour by organisations, as well as helping to establish a level of social responsibility. For these reasons, it is important for society to maintain a level of support and encouragement towards whistle-blowers, so that their often valuable contribution towards eliminating corporate wrongdoings can continue.

Concepts and application:

The ethical reason/s for becoming a whistle blower:

A whistle blower once testified in a California court about how his boss had regularly ordered him to discard some of the company’s toxic waste into a local storm drain rather than dispose of it properly. Why, the judge wanted to know, had the man finally decided to step forward after having participated in this illegal dumping for years. “Well,” the man explained, “I was fishing with my grandson, and it suddenly occurred to me that the waste I was dumping was going to pollute the water so that he might never be able to go fishing with his grandson.”

Whistle blowing has to do with ethics because it represents a person’s understanding, at a deep level, that an action his or her organization is taking is harmful—that it

interferes with people’s rights or is unfair or detracts from the common good. Whistle blowing also calls upon the virtues, especially courage, as standing up for principles can be a punishing experience. Even though laws are supposed to protect whistle blowers from retaliation, people who feel threatened by the revelations can ostracize the whistle blower, marginalizing or even forcing him or her out of public office. On the other hand, there have been occasions when the role of whistle blower has actually catapulted people into higher office and has earned the respect of constituents.

The conclusion:

NO, as an employee if I become a whistle blower, Then I am not being disloyal towards my employer because any potential whistle blower must realise that a well thought-out approach is both essential and practical. Firstly, be positive the situation is one that warrants whistle blowing. Secondly, carefully examine the motives behind the whistleblowing in order to ensure that they are genuine and can serve the public interest. Next, verify and document all information, as this will help to add further credence and strength to disclosures (CJC 1999, p. 13). Fourth, determine to whom the wrongdoing should be reported, and if the internal or external route is best. The allegations should then be stated in a clear, concise and objective manner. Lastly, ensure that all appropriate guidelines have been followed in reporting the wrongdoing.

Question: 3(b)

The introduction:

Business ethics:

Business ethics is the study of appropriate business policies and practices regarding potentially controversial subjects including corporate governance, insider trading, bribery, discrimination, corporate social responsibility, and fiduciary responsibilities. The law often guides business ethics, but at other times business ethics provide a basic guideline that businesses can choose to follow to gain public approval.

• Business ethics refers to implementing appropriate business policies and practices with regard to arguably controversial subjects.
• Some issues that come up in a discussion of ethics include corporate governance, insider trading, bribery, discrimination, social responsibility, and fiduciary responsibilities.

Concepts and application:

Reasons to showcase that study and understanding of ethics makes for a better manager, good business and happy society:

A number of factors play a part in making a business profitable, including expert management teams, dedicated and productive employees, consistent consumer demand, and a careful watch over the bottom line. In addition to these well-known business practices, companies that implement a management philosophy that relies heavily on business ethics are proven to be more successful than those that operate in an unethical manner. Although it may not be the first variable considered in analysing the profits of a company, business ethics is an equally important catalyst to the success of a company.

The leadership of an organization holds the key to its long-term success, and remaining consistent with a management philosophy built on a foundation of ethics creates a positive example for all workers. Ethical accounting practices, treatment of employees, interactions with the public, and information disseminated to shareholders are all responsibilities of the leadership team and can have a direct impact on the overall profitability of the company. When these integral aspects of a business are not performed with a resounding theme of business ethics from the top-down, each facet of the business beneath the management team has a greater potential to falter in the short or long-term.

Companies would be nothing without shareholders and investors, and as such, operating with business ethics in mind is most important when interacting with these crucial players. It is common for the profitability of publicly traded companies to decline rapidly when they encounter situations where information regarding unethical behaviour is discovered. When confidence is lost, it can be a struggle for a company to regain the trust of the public, its investors, and its shareholders; profitability may take years to build up again.

The conclusion:

Employee happiness can also have an impact on turnover and retention, as unsatisfied workers are more prone to seek out other opportunities, regardless of higher pay or benefits offered by their current employer. Continuous recruitment and training of new employees can reduce the capital a company can otherwise spend on revenue- producing activities, ultimately shrinking its long-term profits. Implementing a sound ethical policy at a company ensures a positive impact on all stakeholders, from investors to employees to consumers. Companies that lay the framework for business ethics in all facets of operations are more likely to become and remain profitable than those that conduct business in an unethical manner.

Business Ethics, Governance & Risk: Basic Questions And Answers

Question: 1

The introduction:

Ethical issues:

The specific ethical issues that charathe Code.

• You should not offer or give any funds or property as donation to any government agency or its representatives, in order to obtain any favourable performance of official duties.
• While you are expected to put in best of your efforts in every transaction, you will not be penalised by ICICI Group for delayed performance of a transaction solely on the grounds of refusal to pay bribes.
• You should familiarise yourself and comply with the Bank’s Anti-Bribery and Anti- Corruption Policy which is available on the Intranet. You should contact the Compliance Group with any questions on the matter.

Personal Investments:

• To protect the integrity of ICICI Group and its subsidiaries and affiliates, it is essential that you conduct your personal trading as per the framework prescribed for prohibition of insider trading under SEBI (Prohibition of Insider Trading) Regulations, 2015, in an appropriate manner that withstands public scrutiny and does not create even the appearance of impropriety.
• ICICI Group policy and the laws of many countries prohibit trading in securities of any company (listed / proposed to be listed) while in possession of material, non-public information (also known as inside information or UPSI*) of any company. Employees of certain ICICI Group businesses are subject to additional personal trading policy restrictions.
• You should note that using non-public information to trade in securities, or providing a family member, friend or any other person with a “tip”, is illegal. All non public information should be considered inside information and should never be used for personal gain.
• You are required to familiarise yourself and comply with the Code of Conduct laid by the Bank in line with SEBI (Prohibition of Insider Trading) Regulations, 2015 (or such other Code applicable to your Company), as amended from time to time copies of which are available on the Intranet or from the Company Secretary.
• You are required to ensure compliance and conduct your trading in accordance with Code on Insider Trading and the Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information (UPSI) of the respective company.

The conclusion:

ICICI Group encourages responsible behaviour of its employees and colleagues that result in the best possible accident prevention measures. This applies both to the technical planning of workplaces, equipment, and processes and to safety management and personal behaviour in everyday workplace. The quality of our relationships with our suppliers and other external counterparties often has a direct bearing on the quality of our products, services and ultimately our customer relationships. We therefore expect our suppliers to operate to the same standards as we expect of ourselves. All such relationships with external counter-parties should be conducted in professional and impartial manner. Vendor selection and hiring decisions must be made objectively and in best interest of ICICI Group, based on evaluation of integrity, suitability, price, delivery of goods/ service, quality and other pertinent factors. You should commit to fair contract and payment terms with them in return of good service at a good price supplied in a responsible manner. Employees, officers and Directors are prohibited from taking for themselves business opportunities that arise through the use of corporate property, information or position. No employee, officer or Director may use corporate property, information or position for personal gain, and no employee, officer or Director may compete with ICICI Group. Social media allows users to interact with each other by sharing information, opinions, knowledge and interests. Some examples of social media are sites such as Facebook, YouTube, LinkedIn, Orkut, Twitter etc.

Question: 2

The introduction:

Common business objective:

Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate the employees. It also enables the business to measure the progress towards to its stated aims.

When someone first sets up in business, he/she may have some unstated aims or objectives – for example to survive for the first year. Other businesses may wish to state exactly what they are aiming to do, such as Amazon, the Internet CD and bookseller, who wants to ‘make history and have fun’.

An aim is where the business wants to go in the future, its goals. It is a statement of purpose, e.g. we want to grow the business into Europe.

Business objectives are the stated, measurable targets of how to achieve business aims. A mission statement sets out the business vision and values that enables employees, managers, customers and even suppliers to understand the underlying basis for the actions of the business.

A business may find that some of their objectives conflict with one and other:

• Growth versus profit: for example, achieving higher sales in the short term (e.g. by cutting prices) will reduce short-term profit.
• Short-term versus long-term: for example, a business may decide to accept lower cash flows in the short-term whilst it invests heavily in new products or plant and equipment.
• Large investors in the Stock Exchange are often accused of looking too much at short-term objectives and company performance rather than investing in a business for the long-term.

Concepts and application:

All internal departments worked together to overcome the allegation and re- launch the same product in a way that it would earn the trust of its key consumers and stakeholders:

After the ban of Maggi, India today television team conducted a sting operation in which they approached FSSAI officials pretending to have a food product with high lead levels in October 2015. One of them agreed to pass the samples without conducting any tests. He told the team that they need a pay an amount of Rs. 20,000 on a yearly basis. He revealed that milk samples from one of India’s best known companies had been dismissed by deliberately adulterating it, because company did not agree to bribe the inspectors. He further revealed that they sometimes have pressure to declare food samples of some established brands as unsafe. He also stated that Maggi is an international brand, there may be a possibility that someone asked for donation and the company denied. He also stated that the laboratories and samples lie under the government, it can do anything. Food and Consumer Affairs Minister Ram Vilas Paswan reacting to the operation said that, “Standard products are being labelled as sub- standard and faulty products are being passed by such corrupt officials. This is a big crime and I demand strongest possible action against all those found guilty and promised to take serious action, although FSSAI is not administer by his ministry.

Commenting on the reports, Union Health Ministry stated that FSSAI has clarified that the officials who have figured in the sting operation are not working in FSSAI but are employees of the UP State Government.

1. Target Online Sales A large percentage of people who use Maggi as a meal are people who are pretty busy and who do not have time to cook. These categories of people are generally found in cities and urban areas. The people who live in cities and urban areas prefer online shopping to a very larger extent. Thus, Maggi should initially focus on publicity of the product online.
2. Increasing the Product Line Maggi should relaunch itself by adding new products to its product line. Adding now products would stimulate the customers to try new products which would also help the company to generate sales. Maggi should basically introduce new flavours into the market under the veg and non-veg category. For example, it can introduce Maggi with Potato flavour under the veg category and Mutton flavour under the non-veg category.
3. Indulging in Positive Publicity For six months, Maggi has been a victim of negative publicity, thus it should do something new would help them grab the attention of the media and then the public. For example, the company can launch an advertisement campaign with some creativity or should come up with an innovative product which should have the capacity to grab the attention of the media. iv. Target Children and Women Children’s should be targeted as would be soft targets. Advertisements should be created mainly focusing and targeting the children. After children, the women would play a significant role in deciding what their family members should eat and what they shouldn’t. Thus, focus should be given on women, showing that it is the women who are making a wise decision by opting for Maggi.

The conclusion:

Today, organizations are operating not only by fulfilling the government regulations, but arc partnering for the sustainability and responding to the increased concerns from the consumers and society about human health impact of the products, operations and resources depletion. The company that moves beyond the self-interest and operate selflessly for the betterment of all sectors it affects can actually secure self-interested achievements in the end. Food products industries have to be even more responsive as intake of bad quality product can cause irremediable harm to the health of the consumer and sometimes become the cause of death too. The Nestle India controversy these days have become an eye opener for many on one hand it shows that we Indians easily believe on what is said and not on what the reality is, it is very easy to be fool innocent consumers and make millions and billions of money. Many literate consumers also do not bother to read the ingredients except the expiry date or price on the pack which is their prime concern and it results because of the blind-folded faith in the brand.

Question: 3(a)

The introduction:

Whistleblower:

Employees who discover apparent wrongdoing within an organisation are faced with several options, each of which comprise of both negative and positive aspects.

Generally, a whistle blower may hesitate to report wrongdoings either internally or externally due to a fear of losing their job or being transferred to an undesirable location, being subjected to harassment and victimisation (Lewis, 1997), having their lifestyle, competence and mental health questioned, and becoming a focus of public attention, resulting in a loss of privacy (Criminal Justice Commission [CJC] 1999, p. 2). As well, they may struggle with a sense of disloyalty, where they inadvertently feel as if they are betraying their fellow colleagues or organisation if they report what they know. Larmer (1992 cited Jones 1996) states that a loyal employee will discern that any unethical behaviour can never be in the best interests of an organisation, and to ignore it with silence is in itself disloyal.

Concepts and application:

The ethical reason/s for becoming a whistle blower:

When a person encounters wrongdoing in the public sphere, his or her first step should probably be to use the organization’s internal whistle blowing mechanisms. William Black, professor of law and economics at University of Missouri-Kansas City, was himself a whistle blower when he worked as a Savings and Loan regulator in the 1980s. During a term as visiting scholar at the Ethics Center, he wrote about his experience:

Whistle blowers in the public sector often face the unique problem that their disclosure may constitute a crime. This can create an ethical dilemma when the ongoing misconduct is severe and there is no reasonable prospect that the abuse will end absent blowing the whistle….I would still recommend trying to get the responsible organs (e.g., your agency’s/department’s congressional oversight committees and/or inspector general) to take action first unless the threat to public safety was imminent.

All government bodies should have fairly straightforward lines of authority. For example, if a councilperson has a problem with city staff, he or she would go to the city manager. If an employee of the water district sees wrongdoing, he or she would start with a supervisor and move up the chain of command, and so forth. It’s always best to start with the mechanisms the organization has set up to deal with problems because these represent the best chance at an amicable solution.

If this process does not produce results, however, it’s not enough to say, “Well, I did my best.” If wrongdoing is not being addressed within the organization, it may be time to move outside—to the district attorney, the grand jury, or to the press.

The conclusion:

No, as an employee if I become a whistle blower, then I am not being disloyal towards my employer because a leaker must determine if the conduct he or she is exposing represents actual wrongdoing or if it is simply represents a policy disagreement.

Question: 3(b)

The introduction:

Business ethics:

Business ethics ensure that a certain basic level of trust exists between consumers and various forms of market participants with businesses. For example, a portfolio manager must give the same consideration to the portfolios of family members and small individual investors. These kinds of practices ensure the public receives fair treatment. Business ethics are meant to ensure a certain level of trust between consumers and corporations, guaranteeing the public fair and equal treatment. Business ethics goes beyond just a moral code of right and wrong; it attempts to reconcile what companies must do legally versus maintaining a competitive advantage over other businesses. Firms display business ethics in several ways.

Concepts and application:

Reasons to showcase that study and understanding of ethics makes for a better manager, good business and happy society:

Business Ethics and Employee Morale:

It has been proven time and again that employees who are satisfied with the environment in which they work are more productive than workers who are unhappy. Unethical practices in the workplace can cause widespread unrest with employees, leading to a greater sense of dissatisfaction with the work that they are doing and with their employers. However, when business ethics are encouraged by management and company executives lead by example, the ability of employees to focus on the work they need to complete increases exponentially. Productivity increases when fewer distractions are present and morale is high, and this leads to greater profit levels for the company.

Employee happiness can also have an impact on turnover and retention, as unsatisfied workers are more prone to seek out other opportunities, regardless of higher pay or benefits offered by their current employer. Continuous recruitment and training of new employees can reduce the capital a company can otherwise spend on revenue- producing activities, ultimately shrinking its long-term profits.

Business Ethics and Public Image:

Companies would be nothing without shareholders and investors, and as such, operating with business ethics in mind is most important when interacting with these crucial players. It is common for the profitability of publicly traded companies to decline rapidly when they encounter situations where information regarding unethical behaviour is discovered. When confidence is lost, it can be a struggle for a company to regain the trust of the public, its investors, and its shareholders; profitability may take years to build up again.

The conclusion:

All companies rely on consumers for profits and consumers prefer doing business with ethical companies. According to a study conducted by Nielsen, 55% of online shoppers in 60 countries would accept paying more for goods or services from companies that are focused on having a positive impact on society and the environment. Studies also show that more than 50% of consumers cease spending their money with companies that are unethical. This is particularly easy given the number of substitute products available in the global economy. Implementing a sound ethical policy at a company ensures a positive impact on all stakeholders, from investors to employees to consumers.

Understanding the Importance of Business Ethics

1. Introduction

What are we aware of the ethics of business? Have we ever experienced a difficult ethical issue in which we have to determine what is correct or what is totally off base may be? In modern society and corporate world, business ethics is now a central issue. If we search for the word ethics, we will constantly find five related words: ethics, virtues, morals, values and principles. These words seem interchangeable to the casual observer; indeed, to develop good ethics, each term builds on another. Any business ‘ core goal is to maximize its profit and value. The more revenue a company makes the longer the life of the business would be, and when a business makes earnings in an unethical manner, the life of the business can be shortened. In order to achieve strong ethical morals, both business organizations and individuals should adhere to solid morals. Business needs to balance the ambitions of increasing profits with needs of society. Many corporations have ended in failure because of their terrible business ethics ‘ financial and legal ramifications. Maintaining a healthy balance that often requires compromising profits for society’s needs and demand is essential for businesses.

2. Understanding the Importance of Ethics

Good ethical quality and moral rectitude are essential attributes to show for citizens as does for anybody without any yearning for the government and law enforcement. Naturally we realize that being good and acting upright is a nice thing to do, but then again through considering the objectives behind ethical and moral quality, we must support and encourage such activity. One of the motivations to be good and necessary is to pay little attention to work. Among the reasons to be moral and integral, regardless of occupation are to:

• BUSINESS SUCCESS, if we are hired in a profession where we would have to depend on others, our ethical behavior will determine the level of loyalty we accrue from everyone else. Organizations with a verified bad history are usually seen with alert and are not likely to attract new customers by listening to the conversations of others and will probably not flourish in this way. This is particularly the situation in which internet-based life promptly makes audits available to clients
• REDUCING STRESS, once we settle on cynical actions we might feel insecure and worried about our basic leadership. Significantly stepping on the right choice or taking a principled view of an issue lessens the pressure.
• SECURING A SUBSTENTIAL BUSINESS, businesses sometimes take a gander in the past actions of an individual as an indicator of future actions. In a significant activity someone who has a background marked by unethical behavior will experience problems verifying work as that individual may not be trusted.
• ABSOLUTE EQUALITY, equality is the foundation for most governments of the modern democracy where equivalent privileges are managed by all individuals. This would be absolutely nonsensical without all of the moral efficiency of most people.
• MAKING SOCIETY A BETTER PLACE, by helping to improve society we are remunerated by improving our own lives as well as the lives of our families and our businesses. Society would be a hopeless spot without good leadership and ethics.

We strengthen our live as well as the lives of people surrounding by being ethical. it is notably absolutely essential to pursue an ethical life even if we are pretty young as it is useful to practice and exercise these ideas before gradually dealing with serious issues and problems.

3. Literature Review

Even more than before the demand for a worldwide ethic is increasing. We live in a society that is largely connected leading to more possibilities for communication and confrontation. Investment-centered disparities are the main reason of many nation-to-nation disputes and answers to environmental and economic difficulties almost always involve international cooperation.

3.1 Definition and Theories

Ethics is an aspect of justification that manages the requirements of deep reliability and the well characterized gauges of right and wrong that endorse human character and direct as far as commitments rights rules social advantage decency etc. Ethics involves a discipline that examines good or bad practices within the context of a moral duty. Business ethics include practices and behaviors that are good or bad

3.2 Discussion and Analysis Ethical Challenges Faced by Organizations

It is important to make a distinction between greed and self-interest. The two terms are not synonyms and there is a world of difference between them. Greed may work in the short run, but is very destructive in the long run as the following indicates, bold

Business ethics history is an ongoing story of the employee-employer relationship from the labor conditions of the factory to 20th century’s diversity training focused workplace. As shown in the 2013 National Business Ethics Survey, supervisors are to blame for the work environment offending the dominant part of the time , which is almost 60 percent ,ranking senior managers are almost certain of defying the guidelines than those at a lower level.

BAD LEADERSHIP, It is not the staffs that show immoral behavior in some situations, but the organization’s proprietor or leader. Establishing principles for staffs while not tailing them is a case of a moral issue in the workplace. In order to keep employees motivated and happy with their working environment, a true employer should try to do what he says others should do and maintain their own moral behavior.

Technology and Privacy Concern, The current security technologies for advancement can imply that businesses can use innovation, such as texts, emails and site history, without too much of a stretch monitor for their specialists. In any case, an entrepreneur might well continue to run into the moral issue of how much security an organization staff can anticipate on an organization gadget, regardless of the source of whether it is a PC, tablet or telephone. Similarly Internet-based usage, employees should have a distinctive understanding of how much they have, assuming any, and security when using a claimed gadget organization. If the organization initiative intends to peruse email or if its web use will be followed, they should be cautioned.

Perils of Employee Favoritism, while it is not preposterous for an organization’s owner to have representatives that they appreciate working with more than others, moral issues will arise if the individual in an organization place shows a worker with no moral legitimacy behind it to be generally opposed. Giving employees up to playing personal favorites can cause major problems and organizations might end up losing important employees.

Cooking the books (Accounting), conducting unethical accounting practices is a serious problem, especially in publicly traded companies. One of the worst infamous brands was the embarrassment of 2001 that wrapped American vitality organization Enron, which for a long time mistakenly announced its fiscal reports and its inspector, bookkeeping firm Arthur Andersen, approved the announcements despite being inaccurate. When reality devised, the two organizations left business, Enron’s investors lost $25 billion, and despite the fact that the previous ‘Enormous Five’ bookkeeping firm had a bit of its staffs working with Enron, the company’s conclusion resulted in a loss of some 85,000 positions.

Health and Safety, ILO (The International Labor Organization) claims that more than 2 3 million people die worldwide each year from employment-related accidents or sicknesses. That makes 6300 deaths every day. The top 10 most frequently cited violations of 2015 are, according to the Occupational Safety & Health Administration,

1. Communication of hazards, for example, categorization of harmful chemicals
2. Lockout / Tag out, for example, trying to manage unsafe energy like oil and natural gas.
3. Powered industrial vehicles, such as fire truck safety regulations.
4. Ladders, e.g. standards for how much weight a ladder can sustain.
5. Electrical, cabling techniques, i.e. electromagnetic interference reduction methods.
6. Machine guarding; for example, to clarify those chainsaw blades, saws, power presses and other equipment require monitoring point of procedure.
7. Fall Protection, for example, unsecured sides and edges and leading corners.
8. Respiratory safety, such as safety procedures and standards for respiratory / filter facilities.
9. Electrical, particular requirements; i.e. do not place drivers or equipment in humid as well as humid places.
10. Scaffolding e.g. required strength and the maximum amount of weights.

Though, physical hardship is not the main security problem to be considered about. An ILO report specialized on the negative impact of ‘psychological health consequences’ on the well-being of workers in 2016. These potential risks, these include components such as occupational weakness, popularity levels, gender imbalance in compensation and poor self-sufficiency, are influenced by social safety risks connected to well-being, including an inactive one.

3.3 Improving Personal and Organizational Effectiveness (Contribution of ethical measures)

If we want to run a sustainable business, then it is absolutely necessary to have a set of high ethics. Even though each man and his puppy seem to own a few Nike these days, the Nike image was interchangeable with sweatshops and misleading manufacturing in the relatively recent past. But does this brand value the care of individuals, society and animals today? In 1991, a famous activist named Jeff Ballinger distributed a report listing small pay rates and unsafe working conditions at Indonesian manufacturing facilities of Nike. The brand became the subject of a strong and backed up battle between United Students and Factories. Nike was at first moderate to react – yet under expanding weight it in the end rolled out certain improvements by improving its checking endeavors, rising the base period of laborers, and expanding industrial facility reviews. Since then, the brand has earned far and wide acclaim for its efforts. Just last year, Business of Fashion reported that Nike has extensively turned its damaged reputation into a ‘recognized leader in sustainability,’ with Morgan Stanley ranking Nike ‘the most environmentally and socially sustainable apparel and Footwear Company in North America, including its labor record.’

Good ethics might be critical to establish, but if bad ethical decisions are taken, severe consequences will arise. Whether we honestly think that good business ethics leads to profits or not, poor ethics will have a significant effect on in our own ultimate outcome. Misinformation, misguide and bad decisions without standards that can lead to economic loss or accident to other individuals or business. Several criminal cases are brought up since people require reimbursement for their casualties as a result of unethical decisions being made by business people.

3.4 Ethical Business Practice

Business ethics are the standards of behavior for making business determinations identifying what’s good or bad and drawing up frameworks that a business must engage in. Since acquiring faith and confidence from its customers is very essential for an organization, business ethics plays a significant role in establishing values for its clients. Here are some examples of business ethics:

Examples of Business Ethics:

Enforcing Policies: Ethical values may not always be enhanced and laws and regulations will naturally be compromised. It is essential that inappropriate actions is not accepted and there are has to be legal ramifications for it. Pushing liable employees should prevent any unwelcome practices from being reinforced and tuck them before they get out of grasp.

CSR: Corporate Social Responsibility focuses through the very concept as industry uses the society’s capital; it requires restoring some benefit to society. Businesses can do that by investing in education, developing transportation infrastructure, contributing money to civilized charitable organizations, and so on. Thus an organization creates a better relationship outside the business with the society.

Developing ethical standards: An essential task is to simplify standards and clarify what behaviors in the organization are and isn’t appropriate. Build a code of ethics that describes good business behavior and must make all employees conscious of everything.

Appreciating Positive Attitude: the search for great practices is extremely valuable to laud officials. Compensation for the staff portion could be straightforward affirmation. This should be a positive motivating force that can be a long term business advantage.

Set examples: it is significant that pioneers demonstration ethically and fill in as models for the remainder of the representatives. Whenever pioneers and directors try to do they say others should do and maintain an exclusive expectation of morals it will normally acclimatize into the way of life of the association.

3.5 Ethical Business example

It is quite simple to paint the corporate world in a negative light between the relentless challenge and the flawed movements made to expand net income. Nevertheless there are many organizations out there that hold on to a higher standard and show consideration for their general environment. This rundown praises organizations with excellent good practices from having the best representative advantages to advocating instruction and earth.

Cadbury: Cadbury’s ethical standard is not something new. John Cadbury founded the company in 1824. He was a Good Samaritan who decided to sell cocoa and tea to extricate people from alcohol the organization moved to Bonneville in 1879 a country site next to Birmingham to be in a more advantageous cleaner area. The organization paid high wages set up great working conditions spearheaded annuity plans and a well-being administration for it employees. the organization stays at the bleeding edge of corporate and social responsibility even after two centuries later.

TATA: Tata is one of the largest Indian corporations established in Mumbai. In 1868 the company was founded by Jamsetji Tata, in the wake of obtaining a few worldwide organizations, the organization increased global acknowledgment. Tata Steel has been perceived as a standout among the most ethical organizations in the world. It’s often recognized because of its commercial action transparency. It offers its workers with so many welfare benefits. The company’s CSR practices are quite well acknowledged.

H&M: H&M one of the biggest apparel manufacturers in the world is extremely devoted to its clarity in the manufacturing process. Once every three months they distribute and update a rundown of 98.5% of the names and addresses of their providers on their website. This guarantees they can be considered freely responsible for their providers ‘ conduct, and that anybody can confirm that their providers satisfy the organization’s guidelines. Other than sharing data on the inventory network, H&M additionally has a dependable sourcing target of utilizing just 100% recycled or supportable materials by 2030. This will allow H&M to become true a pioneer, an innovator in apparel retail ethics.

4. Conclusion

After quite a brief discussion on the need and difficulties of ethics in businesses, the vast majority are familiar with hearing or seeing the moral benefits of profound corporate quality. Since we comprehend the business morals thought solid moral ethical quality is essential to work out. To show others how it’s done to instruct by guide to be a good example these are on the whole conceivable results in the event that we practice moral conduct and act dependably and take moral choices for our business. Ethics begins at the highest level that implies that anyone in charge should work and live ethically to give more people who work for them a prime example. It is important to develop ethical behavior throughout the corporate world to build confidence and to provide a sincere products or services.

5. Recommendations

People neglect business ethics and corporate social responsibility in order to make money, and ultimately lead to the serious consequences. Thus, connecting utmost importance to ethical social responsibility is of great significance for the business, but since when paying attention to making money in any way. While dissecting moral arrangements it is important to consider the expenses and advantages related with working together morally however it is vital to take a gander at long term impacts versus short term costs.

Partial Fulfillment of the Requirements for Ethics and the Legal Environment of Business

Corporations institute compliance and ethics programs (C&E) with the purpose of following the law and promoting ethical conduct on a daily basis. Traditionally, public law and order officials were authorized to keep a watch and prosecute civil and criminal infractions by business entities and their owners. Over time, businesses found it more beneficial to comply with public pressure for self-policing. “Outrage over ethical and financial misconduct by the senior management of public companies led to the passage of historic legislation redefining the roles and responsibilities of corporations and those who serve them.” (FindLaw, 2019).

A large number of corporate cases of bribing foreign officials for business and contracts, particularly government contracts, led to the coming of the Foreign Corrupt Practices Act (FCPA) in 1977. The investigations of offenders were carried out by the Securities and Exchange Commission (SEC). Enforcement is the joint responsibility of SEC and the Department of Justice (DOJ). (SEC, 2017). Enforcement agencies were formed to give teeth to the law. Such agencies were Environmental Protection Agency (EPA) and the Drug Enforcement Agency (DEA).

With the corruption and illegalities exposed in defense procurement in 1980s companies were in the negative radar of public resentment. Karpoff et. al. (1999) reported, “… from 1983 through 1989, 17 top defense contractors were convicted of fraud, whereas none was from 1946 through 1982 … From 1983 to 1995, these 98 companies were incriminated in press announcements for 249 separate cases of (alleged) procurement fraud … The most announcements in a single year occurred in 1988… Intentional frauds include mischarging, bribing, falsifying test results, and submitting false claims or invoices.” Managers were aware of the fraudulent activities. The contractors were penalized about the same, proportionally irrespective of size.

In response, companies started to create managerial positions for in-house policing. They are known as compliance and ethics officers. The purpose was to preempt further federal regulation by voluntary corporate responsibility. In 1991, the US Sentencing Commission released the first guidelines for organizations. It defined the specific requirements for an effective compliance and ethics program. Currently, there are stiffer federal sentencing guidelines for frauds committed with managers’ intent (Karpoff et. al., 1999). Leniency was proposed for successfully compliant companies.

Successfully compliant companies are considered favorably by prosecutors for pretrial agreements and deferred prosecution agreements in corporate criminal investigations. Executives of unsuccessful or noncompliant organizations can be imprisoned. Companies are increasingly integrating C&E programs into risk management and general counsel oversight.

The revelation of Enron’s unethical practices from 2001 was another major historical point for reforms. (FBI, n.d.). The directors of Enron had precisely waived the provisions of the code of ethics before their horrendous collapse. The chief financial officer was allowed to benefit from transactions involving Enron. Such blatant unethical behavior led to reforms incorporated in

Section 406 of the Sarbarnes-Oxley Act. The Act addressed the unethical practices at Enron, WorldCom, and Arthur Anderson. FindLaw (2019) reported, “Section 406 requires public companies to disclose whether they have codes of ethics and also to disclose any waivers of those codes for certain members of senior management. The Commission adopted specific rules implementing these requirements in January 2003.” FindLaw (2019) further reported that in 2003, “the Commission approved significant reforms by the NYSE and Nasdaq that, among other things, specifically require companies listed on these markets to have codes of ethics applicable to all employees, senior management, and directors.”

The US Sentencing Guidelines provides direction for an effective C&E program. It includes due diligence, organizational culture and effective program for preventing and detecting criminal activities, and knowledge of, leadership by, and responsibility for the program on the part of organizational leadership. Barring suspected and proven former offenders, periodic evaluation, reporting systems, appropriate response to criminal conduct, and program modifications for prevention of further repetition of such conduct are part of the guidelines. All employees and agents require training. There are also industry specific guidelines and requirements. One such industry is banking.

Congress and the Securities Exchange Commission (SEC) “asked public companies to disclose the fundamental values by which they operate, and by which the conduct of executives may be measured. Senior management and directors are challenged to examine the ‘tone at the top’ of their organizations, and to emphasize ethics and integrity in business decisions.” (FindLaw, 2019).

While progress has been made, much remains to be done. The 2013 National Business Ethics Survey reported that misconduct was significantly down as a result of organizational C&E programs. At the same time the nature of misdeeds, especially among management, is shocking. Reporting has gone down, and at the same time, retaliation is high. (Ethisphere, 2014).

C&E programs have mushroomed in organizations. The motivation appears to be the avoidance of stiffer punishment, including fines and penalties. Simultaneously, corporate scandals have mushroomed too. It is not surprising to deduce that corporations are too busy to stay within the law to avoid repercussions than to fine-tune corporate ethical culture.

The purpose of C&E programs is both law abidance and ethical conduct. For effectiveness, procedures, communications, and culture are essential. (Ethical Systems.org, 2018). A researcher at the University of Michigan, David Hess proposed two additions to the federal corporate sentencing guidelines: “Monitor the organization’s informal system of communication, surveillance and sanctions, and promote an informal system that supports the goals of the compliance and ethics program. Periodically assess organizational members’ perception of the organization’s ethical climate.” Hess emphasized that focusing on what can be measured is the easy part. Measuring culture on the other hand is not easy. Therefore, with time, compliance and ethics drifted apart, whereas they should have worked together. The end goal should be to do the right thing. (Vice President for Communications, 2016).

Edwords (2015) added, “Law, however, is not necessarily the same as morality; there are many moral rules that are not regulated by human legal authorities … Laws and rules are generally designed to regulate activities that can be publicly observed. This makes enforcement easy. But breaches … often involve acts that are not illegal but simply unethical and can include acts that are private and difficult to observe without invading that privacy. Enforcement, therefore, is almost totally left to the perpetrator. Others may work on the perpetrator’s emotions to encourage guilt or shame, but they have no actual control over the perpetrator’s conduct.”

Corporations are smart enough to know the difference between compliance and ethics. Compliance basically means to follow the law, rules, and policies so you do not get into trouble. Compliance is easier to achieve and easier to deliver. It can be very objective. As long as you have mechanically and accurately fulfilled the checklist, you have complied with the standard requirements. Ethics on the other hand, demands more.

While ethics at its minimum is compliance with the law, that is not by itself sufficient. Ethics demands that you have complied and complied in the right way. Fulfilling the requirements for the right way is where the challenge lies. Therefore, it is more convenient to have multiple and repeated measures for compliance than it is to have measures of ethics. It is not surprising therefore, that efforts at compliance “crowd out” corporate ethics in several C&E programs.

“Deterrence theory in its classical form holds that crime is deterred by the threat of punishment,” wrote Andersen et.al. (1983). They added that people make criminal choices rationally, based on the payoff probability. A moral hazard is doing something risky and leaving the damages on others that follow. The person or group that committed the action do not face the consequences of their actions. This leads to willful questionable behavior since there are no consequences on the wrongdoer, added Pritchard (2019). Deterrence theory and model provides the vital stimulus for C&E programs.

A good example from the world of business is the subprime crisis that came to light in 2007. Banking lenders gave housing loans to people who could not afford to make the payments. They were done with the principle that they, the banking lenders, would not be responsible for the aftereffects. Several banking lenders skipped due diligence with documentation, fabricated income figures, and approved loans on those bases. Once they sold/originated the loans, the banking lenders sold the loans to investment banks. When the borrowers failed to pay back, the investment banks, not the original banking lenders, paid the price, recounted Fiorillo (2018).

There was a public uproar, and the lawmakers swung into action. Some of them were themselves parties to the act. Fearing bank failures and the collapse of the US economy, and since the US government considered these banks to be “too big to fail,” the US government bailed them out. The bailout of course was with taxpayers’ money. “Lenders and investment banks took risks that had consequences for taxpayers and others,” said Pritchard (2019). Therefore, the banking lenders took unethical and even criminal action and taxpayers were the ones punished. That is blatant involvement in moral hazard.

Collins (2015) stated, “The operating principles of the big banks is a cesspool of greed, ethics and criminal intent and they give a very bad name to free market capitalism. The industry is not afraid to do it again because they know no one goes to jail and the government will bail them out.” About the global repercussions that followed, Noonan et. al. (2018) added, “The US, ground zero for the financial crisis, has jailed just one banker for issues relating to the crisis. Former Credit Suisse trader Kareem Serageldin was sentenced to thirty months in prison for artificially inflating the price of subprime mortgages, a financial product at the very heart of Wall Street’s unravelling.”

In conclusion, I strongly believe that the deterrence model by itself is inadequate to handle all ethical challenges. It is a good and strong start but not the end-of-all solution to ethical depravity. While it does provide for punishing somebody to establish accountability, in cases of moral hazard there is high likelihood that the original offenders go free and some poor unfortunate soul, who is left holding the bag, is punished. Ethically, that is fundamentally wrong. While the intent of Deterrent Theory was for establishing C&E Programs in corporations, it needs a lot more work. It needs to expand to control for moral hazard. The Theory is invaluable but it is still flawed. It is a work in progress.

A review of various cases of US C&E programs and related cases showed that both high-ranking and “the little people” are mostly equally treated. There is evidence to support that. The trend seemed to have been in place since the 1980s. There are exceptions too, but prosecution efforts are on. As Karpoff et. al., (1999) had pointed out, there are stiffer federal sentencing guidelines for frauds committed with managers’ intent. Intentional frauds include compliance and ethics. They found defense contractors who were found to have committed fraud in the 1980s were penalized irrespective of size.

In the Enron case revealed from 2001, several top executives and others were fined and sentenced to prison terms. This included high-ranking corporate officials and “the little people”. Section 406 of the Sarbarnes-Oxley Act addressed the unethical practices of top-management. “Section 406 requires public companies to disclose whether they have codes of ethics and also to disclose any waivers of those codes for certain members of senior management. The SEC adopted specific rules implementing these requirements in January 2003.” (FindLaw, 2019). FindLaw (2019) further reported that in 2003, “the Commission approved significant reforms by the NYSE and Nasdaq that, among other things, specifically require companies listed on these markets to have codes of ethics applicable to all employees, senior management, and directors.” This addressed all “high-ranking corporate officials” and “the little people”.

There are arguments or outcries that justice is not served equally. Collins (2015) complained that nobody is affected by the C&E program requirements among the high-ranking corporate officials because “they know no one goes to jail and the government will bail them out.” Noonan et. al. (2018) suggested that only “the little people” get punished. He said, ““The US, ground zero for the financial crisis, has jailed just one banker for issues relating to the crisis. Former Credit Suisse trader Kareem Serageldin was sentenced to thirty months in prison for artificially inflating the price of subprime mortgages, a financial product at the very heart of Wall Street’s unravelling.”

Pursuant to the Subprime crisis and the Troubled Assets Relief Program (TARP) Bailout. “There have been 35 bankers sentenced to prison, according to Christy Goldsmith Romero, the special inspector general for the Troubled Assets Relief Program (SIGTARP), in a report to Congress …” reported Isidore (2016). She reported further that Romero said, ‘I certainly understand the frustration of the people who want to see accountability for those who brought on the financial crisis. Some of these institutions where we are finding criminal conduct, the level of accountability stops at a lower level and doesn’t rise up.’ Romero’s “office is continuing to investigate hundreds of cases at institution of all sizes.” Isidore (2016) added, 59 bankers were convicted, 19 more bankers have been charged with crimes, and several are awaiting trials.

On April 23, 2019, the first ever felony charges were filed against Rochester Drug Co-Operative (RDC), Laurence F. Doud III, the company’s former chief executive officer, and William Pietruszewski, the company’s former chief compliance officer, for violating federal narcotics laws. The Manhattan U.S. Attorney and N.Y. Division of the Drug Enforcement filed the charges. “RDC entered into a Stipulation and Settlement Agreement (the “Agreement”) and consent decree under which RDC provided an extensive Statement of Facts admitting to its conduct, agreed to a $20 million penalty, reform and enhance its Controlled Substances Act compliance program, and submit to supervision by an independent monitor,” reported Sullivan (2019).

Pietruszewski “pled guilty to numerous charges, one of which carries a maximum sentence of life in prison and a mandatory minimum sentence of 10 years. A criminal case will proceed against Doud, who also faces two charges, one of which also carries a maximum life sentence in prison and a mandatory minimum sentence of 10 years. The government also brought a civil lawsuit against RDC for its knowing failure to comply with its legal obligation to report thousands of suspicious orders of controlled substances to the Drug Enforcement Agency (“DEA”).” (Sullivan, 2019).

Looking at both sides of the issue, the progress made, and the concerns about both the high-ranking corporate officials and “the little people”, I believe that C&E programs can be more intimidating for the latter. The 2013 National Business Ethics Survey reported that the nature of misdeeds, especially among management, is shocking. Reporting of violations has gone down, and at the same time, retaliation against “the little people” is high. (Ethisphere, 2014).

The attributes of an effective C&E program include all nine of the following. They are found in the U.S. Department of Justice’s 2017 document titled “Evaluation of Corporate Compliance Programs.”. The attributes are, 1. Oversight by Senior and Middle Management, 2. Autonomy and Resources Available for Compliance, 3. Assessment of Policies and Procedures, 4. Risk Assessment, 5. Training and Two-Way Communications, 6.Confidentiality and Reporting Hierarchy, 6. Fair and Consistent Disciplinary Actions and Incentives, 7. Continuous Improvement, Periodic Testing, and Review of Data and Reporting to Management and Board, and, 8. Third-Party Management – Monitoring and Incentives for Compliant and Ethical Behavior. (Chen and Soltes, 2018).

Paine (1994) proposed an integrity-based approach to ethics management. The integrity-based approach combines both the compliance requirements of law and the managerial responsibility for upholding ethics. The intent of the integrity approach is to “strive to define companies’ guiding values, aspirations, and patterns of thought and conduct. When integrated into the day-to-day operations of an organization, such strategies can help prevent damaging ethical lapses while tapping into powerful human impulses for moral thought and action. Then an ethical framework becomes no longer a burdensome constraint within which companies must operate, but the governing ethos of an organization,” Paine (1994) wrote.

Legal compliance is inadequate for addressing all everyday ethical issues. Just being legal is not necessarily ethical. For example, in the Salomon Brothers case from 1991, company lawyers found no law that dictated that the four top-level executives had to disclose the wrongdoings. Their ethical shortcomings adversely affected stakeholders. The loss to Salomon Brothers was nearly $1 billion. (Paine, 1994).

The attributes of the integrity-based approach are similar to a compliance-based initiative in several ways. It has the code of conduct, training, mechanisms for reporting and investigation, and, audits and controls. Paine (1994) argued, “A strategy based on integrity holds organizations to a more robust standard. While compliance is rooted in avoiding legal sanctions, organizational integrity is based on the concept of self-governance in accordance with a set of guiding principles. From the perspective of integrity, the task of ethics management is to define and give life to an organization’s guiding values, to create an environment that supports ethically sound behavior, and to instill a sense of shared accountability among employees. The need to obey the law is viewed as a positive aspect of organizational life, rather than an unwelcome constraint imposed by external authorities.”

There are fundamental differences too between integrity strategy and compliance strategy. Compliance aims at conformity with laws and preventing crime. Integrity aims at self-governance, responsibility, abiding with laws, company values, and social obligations. The activities in compliance and integrity differ in that integrity includes development of company values and standards from the top, integration into company systems, guidance and consultation, assessment of values performance, and, identification and resolution of problems. (Paine, 1994).

Navran (1997) recommended 12 best-practices attributes for an ethics program. They are: Vision Statement, Values Statement, Organizational Code of Ethics, Ethics Officer, Ethics Committee, Ethics Communication Strategy, Ethics Training, Ethics Help Line, Measurements and Rewards, Monitoring and Tracking systems, Periodic Evaluation, and Ethical Leadership.

The vision statement would define the parameters of acceptable decisions. If unethicality is involved in the decision or in the execution in the decision, it is an unacceptable decision and should be rejected. The company’s values statement would influence and retain appropriate behavior. The organizational code of ethics would provide organization-specific requirements of expected C-suite behavior in carrying out duties. The ethics officer provides the coordination and implementation. The ethics officer reports to the ethics committee that oversees the organizational efforts. The ethics officer should deliver an effective ethics communication strategy that is timely and usable and fosters two-way dialogue.

Ethics training helps to handle difficult situations and utilize safe avenues for communicating concerns and fair dissent. Ethics helplines facilitate communication. Measurements and rewards provide validation of acceptable practices. Monitoring and tracking systems provide feedback on internalization of the organization’s values and ethics code. Periodic evaluations show progress or need for intervention. Above all and most importantly, ethical leadership provides credibility and facilitates acceptance.

Here is the outline of the C&E program that I would recommend for my corporation. It will incorporate the integrity-based approach and fulfil the attributes provided by the Department of Justice. It would be in line with the US Sentencing guidelines for effective C&E programs. As mentioned earlier, the integrity-based approach combines both compliance and ethics.

Conclusion

With the plethora of outrageous corporate scams and frauds that came to light in the last 40-plus years, public outrage on corporate behavior reached revolutionary levels. Congress responded with Acts to reduce the blatant infractions. In order to avoid some of the impositions of the law, businesses started self-policing of compliance and ethics. Results have been achieved but the efforts cannot stop on the part of the government and businesses. A corporate C&E program has been recommended for my company.

In my remarks on the C&E program, I would like to emphasize that in the above-recommended C&E program for my company, both compliance and ethics are addressed. Complying with the law is the minimum starting point of ethics. It is impossible to enact laws for all ethical violations. However, if certain ethical violations become rampant, society would be forced to enact laws. Voluntary compliance and ethical propriety would serve all society well. The recommended C&E program fulfils the requirements of attributes of an effective C&E program, the expectations highlighted by the Department of Justice, the US Sentencing guidelines for effective C&E programs, best practices, and over and above all, integrity.

References

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