Yap, Stephanie Florence B.

Business Communication

AB Psychology 8:00-10:00 T/TH

Business Ethics

In business is it very crucial to earn maximum profit for their owners and shareholders
because it is what they aspire at the very beginning. However, this does not mean they can do
whatever it takes to get that maximum profitability. They can’t do bent things just to get their
desired profit. It takes risks and multiple decisions. They need to emphasis and apply their
conscience, responsibility and belief first when doing something they aren`t sure about. This is
where business ethics and social responsibility comes into the picture. There is much confusion
between these two terms and they tend to get used interchangeably. Social responsibility is
easy to understand because we all have knowledge about what is this all about because we are
already expose to the situation and reality of society itself. While on the other hand the word
‘ethics’ causes much confusion to other people because it is very deep and require broad
understanding. A company policy must be followed to benefit the community. This is coined as
the corporate social responsibility. However, when one talks about business ethics, it becomes a
very different thing, because ethics is based on conscience. There is a significant difference
between social responsibility and business ethics and the best way to differentiate the two is by
defining both of them.

Everyone remembers learning about ethics and morals in school. It was the basic right
and wrong and the golden rule. Ethics are the moral principles that represent a person or group.
They are how a person or group acts in regards to what they consider to be right or wrong. It is
much easier to uphold your ethics as a person than it is to uphold ethics in a business. When it
comes down to ethics as a person you may be faced with: Should I gossip about my best
friend? Should I not leave a tip for the server at the restaurant? Or, should I lie to my wife?
Business ethics are a much deeper topic and are more complex than these simple trials we may
face as a person. For most businesses, the ultimate goal is to bring in revenue and be the best
in their industry. However, achieving these goals at all costs is not always ethical. Every
business needs to have and uphold business ethics. Business ethics are how companies
conduct themselves in their practices and policies. Companies that have failed in this area have
been subject to losing customers and bad publicity. For example, Mattel, the toy company, has
faced scrutiny in the past because of their business ethics. Wanting to lower costs of production,
they outsourced their manufacturing, which led to toys being produced that had high amounts of
lead and were dangerous for children. This is an example of a company making a decision
using bad business ethics. Companies need to care about their employees and customers. The
decisions they make regarding ethics can impact not only many people, but the company as
well. These decisions are much bigger than trying to decide whether or not to tell a lie. Society
has become more aware of how goods that they purchase are produced, and they expect
businesses to be a responsible member of society, just as if it were an individual. Because
business decisions can impact society, including the environment, businesses are also faced
with social responsibility, an ethical concept that implies that companies have a duty to the
society and environment around them.

Recently, there has been a lot of media attention given to ethics in decision making;
particularly in the workplace. Consumers and society as a whole want to see more corporate
accountability. Additionally, we want business to more actively think about not only how a
company treats employees, but also how a company's code of ethics extends to all of its
stakeholders, such as customers, suppliers, and community. From the time a business begins
its operations to the time it delivers a service or product, there are a lot of choices to be
reviewed, problems to be solved and decisions to be made. The manner in which those choices,
problems and decisions are handled speaks volumes about the business' ethics. As a small
business owner or manager, it is your responsibility to ensure that your organization follows
ethical practices and behaviors; and to ensure that your vision, mission, and value statement
are ethically aligned and understood by all your employees, suppliers and other stakeholders.

Ethics concern an individual’s moral judgments about right and wrong. Decisions taken
within an organization may be made by individuals or groups, but whoever makes them will be
influenced by the culture of the company. The decision to behave ethically is a moral one;
employees must decide what they think is the right course of action. This may involve rejecting
the route that would lead to the biggest short-term profit. Ethical behavior and corporate social
responsibility can bring significant benefits to a business. For example, they may attract
customers to the firm’s products, which mean boosting sales and profits. Make employees want
to stay with the business, reduce labor turnover and therefore increase productivity. Attract
more employees wanting to work for the business, reduce recruitment costs and enable the
company to get the most talented employees. Attract investors and keep the company’s share
price high, thereby protecting the business from takeover.
Knowing that the company they deal with has stated their morals and made a promise to work in
an ethical and responsible manner allows investors’ peace of mind that their money is being
used in a way that arranges with their own moral standing. When working for a company with
strong business ethics, employees are comfortable in the knowledge that they are not by their
own action allowing unethical practices to continue. Customers are at ease buying products or
services from a company they know to source their materials and labor in an ethical and
responsible way.

Social responsibility is built on a system of ethics, in which decisions and actions must be
ethically validated before proceeding. If the action or decision causes harm to society or the
environment then it would be considered to be socially irresponsible. Moral values that are
inherent in society create a distinction between right and wrong. In this way, social fairness is
believed to be in the “right”, but more frequently than not this “fairness” is absent. Every
individual has a responsibility to act in manner that is beneficial to society and not solely to the
individual.

The behavior that man must display must be according to the acceptable norms and morals
of the community or society. Comparing this scenario to business, businesses must still perform
its social obligations by performing activities that are according to the norms of society or
community. Even if businesses are more concerned on making profits for the company, it should
still have a social responsibility and apply business ethics towards its community. Social
responsibility and business ethics is more of an obligation or a duty towards the people that the
business affects.

References:

Difference Between. Net (2011, March 30) Difference Social Responsibility and Business Ethics.
http://www.differencebetween.net/business/difference-between-business-ethics-and-social-responsibility/

Riar, Guvan Singh ( 2014, November 25) Why ethics is important to business.
https://www.google.com/amp/s/blogs.accaglobal.com/2014/11/25/why-is-ethics-important-to-
business/amp/

Samosruk, Savannah (2003-2019) Business Ethics and Social Responsibility: Definition and Difference.
http://study.com/academy/lesson/business-ethics-responsibilty-definition-differences.html