Table of Contents
1.1 Explain the nature and purpose of business ethics.
1.2 Describe theories on ethics that apply to business practice.
1.3 Describe how governments influence ethical approaches to business.
2.1 Describe contemporary national and international ethical issues affecting businesses.
2.2Explain the impact of ethical issues on business activities.
3.1 Explain the principles of Corporate Social Responsibility.
3.2 Analyse how Corporate Social Responsibility requirements impact on business decision-making
3.3 describe the importance of stakeholder engagement in the creation of corporate social responsibility policies
Most of the organization in the world now focuses on the business activities which affect the business environment in the organization and business environment is very important for the organizations to become successful in the world of competitive business. Transco Gas Limited is a private limited company based in the UK and the company also focuses on the norms of corporate social responsibility. This paper deals with the nature and purpose of business ethics, theories of business ethics, ethical approaches and it will discuss various aspects of corporate social responsibility in the organization.
1.1 Explain the nature and purpose of business ethics
‘Ethics’ is a kind of system of ethical principles. These affect the decisions as well as the way of life of the people. According to BBC (2018) notes, Ethics is mainly concerned with the good things that are essential for individuals and also for society. As Kenton (2018) notes, business ethics is a term of right or appropriate practices and policies of business on several provocative issues including insider trading, corporate governance, discrimination, fiduciary responsibilities, and CSR (corporate social responsibility).
Nature of business ethics
A study by Rasel (2015) stated that business ethics have different natures that are explained as follows:
Following rules and regulations: Business organizations should follow the appropriate regulations or rules which are made by the government. In addition, a businessman of a business must ensure that the activities of a business are legal and avoid different illegal activities.
Customer orientation: The operations of a business should be customer-oriented because customers are the key stakeholder of a business organization (Rasel, 2015). Thus, business organizations must focus and make the products and services that can please their customers.
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Supplying quality products at reasonable prices: Business organizations must ensure the supply of quality products. As a result, the businessman must manage the product standard. A business organization must ensure reasonable and legal price for its products and services to make the customers satisfied (Rasel, 2015).
Employer-employee relationship: A businessman must ensure a healthy and good environment for its business to create a good relationship between the employer and employees. As a result, business organizations can get success easily (Rasel, 2015).
Avoid harmful competition, fraud, and cheating: Business organizations should be cooperative with their competitors and must avoid its harmful competitors. Business organizations must avoid unfair activities and also keep away from any kind of cheating with the customers. A businessman must be honest and sincere with his/her customers (Rasel, 2015).
Social and environmental welfare: Profit earning should not be the key purpose of business organizations. Business organizations must make the products and services which have a positive impact on society (Rasel, 2015). A good environment is a key factor for any kind of business organization nowadays. Business organizations should ensure a good environment for the employees and also for the customers to make a business successful (Rasel, 2015).
Purpose of business ethics
Business ethics have different purposes that are explained as follows:
Brand image and business reputation
A study by Root (2017) claimed that business organizations should be considered as a single entity by society, employees, suppliers, and other stakeholders. The code of ethics of a business must ensure a unique image as well as manage a positive image in its both internal and external factors.
A business organization must maintain a number of legal issues in its business including legal issues related to workplace discrimination, hazardous working situation and any type of harassment which are made by the government (Root, 2017). In addition, business organizations must follow several employment laws and practice these ethically to achieve success.
Ethical practice in the business creates a positive reputation between its customers, suppliers, customers, and employees. As Root (2017) notes, proper ethics in business can support make strong relationship between employer and the employees that result in good customer experience, low product, and labor costs, and high business growth.
Business ethics are essential to reduce staff turnover. This is because when staff is not happy in the workplace they leave the jobs and have bad comments about the business. This means high turnover damage business reputation. On the other hand, hiring new employees is cost-effective and time consuming that affects the business’s overall profitability and performance (Root, 2017).
1.2 Describe theories on ethics that apply to business practice
According to wiseGEEK (2018) notes, the theories related to business ethics contain a number of moral principles that a business organization utilizes in its business to ensure that the employees who are working in this organization behave in an acceptable manner. There are several theories on business ethics including deontology theory, utilitarian/teleological, right ethical theory, justice theory, and virtue approach which are explained as follows………….