What is business ethics?
Business ethics is the ability to distinguish right from wrong in a business setting regarding products and relationships with stakeholders (Giacalone & Thompson, 2006). It entails the study of business activities and moral decision making.
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Why is business ethics important today?
Business ethics improve a firm’s reputation, thus increasing the chances of growth. Consumers often want to associate with firms that have a good reputation. The success of a business today is determined by the ethics upheld. Companies adhering to business ethics attract investors, thus boosting the economic growth of the business. It also protects the business from takeover as the prices of their shares remain high.
Does business ethics differ from personal ethics?
Yes. Whereas business ethics is constructed by an organization and introduced to its employees, personal ethics is made by an individual and is drawn from family and parents. People choose whether to adhere to their personal ethics or not depending on their situation. Business ethics must be followed by their respective employees.
Why is it often difficult to behave ethically in business?
The business sector is intensely competitive. Those involved often can do anything to achieve success. Consequently, the tendency to compromise becomes high as people overlook ethics and focus on profits. There is a reduction in people’s sensitivity to morality due to individualism in business. Employees and employers may hold different opinions about business ethics.
Discuss the relationship between ethics and the law
Business ethics and the law can exist independently, but they are interrelated under crucial circumstances. Ethical considerations in a workplace can be enforced through the law despite the fact that ethics can be at times unwritten (Kutz, 2007).
What is meant by the term “globalization”?
Globalization is the worldwide integration of all sectors of life, including financial, trade, and communication. It is the change of business boundaries from local to international.
What are the two main causes of increasing globalization over the past 50 years?
Advanced technology has contributed immensely to globalization. Cheap and readily available means of transport and communication aid in international interactions (Scholtens & Dam, 2007). Most rich countries allow free trade agreements, which make it easy for international integration. People can now freely invest and transact worldwide efficiently.
Discuss the ethical challenges raised by globalization
According to Crane and Matten (2007), global products erode the cultural identity of a particular region due to the effects of westernization and imperialism. Some products may impose the western culture on local people that may be unacceptable in that region. Globalization has increased risks and financial instability for the stakeholders. Lack of regulation of the global market capital has contributed to these outcomes. Companies may choose to outsource their products from developing countries to cut on the local market cost, which could be an opportunity to exploit workers through unfavorable working conditions.
What is “sustainable development”?
Sustainable development refers to economic growth that raises the living standards of the present generation without jeopardizing the chance of meeting the needs of the future generation (DesJardins & McCall, 2014).
What are the most important “best practices” associated with sustainable development?
Life-cycle analysis: It is the evaluation of the whole process of production to ensure efficiency. The change should be initiated where possible to maintain sustainability.
Environmental management is crucial because it ensures that the company’s operations are environmentally friendly.
The progress of a company should be reported with clarity and transparency to the stakeholders. There should be collaboration and acceptance of new initiatives from the stakeholders.
Discuss the meaning of the term “race to the bottom”
This is a situation where companies lower the environmental and social standards to maintain their financial status due to extreme competition (Trevino & Nelson, 2010).
In the GAP case studied in class, why did GAP choose to establish a vendor code of conduct (VCC)?
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VCC was meant to monitor the work of various companies in terms of their working conditions and employees’ wages. It was to ensure that the firms maintained business ethics in their undertakings.
What were the main elements of the VCC, and how did the GAP ensure that suppliers lived up to the terms of the VCC?
Monitoring programs – these programs were comprehensive to evaluate the conditions in the respective companies and their adherence to the required standards.
Vendor compliance officers were hired to make visits to the factories and monitor the issues.
GAP took active action, ensuring factories that did not meet the standards had their contracts terminated, and others were given a short timeframe to comply. The issues investigated were published to ensure responsibility and partnerships were formed to tackle the issues related to working conditions. It also organized summits to review the progress of the factories.
Crane, A., & Matten, D. (2007). Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford: Oxford University Press.
DesJardins, J. R., & McCall, J. J. (2014). Contemporary issues in business ethics. New York: Cengage Learning.
Giacalone, R. A., & Thompson, K. R. (2006). Business ethics and social responsibility education: Shifting the worldview. Academy of Management Learning & Education, 5(3), 266-277.
Kutz, C. (2007). Complicity: Ethics and law for a collective age. Cambridge: Cambridge University Press.
Scholtens, B., & Dam, L. (2007). Cultural values and international differences in business ethics. Journal of Business Ethics, 75(3), 273-284.
Trevino, L. K., & Nelson, K. A. (2010). Managing business ethics. Hoboken, NJ: John Wiley & Sons.