Introduction
Organizations are established with an ultimate objective of providing goods and Services to people. These organizations can operate locally or internationally. Those that operate in other countries in addition to their country of origin are termed as multinational corporations. There are those organizations that are solely after making profit while others are non profit organizations.
Whether the organizations are after making profit or not, they should operate in a manner that will not compromise with quality expectations of the clients. This is especially true given that organizations operate in an environment that is dynamic. The environment in which the organizations operate include political, social and economical environment.
Such environments call for the organizations to observe ethics and corporate social responsibility as a strategy for them to survive. This is due to the fact that corporations require good will from the communities in which they operate and they are governed by laws of the land.
Therefore this essay is going to focus on how ethics and corporate social responsibility (CSR) should be an integrated part of an organization’s strategy. This shall be discussed in relation to theories and using real life examples to support the arguments in the essay.
Ethics as an integral part of strategy
Ethics, as an integral part of an organization, is a strategy that can be approached from various theoretical perspectives. Therefore, an ethical organization should be built on the following three fundamental pillars: workers that observe ethics in the cause of their duties, leadership that is keen on ethics as it pertains to the workers and clients and the organizational structures and systems that are ethically sound.
Without these ethical pillars the organization will encounter challenges in the environment it operates (Jackson 2004). The organization cannot operate in a vacuum. This is because the management leaders of the organization must make decisions that are legal and customer friendly.
To achieve this different ethical approaches or theories are to be taken into considerations. They include moral rights approach, justice approach, utilitarian approach and individualism theory (George 1999).
To begin with, moral rights approach as an integral ethical strategy of an organization asserts that human beings have certain rights and freedoms that cannot be infringed by the decision made by individuals. For the decision to be considered ethical, it has to ensure that individual rights and liberties are not taken away from them.
The decision made by the leadership of the organization regarding its workers should be consistent with the following rights, “right of safety, moral right of free consent, the right of due process, the moral right of life and the moral right of freedom of speech (Behrman 1988).
An example that shows how companies violate human rights can be seen by how the Wal-Mart was found to violate its U.S workers rights in 2007 by preventing them from forming trade unions and instilling fear into them.
The leadership of the organization should ensure that its workers or any other stakeholders to the organization such as suppliers, creditors and the clients should have a free consent in decision matters that affect them. Free consent as a moral right encourages the leaders to allow the people to make decision that are knowingly and freely (Fisher & Lovell 2003).
On the other hand the leadership of the organization consider legal due process in their decision making process. This moral right calls for fair and sound hearing for an individual. The manager in the organization should allow the workers to seek a due legal process whenever they feel that their rights have been denied (European Commission 2002).
Like wise if the organization carries out the activities that pollute the environment the people can sue the organization for its harmful activities to the people and the environment. The fear of being sued for such violations leads to most organizations to do what is required of them (DFID 2003).
For instance, the Los Angeles Car Wash Company was sued by its workers for underpaying them. The workers were kept on duty outside the working hours without being paid their overtime dues. The workers were paid up their dues and were not dismissed from duty due to strong laws that protect them.
Next for decision to be considered morally correct the decision of the leaders in organization should consider the right to life and safety of its workers. The managers in the organization cannot expose their workers to the activities that threaten their life and safety. The companies that manufacture products for public consumption like the motor companies must be liable for the safety of the products to the consumers.
It shall be good ethics for such products to undergo vigorous tests before being sold to the public for safety reasons. The companies can give warnings to customers if the products may jeopardize their safety.
For example the General Motors Company recently recalled more than 300,000 SUVs and trucks to correct turn signal problems even though there were no injuries that had been reported from the clients. The recalling was well intended to correct a mistake that had been noticed and was vital in order to forestall any legal suits that might have followed (Dellaportes, Gibson, Alagai 2005).
In addition to that, the executives of the organization need to protect the privacy of their workers. The managers need avoid sexual harassment against their workers. The company needs to uphold to its free consent all the time. The company should give the right information to its stake holders regarding its operation.
Giving fraudulent information is unethical and may cost a lot to the company in terms of legal cost. For instance, one particular company gave a prospectus bearing false information about the unbounded wealth of Nevada.
A particular share broker who took such information in good faith wanted to disregard the contract agreement after realizing that the information provided was not true. Thus it is important that companies give correct information to such situations (Hartman 2004).
Lastly the people working within the organization and other stake holders to the organization have the right to freedom of speech and information.The companies should make an effort of informing its consumers on the products offered through education.
The companies should provide truthful information to the customers and should be truthful in their dealings (Crane & Matten 2007). For Example, in 2003 the U.S food and drug administration (FDA) destroyed up to 90,000 units of Royal Tongan Limu Dietary supplements that were being false claimed to treat several diseases (Hartman 2004).
The company should make decision that allows the stake holders to the organization to express themselves. This should allow the voice of the workers to be heard in matters that affects them. The top leadership should not undermine the views of those under them.
If the leader goes to the extent of embracing totalitarian kind of leadership in the organization there would be conflicts in organization which may lead to the eventual collapse of the organization. This is due to the fact that there will be a disconnection between the top management and the workers (Castka, Bamber, Bamber & Sharp 2004).
The second theoretical approach in the ethical strategy of an organization is the utilitarian approach. This theory upholds that when the managers make the decision, it should be morally good and its consequences should benefit a large number. Therefore this approach calls for a greater measure of benefits and harm or cost in terms of what is valued most by the decision makers in the organization.
For example if a company finds that using low-wage foreign workers will give it a competitive edge, it may just do that as a means of survival. However, this may not go down well with the locals who may feel that their jobs have been taken by foreigners (Jackson 2004). For Example, there were street protests in Ireland in response to increased number of companies using cheap labor provided by immigrants.
Another ethical approach as a strategy of an organization is that of individualism. This approach highlights that an individual’s interest to the organization should prevail for a long time. The managers should allow the stake holders of the company to make free choice as long as their interests do not conflict with those of the company.
For Example the Caribbean Money Market Brokers (CMMB) collapsed suddenly in February 2009, nothing was said about the imminent collapse and most of the stake holders were left in shock (Chrysside & Kaler 1996).
The justice approach as an ethical strategy by the organization is very important. This theory stipulates that moral decisions affecting the people in the company should be fair, equal and very impartial (Albertson 2007). For example it will be unfair for the unskilled laborer in the company to earn a higher salary than their skilled counterparts.
This kind of scenario is common in firms that employ relatives who often are not up to the task but they end up being paid more. The management of organizations should ensure that they pay workers depending on their output and level of skill.
On the other hand it will be unfair by the remuneration team in the organization to deny the workers compensation after they had been injured while on the job. This can exist where the legal process for such compensation is delayed by the management team who may not be willing to compensate their workers. That is not ethical in the life of the organization (Chrysside & Kaler 1996).
The rules and regulations of the organizations should be applied uniformly by the workers of the company. There should be no rules that discriminates the workers on the grounds regarding their health condition, race and gender. For Example, the Ghanaian government has formulated tough penalties to deal with Companies that are discriminating their workers on health Grounds. (Jackson 2004).
CSR as a strategy in organizations
The corporate social responsibility as a strategy in the organization has been favored for a very long time as far as business is concerned. Competition from other organizations sends a company into looking for ways that can really put it above others. Corporate social responsibility seems to be the best avenue through which an organization can make itself appealing to its clients.
Organizations which get deeply involved in communal activities usually develop some bonding with the members of the society in which it operates. In the end it is always true that a company that will identify itself with the people will rip more from them. (Crane & Matten 2007).
How did this corporate social responsibility come about? It was partly brought about by the reshaping of the old-age traditional method of relationships in authority by ushering in new modern technology in creating of the wealth (Davis 2006). Thus the organization had to give back to the society in which it operates in which enables the organization to make large profit.
Therefore the organization gives its workers services such as free health services, promotion of education that were meant to appreciate the efforts of the workers to the organization. An organization that treats workers well will be better placed to maintain a skilled workforce and thus maintaining an overall good performance (Blowfield & Murray 2008).
Furthermore since the business or the organization acts as the moral agent of the society their social responsibility is to ensure that their social behavior does not compromise with the moral values of the society. Thus the decision making organ within the organization should ensure that they go beyond individual self interests to make decisions that will put the larger society in danger (Balabanis, Phillips & Lyall 1998).
The corporate social responsibility of the organization is well supported by the stake holder theory. This theory encourages the management team of the company to safeguard the interests of the legal fraternity subsystem, clients, creditors, and suppliers who are the stakeholders to the firm (Knight 1980).
The company has the corporate social responsibility of abiding to the government laws and regulations so as to avoid harming social good such as the citizens and the environment. However such government regulations interfere in the operation of the company.
For example, its failure to clean Hudson River led to legal suit against General Electric Company. This was as a result of failure to abide by the regulations. The company kept on arguing through legal structures for a long time while the river remained unclean (Blowfield & Murray 2008)
Another important theory that explains the role of corporate social responsibility of the organization is that of social demandingness. The theory stipulates that the managers of the organization should safeguard the interests of the stake holders in the society.
The executives of the corporations have to ensure that the social issues such as health care, safety and the prosperity is highly taken into consideration without disrupting the social harmony. A good example is Magellan Metal Company in West Australian that had to bear responsibility for the death of birds within the environs as a result of lead deposits.
The company showed a good example by closing down for a while to clean up. This was welcomed by the locals who were impressed by the move as a step in the right direction. (Balabanis, Phillips & Lyall 1998).
The corporate social responsibility embraces the legitimacy theory which states that organizations need to carry out activities that are proper. This indicates that the organization should not engage in the activities that are against the norms and values of the society (George 1999).
This theory calls upon the organization to carry out the activities that respect the moral values of the society in the society in which it operates. The company has to engage in the activities that should not impact negatively on the environment. The operations need be generally accepted.
For example, the toy making company had to adopt the risk management and quality control after it realized that its products contained lead poison. The millions toys were recalled by the company world wide. Such response was legitimate for the company and it saved the general public (Grace and Cohen 2006).
Conclusion
In conclusion it is imperative to note that an organization cannot operate in a vacuum. It operates in the society that is dynamic. For it to succeed, it has to lay down an appropriate strategy that is ethical and which incorporates corporate social responsibility. The organization that respects the moral rights of the people in the society shall be legitimate in its operations in the society.
Likewise, the organization which has a good corporate social responsibility will not fail to safeguard the interests of its stake holders. On that note, its public image shall be well defined by the people in the society in all spheres. Thus all companies that want to venture into any society around the globe should be aware of the social requirements of the given society.
They should also be willing to put up structures that will ensure that their operations do not compromise the environment. If all this are observed then the companies will exist harmoniously with the society and will also prevent legal hurdles that are associated with breaking the rules.
References
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