Free Essay on Business Ethics

Free example essay on Business Ethics:

By negative criticism received in the past on companies unethical behaviour organizations have begun to see as part of their mission, to raise standards, not just within the company but also in the countries where they work. However Friedman (1970) argues that business social responsibility has to be in the shareholders long-term interests, which in other words is to get as much money as possible for their shares and by taking on social responsibilities there can only be financial loss, due to the fact that someone must pay for it, either shareholders or customers, by paying higher prices. This argument is supported by Smith (1776) that common good is best served by people pursuing their own interests rather by the doing good, which social responsibilities require. Still we could argue that what shareholders want is not in their best interests and is that really true what they want? Chryssides (1995) argues that shareholders interests could be best served by living in a society, which has desirable social ends like reduction of unemployment, pollution and discrimination even though it means reduction in their profits. Then again we could say that business people are not specialists to decide on social needs and priorities for the reason that when they decide to impose their preferences, that this can have bad consequences on society in whole.

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Unfortunately this is happening to the extent that multinational companies have been able to finance elections and have their candidates elected, they have been able to penetrate very powerfully into the Western political system. As a result economic globalisation is criticised in that it lacks an ethical framework and political control to ensure that economic performance is subordinated to essential human and social needs, because of this many of the developing countries have shown negative effects and attitude towards globalisation for example rich countries want the developing countries to open up their markets by lowering import tariffs. By doing this developing countries fear that quality products at cheaper rates will make their fragile industries go out of business. In Tanzania the leather and textile industry have almost collapsed affecting lots of peoples lives in negative way. We could argue and say this is what happens in a global economy and that countries should concentrate in producing things, which they are good at and that every country has the same opportunities. Is this really true? Not necessarily considering that the West have superior technology, better skills and more resources to spend, also it would be hard to say that every country has the same opportunities. Fair opportunities would be if all countries or organizations have equally good technology and skills. Therefore it could be said that commercial self-interest for multinational firms can extend beyond the common good that ‘good business’ not always follow ‘good ethics’. Better it would be said, if these large organizations would work together with foreign infant industries and invest in them and raise standards that way. Good example is the Japanese firms who work closely together with other organisations to improve productivity and quality and help each other out in difficult times.

While developing countries allowed in more food and manufacturing imports the West have not done so. For example western farmers receive large handouts in subsidies and increasing their share of global markets at the expense of world’s poor where as the West is slow in lowering their quotas on imports. Legrain (1999) points out that rich countries need to return the compliment and open up their markets so poor countries can sell their goods to the West too. More needs to be done to restructure liberalization, so that a larger share of population benefits from the process. It is imperative that developments of globalisation are measured not just in profits but also in social quality, for example better education and health.

The best way to deal with globalisation is to be honest about it. Globalisation brings opportunities but it also brings risks, even when poverty falling overall there can be regional increases about which society needs to be concentred. Especially for the developing countries, with their potential lack of recourses for up to date legislation, it is important to remember that not everything that is legal is right. Legality is often only the ethical minimum. Therefore where national standards are inadequate, the company would need to enforce their own higher standards and not take advantage of them. Many aspects of our system have not caught up with our social needs and not many organizations and managers faced up to the social responsibilities of business. It is easier to produce the product and then think what social impact it will have. Business is part of our society and ethics has place in business as in any other part of social life [De George, 1978].

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