3.8: The Role of Ethics in Global Business Decisions

Question 1

What is the definition of Ethics in Business?

(just for context - don’t need to memorise)

Answer 1

Ethics are a set of principles, morals or rules of conduct that govern an entity’s (firm) behaviour when conducting an activity. Ethical behaviour is behaviour that is fair, objective and consistent and considers the interests of all those likely to be affected, directly or indirectly by the behaviour.

Question 2

What is the definition of Corporate Social Responsibility? (CSR)

(just for context - don’t need to memorise)

Answer 2

CSR is a management concept whereby companies integrate social and environmental concerns in their business operations and interactions with their stakeholders.

Question 3

Describe the role of ethics in global business decisions surrounding Environmental Responsibility?

Answer 3

The belief that businesses should behave as environmentally friendly as possible and that firms must protect and improve the environment they operate in and are a part of. This includes sustainability of resources, recycling, the reduction of carbon emissions and the use of solar or alternative sources of energy where possible. Also can be used as promotional material for a business to strengthen public image.

Question 4

Describe the role of ethics in global business decisions surrounding Outsourcing?

Answer 4

Outsourcing is when a business contracts work to an external party, either domestically or overseas. This can lead to specialised foreign workers being outsourced due to cheaper inputs and cost of production. Companies must partner with firms that pay their employees fairly and ensure safe working conditions.

Question 5

Describe the role of ethics in global business decisions surrounding the use of Offshore Labour?

Answer 5

Refers to when you relocate work, such as the production of products, to a different country. A business must ensure that operations overseas are conducted using ethical principles, such as workers being paid a fair wage and that their working conditions are of an acceptable standard.