Business ethics

Question 1

Corporate social responsbility

Answer 1

Corporate social responsibility (CSR) means a business has a responsibility towards the community and environment.

Question 2

Whistleblowing

Answer 2

Whistle-blowing is when an employee discloses wrongdoing to the employer or the public.
Businesses have processes through which employees can report faults or problems so that they can be addressed.
Whistle-blowing may be perceived as an individual moral choice. But in some cases, employees have a legal responsibility to report unethical behaviour because of the likelihood that this behaviour is criminal.

Question 3

stakeholder

Answer 3

A stakeholder is anyone with an interest in an organisation.
Businesses take on social responsibilities because they think these will improve their image with customers or with a certain type of investor or a certain type of employee.

Question 4

Globalisation

Answer 4

Globalisation is the integration of the world economies, industries, markets, cultures and policy-making.
Moving production from wealthier countries - such as the US and Western parts of Europe - to countries such as China and India - where the wage paid is much lower than it would be in these MEDC’s (more economically developed countries) - has rapidly increased economic development and technology.

Question 5

GEIGB

Answer 5

Generally, customers prefer to buy from ethical businesses rather than from businesses they suspect of trying to cheat them, exploit others or cause social or environmental damage.
The idea that good ethics is good business also extends to business decision-making
Not only will customers relate positively to the business if it ‘does the right thing’, but the business will be more successful if all its decisions are ethical decisions.
Businesses are often damaged when the media exposures their unethical practices - even if they are within the law. If customers start to perceive them negatively, businesses often change what they do.

Question 6

Impact of Globalistion on wages

Answer 6

Although the wages that corporations pay in countries like China are far lower than the wages they would need to pay in Western countries, they are still much higher than those of rural workers, like peasant farmers in China.
This has had enormous economic benefits for stakeholders in these emerging economies.

Question 7

benefit of globalisation

Answer 7

Jeffrey Sachs says that, as a result of globalisation, the number of extremely poor people in India has reduced by 200 million and by 300 million in China (The End of Poverty, 2005)

Question 8

Consumer culture

Answer 8

Moving production to low-wage countries has had major impacts on stakeholders in the US and Europe.
Consumers have benefited from cheaper products, fuelling a consumer culture.

Question 9

Utiltarianism

Answer 9

Classic utilitarians, such as Jeremy Bentham and John Stuart Mill, would likely support the concept of corporate social responsibility (CSR).
Corporate social responsibility means that a business has a responsibility towards the community and environment.
So in a utilitarian’s view, if a business acts in a way that benefits the majority of its stakeholders, then it is a good business as it brings the greatest happiness to the greatest number of people.

Question 10

Weighing profit against outcome

Answer 10

If corporate social responsibility is just ‘window dressing’ for profit and greed, then this has to be weighed up in terms of the outcome.
If this profit and greed benefits employees, governments and other stakeholders, then the end justifies the means.

Question 11

Kant

Answer 11

Kant would argue that a business should be ethical and take responsibility for all stakeholders because that is the right thing to do. However, if a business was simply being responsible to make a profit then this would not be moral.
Kant argues that we have a duty to treat people as an end and not a means. If our prime reason for being ethical in business is to make a profit in the future, then this is not a moral action.

Question 12

Categorical Imperative

Answer 12

Kant’s categorical imperative highlights that human beings are the pinnacle of creation: they are the highest point.
So how people are treated in a business/the people who are directly affected by that business need to be taken into account. No one should be exploited or mistreated in the search for profit.

Question 13

Kant on globalisation

Answer 13

Globalisation raises moral concerns because people in less developed countries could be getting exploited.
If the company is acting just for its own good, then in Kantian terms it is treating the people of the poorer nations as a means, not as an end.

Question 14

Globalisation promotes good ethics

Answer 14

The pursuit of good ethics as the foundation of good business is something that the excesses of globalisation might be encouraging.
Some transnational corporations have made sincere efforts to live up to their mission statements.
Microsoft, for example, has donated well over $1 billion to charity since 1983.

Question 15

globalisation promotes bad ethics

Answer 15

Globalisation operates mostly in the interests of the richest countries, which continue to dominate world trade at the expense of developing countries.
The role of LEDCs (less economically developed countries) in the world market is mostly to provide the North and West with cheap labour and raw materials.
Critics include groups such as environmentalists, anti-poverty campaigners and trade unionists.

Question 16

Only people can have responsibilities.

Answer 16

A Friedman Doctrine: The Social Responsibility of Business is to Increase Its Profits”. In it, he argued that a company has no social responsibility to the public or society; its only responsibility is to its shareholders.
buisnesses have no other responsbility but to increase their profits

Question 17

Adam Smith

Answer 17

Adam Smith was an economist and philosopher sometimes called the father of capitalism. Smith’s argument is that when people follow their rational self-interest competing in a free market, the result is economic prosperity which benefits society and general happiness. In a free market, people gain money by providing a product or service that others are willing to pay for. Competition encourages productivity and innovation resulting in economic growth. Free market capitalism harnesses self-interest for societal gain, as if guided by an ‘invisible hand’. This is the origin of the view that good business decisions have positive social results and is thus linked to good ethics.

Question 18

Primark case study

Answer 18

Primark were found to be supplied by exploitative factories in the third world that used child labour and paying people very little for extremely long hours. In response to this, Primark cut ties with those suppliers.

Question 19

Rana Plaza

Answer 19

The garment factory building was built with substandard materials. An engineer inspected the building the day before it collapsed and warned the owners that it was unsafe. But the owners ordered workers to return the next day, which tragically resulted in the loss of many lives.

Question 20

Facebook case study

Answer 20

Frances Haugen worked for Facebook (which owns Instagram) and leaked internal documents which came to be known as ‘The Facebook Files’. One quote from the files in the leak acknowledged that “we make body issues worse for one in three teenage girls”. The leak also shows that the Facebook algorithm promoted posts that caused anger or outrage.