Ethics and Social Responsibility Flashcards
What is ethics?
system of moral principles that examines the concept of right and wrong
what is business ethics?
the application of ethical values to business behaviour
an action being right or wrong depends on what factors?
- consequences
- motivation behind the action
- guiding principles
- key values
3 reasons why business ethics are important for the organisation?
- seen as driver for profitability rather than burden
- ethical framework is part of good corporate governance and suggests a well-run business
- investors are reassured about company’s approach to risk mgmt.
3 reasons why business ethics are important for the individual?
- consumer and employee expectations have evolved over recent years
- consumers may choose to purchase ethical items even if they’re not as cheap
- employees won’t blindly accept orders to act in a manner they don’t believe is ethical
how have most companies approached the concept of business ethics?
by creating a set of internal policies and instructing employees to follow them, they can be broad generalisations or contain specific rules
organisations may also appoint ethics officers to monitor the application of policies and to be available to discuss ethical dilemmas with employees when needed
What is corporate social responsibility (CSR)?
the idea that a company should be sensitive to the needs of all stakeholders in its business operations, not just shareholders
a socially responsible company may consider… (4 things)
- environmental impact of production/consumption
- fair treatment of employees
- whether its right to experiment on animals
- safety of products and production processes
CSR encompasses which four dimensions?
- economic
- legal
- ethical
- philanthropic
4 benefits of CSR:
- differentiation – CSR strategy can act as a USP
- high calibre staff will be attracted to companies that do the right thing
- brand strengthening – CSR leads to a better reputation
- increase in profitability
