Ethics & Environment Flashcards
What does ethics mean?
Ethics refers to a business decision that is thought to be morally right or wrong. An ethical decision is made on the basis of what is judged to be morally right. Some companies put what is morally right above profit.
How can a business behave ethically?
Are suppliers (especially small businesses) paid on time or is the payment delayed?
Are employees treated fairly? Are they paid well? Is child Labour used in overseas factories?
Are consumers aware of the materials used to make products?
Is the business’s advertising truthful and fair? Are products harmful?
Ethical marketing:
Designing new products to reduce the damage they do to the environment - Tesla
Avoiding targeting children with advertisement for products with potentially harmful side effects - junk food
Not using a dominant market position to set unacceptable high prices
Ethical operations:
Managers might choose not to buy resources from suppliers that are involved in unethical practices such as destroying the rainforest or the employment of child labour
An ethical business is likely to manufacture products that can be recycled once their useful life is over
Ethical HR:
Offering employees the opportunity of high quality training despite its cost
Paying wages sufficient to allow employees a decent standard of living
How does behaving ethically impact on profits?
Using environmentally friendly resources or fair trade products, which are more costly
Providing employees with high quality training (they may leave)
Offering low priced products to certain groups such as OAPs
Acting in a socially responsible way - taking into account the needs of all stakeholders
What does fair trade and social responsibility mean?
Fair trade products are those for which customers pay higher prices and offer better trading terms, such as payments with orders. The aim is to improve the living standards of people in poorer countries where the products are produced.
Social responsibility is an approach to managing businesses in which the interests of all groups in society are taken into account when making decisions.
How can businesses and consumers show environmental responsibility?
The use of renewable sources of energy such as solar and wind power
Means of transport that don’t cause pollution - electric vehicles
Making products from recycled or renewable materials such as sustainable timber
Consumers can take a range of decisions that can help protect the environment:
Recycle products
Buy environmentally friendly products - encourage businesses to produce them
Complain to businesses whenever they are seen to damage the environment
What is global warming?
The gradual heating of the earth’s surface, oceans and atmosphere, leading to a rise in average temperatures.
What are the good and bad things about being environmentally friendly and ethical for a business?
Positive publicity - information placed in annual reports and marketing (advertising especially)
Charge higher price or frequently change their price - increased profits
Competitive advantage - win over customers
Increase costs
What are the impacts of global warming?
Melting of ice - rising sea levels
Changes in weather patterns
Shortages of water and drought
