Business Ethics Report: Ethical Issues, Practices, and Globalisation

This report examines the core concepts of business ethics, providing an overview of ethical practices and their significance in the business world. It explores various aspects, including the benefits of ethical conduct, the importance of ethical decision-making, and the roles of stakeholders in shaping business ethics. The report analyzes ethical issues within organizations, such as unrealistic profit targets and unethical employee behavior. It also addresses the ethical dilemmas arising from globalization, including the need for businesses to navigate diverse cultural and economic models. The report uses examples like the Volkswagen scandal and the Tesco horsemeat case to highlight the consequences of unethical practices, emphasizing the long-term positive impacts of ethical business operations on reputation, profitability, and customer loyalty.

Running head: BUSINESS ETHICS
BUSINESS ETHICS
Name of the Student
Name of the University
Author note:

1BUSINESS ETHICS
Table of Contents
LECTURE 1...............................................................................................................................2
LECTURE 2...............................................................................................................................3
LECTURE 3...............................................................................................................................4
LECTURE 4...............................................................................................................................6
LECTURE 11.............................................................................................................................7
REFERENCES...........................................................................................................................9

2BUSINESS ETHICS
LECTURE 1
The lecture one is helpful in giving an overview of the whole course and basic
concepts of business ethics. Business ethics is analysing and understanding fair practices in
business, especially about aspects, which are much debated and proper ethical standards of
them is not universally accepted or applied. Business ethics may deal with governance of the
business, corporate social responsibility and its issues, discrimination in work place, pricing
of the products and product representation in the society (Ferrell and Fraedrich 2015). The
specific aspect I will focus on from this lecture is the benefits of following ethical practice in
business.
I have seen that there are many businesses that do not run with proper ethical
standards. There are deceptive advertisements on television, overpriced products and even
within the business there are unethical practices like discrimination and lobbying. Products
often use terms like “natural, fresh, and scientifically proven” to win customer trust (Zinman
and Zitzewitz 2016). In the very famous case of Volkswagen where the company misled the
customers claiming that they were selling cars, which were very low on emission and were
eco-friendly but the claim was false (Latif 2017). The company had to go through high value
lawsuits and the reputation was ruined. In another highly unethical case of deceptive business
practice, the famous supermarket chain in the USA Tesco was found to pile horsemeat in its
beef burgers and other packed food items. In both of these cases, the companies had huge
financial penalties, Tesco had to shed off $432 million after the scandal, the reputation was
greatly impacted, and customer base was lowered (Heilpern 2016).
I believe that if the companies had not been involved in such unethical practices, they
would have been in a much better place now. Ethical practices may not be producing
immediate benefits, but they have long-term positive effect on the business. Ethical business

3BUSINESS ETHICS
organisations gain much higher reputation and good will in the market, in comparison to
businesses that raise doubts among the population. The organisations with higher goodwill
and reputation automatically brings in more customers and results in higher profitability.
Business organisations with higher profitability are more sustainable and can operate for
longer terms (Ortiz‐de‐Mandojana and Bansal 2016). The benefits of ethical business practice
overshadow the immediate small economic benefits of unethical ways. In addition to that,
when unethical business practice of a particular organisation is exposed the reputation,
profitability, customer base and good will of the business get shattered instantly. These
intangible assets take a long time to build up but no time to be destroyed.
LECTURE 2
I have found the lecture 2 of the course module to be very effective in explaining the
importance and implications of ethical standards in business. Either one empowered
individual or a group of people who form a board takes the decisions in business singularly or
collectively (Baker 2017). It does not matter who in the authority is taking the decision, but a
decision when made influences the business in some way. Therefore, the decision makers in
an organisation need to be careful about maintaining ethical standards.
There are number of importance associated with the ethical decision making process
in businesses (Hartman, DesJardins and MacDonald 2014). Apart from attracting more
customers due to the goodwill, it helps in employee retention as sustainable business practice
help in creating better working conditions (Van Der Klink and Van Der Wilt 2016). The
ethical businesses include better and reasonable employment conditions. A business that is
ethical, boasting of high customer loyalty, goodwill and good working condition will
naturally draw more investors. The investors would also know in their mind that the money
they are spending is spent on ethical and moral practices. I have understood from the video

4BUSINESS ETHICS
that business ethics is not just about following the law but upholding the morality and
humanity over blatant profit making.
The stakeholders who influence the ethical standards of the business include the
management of the company, the employees, all the investors and shareholders, the
customers, related government agencies and everyone who is in some way connected the
business. I will specifically focus on my understanding of social responsibilities that lie on
the management who are the prime decision makers in the process. There are various social
responsibilities that the business has to perform including legal, economic and humanitarian.
Economic responsibility is the one beyond profit making and giving something back to the
society, to the people who need it. I have studied that businesses spending large amount on
social causes actually get more in return in long term as they are perceived as credible (Tai
and Chuang 2014). The lecture taught me how the key concepts of ethics in business has
changed over time, from civil rights questions dominating ethical principles in the 1960’s, to
cyber security and privacy becoming main concern in the 2000’s (Schrempf-Stirling, Palazzo
and Phillips 2016). The ethical standards in business or any other fields have been dominated
by the contemporary events and political scenario of the time. However, the basic principle of
morality and maintaining the “good” quotient has remained the same throughout the times.
LECTURE 3
Any individual or group of people who are affected by a business organisation or get
affected by the decisions of the business organisation are known as stakeholders. I can easily
explain the stakeholder’s relationship by understanding how the stakeholder’s are connected
to the organisation. The video explains how the relationship with the stakeholders affects the
profitability of the business. Apart from that ethical consideration are necessary to maintain
such relationships. The stakeholders are the customers, employees, managers, owners, and

5BUSINESS ETHICS
governmental agencies (Lawrence and Weber 2014). There are two kinds of stakeholders, the
primary and the secondary (Carroll and Buchholtz 2014). The primary stakeholders are the
above-mentioned stakeholders and the secondary are those who are not affected by the
business directly or directly do not affect the business. They are media, trade associations,
special interest groups and the competitors. However, I believe that the competitors act more
like primary stakeholders, because they have direct effect on the business organisation. I have
seen that when one competitor in the field brings down the price of a product, others in the
business have to also follow; this is a direct impact on the business. Therefore, I have my
doubts about the nature of stakeholder that the competitors are.
Every company has to engage in stakeholder’s orientation. Stakeholder’s orientation
is the process in which a business organisation gives attention to managing the interests of all
the stakeholders and maintains good relationship with the stakeholders (Bottenberg, Tuschke
and Flickinger 2017). I have understood that it is an ethical process to take care of the well-
being of the stakeholders because of whom the business runs and grows.
The shareholders of the business and all the stakeholders have some kind of
expectations from the organisation. Performing necessary activities to meet those
expectations while abiding by the economic, legal, ethical and philanthropic responsibilities
is known as “corporate citizenship” (Andriof and McIntosh 2017).
In a famous case the mobile application called “SnapChat” was legally charged of
misleading the customers that the SnapChat photos disappear forever whereas in reality these
can be preserved (Frohlich and Calio 2014). The stakeholders of the business included the
users of SnapChat who were misled and hence it is a case of failure of ethical business
practice in terms of corporate citizenship.

6BUSINESS ETHICS
LECTURE 4
I have found the lecture number 4 to be the most useful in understanding the ethical
issues within the business organisation and the emerging ethical issues that were not known
in the earlier decades (Askew, Beisler and Keel 2015). The emerging ethical issues mainly
comprise of the digital space and include online privacy, intellectual property rights, and
cyber security (Crane and Matten 2016).
Ethical decisions have to be made on a regular basis within the businesses. These
decisions are mainly about something, which is perceived as good or bad (Bishop and Lee
2017). Some examples can be made in this regard; a manager has to decide whether to
continue a particular business decision, which is very profitable for the company but puts
extra burden on the employees without much financial benefit for them. This is an ideal case
of ethical question, which is related to business decision making. In order to remain on the
correct side of such a contentious situation the managers have to be first eloquent about
ethical dilemmas in business and their possible solutions.
In this regard, I will try to specifically focus on the reasons why the organisations or
the employees within an organisation tend to behave unethically. The organisational unethical
behaviour is caused due to collective unethical behaviour of the individual employees.
Unrealistic targeting of profits can be reason why the organisation tends to become unethical.
The overall unrealistic profit target of the organisation will be distributed among its
employees this will pose unrealistic target on the individual employees and they will tend to
become unethical in achieving those. They will start lying or misinforming the customers so
that they buy the product. Fierce competition between several organisations leads to the
individual organisations in taking unethical ways to go ahead of others. This is the reason
misleading advertisements are published or broadcasted. Competition among the employees
within the organisation forces them to unethically lie or misinform about each other to the

7BUSINESS ETHICS
higher authority. Often it is seen inhumane schedules of work lead to frustration among the
employees, which increases the rates of work place abuse, sexual harassment to colleagues
and unsocial activities.
LECTURE 11
The lecture number 11 has given me a clear context of the ethical issues and unethical
practices that are happening due to globalisation and increasing worldwide business
activities. Globalisation is the phenomenon, which has increased connectivity among various
nations of the world. It has increased the business scope and activity among nations and more
and more companies with enough financial capabilities are opting for operating in a multiple
number of countries. These companies are also known as the Multi National Countries or the
MNCs’.
The ethical problem of such companies that work in multiple countries is with the
varied cultural and ethical values in different countries (Khadartseva and Agnaeva 2014). I
have seen foreigners working for such companies often feeling uncomfortable in my country
because of different culture, food habit and behavioural characteristics of the people.
The private companies who want to expand into new nations have to first understand
the culture of that nation to avoid any kind of fallacy or mistake in order to not offend the
citizens of the host nation (Sethi 2016). There are various economic models followed in
different countries. There are some countries, which follow the socialist economic model.
The socialist model is developed from Karl Marx and Frederick Engels theory of socialism
and communism, which implies that though the citizen’s may own their private properties
and personal businesses but the larger public utility economic bodies, like banks, railways,
hospitals, educational institutions will be owned by the government (Uysal 2016). The
opposite theory of capitalism, which is liberal and allows individuals to grow economically

8BUSINESS ETHICS
without limitations is followed by most of the nations worldwide (Jahan and Mahmud 2015).
I personally believe that a free market society where individuals will be free to pursue their
economic ambitions is better than a system, which poses conditions on economic growth of
the individuals. Therefore, it is evident that the practices, which would be considered ethical
in the liberal capitalist countries, will be unethical in the socialist and communist countries.
These are the ethical dilemmas that the organisations have to face in the globalised economy.
It is true that there are some “global common values”, which are practices followed all over
the world as ethical and moral, but the number of local cultural and ethical differences
exceeds the global common values. The two organisations “World Monetary Fund” and
“Word Trade Organisation” are formed by multiple countries in the objective of
homogenising the business practices all over the world and synthesizing the difference of
ethical standards in a way that would not be offensive to any nation, but would uphold the
“global common values”.

9BUSINESS ETHICS
REFERENCES:
Andriof, J. and McIntosh, M. eds., 2017. Perspectives on corporate citizenship. Routledge.
Askew, O.A., Beisler, J.M. and Keel, J., 2015. Current trends of unethical behavior within
organizations. International Journal of Management & Information Systems (Online), 19(3),
p.107.
Baker, D.F., 2017. Teaching Empathy and Ethical Decision Making in Business
Schools. Journal of Management Education, 41(4), pp.575-598.
Bishop, D.L. and Lee, D.S., 2017. Business Ethics: Ethical Decision Making and Cases (Asia
Edition).
Bottenberg, K., Tuschke, A. and Flickinger, M., 2017. Corporate governance between
shareholder and stakeholder orientation: Lessons from Germany. Journal of Management
Inquiry, 26(2), pp.165-180.
Carroll, A. and Buchholtz, A., 2014. Business and society: Ethics, sustainability, and
stakeholder management. Nelson Education.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Ferrell, O.C. and Fraedrich, J., 2015. Business ethics: Ethical decision making & cases.
Nelson Education.
Frohlich, T. and Calio, V. (2014). 9 of the Most Totally Misleading Product Claims. [online]
Time. Available at: http://time.com/107224/misleading-products/ [Accessed 31 Jan. 2018].
Hartman, L.P., DesJardins, J.R. and MacDonald, C., 2014. Business ethics: Decision making
for personal integrity and social responsibility. New York: McGraw-Hill.

10BUSINESS ETHICS
Heilpern, W., 2016. 18 false advertising scandals that cost some brands millions. [online]
Business Insider. Available at: https://www.businessinsider.in/18-false-advertising-scandals-
that-cost-some-brands-millions/articleshow/51630709.cms [Accessed 31 Jan. 2018].
Jahan, S. and Mahmud, A.S., 2015. What is capitalism. Finance & Development June, pp.44-
45.
Khadartseva, L. and Agnaeva, L., 2014. Globalization and business ethics. In Сборники
конференций НИЦ Социосфера (No. 16). Vedecko vydavatelske centrum Sociosfera-CZ
sro.
Latif, A.A., 2017. Volkswagen brand: the fall of an auto empire. Journal for Global Business
Advancement, 10(3), pp.281-304.
Lawrence, A.T. and Weber, J., 2014. Business and society: Stakeholders, ethics, public
policy. Tata McGraw-Hill Education.
Ortiz‐de‐Mandojana, N. and Bansal, P., 2016. The long‐term benefits of organizational
resilience through sustainable business practices. Strategic Management Journal, 37(8),
pp.1615-1631.
Schrempf-Stirling, J., Palazzo, G. and Phillips, R.A., 2016. Historic corporate social
responsibility. Academy of Management Review, 41(4), pp.700-719.
Sethi, S., 2016. Globalization and self-regulation: The crucial role that corporate codes of
conduct play in global business. Springer.
Tai, F.M. and Chuang, S.H., 2014. Corporate social responsibility. Ibusiness, 6(03), p.117.
Uysal, G., 2016. Marx and theory: Socialist market economy. In International Business and
Management Conference’16.

11BUSINESS ETHICS
Van Der Klink, J.J. and Van Der Wilt, G.J., 2016. Sustainable employability-definition,
conceptualization, and implications: A perspective based on the capability
approach. Scandinavian journal of work, environment & health, 42(1), p.71.
Zinman, J. and Zitzewitz, E., 2016. Wintertime for Deceptive Advertising?. American
Economic Journal: Applied Economics, 8(1), pp.177-92.