Ethics in Business: Importance, Issues, and Recommendations

This study explores the importance of ethics in business and the impact of unethical practices on stakeholders. It focuses on Ladbrokes Coral, a British gambling company, and discusses ethical issues, the role of business in society, examples of good and bad ethics, and recommendations for improvement.

Business Ethics and
Responsible Management
Table of Contents
1

Part 1 3
Ethical issues 3
Role of business in society in the context of ethics 4
How stakeholders affected by the ethical issues 5
Examples of good and bad ethics 5
Recommendations for improvements 6
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INTRODUCTION
Business ethics can be defined as a form of ethics that examines ethical morals and
issues that occur in a business and perform activities which will be beneficial for the society.
Ethics plays an important role in professional and personal life as it shows other the way of
behaving and protecting themselves against lawsuits and other problems (Crane and et.al., 2019).
For living a happy and effective life and for making the business successful in an efficient
manner it is important to keep up loyalty, honesty and trust which all are codes of ethics. This
study is based on Ladbrokes Coral which is a British gambling company whose headquarter is in
the London, UK. IT has approximate 16,685 employees at its all stores. This present study of
business ethics is going to show some importance of ethics and business ethical practices for
business, employees and the society. It will also show several issues which occur due to not
following ethics or unethical behavior. Unethical behaviors affect stakeholders and the society in
a negative manner.
Part 1
Ethical issues
Ethics is a code of morals that are being practiced by a group of people and individuals
that shows an individual’s honesty, loyalty, trust and the way of behaving. It also makes an
individual able to identify the difference between the right and the wrong. There is an increasing
importance of following codes of ethics and morals such as: it helps an individual in making its
business successful in professional and in his personal life. In the context of Ladbrokes Coral
who is a British betting and gambling company run its business with several ethical issues. It is
stated that this company was accused of conflicts of interest over problem gamblers. This shop
introduced a fixed odds betting terminal where punters could lose and win big data. Due to these
gambling which people were used to do for fun gradually became the reason of losing their
money as well as families too (Ethical issues at Ladbrokes Coral, 2018.). Due to this reason,
government took a step and limited the maximum bet down from £100 to £2. This was good for
families and the society but it was a huge loss for betting and gambling companies. After this law
and changes in laws by government, Ladbrokes Company said in the argument that it will close
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approximate 5,000 jobs which will directly impacts on the employees and staff of this company.
It will increase unemployment rate. For this solution, all staff were told to sign up gamblers to
online accounts in order to avoid redundancy. No one wants to lose their job, so company took
an undue advantage of it and said to their employees that they need to give an online test in
which they need to score maximum and more as compare to other if they want to keep up and
continue their job. For that they need to make influence to customers about open and set up new
online account for gambling and avoiding redundancy. Score will be marked and being given as
per the number of customers that how they persuade to set up their accounts. This change shifted
gamblers from the shops to online. It shows unethical behavior of this company who impacted
negatively to the society. This behavior of running business who hurt someone in the context of
money, loss of family is called ethical issues.
All those activities which is being run for earning money by hurting people in several
ways are called unethical business practices which this Ladbrokes company was perusing.
Role of business in society in the context of ethics
Business ethics and practices run according to ethics under the expectations and welfare
of the society is called an ethical business behavior. On the other hand, all practices and activities
which do not focus on satisfying customers, society and somehow hurt their feelings is called
unethical business behavior. Unethical business practices impact negatively to the society. Some
impacts of unethical business practices are being described as below:
Loss of respect: When a business makes unethical decisions than employees’ loss a lot of
respect and trust for their boss. All unethical behaviors of the company publicized and come into
news which gives a negative impact on the society. In the context of Ladbrokes Company, it can
be said that this company comes in news several times by which people started to becomes the
reason of loss of public credibility (Motro and et.al., 2018).
Decrease productivity: Initially, unethical behaviors like gambling can be fun when people earn
a lot from this, but it is a practice which does not give profit all the time, it is an activity which
can snatch a lot from people like their money, home, families etc. Unethical business practices
gradually become the reason of decreased productivity. There are lot of chances to commit
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mistakes and these errors decrease quality of products and services (Matherne, Ring and Farmer,
2018).
How stakeholders affected by the ethical issues
In the context of Ladbrokes Coral company there are several stakeholders and people who were
involved with this company directly and indirectly. Customers or gamblers, employees, society in which
it runs and investors are some stakeholders. All of these have an influence on its business. It is stated that
it involves and engages with its stakeholder proactively but some unethical behaviors impacted on its
stakeholders negatively.
In the context of employees, it is stated that due to its unethical behaviors and changes in
governmental law, approximate 5,000 employees lost their jobs immediately by which their families
suffered. It also impacted on its society and gamblers families as an active participation in gambling
activities became the reason of money and family’s loss of many people (Impacts on stakeholders,
2018). It closes approximate 1000 to 3500 shops which was great loss for this company and its investors
as well. On the other hand, this company said that it is upholding responsible gambling behaviors,
harm minimization and player protection and fostering integrity on sports. But it’s all activities
shows that it increases crime and unlawful behavior. So, it can be said that activities of
Ladbrokes Coral company was unethical which impacted greatly to its all stakeholders.
Examples of good and bad ethics
There are several examples and actions which shows the difference between the wrong
and the right as well as bad ethics and good ethics. There are several examples in business which
shows unethical and bad ethics such as:
 Not paying an employee for all that hours he/she worked.
 To use false advertising tactics which this Ladbrokes company use as it asked cits
employees to make influence to gamblers and customers to switch their shops into an
online account. It was a bad ethic and unethical behavior
 Engaging in price fixing in order to force smaller competitors out of business.
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 To force employees to perform activities by giving them bribe and some type of greed
and temptation. This Ladbrokes company tried to use this unethical behavior on its
employees and said them if they influence customers for unethical behaviors then they
will employ them (Davies, 2016).
 Cheating customers by not telling them whole processes and information’s about the
company which are important for them to make decision of buying products and services
also shows unethical behavior or bad ethic.
So, all these behaviors show bad ethics. Here are some examples of good ethics and shows
that an organization runs its activities in an efficient manner such as:
 To tell all details of the activities and way of producing things and services to
customers before they take decisions about purchasing and keep honesty with them is
an example of good ethics. Starbucks is one of them companies who uses good
business ethics and makes its society and employees happy.
 To fulfill all needs and expectations of customers, society and environment by
following all laws related to the company’s industry are one of the best example of
good ethics (Zhang, Kong and Wu, 2018).
 Creating a code of conducts before starting a business and implement it in business
for making employees able to follow all practices and pay workers as per their
experiences and hours worked is other example of good business ethics. Google,
Microsoft and TATA are some examples who follow codes of ethics.
Recommendations for improvements
From the above study and case of Ladbrokes Coral it can be recommended to this
company that it should follow all ethics like loyalty, trust, integrity. It is stated that its activities
were hurting people because many of its customers lost money, home and their families which is
decreasing living standards of the society. It can be suggested to this company that it should
implement some theories of ethics by which it can know the importance of following ethics and
consequences of not following ethics. It needs to focus on stakeholder analysis because unethical
behaviors of an organization majorly hurt to stakeholders so, by identifying their needs it can
perform accordingly. Reviewing all procedures, policies and practices of the company can also
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solve the problems of ethics. There are several laws which are made for ethics which put
pressure on companies and people to behave ethically. By following all those rules in an efficient
manner, ethical issues can be solved out. Monitoring each process and providing training to
employees in order to make them know the increasing importance of business ethics, companies
can perform ethically and resolve ethical issues.
PART 1 B
Two theories
These ethical theories are concentrating on guiding the company employees and company
as well. Theories includes the normative ethical theories which are providing the rule sand
regulations for any situation in the company. These normative ethical theories are focusing on
the actions which are to be done by the person while he is in the situation. As the Ladbrokes is
dealing with the problems of the gambling and so the company has to remove the employees
which are working in the company. These normative ethical theories describe about the correct
way of acting in the situation. One of the theories is the egoism, these theories is including the
action of the individual in the situation and that decision would result in the short term to the
long-term decisions. Individual interest is changing from time to time and so the company has to
deal with the problems and the situation in the suitable way (Trevino and Nelson 2016). Theory is
relied on the free competition and good information because the market is full of the competitors
and the company has to survive in the market so the individual person has to be confident and
take the decision in the freely. So, these individual people would calculate the profits and losses
as well.
Egoism is said as the theory which is motivating the person and the individual would take
the decision in the effective way but if these individual people not provide with the information
in the correct way then it would result in the disaster. Individual person is acting on the situation
in that way which they have learnt and they have been thought as well (Pearson 2017). These
individuals are not acting as per the interest so they are disturbed as well. These ways the
individual is not following the ethics and these would affect theory life. So, the company has to
look after the employees and see that the employees are working in the effective manner which
would not affect the performance of the company. Gambling is the most changing business
because government has strict eyes on the business of gambling and the company is running the
gambling business and they are suffering the severe losses in business because the strict actions
of the government on the gambling.
In the egoism there are many types of the egoism and these would affect the performance
of the individuals. Egoism is generally defined as the individual person Is self-centered and self-
motivated. Sometime these egoisms would Self-motivation is not good for the situation which
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the individual is facing (Chell Spence Perrini and Harris 2016). Like the company has entered the
market with the gambling business at the company has faced the problems when the gambling
business is affected and these all has affected the life of the employees which are working in the
company.
Deontological ethics
These ethics are usually known as the duty of ethics individual person is affected and the
person is taking the decision by keeping in mind the consequences and the practical matters. The
people need to provide the knowledge regarding the situations and hon to manage the situation
and how to take the right decision in the effective way. Mistakes cannot be justified and these
would affect the life of the people (Painter-Morland, 2019). So, the theory of the ethics duties is
containing the duties of the individual relating to the decision and how to take the right decision
at the right time as well. The ethics are the principles which must be followed by the individual
while doing the work. These ethics are teaching but the wrong things and rights things which
would justify the needs of the individual as well (Hibbert and Cunliffe 2015). The needs of the
individual are important for them but these cannot be fulfilled by the wrong things so the
individual has to look after the things in the correct way. The decision is taken by the individual
and so the consequences of taking the decision can be negative and positive. Sot the individual
must be ready for the consequence of the decisions.
It is also providing the moral issues which includes the principles like the it is wrong in
killing the people. It is wrong to steal thing form the strangers and also from the relatives as well.
The individual must be efficient so they do not have the lie to the other people. Promises given
by the Individual must be kept and so it is duty of the individual to keep the promise sand not try
to break it. People must know what is right and what is wrong and these would be understood by
the duty of the ethics. The company is cheating the employees and not following the business
ethics as well (Mckiernan and Tsui 2019). The company is facing the tough situation but then
company must break the business ethics and employees of the company must be provided with
the pay for they have worked in the company. So, the company is provided with the ethics and
duties which must be fulfilled by the company in the effective way.
The theory is providing the good point and the bad points (Ingham and Havard 2018).
Good points are the pints which are gained by the individual at the time when the individual has
followed the ethics. Bad points are gained by the individual when the individual has followed the
bad ethics. Some act is always wrong because the act is wrong and right as per the situation and
time. but the duty-based ethics is providing the knowledge to the employees for the acts and
ethics and so the employees are complaining about the company
PART 2
Reflection
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In my opinion leadership management is looking after ethics which are followed in the
company these ethics must be followed by the employees which are working in the company.
The ethical values and beliefs would include the dignity of the employee and the right of the
employees and employers as well (Painter-Morland 2015). The trust and honesty must be
maintained at the workplace so the company must look after the measures which would provide
the knowledge to the employees regarding the th8ics and duties and right of the employees. The
values and morals which are followed by the government in the effective way. It would include
the beliefs which are followed in the society and the company must look after the life and look
that the value and culture must be followed and not disrespected. The leader of the company is
looking after the need of the employees and the company as well. Leader would provide the
duties and ethics so these would increase the morale of the employees they would be motivate to
work with the ethics and follow the ethics.
It is the responsibility of the leader that all the employees are following the ethics and
motives of the individuals as well (Nonet Kassel and Meijs 2016). The employees which are
working in the company are form the different areas and different culture as well. So, the leader
must look after that the employees’ culture and beliefs are not disrespected. So, the leader must
look after the need of the employees which are working in the company.
Unethical leadership management is the leadership in which the company and the leader
is not following ethics. The boundaries are set by the company and the business ethics but these
boundaries are not followed by them company and the leaders. The employees of the company
are also not working in the company with the ethics. It is destroying the ability of the employees
and employees are learning different things form the company. It includes the wrong practices
and techniques which are flowed by the employees. It is affecting the leadership behavior and the
performance of the employees (Crane Matten Glozer, and Spence 2019). Unethical behavior is
affecting the performance of the team projects and leader are not guiding the employees in the
right way and at the right time. Unethical leadership is Motivating the greed of the employee and
leaders. Leaders want to gain the profits by the wrong way and so the leader is following the
unethical way. Leader are not following the moral and business ethics which are affecting the
image of the company and the performance of the company (Ferrell and Fraedrich 2015).
CONCLUSION
From the above report it would be concluded that the company is working in the
gambling business and the company is facing the problems because of the rules but the company
is covering the losses by the way of not providing the salary to the employees and by leaving the
employees without the security. So the business ethics are not followed and the unethical
behavior of the company and company need to work in the effective way for overcoming the
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behavior of the employees and leader. The report is including the theories of the ethics which
would change the image of the company in the market and so the company would gain the
positive image in the market. These unethical behaviors of the company are affecting the
employee of the company and employees would not support the company at the time of the
needs.
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ONLINE:
Impacts on stakeholders. 2018. [ONLINE] Available through: <
https://gvc-plc.com/wp-content/uploads/2018/03/ladbrokes-coral-cr-report-2016.pdf>.
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