Business Ethics and Responsible Management

This study material explores the concept of business ethics and responsible management. It covers topics such as ethical dilemmas, their impact on society, stakeholders affected, good and bad ethical practices, and recommendations. The material also discusses the application of ethical theories in addressing the issue of gender pay gap. Course code: N/A, Course name: N/A, College/University: N/A

BUSINESS ETHICS
AND RESPONSIBLE
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................4
PART 1 (A)......................................................................................................................................4
1.1A Introduction and explanation of ethical dilemma...............................................................4
1.2A Company affect the society with these issues....................................................................5
1.3A Stakeholders affected by the issues....................................................................................6
1.4A Good and bad ethical practices...........................................................................................7
1.5A Recommendations..............................................................................................................7
PART 2 (B)......................................................................................................................................7
1.1B Introduction of ethical theories...........................................................................................7
1.2B Application of theories.......................................................................................................8
1.3B Critically evaluated the selected theories...........................................................................9
1.4B Recommendation..............................................................................................................10
PART 2..........................................................................................................................................10
2.1 Ethical leadership management...........................................................................................10
2.2 Reflect about how ethical leadership management can be put in practice in an unethical
business environment................................................................................................................10
2.3 How personal ethics, integrity and compliance help to practice ethical leadership
management at work place........................................................................................................11
2.4 Own working experience at your work place as an ethical leadership manager.................11
2.5 Conclusion of Ethical Leadership Management in an UN-Ethical Leadership environment
...................................................................................................................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business ethics is useful in order to conduct and operate the organisation by considering
the practices and policies and every business needs to have ethics which is useful in order to
achieve their goals and objectives in an ethical and desired manner (Haski-Leventhal, Pournader
and McKinnon, 2017). As ethics involve knowledge and understanding about what is right and
wrong and how to deal with the complex situation. Business ethics also impact the decisions
which is related to the organisation. This report is based on the case of gender pay gap which is a
difference between the remuneration of male and female who are working in an organisation.
This difference is based on various factors such as discrimination on the basis of gender, caste,
education, working hours and many more. This report is in the context of TESCO, which is a
supermarket store headquarter in England, UK and also describe its gender pay gap report. This
report is going to cover the explanation about the ethical dilemma and how the company affect
the society with these issues. Moreover, it also select five stakeholders who are affected by the
issues. In addition to this, it use two theories in order to describe the selected issues and also
provide recommendation. Despite of this, also reflects the ethical leadership management.
PART 1 (A)
1.1A Introduction and explanation of ethical dilemma
This section of report covers the various issues which influences the society and also
describe that how the stakeholders affect from these issues (Borges and et. al., 2017). Moreover,
also depicts the good and bad ethical practice and what is learned from it and provide
recommendations which can safeguard the stakeholders in future in order to avoid various issues.
While considering the ethical dilemma which is described by the senior manager of TESCO for
the gender pay gap, the poor rating is come from their female employees as they analyse the
discrimination and difference in their pay. It is addressed to senior managers which is to bring
out the attention about the dilemma in the unethical practices Through the official gender pay
report of TESCO stores Ltd, it is determined that hourly wages pay for women is 92p for every
£1 that men earn which means 8% lower than men.

(Source: Gender pay gap report, 2018)
Moreover, while considering the bonus pay gap in an organisation, it is analysed from the
survey that women get 70p for every £1 which describes that approximately 30% lower than
men's (Gender pay gap report, 2019). Despite of this, proportion of females in each pay quarter
as women occupy around 39.9% of the highest paid jobs and 67.1% of the lowest paid jobs
(Gender pay gap report, 2019).
1.2A Company affect the society with these issues
In the above discussed dilemma, there are various issues which impacts the image of
company and also influences the society. This case is considered as an ethical question in terms
of society and company (Kolb, Fröhlich and Schmidpeter, 2017)(. Through its discrimination
between the pay role among the men and women influences various factors of an organisation
such as performance of employees, reputation of company, productivity of company and overall
performance of company in front of society. Currently, three factors are described in the official
survey of the company which is hourly wage pay, bonus pay and proportion of women in each
pay quarter.
Illustration 1: Gender pay gap report

As the difference between the hourly wage pay among the men and women impacts their
productivity and performance and also develop feeling of job insecurity. For this, apart of
motivation, salary plays an important role in order to increase the performance of employees and
it includes incentives and fair pay (Smith, 2018). By considering the ethical issues of TESCO
they pay less wages to their female employees in comparison to the male employees which can
influences their performance and productivity.
After that considering the bonus pay gap which depicts that women get 30p less than £1
in comparison to men which impacts their extra work performance and also provide hike to their
men employees (Crane and et. al., 2019). Lower bonus rate of women happen by considering
various key points such as women start their career at a very low wage which impact their bonus
rate and women in the finance and real estate industries make approximately 21% less than men
in bonus. As this difference impacts their motivation and morale level and also become a
question mark in front of society and affect its image.
1.3A Stakeholders affected by the issues
 Customers: Through the gender pay gap survey of TESCO, it is described that its ethical
issues also affects the customers and their relationship with the company which depicts
that it put bad influences on the mind of their customers and also affects their purchasing
power (Barrena-Martinez, López-Fernández and Romero-Fernandez, 2018). Due to this,
the sales and revenues also gets influenced which can decreases the reputation of
company.
 Suppliers: By considering the gender pay gap report of TESCO, their ethical issues
impacts the suppliers as there is minor difference between the suppliers and customers. In
terms of suppliers, they does not want to deal with that company who has poor credibility
in the market and because of its ethical issues, the image of company gets influenced.
 Government: As per this factor, the government impacts their overall performance
because the operations and supply of raw materials depends on the government. Because
of the unstable government, the trade policies gets affects (Rothaermel, 2017). In terms of
company, it influences the government in tax policies.
 Senior executives: These executives acknowledge the role in designing and shaping the
organisational ethics and describes that because of the unethical practices of TESCO, it
impacts the post and image of senior executives.

 Line level employees: In terms of line level employees, through the unethical practices of
TESCO, it impacts the performance and productivity of their employees. Moreover, also
develop job insecurity among them.
1.4A Good and bad ethical practices
Bad ethics: It consider any instance in which company ignores the healthy interest of
their employees and in the context of TESCO, it influences the working style and performance of
their female employees and also bring down their motivation level (Senge, 2017). For instance,
in terms of Volkswagen emission scandal in 2015 it put bad impact on the mind of employees
and by this company also leads to face employees turnover.
Good ethics: It consider the various factors which helps in boosting the performance of
employees and encourages the fair treatment in an organisation. Unfortunately, it does not
happen in all organisations but in the context of Uber, they always their each and every
employee at equal level and it is helpful in boosting the morale of employees and increases the
performance of employees.
1.5A Recommendations
Due to the unethical practices happen in the TESCO, various recommendations are given
to them which are mentioned below:
 In order to avoid gender imbalances in an organisation, men and women need to apply for
promotion in proportions that can matches the composition of their grades (Schaltegger
and Burritt, 2018)(.
 In terms of senior executives, they plays crucial role in order to eliminate the gender pay
gap by providing and treating equally to them.
 If women are tend to enter in an organisation at junior level or if women are less likely to
be hired when they apply to join the organisation at higher level then it impacts the
gender pay gap and for this company need to consider each and every women candidate
in the firm.
PART 2 (B)
1.1B Introduction of ethical theories
The aspect of ethics is refers as a combination of values, norms, beliefs, thoughts that
help an individual to make a better decision between right and wrong. The concept of ethics

plays a vital role in every personnel life as it help them to improve their personality and
attributes in an impressive and attractive style. At the same time, it also considered as important
element within organisation as it lead them to accomplish organisational goal or objective in an
effective or efficient manner (Laasch and Conaway, 2017). There are different theories or
concepts which is related to ethics which guide an establishment to place its brand in an
aggressive or competitive position. In relation to this report, the issue which has been considered
is gender pay gap which states that showing partiality in terms of providing rewards or wages on
the basis of gender. Some of the theory which has been identified for reducing the ethical issue
of gender pay gap are as follows:
Teleological Ethical theories: This aspect is concern with those concept which states that
each personnel action whether right or wrong has huge impact over other manpower behaviour
and attributes. This theory has been classified into ethical egoism, utilitarianism, eudalmonism
and each of them are differ from each other.
Deontological Ethical theories: Under this, it mainly focusing over developing a
relationship between duty and morality of human action (Miska and Mendenhall, 2018). Along
with this, it put less emphasise on overall outcome rather it signifies that each individual are
characterised by their action which is morally right. Moreover, it is distinguished into various
forms i.e. negative and positive right theories, social contract theories, social justice theories.
1.2B Application of theories
As per this report, gender pay gap has been regraded which is one of the major issue in
every kind of organisation. This issue is link with those issue in which it states that
discriminating the men and women in regard of paying remuneration or wages. Due to such
problem, it generate several complexities like conflict of interest, dispute, ambiguities and many
more. IN order to tackle gender pay gap from company, application of some theories has been
analysed which act as a proper guidance or direction to managers for maintaining the working
culture in an ethical manner. The explanation of theories are as follows:
Teleological Ethical theories
Ethical Egoism: This concept defines that actions or activity of a personnel is termed as
good when their act results in maximising the other person's self interest. IN relation to the issue
of gender pay gap, implication of this aspect enable an establishment to take effort to provide
fair rewards on the basis of their potentiality not on their sex (Camilleri, 2018). This is because,

it explains that providing other personnel a improved level of self interest help manager to
acquire high level of employee involvement into business activities. Due to which, it drive them
to enhance their market share or size in an amended or efficacious mode.
Utilitarianism:In this term, it highlights that the an action can be called as good if it's
outcome provide high level of satisfaction or motivation to employee. However, in context of
gender pay gap, implication of this concept assist superior to identify the capability of each
employee and based on that delegate them in right position. Along with this, for retaining them
inside firm for longer period of time, Utilitarianism empower organisation to render appropriate
amount of compensation that help them to gain increased level of employee satisfaction with
working culture.
Eudaimonism: In this, actions are defined as good when it accomplish the desired goal or
purpose along with welfare of human being. In context of gender pay gap, it motive
establishment to make best decision on the concept of salary or wages and also lead them to give
equal preference to both the gender i.e. male and female (Greenberg and et. al., 2017). With the
help of this, it help manager to enrich its working environment and also can control the negative
organisational politics in an improved mode.
Deontological Ethical theories
Negative and Positive Rights Theories: In aspect of negative right theory, it signifies that
an action is define as right if prevent the personnel from harm or unjustifiable intervention from
other people or government during performing his /her particular creativity. IN context of gender
pay gap, if an employee undergoes with an issue of discrimination then they have a full authority
to take corrective course of action. AS per this theory, organisation are not supposed to
intervention in their activity.
1.3B Critically evaluated the selected theories
As per the earlier explained various types of theories, it has been evaluated that in order
to improve the overall productivity of an organisation, it is essential that manager make a
decision to process fair rewards system within functional unit (Shen and Zhang, 2019). This is
because, it lead an establishment to invite their manpower towards business activities and give
equal opportunities . Due to which, it help them to enhance their sales volume and also can
acquire full contribution of employee towards an achievement of organisational pre defined
objective in a prescribed time duration.

1.4B Recommendation
Some of the ways which company can cope up with the problem of gender pay gap are as
follows:
 The foremost step which an establishment can acquire is that they must adopt effective
communication process. This is because, it enable them to control the occurrence of
misunderstanding, misconception and so on.
 The another measure is that company needs to treat both male and female staff equally as
well as provide equal growth platforms in all areas like pay, promotion, motivation and
etc. With the help of this, it empower each manpower to gain positive relationship with
working culture of firm.
PART 2
2.1 Ethical leadership management
Business environment is comparative and each individual working in efficient manner to
bring desired results. Human resources is most important tool for success of a business
organisation and managed through leaders and managers. Leadership in the present market
scenario is used to become successful as high amount of motivation and influencing power is
possess by leaders. Leadership reflects more productive results when it is in terms of ethical
form. As a leader while performing leadership practices I have to be honest and virtuous (Von
Schomberg and Hankins, 2019). Ethical leadership management helps to hold each and every
employee of the organisation on the same board. While taking all the decisions keeping benefits
of organisation to first place and setting an example for followers is achieved through ethical
leadership management. For me while I am working in business organisation principals of ethical
leadership needs to be followed. These principals are respect, service, community, justice and
honesty. All are served as a core of business ethics.
2.2 Reflect about how ethical leadership management can be put in practice in an unethical
business environment
Unethical business environment serves injustice to employees working in an organisation
at each operational and functional level. While working as a leader in an unethical environment
to implement ethical practices at the first place I needs to find that issue that made unethical
environment to grow. Initially stages where ethics are not followed and organisational structure

will be accessed to understand the complete scenario. Issues will be identified and policies form
top level to lover level management will be implemented that supports ethical practices (Haski-
Leventhal, Pournader and McKinnon, 2017). Training programmes and motivation sessions will
be provided so that importance of ethics can be developed. Employees are motivated to work
ethically and when any unethical act is seen then it should be reported. Rewards must be made to
individuals working towards introduction of ethical environment in organisation. All these
practices will induce each individual operating in business organisation to support ethical
practices and eventually will leads to adaptation to ethical practices in unethical business
environment.
2.3 How personal ethics, integrity and compliance help to practice ethical leadership
management at work place
Initiation of ethical practices takes place when personal quality is available among a
leader to work on ethics no matter whatever the situation is. As a leader when I am aware of all
the ethics while working in business organisation and my quality of being honest and having
effective moral principals will help me to bring ethical practices at workplace (Borges and et. al.,
2017). Compliances with all the policies at workplace and following all the ethics will help in
generating more productive results. All the followers gets influenced through personal qualities
and gets motivated towards following ethics while working in business environment. When an
individual as a leader always prefer ethical behaviour in each and every situation then an
example is set to followers to follow and induces them to work with ethics. It is difficult to adopt
qualities that are required to behave ethically and personal quality of being honest helps in
adopting ethical practices while performing various activities at managerial and leadership
position.
2.4 Own working experience at your work place as an ethical leadership manager
As I was working in one of the leading organisation in retail industry named as
Sainsbury. It is seen that various unethical practices are made in operating business activities.
Such as gender preference to a particular job and different pay scale for same post on basis of
gender. This unethical behaviour of management leads to dissatisfied workforce (Kolb, Fröhlich
and Schmidpeter, 2017). When I become a leader of this organisation and tries to introduce
ethical practices it become tough as management was not ready to make these changes. While
dealing with human resources I recorded their issues and on the basis of these issues a plan was

designed to introduce ethical practices. This act was supported by number of employees who was
suffering with unethical practices in the organisation. This leads to generation of productive
results and in long run management also supported this initiative to sustain in long run.
2.5 Conclusion of Ethical Leadership Management in an UN-Ethical Leadership environment
When ethical leadership management is followed in unethical business environment then
all the practices that provides injustice to an individual and preferential support to one person is
minimised to grate extent. In unethical environment decisions are based on manipulation and
honesty is not supported. Personal benefits and personal relationships are prioritised over
organisational benefits. Introduction of ethical leadership will minimise this form of attitude in
organisation and in long run will support honesty and integrity (Smith, 2018). As a leader I can
record changes that will take place in a business organisation when ethical practices will be
followed in comparison to unethical practices. Benefits that are enjoyed with ethical practices are
more then which can be recorded in measurable terms as it leads to enhance level of job
satisfaction among employees. As each employees will be provided equal pay, equal opportunity
and fair chance to grow and develop. It will a hard process but eventually benefits that all will
enjoy thorough ethical practices will make it possible to achieve introduction of ethical
leadership management in business organisation.
CONCLUSION
From above project report it has been concluded that business ethics are the basis that
helps a manager and leader to gain success in competitive environment. Introduction of business
ethics eventually leads to ethical dilemma and managers and leaders needs to take effective
decision to implement and maintain ethical practices in business organisation. Society at large is
affected through activities that are performed through business organisations. As business
organisation is comprised with stakeholders and they belongs to society. Impact on each
stakeholder affects society as a whole. In the process of introducing ethical behaviour and
practices in business various theories will be used so that desired results are produced. Ethical
leadership management will help in introducing ethical practices at each level in organisation in
most productive manner.

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Online
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