Ethical Decision Making in Business

This assignment delves into the history of business ethics. It examines prominent works by scholars like J.B. Ciulla, A. Crane, and D. Matten, exploring their perspectives on ethical decision-making in the context of globalization and corporate social responsibility. The assignment also considers various ethical frameworks, including deontological ethics, and analyzes how businesses navigate ethical challenges in today's complex environment.

Business Ethics

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Development and background of theoretical ethical approaches..........................................1
1.2 Contrast and compare absolute and relative ethics...............................................................2
1.3 Different ethical issues which can affect operational activities of organization...................3
TASK 2............................................................................................................................................4
2.1 Organisational objectives are affected by ethical considerations..........................................4
2.2 Implications of organization and its stakeholders to work ethically.....................................5
TASK 3............................................................................................................................................6
3.1 Role of Marks and Spencer Plc as a moral agent..................................................................6
3.2 Improvement of mechanism for accomplishing employee involvement and empowerment
.....................................................................................................................................................7
TASK 4............................................................................................................................................7
4.1 Existing ethical issues which are affecting Shell..................................................................7
4.2 Ways to improve ethics of organisational operations...........................................................8
4.3 Ethical code...........................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business ethics plays a significant role in every organisation. It helps in determining
those ethical difficulties and principles which arise in work place. Ethics are apply on business
and individual conduct. They also helps in representing those organisational values, principles,
standards, and norms which regulate individual activities and their behaviour within work place.
With the help of professional ethics, philosophy of business can be identified (Acevedo, 2012). It
includes various rules and regulation which helps in regulating daily organisational activities and
practices. Every individual of company is obliged to follow those rules. In modern world, due to
legal system, every business enterprise has been obliged to work in right manner. This project
report is focused on a case scenario in which different ethical aspects of The Volkswagen Diesel
Deception has been examined. Organisational objectives has also been evaluated from ethical
perspectives. Along with this, importance of corporate ethics in work place relationship has been
determined. At last, different ethical issues has explained which arise in business environment.
TASK 1
1.1 Development and background of theoretical ethical approaches
Business or corporate ethics are very much important for organisational success. So
everyone in work place should operate their activities and practices in ethical manner. In
previous time, enterprises were very much honest with their work, but in present time no
company gives importance to ethical preselective they just want to earn high financial profit at
any cost (Audi, 2012). Even researcher have declared that business moral is very important
concept because it can influence positive or negative impact on organisation, society, individuals
and environment. There are three main theoretical ethical approaches which are following as
under:
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Deontology Theory: As per this ethical approach, consequences are not important. It gives
importance to actions, they should be justified ethically. This theory was firstly introduced by
Immanuel Kant. This theory state that while making decision process, duties or roles should by
followed in appropriate manner. People should take those actions which are morally right.
Teleological theory of ethics: This theory of moral give its core importance to consequences,
which describe the action that helps in producing positive results. It was firstly introduced by
Aristotle. According to this preselective, to achieve desired consequences people should focus on
their decision making.
Consequentiality theory: According to this theory, moral actions of a individual decided their
consequences. Results can be either good or bad and also they can be damaging and favourable.
Hence, these are some most important approaches of ethics which can help business
enterprise to operate its activities morally and ethically correct. With the help of these theories,
organisation and its individual can get encouraged to work ethically within work place (Bageac,
Furrer and Reynaud, 2011).
1.2 Contrast and compare absolute and relative ethics
Business ethics are very important for organisation. If enterprise will not operate their
activities ethically then they can not accomplish their desired goals and also can not build strong
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Illustration 1: Ethical approaches. 2017

goodwill in competitive market place. There are two most essential approaches of ethics first is
focused on relationship and character, other one is focused on principles or rules.
Approaches based on ethical principles
Approach which comes in this category are depended upon two traditional ethical
preselective first is Kantianism and other one is Utilitarianism. This concept was introduced by
Immanuel Kant. This theory is also called as deontological. This ethical perspective gives core
attention to explain duties and responsibilities. It plays an important role in corporate ethics and
moral philosophy. Approaches based on ethical principles give importance to customers or
service user, their decision making capability is not important. The most essential points of this
concept are to create and maintain confidentiality within a person, obtain permission of
information, no favouritism and not provide the wrong information.
On the other hand, teleological theory is known as utilitarianism, which is a part of
consequentiality ethical theory. The biggest difference of both theories lies on their nature and
concept. Both perspectives have contrast with kantian moral approach. This aspect gives high
importance to better resulted. As per this approach there is no problem in telling lies. It is
focused on real facts, either they are right or wrong. According to teleological ethics, end results
justify everything. In simple words, correctness of taken action is judged in the ending (Becker,
2012).
1.3 Different ethical issues which can affect operational activities of organization
It is very much important for business enterprise to work according to their corporate
ethics. This can help company in achieving its goals and objectives, also force it to work in
ethical manner. In simple words, without professional moral no enterprise can accomplish it
desired results. In modern time, many company suffer from high financial losses because they do
not work ethically. Volkswagen have also faced various problems because It have operated its
activities in unethical manner. Some honourableness practices of this organisation are following
as under:
Lack of concern for business domain: Inappropriate actions of this organisation have also
affected its nearby surrounding. Different car accidents have damaged environment and its
various aspects. Those accidents have taken place due to recklessness of Volkswagen and its
staff members.
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Technology usage to harm people: This company was get blamed for using technical factors in
inappropriate manner. This organisation have used online services to communicate wrong or
incorrect messages to its customers, so that it can attract them.
Lied to customers: This company was well known for its effective products and services. But
recently it got failed in providing quality services to its customers (Ciulla, 2011). It promised to
its customers to provide them guarantees and warrantee but at the time of damage they did not
provide such guarantees, which dissatisfied their potential clients. Spoken lies of managers have
decreased goodwill and corporate image of this company.
Hence, these are some most inappropriate organisational activities which have done by
Volkswagen. Due to these non sufficient practices this company have suffered big financial
losses and also have lose its goodwill in competitive market place.
TASK 2
2.1 Organisational objectives are affected by ethical considerations
Human behaviour and nature is affected by their ethics. It is their moral preservative
which force them to do any task. Most of individuals are influenced by their own moral
contemplations. These morals can also help business enterprise to operate their activities in most
effective and systematic manner. Ethics of a person represents their commitments and
responsibilities. For better growth and development of organization its is very much important
for its mangers and other staff members to perform their duties and responsibilities ethically.
Company can provide various training and development programs to mangers and employees so
that they can improve and develop their moral behaviour (Crane and Matten, 2016). Without
morality they can not accomplish organisational goals and objectives. So it can be said that,
different motives of company are affected by ethical considerations. Some objectives of
Volkswagen are following as under which are affected by its moral aspects: To lead in Auto mobile industry: this is the most important objective of this organisation.
For getting higher success in this industry it have to follow ethical consideration. If it will
operate its business activities and practices ethically, then it can make good position in
market place, which can help it in leading in Auto mobile industry. For better results it
should motivate its staff member that they work with business ethics so that they can
build trust in customers.
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 Captivation: This is the next most important objective, to captivate more people it have
to provide good products and services. This can be possible if it will assure its audience
that Volkswagen operate its operation to consider ethical principles.
Moreover, these are some most important objectives of Volkswagen which have affected
by ethical considerations. This company should operate its activities in ethical manner so that it
can attain its goals and objectives, also can build best corporate image in market place.
2.2 Implications of organization and its stakeholders to work ethically
There are various stakeholder which plays and important role in accomplishment of
organizational goals and objectives. In simple words, it can be said that success and failure of
organisation depend upon different key people and their ethical actions. Most important
stakeholders of Volkswagen are following as under:
Shareholders: They are known as key people of every organisation. There work is to invest in
organisational activities so that company can get higher level of success. If shareholders will
invest in organisation to consider ethical considerations, then they can help enterprise in
producing most effective results. They are the most powerful people because they buy shares of
business enterprise (De George, 2011).
Customers: In modern world, all organisation are becoming customer oriented. If enterprise
wants to survive in competitive market place, then it have to provide good satisfaction to its
clients. Through this company can fulfil all needs, demands and preferences of their potential
customers. They are the person who helps organisation in enhancing their financial profit, if they
will not purchase anything then organisational development can not take place.
Employees: They are considered as most expensive assets of organisation. Without them,
organisation can not produce and deliver different products/ services to their customers. For
better organisational growth and development, employees should work ethically so that they can
provide high quality goods to clients. If workers will not manufacture goods in ethical way, then
they can not provide high satisfaction to customers as well as organisation (Fassin and Buelens,
2011).
Government: Legal system governs various rules and regulations for organisation so that they
will follow ethical manner to produce goods and services. In modern world, almost all company
have been obliged to follow those rules otherwise they will have to pay a specific amount of
money as punishment.
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Competitors: Due to globalisation, market competition have been increased. Volkswagen also
facing various problems or difficulties due to increment in rivalry firms. It competitors are
providing same products and services at less prices which is decreasing number of its customers.
In present time, Toyota is its biggest contender in market place.
Hence, these are some most important stakeholder of business enterprise who have great
role in organisational success. Ethical actions of these people can lead organisation to higher
level of financial profit. Volkswagen have faced various difficulties because its staff members
have not performed their duties in ethical manner.
TASK 3
3.1 Role of Marks and Spencer Plc as a moral agent
Moral agent can be defined as ability of an individual to take different ethical or moral
judgement, which are related to right or wrong actions. People or organisation who considered as
moral agent, should have the ability to differentiate between what is wrong and right. Different
company can earn trust of their customers by providing results as per their predetermined
commitments. Marks and Spencer is known as moral agent, as it provides effective services
which it have committed to provide to its clients.
It is very difficult task to make and hold trust of consumers. This organisation also help
United Kingdom to hold its heritage aspects. This is most powerful business enterprise because it
make its organisational decisions to consider different rules, regulations and policies of UK
government (Fassin, Van Rossem and Buelens, 2011). M&S operates its various activities and
practices with honesty and integrity. The code of ethics also determine its behaviour towards its
different key people such as employees, customers, shareholders, competitors and government.
Various ethical initiatives of this multinational company represents that it have great brand
image in competitive market place. As per official data, Marks and Spencer is comes in the
category of ethical business enterprise. This corporation gives high importance to local
communities, suppliers and its potential customers.
M&S is a well known organisation, because gives core attention to its customers, without
them it can not accomplish its organisational goals and objectives, also can not earn high
reputation in market place. It have huge number of loyal customers because its provides them
high quality goods and services.
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3.2 Improvement of mechanism for accomplishing employee involvement and empowerment
For better growth of organisation it is very much important to involve employees in
decision making process, through this company can enhance moral of workers. So mangers have
to take many initiatives so that they can increase engagement of workers in business activities. In
modern world, that enterprises are highly known which gives importance to customer services
initiatives, employee empowerment, total quality management and change administration. To
motivate and influence employee to contribute in organisational success, company should take
initiatives regarding human resources empowerment. In recent years, Marks and Spencer have
started to provide art training to their employees, so that they can involve them in generating
effective work. This enterprise have also make changes in its human resource policies so that it
can modify current business environment of organisation. HR department of this enterprise have
made necessary changes so that it can follow current market trends. Along with this,
management sections have also been transformed in Retroactive role. Different changes in
human resource department have taken place because this organisation wants to increase skills
and abilities of its employee so that they can be involved in decision making process. With their
effective skills they can perform use their power in best manner. Marks and Spencer provides
various induction programs to their newly hired workers so that it can engage them business
activities from starting (Ferrero and Sison, 2014).
TASK 4
4.1 Existing ethical issues which are affecting Shell
Shell is a multinational company, as it operate its business in all over the world. It have
suffered from various difficulties such as financial problems and less employees. These
challenges have arise due to ethical issues. This organisation took help of Nigeria by taking Oil
from them. Due to negative circumstances in Nigeria, this enterprise have faced various
problems. Because of incident of oil spill, reputation and goodwill of Shell has also been
decreased. This organisation was unable to provide health care services in Nigeria, that is why
its position has become lower in market place.
Due to oil spill in Nigeria, many people of that country suffered from health issues, also
there was no scope of heath and social care services. Child labour is one of the biggest problem
of that company, because that time condition of organisation was very poor, so it started to hire
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child labour. Shell in notable to perform corporate social responsibility and also have paid a big
amount of money to break environmental legislations (Ford and Richardson, 2013). Due to oil
spill incident, that country have faced various problems of food, environment, health issues and
national economy.
4.2 Ways to improve ethics of organisational operations
To improve and develop the goodwill and reputation of organisation, Shell company
should make some initiatives towards its corporate social responsibilities. It should also give
importance to individual rights, which have been spoiled by this organisation in previous years.
To perform its social responsibilities, Shell has taken various initiatives so that it can clean the
incident affected area. But still its organised process are not sufficient to clean whole
environment. Due to oil spill, people are not able to clean drinking water, but this company can
help poor individuals by supplying them clean and fresh drinking water. To deliver better
performance Shell can combine procedure, plans and individuals. This organisation is taking
huge initiatives but still reputation of this company was damaged very badly. Because of that
incident many environmental disasters has tool place. They highly influenced climate, so it will
take lots of time to improve and develop situations in Nigeria (Jennings, 2014).
With hard efforts, organisation can help Nigerian people in improving and developing
their living standard. They need food, shelter and drinking water to survive, So Shell can provide
them all by their financial profits. It is a long process but not impossible.
4.3 Ethical code
Business code can be defined as a rule or regulation which is a manner of organisation to
show its duties towards its business environment and social groups. For this, it is very much
important for employees to follow moral code of conduct. In the case of Oil spill, Shell
corporation have abided with several legislations to concern about health and safety. Through
this, organisation can operate its organisational activities in safe environment, without
influencing any negative impact on natural resources and other aspects of business environment.
For better results, organisation can provide medical services to affected people at free
cost. If people get injured while working, then company can give them extra pay (Martin and
Parmar, 2012). Along with this, organization should provide equal opportunity to all employees.
Shell can also make ethical partnership with other enterprises, this can help in reducing industrial
conflicts. Corporate should make their important decisions to consider different interests of its
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employees. In simple words, by protecting and promoting employee's interest company can
motivate them to contribute their efforts in organisational growth and development.
CONCLUSION
According to above mentioned report it has been concluded that business ethics are very
much important for organisation, because it helps in following correct path. With the help of this,
organisational values and standards can be determined easily. In simple words, business ethics
gives a full description about organisational policies and activities which are related to corporate
governance, internal trading, favouritism, graft, property and corporate social responsibility.
Ethical preselective are guided by central government so that business enterprise operate its
activities in right manner. With the help of this, organisation can build required level of trust
within its potential customers. As this project report is based on Volkswagen which is
multinational car manufacture company. This organisation was highly affected by a scandal,
which is raised due to unethical behaviour of its staff persons. If enterprise and its individual
will work in ethical manner then they can enhance brand image of Volkswagen. In this report
various ethical preselective has been explained which can help organisation in building its strong
position and also can build required level of trust within its clients.
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REFERENCES
Books and Journals
Acevedo, A., 2012. Personalist business ethics and humanistic management: Insights from
Jacques Maritain. Journal of Business Ethics. 105(2). pp.197-219.
Audi, R., 2012. Virtue ethics as a resource in business. Business Ethics Quarterly. 22(2). pp.273-
291.
Bageac, D., Furrer, O. and Reynaud, E., 2011. Management students’ attitudes toward business
ethics: A comparison between France and Romania. Journal of Business Ethics. 98(3).
pp.391-406.
Becker, G.K. ed., 2012. Ethics in business and society: Chinese and western perspectives.
Springer Science & Business Media.
Ciulla, J.B., 2011. Is business ethics getting better? A historical perspective. Business Ethics
Quarterly. 21(2) . pp.335-343.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
De George, R.T., 2011. Business ethics. Pearson Education India.
Fassin, Y. and Buelens, M., 2011. The hypocrisy-sincerity continuum in corporate
communication and decision making: A model of corporate social responsibility and
business ethics practices. Management Decision. 49(4). pp.586-600.
Fassin, Y., Van Rossem, A. and Buelens, M., 2011. Small-business owner-managers’
perceptions of business ethics and CSR-related concepts. Journal of Business ethics.
98(3). pp.425-453.
Ferrero, I. and Sison, A.J.G., 2014. A quantitative analysis of authors, schools and themes in
virtue ethics articles in business ethics and management journals (1980–2011). Business
Ethics: A European Review. 23(4). pp.375-400.
Ford, R.C. and Richardson, W.D., 2013. Ethical decision making: A review of the empirical
literature. In Citation classics from the Journal of Business Ethics (pp. 19-44). Springer
Netherlands.
Jennings, M.M., 2014. Business ethics: Case studies and selected readings. Cengage Learning.
Martin, K. and Parmar, B., 2012. Assumptions in decision making scholarship: Implications for
business ethics research. Journal of Business Ethic. 105(3). pp.289-306.
Michalos, A.C., 2017. Issues for business ethics in the nineties and beyond. In How Good
Policies and Business Ethics Enhance Good Quality of Life (pp. 197-212). Springer
International Publishing.
Rutherford, M.A. And et. al., 2012. Business ethics as a required course: Investigating the factors
impacting the decision to require ethics in the undergraduate business core curriculum.
Academy of Management Learning & Education. 11(2). pp.174-186.
Trong Tuan, L., 2012. The linkages among leadership, trust, and business ethics. Social
Responsibility Journal. 8(1). pp.133-148.
Online
Deontological Ethics. 2017. [Online]. Available through:
<http://www.allaboutphilosophy.org/deontological-ethics.htm>. [Accessed on 31st
August. 2017].
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