Importance of Business Law and Ethics in Modern Corporations

This essay discusses the importance of business law and ethics in modern corporations. It covers the definition of ethics, its impact on decision making, and the neglect of ethical responsibilities by modern corporations. The essay also highlights the documentary of Joel Barkan's on corporate behavior and social responsibility.

Business Law and
Ethics

Table of Contents
INTRODUCTION ..........................................................................................................................2
TASK ..............................................................................................................................................2
CONCLUSION ...............................................................................................................................5
REFERENCES................................................................................................................................6
INTRODUCTION
The success and failure of a business depends on the organizational behaviour, value,
culture, ethic, etc. These all make the combination which helps a business to move forward.
Business law guides how the business is carried out with respect to following the legal rights and
obligations. Every owner before starting a business states its objectives, vision, mission and
structure(Almahrog, Aribi and Arun, 2018). It is essential that a balance is maintained between
profit making and abiding by the ethical values. In the general sense all the companies and
businesses require a business plan and strategy that can help to cope with the competitive market
and also with ethics to flourish in the modern world. This essay will cover in detail the ethics of a
business, what changes are taking place in the corporate world and will focus on what the
documentaries of Joel Barkan's present in relation to the modern corporate world.
TASK
Ethics are basically defined as a system with moral principles. Business ethics basically
relates to the ethical principles that take place in the business environment. It affects the decision
making of the organization and leads it towards functioning in a manner that benefits the society
as well and not just dependent non profit making. It involves working with fair actions and
ethical standards. These are established by corporations and organizations for the rules and

regulations. It thus involves the duty of doing moral good and maintaining a balance between the
business activities and societal good. Ethics thus help in defining what is right and what is
wrong. Corporate ethics sets standards that are set to define the conduct at the workplace.
Business ethics also emphasizes and outlines the law that outlines what is are the acceptable
behaviours in the organization (Halbert and Ingulli, 2020) . These are established in order to
promote integrity in the employees and members and to have the trust from the stakeholders like
investors and consumers that the corporation is not just a profit making organization but rather it
also looks after the ethical principles which are must in today's time.
Ethical management is very essential for the business because it benefits the corporation
with respect to increasing customer and employee retention, reputation, status and image of the
organization improves, the potential investors get attracted towards the company to make
investments, loyalty of employee increases,etc.
Corporations are special and different kind of professional entity. Corporations like an
individual person have moral responsibilities. Ethical practices in an organization are driven by
truth, honesty, trust and the thinking which is far above the profit making objective. The effect of
ethics is inter-related and inter-dependent(Haugh, 2019) . The stakeholders are affected by the
ethical practices of a corporate who are customers, employees, government, investors and
society. With legal scandals and employees dishonest behaviour making the news, it is no
wonder that the ethical behaviour in today's modern corporate world is taking a back foot in their
priority based to-do list.
Since the origin and beginning of commerce and trade, the business and its ethical basis
has been a point of question. To create a balance between pursuing the opportunities present in
the market and maintaining integrity with respect to ethics has posed as a challenge for the
business corporations. The modern corporation today is neglecting their ethical duties in order
to gain more and more profits. They are not looking after the responsibilities that they have
towards the society based on some ethical principles. The ethical behaviour that are expected
from the modern corporation but are neglected by them are the issues of discrimination. Due to
the diverse workforce the tolerance level in the corporate world is gradually decreasing giving
rise to ethical issues that are not looked after(Scherer and Voegtlin, 2020). Another ethical issue
is of Nepotism and Favouritism which is commonly seen in the modern world of corporate
practices. It discourages the employees in having a positive behaviour towards the corporation.

The major issue with respect to ethics is of Corporate Social Responsibility which is neglected
by the corporations in today's time. CSR is defined as the responsibility of the corporate towards
the environment and society where the company makes the commitment in benefiting the society
by sharing a percentage of the company's profit in doing something good. It helps in enhancing
the relations. Still is majorly perceived as a forceful duty which the corporations do not wish to
fulfil. Corporates perceive it as something which will impact their accounts of profits. But in the
real sense it acts as a indicator of credibility of an organisation.
Joel Barkan's an American Law professor in his documentary by the name of The
Corporation has focused on Corporate Behaviour and Corporate Social Responsibility. This
documentary specifically focuses on the corporations that exist in the modern day world.
Through this documentary he tries to throw light on the fact that the corporations are driven by
profits and their primary and only aim is to maximize profits (Schiff, 2020). It presents the view
that these kind of businesses have an increased control over the behaviour of society towards
different aspects. It has highlighted a legal entity in it which initially started as a corporation that
targeted public oriented work benefiting the society but that later turned into a commercial and
profit making business. It largely focused on the corporations that exist in the country of United
States. The documentary's assessment of the large modern business corporations leads it towards
the controversial and critical topic relation between the major two elements that are Corporate
behaviour and Corporate responsibility. Its critical analysis helps the viewers to understand the
corporate lifestyle. The interviews that are included in it with the various corporate critics
presents the back door image of the actual reality that takes place in the large corporate worlds
(Sison, Ferrero and Guitián, 2018).
There are growing indicators of large corporations taking their ethical responsibilities
less seriously then they actually should. Thus, it is becoming critical agenda that requires
discussion. Modern corporations perceive and conceive business ethics as a set of impositions
and restrictions, obstacles to the business behaviour rather than the motivating force of that
behaviour. Ethics require proper understanding because they should not consist rules or
principles that are prohibitive in nature because it makes the corporates to take a step back in
following the ethical principles. Wrong perceptions of the ethical basis for a corporate creates a
mindset that ethical principles and practices are not fruitful for the organisation. This is the

reason that today's modern corporations are increasingly going far from following ethical
practices in their organizations.
Thus, business ethics is an area of business which if ignored will result in overlooking
unethical behaviour that will result negative reactions on the business stakeholders. The famous
notion that there is mutual exclusiveness of business and ethics refuses to die. And the prejudice
and conception the success of a business corporate is possible only at the expense of morality
and ethical behaviour continues to prevail. These perceptions are clearly false because strict
policies of maximization of profit cannot be regarded as a legitimate principle of corporate
conduct and practices (Wood, 2019). The rise of CSR, Ethics in the business and corporate
governance are all attributed to the need for ethics in the modern corporate world which makes
it essential address this topic of ethics losing its importance n the corporations. Voluntary code of
ethics and standards is the need of the hour for the corporations so that do not lose their identity
while not having a ethical base.
CONCLUSION
It can be summarized from this essay that just like following legal methods is essential
for a business, ethical practices also hold a very vital part of the corporate world. With the
growing competitions of the corporates in the market, it is necessary that they follow and look
after their moral responsibilities. It is getting important for the companies and organizations to
carry out their work in the right way. A corporate that embraces ethical ways and manner in
conducting its business affairs is more likely to achieve quality in the work and performance than
an unethical one. The sole reason that the modern corporations are neglecting their ethical basis
is to maximize their profits. Joel Barker in his Documentary The Corporation has also
highlighted Corporate Social Responsibility and Corporate Behaviour that explains that the
corporations today are driven by profit maximization due to which they ignore their ethical
responsibilities towards society.

REFERENCES
Almahrog, Y., Aribi, Z.A. and Arun, T., 2018. Earnings management and corporate social
responsibility: UK evidence. Journal of Financial Reporting and Accounting.
Halbert, T. and Ingulli, E., 2020. Law and ethics in the business environment. Cengage Learning.
Haugh, T., 2019. Modeling the Message: Closing the Knowledge Gap in Business Law and
Ethics Classes. Journal of Legal Studies Education, 36(2), pp.159-188.
Scherer, A.G. and Voegtlin, C., 2020. Corporate governance for responsible innovation:
Approaches to corporate governance and their implications for sustainable
development. Academy of Management Perspectives, 34(2), pp.182-208.
Schiff, D., et. al., 2020, February. What's next for ai ethics, policy, and governance? a global
overview. In Proceedings of the AAAI/ACM Conference on AI, Ethics, and Society (pp.
153-158).
Sison, A.J.G., Ferrero, I. and Guitián, G. eds., 2018. Business ethics: A virtue ethics and common
good approach. Routledge.
Wood, G., et. al., 2019. Codes of ethics content: UK and Australian corporations. European
Business Review.