Impact of Business Ethics on Organizational Performance

Student : Anis Sahraoui
To analyse the impact of business ethics on organizational performance: In context of
Iceland Retail Company, UK

DISSERTATION 2
Abstract
In the current scenario, the organization faces different challenges like unethical and illegal
business practices in the business transaction. Hence, the organization should use the code of
ethics to deal with the ethical challenges. It is evaluated that code of ethics is the set of moral
principle which is used by a corporation for right conduct with employees internally and
externally. This research uses mix research methods such as both qualitative and quantitative
research methods to complete the research in a specified time period. Further, both statistical
and descriptive data analysis is used to analyze the facts and figures regarding research issue.
From the findings, it is revealed that ethical conduct has an impact on the performance of the
organization. It is also found that there is a favourable relationship between business ethics and
organizational performance. At the last, it can be recommended that company should use a
different strategy to improve the business ethics within an organization as it will improve the
organizational performance.

DISSERTATION 3
Table of Contents
Chapter 1: Introduction..................................................................................................................4
1.1 Background of the study.......................................................................................................4
1.2 Overview of the company.....................................................................................................5
1.3 Statement of problem............................................................................................................5
1.4 Reason for investigation.......................................................................................................6
1.5 Research aim and objectives.................................................................................................6
1.6 Research Question................................................................................................................7
1.7 Dissertation structure............................................................................................................7
Chapter 2: Literature Review.........................................................................................................8
2.1 Introduction..........................................................................................................................8
2.2 To explore the meaning and concept of business ethics.......................................................8
2.2.1. Ethics.............................................................................................................................8
2.2.2 Organization Performance.............................................................................................8
2.3 Critical Theoretical Literature Review.................................................................................9
2.3.1 The Employee Risk Triangle Theory.............................................................................9
2.3.2 The Stress Facilitation Theory.......................................................................................9
2.4 Empirical Literature Review..............................................................................................10
2.5 To address the impact of business ethics on organizational performance: in context of
Iceland, UK...............................................................................................................................12
2.6To recommend the strategy to promote the business ethics: in context of Iceland, UK.....14
2.7 Summary.............................................................................................................................16
Chapter 3: Research methodology...............................................................................................17
3.1 Introduction........................................................................................................................17
3.2 Research philosophy...........................................................................................................17
3.3 Research Approach.............................................................................................................18
3.4 Research Strategy...............................................................................................................18
3.5 Research Design.................................................................................................................19
3.6 Research Purpose................................................................................................................20
3.7 Data Collection Method......................................................................................................20
3.8 Sampling Procedure............................................................................................................21
3.9 Data Analysis Methodology...............................................................................................21
3.10 Ethical Consideration.......................................................................................................22
3.11 Reliability and validity of data.........................................................................................23
3.12 Research limitation...........................................................................................................23
3.13 Summary...........................................................................................................................23
Chapter 4: Findings.....................................................................................................................25
Article 1: Ethical commerce is in demand and on the rise.......................................................25
Article 2: SUPERMARKET ETHICS: ISSUES OLD AND NEW.........................................28
Article 3: Corporate Responsibility of Iceland.........................................................................32
Chapter 5: Interpretation and conclusion.....................................................................................36
Interpretation............................................................................................................................36
Conclusion................................................................................................................................40
Recommendation..........................................................................................................................41
References....................................................................................................................................42
Figure 1: Ethical spending in the UK.................................................................................26

DISSERTATION 4
Figure 2: Data regarding business ethics in the UK................................................................26
Figure 3: Market share of Iceland Retail............................................................................. 28
Figure 4: Ethical spending in the UK.................................................................................29
Figure 5: Iceland Average Monthly Wage...........................................................................31
Figure 6: Corporate Social Responsibility of Iceland..........................................................33
Figure 7: Economic growth % of Iceland............................................................................33
Figure 8: Consumer price index of Iceland..........................................................................34

DISSERTATION 5
Chapter 1: Introduction
1.1 Background of the study
In the earlier year, business ethics is essential for every organization to run their business in
long-term. Business ethics can be measured and conceptualized in different manners. In a
business environment, ethical principles and morals can affect the organizational performance.
Earlier studies depicted that business ethics can be favourably associated with the process by
which good conducts are implemented in the business. Moreover, business ethics entails the
demonstration of the high extent of reliability in business dealings. For implementing all facet
of business conduct, the company should focus on the conduct of individual and business
organization. The ethical issue is relating to the good conduct of a person within society but law
issue can create complexities within society to conduct bad and unethical behaviour. Laws can
be enforced by the court and state whereas ethics are enforced by professional codes and ethical
committees. Ethics is becoming an essential component of the business (Burrell, 2017). Under
the business, a person can access codes of ethics, a record of moral guidelines, and practices on
maintaining high levels and traced description of moral and ethical concern.
Business ethics is important to attract the customers with respect to company’s products thereby
sales and profit can be boost. It is also beneficial to attract investors and keep share price high
thereby defending the business from takeover. Business ethics play also important role to
influence the employees who want to work for company and reduce recruitment expenses.
This research uses three case study related to Iceland food Retail Company. These case studies
are Ethical commerce is in demand and on the rise, supermarket ethics: issues old and new and
Corporate Responsibility of Iceland. It is assessed that Iceland spends high amount on ethical
practices because it could be effective for them to gain their revenue. In addition, there are 33%

DISSERTATION 6
of the consumers who prefer to buy from a brand because they believe that the company is
doing social and environmental good. There is issue regarding fair trade practices in the
supermarket. In this way, it is assessed that re-current matter among ethical customers may
generate the complexities for Iceland retailers. It is evaluated that Iceland retailer emphasized
on energy efficiency within their plan to protect the environment. It could be effective to attract
the customers towards their business and also helps to improve the business performance.
1.2 Overview of the company
Iceland Foods Ltd is a British supermarket chain which focuses on the selling the frozen foods
such as prepared meals and vegetables. It also sells the non-frozen grocery products like
produce dairy, meat, and dry goods. Further, the corporation has about 2.2% of share in UK
food sector. It is one of pace growing and most innovative retailer in the Britain. It is also
recognized as one of leading corporation in the UK because it has more than 40 franchised
stores across the Europe. The corporation has made a large alteration in its promotions. These
promotions show the corporate social responsibility of a company towards society (Iceland,
2017).
1.3 Statement of problem
There is a large number of an organization which faces different challenges like unethical
behaviour and illegal activities in a number of business dealings. A manager faces the issue of
assessing the impact of the critical conduct on the performance of organizations. Besides this,
there are several business managers who deal with ethical activities without showing a keen
interest in concern whether their action is right and inappropriate. Further, high extent of
employees develops the understanding of the terms of ethics in which high extent of obedience
can be highly insignificant. It is analyzed that UK society makes little care about the wealth and

DISSERTATION 7
highly relied on the ethical practices of an organization. Business ethics focuses on studies of
management over the many previous years. There are different reasonss for paying attention to
business ethics such as management of professionalism in an organizational practice. The key
aim of business ethics is used to determine the fundamental intention of an organization. Hence,
the company should focus on the issue with respect to moral duties and rights between a
company and its shareholders. As a result, it would be beneficial to improve the organizational
performance. The ethical issue is associated with the corporate social responsibility of
corporation as it has an impact on the business (Saeidi, et. al., 2015). Unethical business
practices can decline the organization image and ultimate impact on the share price of the
company.
1.4 Reason for investigation
This research is significant for the government, public and private retail company in the UK to
assess the organizational performance in the context of business ethics. It also develops the
understanding of readers on ethical conduct of employees. This investigation can also be aided
the Iceland retail company to assess their organizational performance and review that how
ethical conduct of employees may affect the business. This research is also beneficial for
readers to evaluate the impact of business ethics on organizational performance in the context of
Iceland retailer. It also supports the retailers to understand the strategy to promote the business
ethics.
1.5 Research aim and objectives
The main aim of this research is to analyze the impact of business ethics on organizational
performance in the context of Iceland, UK. The following objectives will be used to meet the
main aim of this research:

DISSERTATION 8
 To explore the meaning and concept of business ethics
 To address the impact of business ethics on organizational performance: In context of
Iceland, UK
 To recommend the strategy to promote the business ethics: In context of Iceland, UK
1.6 Research Question
 What are the meaning and concept of business ethics?
 What are the impacts of business ethics on organizational performance in the context of
Iceland, UK?
 Which strategy can be used to improve the business ethics at the workplaces in context of
Iceland, UK?
1.7 Dissertation structure
This dissertation contains several sections. The theoretical structure is defined as the theoretical
perspectives of several authors about the impact on business ethics on organizational
performance. Research methodology parts incorporate the qualitative research approach and
uses different article to identify research issues. The next section demonstrates the findings of
pooled information and focuses on the impact of business ethics as per the perspectives and
views of different authors. In the last section, conclusion is defined by researcher by
summarizing the output of research.