Entrepreneurship Theory and Practice

This report explores the role of ethics in entrepreneurship and whether entrepreneurs always have to take unethical and risky paths to be successful. It includes a literature review on the importance of ethics in business, and case studies on Rupert Stadler and Jeff Bezos to demonstrate different approaches to ethical decision making. The report concludes that entrepreneurs should strive to do good for the greatest number of people.

Running Head: Entrepreneurship Theory and Practice
Entrepreneurship Theory & Practice
Can you make an omelet without
breaking the eggs

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Table of Content
Introduction....................................................................................................................................................... 2
Literature Review............................................................................................................................................ 3
Case Study 1 (Rupert Stadler- CEO Audi)............................................................................................... 4
Case Study 2 – Jeff Bezos, Amazon CEO and Founder.......................................................................6
Conclusion........................................................................................................................................................... 7
References........................................................................................................................................................... 9

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Introduction
Entrepreneurs are the individual who have the guts and energy to change the existing
business ecosystem, and create something which is more beneficial for the society and
the community. The world has seen ordinary people born into ordinary families with
ordinary education background, transforming the world with their cogent minds and
their knack of business understanding. Thus, the entrepreneurs are tagged with the
adjectives of innovation, ethical practices, creativity and business process
understanding.
In the very present day, the role of an entrepreneur has become all the more important.
Due to the changing dynamics in the business ecosystem, the leadership or the
entrepreneurs have to bring certain changes in their leadership style to make the best
out of the situation. They have to deal with tremendous challenges and pressure in the
process of creating a business model which is sustainable. They have the added
responsibility of ensuring that the decision they take are not unethical and impact the
employees of the business organization as well as the related stakeholders. Also it is
literally impossible to make decisions which have a utilitarianism approach, that is do
greatest good for the greatest number of people. Thus, in the process of becoming a
successful business entrepreneur a lot of choices have to be made, which does not fall
into the purview of ethical practices at times.
Therefore, the purpose of the report here is to identify if the entrepreneurs always have
to take unethical and risky path to be successful (Can you make an omelette without
breaking eggs?). Also the report will highlight how the entrepreneur thinks out of the
box with respect to their business with the case study on Rupert Stadler and Jeff Bezos.
Both the leaders however visionary in their approach has a different way of thinking,
which will be the highlight of the report.

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Literature Review
The authors Marcin, Wojciech & Katarzyna in their books ethical aspects of
entrepreneurship discussed the role of ethics and its growing improtance to the
budding founders or the entrepreneurs (Burton, et al., 2016). The authors say that
ethics in business actvity are improtant as it directly impacts the end customers, thus
one ethical practice can shake or break the faith and the trust of the customer on the
businss orgnaization (Kuratko, 2016). The aim of the writing here is to ascertain if an
entrepreneur can be an ethical question, the answer to which remains plausible, but still
swings mostly on the side of , Yes. Uneithical practices which are done deliberately
raises a question on the entrepreneurship ability of the person, however, if the
unethical decision is taken for the greater good of the greatest number of people it can
be dealt with less sevearty (Kets, 1985).
John Hooker in his journal on business ethics education states that the ethics of a person
are a reflection of his upbrining in the society and on the basis of his cognitive learning
from the external world (Read, et al., 2016). The authors stated that an individual can
have only limited learning when it comes to ethics, and accroding train himself to
become an ethical person. It is more of the surroundings in which he is raised, the
situation he is being exposed to and the nature of activity, which makes him take
decisions which are ethical or unetihcal in nature (Burchardt, et al., 2016). John in the
journal defined ethics at the morality of the person in the tie of crisis. John also stated
that ethics and entrepreneurship goes hand in hand, and unetihcal behaviour of the
entrepreneur can seriosuly jeopradise the employees working in the organziation as
well the business organization.

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Elizabeth, Laura, Francesco and Jared in their journal on Social entrepreneurship and
Business, overlooked the question of ethical nature of the social enterprises (Marvel, et
al., 2016). The study here cited that outcome of the entreprenaurial innovative process
have a deeper impact and social value which is beyond the direct effects on the
transactional parties (Klotz, and Neubaum, 2016). The authors mentioened that social
entrepreneurs take their decision of ethics and unethical decision making by focussing
on the four key differecnes: nature of emergent opportunities, differecnes in the
mission, difference in resource mobilization and management and perfromance
measurment of the social impact. Thus, at times Entrepreneurs take decision by bending
the working rules and the exisitng policies for the greater good of the society and the
community.
Case Study 1 (Rupert Stadler- CEO Audi)
The case study on Rupert Stadler will demonstrate how a CEO loses his mind in order to
win a war with its competitors and allows for unethical behaviour in the organziation,

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whilst participating in the unethical means. Early in June 2018, one of the finest
visionary of its times and a marketing marvel, Rupert Stadler was arrested as a part of
probing towards the manipulation of emissions control in the vehicles of Audi. The
move was taken over the emission scandel which rocked Vokswagon in the year 2015,
after which a lot of arrest were the order of the day at Audi. It also resulted in company
paying hefty fines to the tunes of billions to the government authority for cheating the
customers and polluting the environment on the pretext of making it clean(Blackwelder
et. al., 2016).
In the case here, due to bad leadership of Rupert cars sold in Eurpoe were equipped
with a software which turned emission controls on during the lab testing and it again
went off during driving to enhance drive perfromance. Stadler was always into the
middle of controversy in dieselgate case, it was his strong ties with the family which
saved him for quite some time. The huge crisis of dieselgate, which involved cheating
with the federal laws of US and the intention of doing fraud and conspiracy costs
volkswagon almost US $ 30 billion in fines and its impact on the goodwill is beyond any
figures. Now, it is literally impossible to carry such a mass scale operation without the
CEO not in loop. Rupert was in the loop right from the start, and he too was okay with
the plan of calibarating the vehicle to achive the desired results. The move was intended
to potray diesel vehicles as clean fuel emission, a vehicle which would lessen the impact
on the environment(Schafer,2017).
The dieselgate scandal which took the company by storm, also took with itself Martin
Winterkorn, the veteran CEO at the VW. It also seems fair that the controversy of
dieselgate came out in the open, else in most of the cases it has been seen that the
offenders often get free, due to their power and money. The dieselgate case was a big

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eye opened also for the Audi Company but also for its CEO, who thought that the big and
mighty can always find a way to escape (Poncibo, 2017).
The learning from the above case is that the CEO or entrepreneur sometimes takes
unethical decision owing to the situation at hand. In this case, this was not entirely
justified as Rupert Stadler was involved in the scandal to beat the increasing
competition in the market. They were losing their battle in the Petrol car segment, and
they wanted to come up with a clean fuel which was the need of the hour. This forced
him and other top executives to take an unethical decision which at least resulted in the
arrest of Rupert Stadler, and billions in fine for Audi group
Case Study 2 – Jeff Bezos, Amazon CEO and Founder
The case study of Jeff Bezos will demonstrate the social responsibility of the company
and the vision of Jeff Bezos to help the community to grow along with the business
organization. The vision Jeff has set for Amazon in itself shows the determination with
which Jeff works for the benefit of the stakeholders of the organization. He wants the
company to be the most customer centric company on earth, and in order to do so, he

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keeps a good overview of all the policies and procedures in the organization. Jeff takes it
a step ahead; Jeff still keeps a mail of the customer support and responds to some of the
concerns or query of the customers (D’Anselmi, Chymis & DiBitetto, 2017).
Another great step of Jeff is setting up of the programme Amazon Smile in the year
2013, it is a website which is created and activates a donation of 0.5% to charity every
time the consumers shops at the website. The website allows for the donation to
plethora of charity with which Amazon is associated. Amazon boss Jeff Bezos has been
under flak for a very long time, due to his comparison with the biggest philanthropist,
Bill Gates. But Jeff believes that right now the time is to invest more and more in
technology and do well for the mankind. Thus, he is looking up to the clouds while
working on his entrepreneurial journey (Belitski & Herzig, 2018).
Jeff has also created a frustration free packaging which involves only 100% recyclable
material to protect the environment. This thing will help Amazon to reduce the waste
put out on earth by the company; it will help in curtailing the environmental pollution.
Another program of Amazon, which is the brainchild of Jeff Bezos, is the Amazon Wish
Programme. According to the programme, a person can create a wish list of the
products he wants to buy, but somehow does not have the funds or the means to have a
purchase. The people, who come on the website, can make the wish come true of that
person by ordering from the wish list. This just shows, how Jeff Bezos envisions Amazon
to take care of the people who are in need, and he puts in tremendous efforts to make
them happy(Bansal & DesJardine, 2014).
Jeff Bezos, who started his entrepreneurial journey back in 1994, was set out with a
clear mission, to change how the people shop online. The company which was started
off as an online book seller, at the very present scolds anything to everything on the
platform. The company is setting up milestones in terms of technology by creating

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products like Alexa, Kindle, Fire stick, Drone delivery, Amazon go. The latest project of
Amazon, Blue Origin is another step towards mankind. Thus, it can be said that Jeff
Bezos ethics are a culmination of his vision for the company, and no matter what it
takes Jeff has pledged to serve the world in a better manner, every single time.
Jeff Bezos is a very ethical leader, whose ethical philosophy is an extension of
Utilitarianism approach. The approach which states that one should do the greatest
good for the greatest number of people is at heart of Jeff Bezos. All the actions of Jeff are
inclined towards pushing the ecosystem of products and services to its customers. He
ensures that the company in the process does not harm the environment, which makes
Jeff Bezos a good corporate citizen (Turker, 2018).
Conclusion
The report can be concluded by saying that ethics and decision making plays the same
role as that of behaviour of the entrepreneur in order to build his image. The human
psychology plays a very interesting role as people see the decision taken by the
entrepreneur, according to their benefits and same happens with the entrepreneur.
Entrepreneurs are also admired all over the world, as they account for almost 75% of
the world’s wealth.
The life and journey of the entrepreneur is always under the lens of the customers or
the admirers, an additional pressure to do good for the company also rests on the
shoulders of the founders or the entrepreneurs. Thus, at times they have to take certain
decisions which might not be ethical for the people or the organization, but he should
still act in the best interest of all the stakeholders for the organization (Chell et. al.,
2016). Leaders who adopt unethical decision making one day or the other lands in
troubles, which disrupts the hard work of the entrepreneur all his life. Thus, it is always

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advised to take decisions which are based on the concept of “Do good for the greatest
number of People”

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References
Bansal, P. and DesJardine, M.R., 2014. Business sustainability: It is about time. Strategic
Organization, 12(1), pp.70-78.
Belitski, M. and Herzig, M., 2018. The Jam Session Model for Group Creativity and
Innovative Technology. The Journal of Technology Transfer, 43(2), pp.506-521.
Blackwelder, B., Coleman, K., Colunga-Santoyo, S., Harrison, J.S. and Wozniak, D., 2016.
The Volkswagen Scandal. Harvard Business Review.
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Burton, M.D., Sørensen, J.B. and Dobrev, S.D., 2016. A careers perspective on
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Chell, E., Spence, L.J., Perrini, F. and Harris, J.D., 2016. Social entrepreneurship and
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Hooker, J., 2016. Journal of Business Ethics Education. Journal of Business Ethics, 13.
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Klotz, A.C. and Neubaum, D.O., 2016. Article Commentary: Research on the Dark Side of
Personality Traits in Entrepreneurship: Observations from an Organizational Behavior
Perspective. Entrepreneurship Theory and Practice, 40(1), pp.7-17.
Kuratko, D.F., 2016. Entrepreneurship: Theory, process, and practice. USA: Cengage
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Marvel, M.R., Davis, J.L. and Sproul, C.R., 2016. Human capital and entrepreneurship
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