Ethical Issues and CSR Policies in Pharmaceutical Industry

Running head: ETHICAL ISSUES AND CSR POLICIES
Core ethical issues in the pharmaceutical industry and the CSR policies that firms in
that industry have pursued
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1ETHICAL ISSUES AND CSR POLICIES
Introduction
As opined by Grayson and Hodges (2017), the process of globalisation and
the extensive usage of different kinds of innovative technologies had drastically
metamorphosed the nature of the contemporary business world. Trevino and Nelson
(2016) are of the viewpoint that because of this the business competition faced by
the different business firms had increased in an exponential manner. More
importantly, it is seen that the business firms in order to mitigate the adverse effects
of this the business firms are increasingly resorting to the usage of different kinds of
innovative strategies. Schrempf-Stirling, Palazzo and Phillips (2016) have noted that
one of the most important trends which is being seen within the contemporary
business world is the fact that the business firms are increasingly focusing on the
aspect of profitability and thus often focus on the aspect of quantity rather than on
the aspect of quality.
According to Kang, Germann and Grewal (2016), the business firms often
resort to the usage of business practices which are not only immoral but at the same
time unethical as well. Furthermore, it is seen that these unethical business practices
offer significant benefits to the firms in the shorter run yet in the longer run they
prove to be harmful for the firms (Saeidi et al. 2015). Moreover, it is seen that these
practices adversely affect the stakeholders as well as external parties who are
involved with these firms and thereby negatively affect the market or the brand
image of these firms (Parsons et al. 2016). Thus, the firms in order to enhance their
image and also to contribute in an effective manner towards the planet often take the
help of the corporate social responsibility (CSR) activities. The CSR activities not
only help the firms to address the ethical issues that they are facing but at the same
time help in the improvement of their organisational prospects as through the
improvement of their brand or market image. This essay will discuss the ethical
issues faced by the pharmaceutical firms and also the resultant CSR activities that
they are required to pursue for addressing the same.
Discussion
Crane and Matten (2016) have articulated the viewpoint that the notion of
‘business ethics’ or called by the name of ‘corporate ethics’ refers to the branch of
professional or applied ethics which intends to analyse the ethical principles or

2ETHICAL ISSUES AND CSR POLICIES
problems that arises out of the business practices followed by a firm. Trevino and
Nelson (2016) have noted that the business firms are required to follow the concepts
of ethics as well as morals within the framework of the business practices followed
by them as to contribute the maximum amount of benefit to their stakeholders as well
as the planet. More importantly, in the recent times the notion that the business firms
are required to take responsibility for their business practices has gained a
substantial amount of prominence within the cannon of the contemporary business
world (Grayson and Hodges 2017). This act of taking responsibility of their actions
not only requires the firms to utilise the natural resources in an ethical manner and
ensure that the future generations would have access to the same kind of resources
as the present and also take responsibility for the effect that the products or services
offered by them are having on the customers or the clients. In this regard, three of
the most important concepts that have gained prominence are corporate social
responsibility (CSR), triple-bottom line approach to sustainability and stakeholder
theory (Kang, Germann and Grewal 2016).
Saeidi et al. (2015) are of the viewpoint that the concept of CSR has dual
meaning, firstly, the responsibility of the firms to make profit and secondly to
contribute in a responsible manner towards the development of the community in
which they are operational. The net result of this is that the firms are required to
follow the triple-bottom line approach to sustainability and contribute in an
effective manner towards the planet, society as well as the environment in an ethical
manner (Schrempf-Stirling, Palazzo and Phillips 2016). More importantly, it is seen
that the firms are also required to take into effective consideration the interests of the
stakeholders who are associated with following the precepts of the stakeholder
theory (Kang, Germann and Grewal 2016). It is pertinent to note that two aspects
are common among all these three concepts, namely, the need of the firms to take
into effective consideration the factor of ethics within the framework of the practices
followed by them and secondly, to take responsibility for their actions. However, in
the majority of the cases it is seen that the business firms completely disregard the
factor of business ethics and merely focus on the kind of business activities which
are intended to offer them the maximum profitability.
Grayson and Hodges (2017) have articulated the viewpoint that the
pharmaceutical industry is mainly concerned with the discovery, development,