Relevance of Ethics for Business Decisions: A Case Study of Woolworths

This paper analyzes the relevance of ethics for business decisions and focuses on the case of Woolworths, one of Australia's leading retailers. It also discusses the importance of ethics for small business enterprises.

Running head: ETHICS-MANAGEMENT
ETHICS-MANAGEMENT
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Introduction
Ethics primarily concern an individual’s moral judgements, perspectives in relation to
right and wrong. Decisions taken within an organisation may be made by individuals or groups,
but the decision-maker will be influenced by the culture of the organization. An effective ethics
and compliance typically translates into ethical business decisions. Ethical decision-making is a
discipline and an approach of successfully identifying as well as resolving issues in the business
context (Hair et al. 2015). The purpose of the paper is to analyse the relevance of ethics for
business decisions and the way ethics is relevant for business decisions in one of Australia’s
leading retailers, Woolworths. Additionally, it is focus on the significance of ethics for small
business enterprises.
Discussion
Relevance of ethics for business decisions
Business ethics provides the approaches to appreciate and realize ethical challenges faced
by stakeholders in operating fair and principled business (Drumwright, Prentice and Biasucci
2015). Moreover, in the view of authors, business ethics can aid to recover ethical decision
making by providing organizational leaders with the appropriate knowledge and tools which
enable them to suitably recognize, analyse and offer resolutions to the ethical troubles and
pressures they tend to encounter. According to Chell et al. (2016), applying ethics in the
business context necessitates a responsiveness or understanding to ethical concerns which may
occur and a process to determine relevant issues as part of an overall decision. Furthermore,
addressing ethics and values in business decision making primarily sheds light on the need to

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ensure that core focusing areas have been made and align to organization’s standards and
principles. Coles for example, with its application of suitable diligence on prospective suppliers
has been able to monitor a supplier and assess their adherence to stringent standards in specific
criteria. Drumwright, Prentice and Biasucci (2015) have noted that, one such criterion is its
questionnaire will allow the company’s supplier to put across their propensity of executing audits
or have an environmental policy.
Woolworths Ethical Business Approach
It is essential for every business organisation to ensure principles values and ethics with
its stakeholders in order to sustain constructive relationship with them. Schwartz (2016) has
stated that values and ethics family emphasize on the basic framework within which every
organization tend to operate. In this stage, the ethical sourcing policy for the stakeholders in
Woolworths involves efficient provision of superior products and services to its consumers. The
company primarily sources its products from diverse locations in order to obtain the needs of
global business environment and demands. Woolworths has been trying to accomplish the
demands and needs of its customers by operating its business at both local as well as global level
Woolworthsgroup.com.au (2019). Additional reports of Hair et al. (2015) have revealed that the
company aims to source its products through highly efficient and suitable approach.
Furthermore, Woolworths ensure value and ethical practices of its product distributors and
suppliers by aiming to enhance the environmental and social practices. May et al. (2014) have
noted that the company proficiently has dedicated its role in ensuring smooth and resilient work
practices with its suppliers in order to acquire their reliance, engagement, and satisfaction and
stimulate in order to deliver raw materials through timely approach. Comprehensive studies of
Lawrence and Weber (2014) have mentioned that Woolworths to sustain its competitive

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advantages position in the Australian retail industry has been providing comprehensive and
distinct directions to its customers who serve to be influential for their purchase behaviour and
knowledge about the company. Through these ethical practices and decision making,
Woolworths has been able to sustain its recognized brand level by ensuring that its business
actions do not negatively influence its corporate reputation and image of its individual brands
(Woolworthsgroup.com.au 2019).
Woolworths Group has been efficiently providing suitable and resilient working
conditions to its employees in order to safeguard the fundamental human rights, privileges and
further guarantee utmost protection of its surrounding environment. According to Drumwright,
Prentice and Biasucci (2015), the company has been operating proficiently within the community
in order to accomplish the fundamental prerequisites and guidelines of the society and maintain
its responsibility towards the environment community and culture in the region where it operates.
However in order to efficiently maintain the continuing success of Woolworths’ business it is
important for the organisation to achieve the ethical as well as moral standards and further
preserve its reputation in the market. The key values of the company include dedication,
commitment, trust, loyalty, integrity in addition to acting responsive towards its stakeholders. As
a result to enhance the environmental and labour practices of the suppliers and distributors the
company exhibits its comprehensive dedication and commitment towards them. In addition to
this, it has been noted that the regulations, principles and policies of Woolworths include equal
remuneration packages, workplace safety, improved recruitment and retention, employment
conditions along with highly resilient and motivating working environment
(Woolworthsgroup.com.au 2019). Reports of Lawrence and Weber (2014) has emphasized on
the way the company has been successfully maintaining healthy associations with all of it

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distributors from all parts of the world. Moreover for the organization, all of its stakeholders
have equivalent value and play a highly critical role in the company’s decision making
procedure. In recent times Woolworths has implemented certain improvement strategies to
ensure that its extensive range of suppliers develop the ability to meet the current standards of
the market. Woolworth has pension regulation of labour rights whereby the employee has the
authority to choose the type of employment as per their qualifications and experience. Moreover,
none of the employees in the company has any obligation to work in the organisation for any
previously mentioned compliance or agreement and acknowledged to leave the organization
based on justifiable grounds (Woolworthsgroup.com.au 2019).
On the other hand, Hair et al. (2015) in the study have found that Woolworths promotes
the development of trade unions and mutual negotiation with the management of the
organization concerning any corporate issues or challenges. The company maintains
sustainability by promoting ethical performance through suitable approach in order to mitigate
any form of unethical decision making or activities within the organisation. Nevertheless, May et
al. (2014) have observed certain challenges which Woolworths encounter in order to maintain its
extensive range of employees in Australia. The company has increased its financial resources
and investment to maintain the sustainability in its business which has aided the company to
attain corporate targets, goals and further deliver superior quality products and services to its
customers. However, the major issue encountered by the company in recent times is climatic
fluctuations. However at this juncture, Woolworths has insured effective reduction in its carbon
emission in order to protect the environment. Thus, maintaining the value and ethics on regular
basis has facilitated the company to increase its revenue income and attract new customers, build

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brand loyalty and sustain in the highly competitive environment within the Australian retail
industry (Woolworthsgroup.com.au 2019).
Relevance of ethics for small business enterprises
Small business enterprises are identified as dynamic part of the economic survival of
individuals as well as communities. Such an understanding guide small business owners to
efficiently acknowledge the social and ethical responsibilities as they tend to impact various
stakeholders in executing business operations. Burns (2016) has noted that small businesses are
specifically susceptible to the practice and implications of unethical business activities because
of their diminutive size, inadequate or restricted financial resources, monetary investments in
addition to their dependency on ‘word of mouth’ business strategies and dependence on
overpowering clients and suppliers. Considering these factors, authors have claimed that small
business ventures must develop the awareness to balance the goals of earnings with the values of
individuals and society by been committed to positive business ethics. For example, in Australia
small business enterprises tend to encounter upsetting failure which occurs from engagement in
immoral or illegal business practices apart from the ongoing managerial and financial constraints
(Schwartz 2016). One of the most persuasive frames of indication for ethical practices in small
business enterprises relies on legal code of conduct. According to Klettner, Clarke and Boersma
(2014), individuals are likely to be law abiding citizens. As a result, all entrepreneurs are
expected to be abiding legal code of conduct while operating any business activities.
Furthermore, if small business enterprises are supposed to implement a legal rational strategy to
its business then the entrepreneurs must attain superior ethical perspectives and must have the
capability to establish behaviour through recognized agreement. As a result, it is imperative for
small business entrepreneurs to invest in learning legal code of conduct and regulations further

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take lessons from the small business association for pursuing legal education in relation to formal
education. Furthermore, Grimmer (2018) has claimed that as small business enterprises tend to
show critical requirement in professional code of ethics, it encounters challenges while executing
its business operations. However, the development of the code of ethics on the basis of the
guidelines and goals of the business can bring vast improvement in the way a small business is
alleged by its stakeholders. Such code of ethics must serve in order to determine the decisions,
judgements, measures and behaviour of the business entrepreneur as well as its employees.
Conclusion
Ethics provides businesses with models and frameworks for dealing with ethical
situations or ethical challenges. Thus it is highly imperative to understand one’s business and the
diverse types of stakeholders, and their authority to influence and to leverage the business
success and performance. The paper has evaluated the way ethics has been highly influential to
business decisions and the way it is pertinent for business decisions in Woolworths. Furthermore,
it has shed light on the importance of ethics for small business enterprises.

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