Ethics and Business Practices

This assignment delves into the crucial relationship between ethics and successful business practices. Students are tasked with examining how ethical considerations influence various aspects of business, including decision-making processes, organizational culture, and stakeholder relationships. The assignment encourages critical analysis of real-world case studies and contemporary ethical dilemmas faced by businesses.

BUSINESS ETHICS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Background and development of theoretical ethical approaches..........................................1
1.2 Comparison and contrasting absolute and relative theories..................................................2
1.3 Explaining the ethical issues that affect the operational activities of Volkswagen..............3
TASK 2 ...........................................................................................................................................4
2.1 Business objectives are affected by ethical considerations...................................................4
2.2 Implications for Volkswagen and their stakeholders to operate ethically............................4
TASK 3............................................................................................................................................5
3.1 Role of organization acting as a morale agent......................................................................5
3.2 Analysing development of mechanisms employed by Tesco for achieving employee
involvement and empowerment..................................................................................................5
TASK 4............................................................................................................................................6
4.1 Current ethical issues and it impacts over Tesco..................................................................6
4.2 Ways to improve ethics of their operations to meet objectives and develop relationship....7
4.3 Ethical code for Tesco...........................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business ethics can be determined as the form of professional ethics or applied ethics that
is helpful enough to examine problems related to ethics, moral or principles that occurs within
the business environment. Ultimate aim of any firm is to gain maximum profit, this is only
possible when they understand the requirements of customers and delivered services and
products accordingly (Hawkins, 2015). In this context, it is essential to make sure that all the
products and services are provided through which environment may not get negatively affected.
Present report is based on Volkswagen which is one of the European companies. US Department
of Justice on behalf of United States Environmental Protection Agency (US EPA) sued
Volkswagen installing 'defeat devices' on thousands of its diesel vehicles. This report covers
ethical issues that can affect the operational activities of business. Further, it covers implications
for business and its stakeholders to operate ethically. Lastly, it also includes development of
mechanism for achieving employee involvement and empowerment.
TASK 1
1.1 Background and development of theoretical ethical approaches
Business ethics are code of behaviour or set of structure that enables to direct the firm
with the help of which business operations can be undertaken in an effective manner. Further,
constitution and structuring for the business related to ethics depends upon the type of business
that is performed. With the help of ethics, business is able to control, monitor and function,
through which the level of regulation and standard can be maintained (Vasconcelos, Melo and
Muniz, 2016). Main aim of any firm is to develop a strong customers base, this can be achieved
when business follow ethical cords in developing products and services. Further, there should be
moral principles that needs to be valued and followed so that higher profit can be earned. In
accordance with the case, it is essential to make sure that firm like Volkswagen to follow ethical
codes so that are able to maintain customers value, brand reputation and market position. With
this respect, there are certain considerations related with the concept of ethics which should be
followed and few of them are as follows:
Theory Name of
the
Consequentiali
st/non-
Main
aspects
Significance
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person
proposed
the
theory
consequentalis
t
Teleological
ethical
theory
Aristotle non-
consequentalist
Virtue This can be determined as the process
in which it consists of issues or
consequences that are faced by the
business due to ethical action. Further,
it looks for ethical perspective which
focus on negative and positive actions
through which proper steps are
considered (Paulins, Hillery and
Sturgill, 2016). It enables to maintain
the level of ethical impact and issues
that are faced within the business
functions and operations. It is
important make sure that proper
actions are considered so that outcome
can be determined.
Deontologic
al or Duty
Emanuel
Kant
Non-
consequentalist
Duty
and
categor
ical
imperat
ive
This approach is based on the actions
that can be taken rather than deciding
on different possible outcomes. This is
totally based on the moral system that
are focused on attaining moral duties
and rules (Zaharia and Zaharia, 2015).
In this context, it is important for the
firm to make use of moral duties and
moral choices, this can be done by
considering corporate social
responsibilities.
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1.2 Comparison and contrasting absolute and relative theories
Within the business, there are different type of issues that are being faced by the firm, it
is important to make sure that proper steps are considered so that the problem can be solved.
There are various type of theories through which ethical issues can be solved. It is important to
make sure that changes are made by the firm for the type of structure and duties that are followed
by the firm (McMurrian and Matulich, 2016). As per the case of Volkswagen, there are different
set of considerations that can be made through which the issues that is faced can be resolved.
Different set of perception are developed by customers and when the ethical consideration is not
made by firm, then it has negative impact over the business.
Theory Comparison of theories Contrast of these
theories
Absolute ethics As per this theory, it is important for the business
to make sure that they follow single code of
conduct and it is followed by all the workers
within the organization. Moreover, all the
employees should be aware of the ethics that is
followed within the organization
In addition to this, it
also stats that there is
high difference
between wrong and
right aspects.
Relative ethics In accordance with this theory, all the individuals
should have single universal moral standards. It
focuses on understanding customers and in
following different set of moral standards (Nowak
and Pereira, 2015).
From this, it can be
stated that on every
human being, no
universal moral
standards can be
applied.
Teleological ethics One of the main variation lies on the results and
concept that is helpful enough to clear that right
and wrong thinks should be listed so that
appropriate outcome can be selected.
This theory
understands the face
that the actions that are
taken can go wrong or
right. But the only
think which is
connected is belief.
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Deontology ethics This theory is helpful enough to develop moral
philosophy and professional ethics for the workers
of the firm (Johnson, Yang and Frank, 2017).
Further, consideration also made for the customers
and make sure that they involve in decision
making for the working of the organization.
Among all these theories, Volkswagen should make use of deontological ethics as it
enables them to over come the issues related to ethics in an effective manner.
1.3 Explaining the ethical issues that affect the operational activities of Volkswagen
Within the firm, it's market share and shares have direct impact due to the functions and
operational activities. In this context, workers are the face of organization as they have direct
interaction with customers. They are the one who deliver the products and services that are
delivered by the firm. Volkswagen should define their set of principles other ethical codes so that
flow of business operations can be maintained (Jondle, Maines and Young, 2013). Further, cited
firm should consider the working structure in accordance with the regulatory, legal and ethical
framework that are determined for the business. With this respect, below given are the
consideration made for effective functions and working of the business:
Ethical issue Volkswagen operational activities
Individual ethical
responsibilities
With improvement in technology, Volkswagen are able to deliver their
services online. In this context, cited firm is able to make sure that
customers get proper information and are able to book up the car. From this,
it can be stated that there is high level of operational and functional
activities. Further, it also has proper records of the customers and this
enables to them to understand their requirements. Further, this system is
also able to maintain proper security for the personal information that is
gathered by the firm (Crane and Matten, 2016). In this context, Volkswagen
need to make sure that they understand their customers and take proper
steps through which the issues that are faced by them can be solved.
However, the case shows that the services that are delivered by the cited
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firm is not suitable.
Pricing policy It is a type of issue in which customers pay high for the purchasing the
products. It is essential for the firm to make sure that they sell the product
according to the cost that is incurred by the organization.
Product policy All the things that are being conveyed in the advertisement should be
satisfied. The type of quality that delivered by the firm to customers should
be high. It becomes an ethical issue when products are not developed as per
what they purport.
Legal and
regulatory
compliance
This can be stated to be the proper framework that has to be followed. In
this context, the main focus is to control the process of the firm. There are
different set of laws that are included in this and they are as follows:
 Internet and censorship: It is essential to take hold of the operations
when firm deliver their services online. In this context,
considerations should be made for certain issues like reducing
illegal activities, delivering proper information to customers, etc.
(Ferdous and Aziz, 2014).
 Employment law: Volkswagen which is one of well known
organization have strong customers base. It is essential to make sure
that there is proper participation of workers.
TASK 2
2.1 Business objectives are affected by ethical considerations
There are many firms that deliver their customers with similar products and services.
When customers do not get satisfied with the services or products that are delivered by the firm,
then they have the option to shift to organisation that deliver similar services. In accordance with
the case, when Volkswagen operated their business through illegal activities, then the set of
contribution make by the firm in development of public image is negative. The trust that cited
firm has on it gets negatively affected (Akhtar, bin Arshad and Ahmed, 2015). As per the
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objectives, mission and vision that is set by Volkswagen, it to understand their customers and in
delivering them services as per their preferences. However, the type of performance that is made
by cited firm has inversely affected the firm profitability. The rate of information that is passed
on to individuals high and there are different sources that are available with the help of which
information is being conveyed to others. When due to illegal activities business is caught, then
the inverse impact get to reach every one in no time. In accordance with the ethical
consideration, it is important to make sure that all the customers are delivered with proper
information about the type of services that are being delivered to them (Trevino and Nelson,
2016). In auto-mobile industry, Volkswagen is one of the most recognised firms and when the
services delivered by them are not effective, then it affects the business and customers shift to
firms that delivered similar type of products and services.
2.2 Implications for Volkswagen and their stakeholders to operate ethically
Volkswagen operates it business operations at different parts of the world. The type of
services that are delivered by the firm, when it is not effective, then it affects the business
operations at all parts (Khattak, Haq and Zaheer, 2013). As per the findings, it is identified that
are different type of preferences and expectations. However, the ethical consideration that is
made by each of the countries like UK, USA and EU are similar. Cited firm not only faced
expanding criminal investigation but they also faced thousands of lawsuits for the demand
recourse by consumers. For all the three countries the impact of ethical issues caused on
Volkswagen was negative and they lost many of their customers trust and their profitability
reduced. Stakeholders prefer to have services that are delivered to them that are of high quality.
When proper services are delivered, then it has positive impact over stakeholders. The
contribution made by them will be high but when ethical operations are not followed, then it has
negative impact over the business.
Stakeholders Implications to operate
ethically
Examples
Employees They should be provided with
proper job security.
Employees working at Tesco
are provided with monitory
benefits over the high quality
performance that are made by
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the workers.
Shareholders There should have proper
sustainability for the business
and plan should be made so
that shareholders stay longer.
Through benefits that are
provided by higher returns.
Customers Delivering customers with
high quality services.
McDonald's aim at focusing on
providing their customers with
high quality services.
TASK 3
3.1 Role of organization acting as a morale agent
Moral agent plays viral role in identifying the type of issues that are faced within the
organization. Further, this ability enables to make proper judgement for overcoming the issues
that are faced by the firm. Further, they are responsibility to make sure that all the action that are
taken by the firm are helpful enough to grow (Sulaiman, Hisam and Sanyal, 2014). From this, it
can be stated that in Tesco, Moral agent aims at understanding actions that are taken and it
consequences. Tesco is one of the most recognized and firm that holds upon majority of shares.
It is a type of retail firm that delivers customers with all type of products and services. In order to
maintain relationship with their stakeholders, they conduct time to time market research. This
enables to know the needs and requirement of customers. Accordingly, changes are made in the
services and products with the help of which customers are satisfied. Further, workers are
effectively monitored, this helps to know the areas in which they lack. As per the findings, they
are delivered with training and development. This enables to rate the performance and they are
also provided with incentives and monitory benefits which boost up the moral of employees.
Further, they understand the type of issues that are faced by each of the workers and focus on
delivering them with healthy business environment in which they will be able to put on their full
efforts to perform effectively and efficiently (Welsh and Birch, 2015). In accordance with the
ethics that are followed by the firm, they make sure that proper information being provided to
customers and the things that are provided on advertisement are fulfilled.
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3.2 Analysing development of mechanisms employed by Tesco for achieving employee
involvement and empowerment
There are different type of issues that are being faced by workers. When these issues or
problems are not satisfied, then they get demotivated and the performance level get negatively
affected. In such conditions, companies make use of strategies with the help of which the rate of
motivation increases and the rate of performance can be raised. In this context, there are different
type of strategies that are followed by Tesco and they are as follows:
Ways to involve employees Explanation
Decision making Workers have direct interaction with customers and so they know
better about the issues or problems that are faced by service users.
With this respect, workers of Tesco are involved in decision
making (Hawkins, 2015). This enables to boost up the moral of
employees and they work putting all their efforts.
Identifying problems There are different type of problems that are faced by workers
and cited firm make sure that all the issues that are faced by them
are considered and effective steps are taken to overcome them.
Further, they are also provided with proper training so that they
will be able to clarify their regarding the roles and responsibilities
that has to be played by them. Moreover, workers are also
provided with better job opportunities and extra responsibilities
they have positive impact over the performance and they develop
a feeling of importance within their mind.
TASK 4
4.1 Current ethical issues and it impacts over Tesco
There are many countries around the globe in which Tesco has established its business.
Further, there are different type of product and services in which it deals with. Moreover, the
type of law that is being followed at different part of the companies are different. It is essential
for the firm to follow them all. With this respect, below given are the ethical issues that are faced
by Tesco:
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Ethical issues How these issues affect Tesco
Wrong advertising It is important for Tesco to display and provide all the relevant information
about the products and services (Vasconcelos, Melo and Muniz, 2016). All
the things that are presented should be satisfied. In case the advertisement
have affected customers feeling, then there are conditions in which they
can lose their service users.
Environmental
issues
Tesco has focused on reducing their cost by recycling the products and
other type of legislations are also followed by the firm so that better
services can be delivered. This has positive impact over the business and
they are able to raise their sales and profitability.
Relevance of data Relevant information needs to be provided by Tesco for type of products
and services. When this is not done, then the market share and growth of
the firm has negative impact.
4.2 Ways to improve ethics of their operations to meet objectives and develop relationship
Different type of strategies can be followed by Tesco with the help of which ethics can be
improved and strong relationship can be developed with employees and employers. With this
respect, below given are few of them:
Ethics in sales and marketing: There are different set of considerations that are made by
individuals in order to make purchases. In this context, one of the main factor that affects
customer is pricing (Paulins, Hillery and Sturgill, 2016). When the rate of price are high, then the
demand for the product or service gets affected. Tesco will be able to raise their sales by
understanding the preference of customers towards products and comparing it with the pricing
strategy that is applied by competitors. When marketing and sales are done by considering ethics,
then it has positive impact over the business.
Ethics in intellectual property: With time, there are different type of innovations that take
place. In order to be better from other firms, diverse set of strategies are applied. It is important
for the Tesco to make sure that they consider the all the laws related to intellectual property and
make use of terms like trademarks, copyrights, trade secrets and patents.
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Contribution to communication: Tesco can support the community by the services and
products that are delivered by them (Zaharia and Zaharia, 2015). When customers get highly
benefited through it, then it can be determined to be effective strategy related with ethical
consideration.
4.3 Ethical code for Tesco
Tesco can make use of different type of ethical codes that will have positive impact over
the business. These codes will be helpful enough to develop positive impact over the mind of
customers and the rate of profitability can be raised. With this respect, below given are the
ethical codes that should be followed by Tesco:
Integrity: It is essential to make sure that Tesco do not sacrifice customers trust due to
unscrupulous and expediency. They should confirm that all the business related activities are
fairly performed and customers are negatively affected (McMurrian and Matulich, 2016).
Honesty: Workers should be trustful and they should deliver their customers with proper
information about the services and products. Further, employees themselves should have
information about the products so they do not mislead consumers.
Promise keeping: All the information that is being delivered by the firm should be
fulfilled and satisfied so that customers may not develop negative perception within their mind.
Further, all the promises that are made by them should be satisfied by the management.
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CONCLUSION
Customers tent to make purchases decision decisions when they are able to satisfy their
needs and requirements. For this purpose, one of the effective way to understand their
requirement is with the help of market research and survey. It is one of the effective way that
helps to determine the satisfaction level of customers. Further, it also enables to know the areas
in which improvement is required with the help of which changes can be made in the products
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and services. Further, the services and products that are delivered by the firm should be
developed by considering ethical aspects and all the information provided for the goods should
be satisfied.
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REFERENCES
Books and Journals
Akhtar, S., bin Arshad, M. A. and Ahmed, A., 2015. Spiritual Quotient and Ethical Values
towards Organizational Sustainability. International Letters of Social and Humanistic
Sciences. 58. pp.1-7.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Ferdous, J. and Aziz, M. N., 2014. Consumer Perception, Behavioral Gap, and Response to
Ethical Business: The UK Perspective. Journal of International Business Ethics, 7(2), p.46.
Hawkins, R., 2015. Managing Ethical Consumption in Tourism. Tourism Management, 51,
p.282.
Johnson, D. J., Yang, W. W. and Frank, S. M., 2017. Health Policy, Ethical, Business, and
Financial Issues Related to Blood Management in Orthopedics. Techniques in
Orthopaedics. 32(1). pp.51-59.
Jondle Ph D, D., Maines, T. D. and Young Ph D, P., 2013. Modern Risk Management:
Managing risk through the ethical business culture model. The European Financial
Review.
Khattak, F. A., Haq, Z. U. and Zaheer, A., 2013. Organization ethical business operations: Does
it make a difference?. African Journal of Business Management. 7(39). pp.4089.
McMurrian, R. C. and Matulich, E., 2016. Building customer value and profitability with
business ethics. Journal of Business & Economics Research (Online). 14(3). pp.83.
Nowak, L. I. and Pereira, A. J., 2015. The Impact of Culture on Ethical Business Decision-
Making. In Proceedings of the 1996 Multicultural Marketing Conference (pp. 334-338).
Springer International Publishing.
Paulins, V. A., Hillery, J. L. and Sturgill, A., 2016. Ethical Business Leadership: A Simulation to
Develop Value-Driven Mission Statements. Developments in Business Simulation and
Experiential Learning. 43(1).
Sulaiman, M. A., Hisam, M. W. and Sanyal, S., 2014. Ethical Business Practices in
Islam. Purushartha: A Journal of Management Ethics and Spirituality. 6(2).
Trevino, L. K. and Nelson, K. A., 2016. Managing business ethics: Straight talk about how to do
it right. John Wiley & Sons.
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Vasconcelos, D., Melo, M. B. and Muniz, D. D., 2016. Good management practices of the waste
and of the health and the safety conditions in the constructive process: Sustainability, social
responsibility and ethical business activity. Occupational Safety and Hygiene IV. pp.133.
Welsh, D. H. and Birch, N. J., 2015. The ethical orientation of US small business decision
makers: A preliminary study. Journal of Small Business Strategy. 8(2). pp.41-52.
Zaharia, I. and Zaharia, C., 2015. Corporate governance and business ethical values. Linguistic
and Philosophical Investigations, (14). pp.103-108.
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