Analysis of Amazon's Business Ethics, Governance, and CSR

This report provides a detailed analysis of Amazon's ethical performance, corporate governance, and corporate social responsibility (CSR). The report begins with a case study highlighting ethical concerns and then introduces Amazon, outlining relevant facts. It identifies current issues related to employee relations, environmental impact, and political practices. The analysis incorporates relevant theories, including leadership theories, Carroll's CSR pyramid, and stakeholder analysis, to evaluate Amazon's actions. The report concludes with recommendations for improving ethical practices, addressing issues related to employee treatment, environmental reporting, and tax avoidance. The report emphasizes the importance of good corporate governance, ethical business practices, and a strong CSR policy for Amazon's long-term success and stakeholder satisfaction. The report also addresses the importance of maintaining a balance between economic and social goals. The report discusses the role of ethics in business and its impact on stakeholder relationships.

Running head: BUSINESS ETHICS GOVERNANCE AND SOCIAL RESPONSIBILITY
Business Ethics Governance and Social Responsibility
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Discussion..................................................................................................................................3
Case: Business concern towards Ethics, governance and CSR..................................................3
Company’s Overview and related facts.....................................................................................4
Current Issues.............................................................................................................................6
In terms of Governance, Ethical business practice and CSR.................................................6
Theories......................................................................................................................................8
Leadership theories and governance......................................................................................8
Carroll’s CSR Pyramid and Corporate citizenship................................................................8
Traditional and contemporary ethical theories.......................................................................9
Business Ethics.....................................................................................................................10
Sustainability........................................................................................................................10
Stakeholder analysis.............................................................................................................10
Agency theory......................................................................................................................11
Recommendation......................................................................................................................11
Conclusion................................................................................................................................12
References................................................................................................................................14

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Introduction
Business does not work at an individual level. Their working process and ethical
concern directly affect the organization’s performance and all the people connected to it.
Every organization need to maintain a healthy relationship with their stakeholders for their
survival and growth (Lawrence and Weber 2014). Therefore, the organization is required to
give an effective return to their shareholders, a well-satisfied job to their employees,
trustworthy products or service to the consumers, responsible relationship with the
community and towards a clean environment. To fulfil all these requirements, an organization
need to associated with good corporate governance, and CSR policy as well as must be
having concern for the ethical doings in the business. CSR and corporate governance both
concepts are interrelated with the ethics. Ethics is the set of moral principles and standards
that governs the behaviour of an individual or an organization about their right or
wrongdoings (Christensen 2013). Ethics deals with the moral duties and obligations with an
explanation of what is right to do and not right to do. Corporate governance is the application
of the management practices, adherence to the ethical standards and acquiescence of law that
maintains a stability between economic and social goals (Jin, Drozdenko and DeLoughy
2013). The application of good corporate governance leads to an increase in profits as well as
the company's reputation. Corporate Social Responsibility reflects the company’s ethical
behavior with respect to the society and environment along with maintaining the relationship
with the stakeholders.
The report aims to analyze the ethical performance of an organization in general and
any issue related to it. The report discusses the theories related to business ethics, corporate
social responsibility and corporate governance. The analysis for the ethical issues and
concern is done with the use of different theories like CSR Carols model and stakeholder
theory. The organization for preparing this report chosen here is Amazon that is a

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multinational company. The paper has discussed certain facts and existing issues relates to
the governance, ethics and CSR of the chosen organization. The company is facing certain
issues related to the human resource, environmental concern and governance that must be
resolved by the organization as soon as possible.
Discussion
Case: Business concern towards Ethics, governance and CSR
The concept of ethics varies person to person as per their understanding, principles
and priority. However, business ethics keep an organization on track for what is right or
wrong in their doings that can affect the company’s profit and relationship with the
stakeholders (Monga 2017). The term ethics can be defined as a set of business principles that
guides the organizational practices that also tends to show concern towards society as a whole
while making profits. The business leader keeps in mind several factors such as technology
advancements, globalization, mission and vision, opportunities and threats. An ethical
decision taken by the organization as their priority reflects a concern towards all including the
stakeholders, consumers and cultures. Jack Ma, who is the Founder and Executive Chairman
of Alibaba Group whose order volume is more than the combined volume of eBay and
Amazon, said never deceive others whether it is in business or life. He was deceived by four
companies in the year 1995 and all that is closed today. He is clearly against the bribes and
unethical practices. Another business leader Azim Premji, Chairman of Wipro Ltd, states that
the real threat of business is from within, that is lack of integrity and from poor ethical
standards, which results in incalculable harm. Today’s organization is required to have ethical
values that benefit them with safeguarding their reputation and any negative coverage.
Good governance means a complete set of rules and principles that develop with the
time so that to meet challenges in several areas such as reputation, quality, risk, and

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accountability. Corporate governance is the first steps that keep an organization towards
practising CSR (Goel and Ramanathan 2014). When the organization behaves and perform
with their trust, internal confidence and integrity, then it pursues the socially responsible
business practices. Corporate leaders must think first to provide with sound governance and
unbiased business practices. After that, they should think about CSR. In the case of Amazon,
from the beginning, only the company has to face several controversies in terms of taxes and
laws, price discrimination, working conditions of the employees, their wages and a negative
impact on the environment. Corporate Social Responsibility means to have responsibility and
actions on behalf of the society. CSR is an obligation of the organization to keep a balance
between the ecosystem and the economy (Kalysr, Rafi and Kalyar 2013). The management of
an organization is responsible for answering the consumers as they have the right to demand
an explanation regarding the action undertaken by the company. However, Amazon, in the
year 2019, in its sustainability report, not revealed any actions taken regarding the impact of
electronic products or the use of textiles. It was given just a theoretical overview of the ethics,
employment and environment. Earlier, it has also an issue with their sustainability reporting
and CSR strategy that has been raised in the year 2012 (Doh, Littell and Quigley 2015). After
that, the company has taken some initiative for CSR to improve their reputation. To be a good
corporate citizen, the companies have to well-governed and externally responsible.
Company’s Overview and related facts
Amazon is an American multinational technology-based organization and included in
the list of Big Four tech companies with the name of Google, Facebook and Apple. The
Amazon headquarters is in Seattle, and the company deals with e-commerce, artificial
intelligence (AI), digital streaming and cloud computing. Its online marketplace, cloud
computing and AI assistants are considered as the world's largest platform for such services
(US About Amazon 2019). Amazon has reached its products and services at a global level

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and served areas worldwide. It provides employment to nearly 750,000 employees that
include both full times as well as part-time. With several networks, Amazon has added five
tremendous services that are Amazon Fire TV, Amazon Fresh, Amazon dash button,
Amazon Prime Air and Amazon Fire Phone.
(Source: Ebook Friendly 2019)
As Amazon is a well-known company today, but it still has to answer about being a
corporate citizen who is socially responsible (Taubin 2015). From the initial stage and
especially from the last several years, the company has been criticized for various practices.
On August 15, The New York Times has published an article on the amazon view as a
workplace. That time the information describes the corporate culture with a high level of
demands, breeding unhealthy competition amongst the employees, and unmanageable
pressure, lack of benefits and employee distress. Further, Amazon has worked to improve

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their CSR strategy as they have been questioned on their practices from last many years. In
the year 2012, the UK Guardian has raised issues with respect to the company's CSR strategy.
According to the report, the company has made not any effort so that to measure or improve
as well as disclose their performance in terms of environment, political activity and
workplace issues (Carrington and Neville 2015). The company has been criticized for its low
charitable contribution. The governments impose certain restrictions and regulations through
the code of ethics that allow the organization so fulfil their responsibility (Heinrichs 2013). It
can be said that CSR and corporate governance are two sides of the same coin. Good
governance in a country increases the faith of the public in the administration, and people
confidence tends to increase in respect of the stability of the political conditions in their
country.
Current Issues
In terms of Governance, Ethical business practice and CSR
People or Employment relations
The dissatisfaction of the employees leads to a lower profit of the company. As per
the UK report, tailored Wages in the year 2019, it has assessed that leading cloth brands
ensured that the garments workers used to be paid a living wage by the company. In the grade
of A to E, the company got E grade that is worst. The appeal influences the company to take
some responsibility with respect to human rights (Rueda, Garrett and Lambin 2017). The
employees feel the pressure of inaccessible expectations of the company with them as the
company has set an irrational high standard (Shields et al 2015). Addition to this, Amazon
has decreased its marks from the Workers Right. This is because of the report to call the
ambulances 115 times in the last three years. When the data is compared with the same size

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supermarket warehouse, the result was only 8 times to call the ambulances. In the year 2018,
this outcome claims that the Amazon warehouse as not a safe place to work.
Environment
Amazon's environmental reporting has the worst rating in the year 2019. The
company has not given any information about the impacts of electronic products along with
the information regarding the textiles that have been used in its clothing. Amazon has not
even disclosed about the use of toxic chemicals in the manufacturing of branded clothing
(Sidali, Morocho and Garrido-Perez 2016). The production of clothing releases abundant
harmful affluence that negatively affects the environment. The company not even disclosed
about such issue. In concern to the environment, Amazon has decreased its grade within the
terms of pollution as well as toxic category.
Further, the company has ignored some facts while preparing their policy on materials
like merino wool, angora, fur and silk. The use of such materials required high exploitation
and killing of animals. Amazon has not prohibited its sale on such products, and as a result,
the company has highly devalued their grade under the category of Animal Rights.
Politics
The issue raised in the year 2012 was about tax avoidance. As the company has
earned from sales £2.9 billion but paid £1.8 million in the corporation tax instead of £8
million. The ethical consumer felt disappointed and concerned for the unfair practices from
such a big organization. The company afterwards revealed that they had lowered the taxes by
paying to employees in the form of shares that is considered as an expense (Nankole Mukaya
and karvounis 2018). Hence, offset against the corporation tax. This step is legal and ethical
as the traditional policy of the government.

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However, the company Amazon UK Services Ltd is just a single part of the activities
of the company in the UK. In the US filings, Amazon has revealed that UK total sales
increased from £9.5 billion to above £11 billion in the year 2017. The company has not
publicly made available information regarding UK sales. The reason is due to the sales to the
UK customers has been booked through the Amazon EU Sarl. The recent annual report
revealed that the five executives had been paid more than £ 1million (Chen et al 2016). The
Ethical Consumer reckoned the remuneration more than £ 1 million to be extreme. This
unethical conduct decreased the grade in the anti-social finance category.
Theories
Leadership theories and governance
Leadership plays an important role for an organization in achieving their objectives as
well as in maintaining the effectiveness of the team. There are different leadership theories
such as trait theories, behavioural theories, contingency theories and influence and power
theories. The Amazon CEO and President Jeff Bezos best suited with respect to the trait
leadership. As this theory is based upon the personal characteristics and effectiveness. Jeff
has proven its trait leadership quality with its unique personality behavior of dominance,
tolerant of stress, determination, innovativeness and adaptability (Pace, Balboni and Gistri
2017). Further, a good leader needs to develop responsibility towards their employee, which
is the top priority at present. Amazon has to develop good governance within the organization
so that to develop an understanding within their staffs as well as bait trust amongst the public.
Carroll’s CSR Pyramid and Corporate citizenship
Carroll's Pyramid of Corporate Social Responsibility consists of the conduct of a
business in terms of being economically profitable, abided by law, ethical and a good
corporate citizen. Being a good corporate citizen means to be socially responsible. Socially

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responsible is to generate profit and abide law as topmost priority in terms of ethics and a
contribution towards the society (Strandvik, Rindell and Wilen 2013). Different layers of the
pyramid suggest the organizations to fulfil those obligations that expect society from
businesses. Amazon has been profitable throughout the year apart from having several issues
and controversies related with their practices. The company have to be more legally and
ethically responsible in respect to the consideration of things what is right to do and what is
not. The companies have brought several changes in their strategies. However, Amazon still
has to be more responsible to be a good corporate citizen through considering benefit towards
the society and environment.
If the company expects to be good corporate citizen along with a good leader with
respect to global responsibility, it must have to work on adding social responsibility as their
main part of the business and their corporate culture.

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Traditional and contemporary ethical theories
 Utilitarianism theory states that the goal of a business is to bring and increase
happiness within self and to others and to minimize unhappiness (Vargas-Leon and
Kuehn 2015). Amazon gives no pleasure to the employees working in the warehouses
and with the wages. It could have avoided the negative publicity and lawsuits by
following ethical theories. The ethical conduct by the organization benefits the
company as well as its stakeholders.
 Consequentialism refers to a normative ethical theory that states about the ethical
action taken by an organization and a proposed process of how one should select the
right and ethical act. Amazon initiates to develop their actions as per the ethical laws
and with their right doings (Konecnik Ruzzier and Ruzzier 2015). This will help them
in removing the bad image in public. The company must tend to develop
consequentialism theory within their measures and performance so that they analyze
the outcomes of their doings.
Business Ethics
The role of business ethics is to study the most appropriate business policies and
practices that suggest about the right or wrongdoings. Consumers are getting an expected
service by the company, but they are also arising questions in terms of ethics. Amazon has
highly devalued its reputation with their unethical conducts or can say with high ignorance of
ethical behavior (Ritala, Golnam and Wegmann 2014). This, in turn, affected the company's
reputation and downfall in the position of the image that it has maintained. Amazon must
consider about the importance of ethics as soon as possible so that to get back their good
image back.

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Sustainability
Sustainability refers to the prevention from depletion of natural resources so that to
maintain an ecological balance. It means to focus on fulfilling the necessities of the present
without compromising or disturbing the ability for the future generation tom meet their
requirements. Amazon has set its sustainability target to meet in the coming twenty tears that
are too long to bring adversity (Conaway et al. 2018). However, the company has not even
disclosed its current sustainability report with respect to the environment as well as at societal
level clearly. That brought doubt in the minds of others, and ignorance of several rights has
degraded their reputation.
Stakeholder analysis
The stakeholders of the Amazon consists of their employees, customers, along with
the families of both who sell on the platform of Amazon. The employees of the Amazon is
considered as the direct stakeholders of the company as they are the one who is being treated
unethically. While working in the warehouses, some of the employees has faced a medical
condition that also affects their family (Grietens et al. 2013) Customers who used to purchase
the product of Amazon are unaware about such mishappenings inside the warehouses. The
employee packing products to their customers, contributing to the unethical treatment and
involving others. Sellers are also the stakeholders who sell their products on Amazon and
being a part of the unethical practices. Earning profit is not everything. To earn respect and a
lawful image in the society, an organization has to implement ethical practices within their
working environment so that to contribute towards the benefit of others.
Agency theory
In agency theory, a company acts as an interest of the principal that is the
stakeholders. The theory assumes that the leaders work for their own self-interest at the
expense of the principals. However, in the case of Amazon, the company used to follow