Business Ethics and CSR: Analysis of CSR Implementation Problems

This report provides an analysis of business ethics and Corporate Social Responsibility (CSR), focusing on ethical issues and CSR implementation problems within the context of the Indian clothing industry, drawing insights from the documentary "Blood, Sweat and T-shirts." The report examines various ethical concerns, including health and safety, fair working conditions, technology, and leadership, as observed in the documentary. It explores both the broad and narrow views of CSR, contrasting their implications for businesses and stakeholders. The analysis highlights how retailers' practices align with or deviate from the broader CSR concept and discusses arguments for and against adopting narrow and broad CSR perspectives. The report concludes by identifying the poor implementation of CSR policies in the Indian clothing industry and suggesting improvements for ethical business practices.

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Running head: Business ethics and CSR
Business ethics and CSR
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Executive summary
This report provides a brief on the different ethical issues and CSR implementation problems
faced by business organizations. The report focuses on the two concepts of CSR and provides
arguments under each concept. All these concepts, issues and arguments have been provided in
the lights of a given documentary named “Blood, sweat and t-shirts”, which is about the six
British fashion consumers who went to India to explore the various aspects of the Indian clothing
industry. Furthermore, the report puts emphasis on the prevailing business conditions in the
Indian clothing industry and concludes by providing suggestions for the business issues
prevailing in the Indian clothing Industry.
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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Answer 1......................................................................................................................................3
Answer 2......................................................................................................................................4
Answer 3......................................................................................................................................5
Answer 4......................................................................................................................................5
Answer 5......................................................................................................................................6
Answer 6......................................................................................................................................6
Answer 7......................................................................................................................................7
Answer 8......................................................................................................................................7
Answer 9......................................................................................................................................8
Answer 10....................................................................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
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Introduction
Business ethics, which is also known as corporate ethics, refers to a set of values,
principles and norms that helps in governing the behavior and actions of an individual in a
business organization. Business ethics applies to all in all aspects of business conduct and is
relevant to the conduct of the entire organization and of each individual in an organization.
Individuals, organizational statements or legal systems are the sources from which these ethics
usually originate (Crane & Matten, 2016). On the other hand, Corporate Social Responsibility
(CSR) is an integral part of any business organization, without which, it becomes difficult for
any business organization to survive. Every business organization has its own CSR policies that
functions as a self-regulatory mechanism, by which a business ensures and monitors its
compliance with the spirit of law, national and international norms and ethical standards.
Basically, CSR policies of a business organization aim for something beyond making profits for
the organization. It is an organization’s initiative to assess and take responsibility for the effects
of the company on the environment and the society near which it carries on its activities (Abels
& Martelli, 2012). Therefore, in order to run a business effectively, business ethics like integrity,
loyalty, leadership, moral values, respect and concern must be present in an organization along
with proper CSR policies, aiming to protect and improve the society and the environment.
Discussion
The following provide answers for the given assignment, in accordance with the
documentary provided, which is named as “Blood, Sweat and T-shirts”.
Answer 1
The documentary, “Blood, sweat and t-shirts”, is about six British fashion consumers
who visited India for exploring the working conditions and business policies in two of the
garment making factories of the clothing industry. The documentary shows that the six British
fashion consumers visit one of the leading clothing factories in India, where they go through a
training procedure for working in the factory as labors. Later on they also visited another
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clothing small clothing factory for the same purpose. During their training sessions they went
through difficult situations as the working environment, working culture and other working
conditions in the factory were very different from the foreign (western) culture. The
documentary also showed the living conditions of the workers in India, who work in that factory.
In this context, it can be pointed out from the documentary that the Indian clothing industry
suffers from certain ethical issues, based on the experience of the British fashion consumers
(Weiss, 2014). They are:-
 Health and safety issues- The Indian factories suffer from health and safety
issues. The given documentary shows that the food provided in the factory are not
hygienic, the environment inside the factory is dirty and smelly and the workers
are made to work under such low conditions (DesJardins & McCall, 2014).
 Issues regarding fair working conditions- The workers are made to work under
such low conditions with a very basic pay, which makes it difficult for them and
their families to afford a standard way of living (Michaelson, Pratt, Grant, &
Dunn, 2014).
 Technology- The documentary shows that the technology that the Indian factories
use are not advanced, which puts more pressure on the labors and slows down the
productivity rate (Shrader-Frechette, 2012). Moreover, the power supply in the
factories are not proper due to backdated technology, which further harms the
work productivity and puts pressure on the workers.
 Lack of respect and leadership- The video showed that the behavior of the
trainer and the supervisor was rough and the British fashion consumers were
made fun of by the other workers when they made mistakes (Swanson &
Frederick, 2016).
Answer 2
There are two types of views on CSR. One is the broad view and the other is the narrow
view. The broader view of CSR states that apart from the primary objectives like profit
maximization, businesses are also responsible towards the society and community and should
operate in a manner that will address the possible negative implications of their businesses,
practices and activities. Every business organization works for earning profit. But for earning
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profits, it is required by the business organizations to function effectively, and for effective
functioning it is highly required by the organizations to focus of the effects of their activities on
the community, environment and the society (Rangan, Chase, & Karim, 2012). Corporate Social
Responsibility, in the broad view, focuses on the betterment of the stakeholders beyond
shareholders of the business. It includes all the employees, suppliers and the environment as
well. The working conditions, health and safety, and standard of living of the employees and the
society are the few areas in which CSR focuses on. The broader concept of CSR also puts stress
on the negative impacts of business activities on the environment and aims for making a positive
impact on the environment (Schwartz & Saiia, 2012). Therefore, according to the broader
concept, CSR extends beyond the profit maximization and shareholder interests of business.
Answer 3
As stated earlier, CSR is categorized into two concepts, namely, the broad and the narrow
concept. According to the narrow concept of CSR, the sole purpose of a business organization is
to ensure that it makes money, in the form of profit, within the legal framework of the land and
therefore, fulfills its obligations towards its shareholders. The narrow concept states that a
business fulfills its social responsibility by providing employment to people, which gives them
purchasing power, leading to a larger economy. Any other social responsibility is considered as
irrelevant or taxing to the profit margin of an organization (Yin & & Zhang, 2012). The narrow
view of CSR is more concerned about the activities and improvement within the organization
and is limited to the interests of the shareholders, internal policies and the profit margin.
Whereas, in the broader concept of CSR, the focus is given on both the internal and external
factors that affect a business organization (Öberseder, Schlegelmilch, & Murphy, 2013).
Therefore, the narrow concept does not recognize various other important factors like employees,
customers, suppliers and environment within the scope of CSR and focuses only on the profit
maximization of the business, as according to this concept corporate social responsibility is
fulfilled as long as a business fulfills its monetary needs.
Answer 4
The retailers who buy clothes from the Indian factories do not follow the broad concept
of CSR as it is evident from the documentary provided. In the beginning of the documentary it
clearly shows the rush and craze that people have for buying clothes. The documentary shows
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that the clothes are sold at high prices and they are not sold at cheap prices. Passion for fashion
clothing is so strong that people tend to buy clothes even at high price rates. The Great British
High Street has been shown in the documentary, where the retailers buy clothes form Indian
factories and meet the increasing demand for clothes of the people (Twigg, 2012). These retailers
do not buy clothes from Indian factories with the broad view of CSR as they sell these clothes at
higher prices with a sole motive of profit maximization. As the craze for fashion clothing is high,
these retailers buy these clothes from Indian factories to meet such high demands as meeting
these demands lead to high rate of sales that ultimately results in high rates of profit.
Answer 5
There are various grounds on which arguments have been raised regarding the adoption
of the narrow concept of CSR by business organizations. One of the grounds of such argument is
the “invisible-hand argument”. This argument is based on Adam Smith’s contention. According
to this argument, in a free market organizations must be left or must be given the power to
choose and promote their own economic self-interest and while they do so, they will be guided
by an “invisible hand” to promote the general greater good (Dubbink, 2013). The argument
further states that a corporation or organization is not a moral agent and hence, should be left to
do this. In addition, arguments have been raised on the ground that Corporations and
Organizations were formed for creating the greatest good through the pursuit of self-interest and
therefore, if they are left alone they will do the same. On forcing the organizations on CSR, it
will reduce the ability of the organizations to meet the material needs of the society and will
ultimately result in reducing people’s well-being (Szmigin & Rutherford, 2013). This argument
does not state that organizations are not accountable, but they are held accountable when they
fail to meet their economic role and not a moral role.
Answer 6
Like the narrow concept of CSR, there are various grounds of argument for adoption of
the broader concept of CSR by a business organization. One of the grounds of such argument is
“power involves responsibility”. According to this argument, organizations in the modern times
are often large and influential entities and hence, gives them power. With this power comes a
responsibility to behave or act ethically towards everyone who is affected by the activities or
actions of the organization (Caruana & Chatzidakis, 2014).Therefore, this argument basically
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states that in the modern times, business organizations are often powerful and they have more
power and influence over the government, economy and society. Such power and influence also
comes with a corresponding responsibility to take responsibility of the well-being of the all the
stakeholders of the business, including the shareholders, suppliers, customers, employees and all
those who are affected by the business activities. Furthermore, such powers also bring a
responsibility of the organizations to take care of the environment as well (Morgeson, Aguinis,
Waldman, & Siegel, 2013). Hence, the broader concept of CSR is highly important for the
organizations in the modern times.
Answer 7
In the documentary, the poor implementation of CSR policies can clearly be seen. In the
documentary it can be seen that focus is mainly given on the internal activities, production and
profit making. In the documentary when the six British fashion consumers went through the
training sessions in the factory they came across strict disciplinary rules and found that stress
was only given on production of a particular number of garments, which was a daily production
target of the factory. The workers in the factory are demoted if they fail to achieve the daily
targets, leading to lower wages. Moreover, the workers in the factory are not provided with a
proper standard of health and safety and the technology. The factory environment is dirty and
unhygienic and no care is taken to make it better. The factory suffers from electricity issues,
which increases the workload of the labors and makes the working conditions difficult. The six
British fashion consumers, as can be seen in the documentary, found it really difficult to work in
such conditions and at such low wage rates. The wages provided to the workers are so low that it
becomes difficult for workers to even afford a basic standard of living. Due to the lack of
cleanliness, the environment around the factory is also dirty and no care is taken for that
(Księżak, 2017). The whole work process of the factory, as shown in the documentary, clearly
shows that the factory focuses on production with the sole aim of profit maximization. Hence,
these activities as shown in the documentary, clearly shows that the clothing industry (in
connection to both the factories) has adopted the narrow view of CSR.
Answer 8
Most of the documentary shows the harsh working conditions of the workers and the poor
CSR policy implementation in the clothing factories. The broad concept of CSR, as discussed
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earlier, states that the organizations have a responsibility towards all the stakeholders, apart from
the shareholders, including the employees, suppliers, retailers, customers and others and also
towards the environment. The documentary clearly shows that the factories do not focus or give
importance to the work conditions, employee’s living standards, their health and safety or
towards the environment. Its focus is inclined mainly towards the rate of production and towards
the profit maximization (Mezzadri, 2014). Hence, according to the documentary, it is evident
that the broad concept of CSR is not implemented by these factories and they do not focus on
anything other than profit maximization. Therefore, the activities of the factories, as shown in the
documentary, cannot be related to the broad concept of CSR.
Answer 9
The ethic of care is a moral theory, which states that there is a moral theory that states
that there is a moral significance in the fundamental elements of relationships and dependencies
in the human life. In the normative view, ethics of care is essential for maintaining relationships
by promoting the well-being of the care-givers and the care receivers in a network of social
relations. The ethics of care is often said to be a practice rather than a theory and it involves the
maintaining of the world and needs of our own and the others. The ethics of care focuses and
builds on the motivation of those who are vulnerable and dependent. Ethics of care is the follows
the sentimentalist tradition of moral theory and it recognizes the importance of caring
motivation, emotion and the body in moral deliberation, including reasoning from particulars
(Till, 2012). On the other hand, the broad concept of CSR states that the business organizations
in the modern days are powerful and hence, they have a duty to take care of all its stakeholders,
who are affected by its activities, and the organizations should not only focus on profit earning
and shareholders. By all stakeholders, the broad concept CSR states that the organizations have a
duty towards its employees, suppliers, customers and the environment as well, as they all are
affected by the activities of the business. Taking up of the broad concept of CSR is indeed an
ethical practice. This view can be supported by emphasizing on the ethic of care. It is so, because
the duty of care rests on the sentimental tradition of moral theory and states that care is an
integral element of any relationship and aims for the motivation of those who are dependent and
vulnerable. Similarly, according to the broad concept of CSR, in case of organizations, the
employees, suppliers, shareholders, customers and the environment are all dependent on and
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affected by the activities of the organizations and as such, the organizations have a duty to take
care and responsibility of them (André, 2013). Hence, it can be said that the broad concept of
CSR stresses on the duty of care by the organizations, which is an ethical practice and therefore
makes the broad concept of CSR an ethical practice.
Answer 10
The given documentary gives an overview of the working conditions prevailing in the
Indian factories and shows the level of CSR implementation by the clothing industries in India.
The working conditions are extremely poor with the focus solely given on the profit
maximization of the industry. Moreover, the living standards of the workers are very low, the
environment inside the factories are unhealthy and dirty and no importance is given to the
environment as the factory wastes are dumped outside in an unorganized manner, which leads to
pollution. From the above study, that gives a brief of both the narrow and broad concepts of
CSR, it is evident that CSR is very much important in today’s world and the organizations are
bound by social obligations which includes the welfare of all those who are affected by the
activities of the organizations. In this scenario, it can be said that the business professionals can
improve the lives of the workers. It is so because the professionals are the ones who decide the
policies of the organizations and if they revise their policies based on the broad concept of CSR,
then they can make the lives of the workers better (Costa & Menichini, 2013). With time, the
importance of CSR has also increased. Therefore, the business professionals are bound by certain
morals and social obligations because on case the professionals don’t look into the welfare of all
the stakeholders, then the business cannot survive for long, as all the stakeholders, including the
employees, suppliers, customers and the environment are affected by and somewhat dependent
on the business activities (Cohen, 2017). Hence, it is imperative for the organizations and the
business professionals to focus on fulfilling their social and moral obligations. As a business
professional, I would firstly adopt better wage policies for the workers so that they can have a
better living standard. Secondly, I would use policies providing for a better and healthy working
environment. Thirdly, I would use policies for flexible working hours so that the workers don’t
get to much stressed with work and lastly, I would ensure that the factory wastes are disposed in
an organized way so that the environment outside the factory is not negatively affected.
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Conclusion
Therefore, from the above discussion it is evident that the importance of the broad
concept of CSR has increased with time and it has become important for the every business
organization in the modern times, as without CSR it becomes difficult for the organizations to
survive. In this context, the given documentary about Indian factory workers shows the poor
CSR implementation by the clothing industry, including the harsh working conditions and living
standards of the workers in the factories. From the documentary, it is evident that the
implementation of the broad concept of CSR in the Indian clothing factories is very much
required.
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References
Abels, P. B., & Martelli, J. T. (2012). WHAT IS CSR ALL ABOUT?. In Global Conference On
Business & Finance Proceedings. Institute for Business & Finance Research, (Vol. 7, No.
2, p. 86).
André, K. (2013). The ethics of care as a determinant for stakeholder inclusion and CSR
perception in business education. Society and Business Review, 8(1), 32-44.
Caruana, R., & Chatzidakis, A. (2014). Consumer social responsibility (CnSR): Toward a multi-
level, multi-agent conceptualization of the “other CSR”. Journal of Business Ethics,
121(4), 577-592.
Cohen, E. (2017). CSR for HR: A necessary partnership for advancing responsible business
practices. Routledge.
Costa, R., & Menichini, T. (2013). A multidimensional approach for CSR assessment: The
importance of the stakeholder perception. Expert Systems with Applications, 40(1), 150-
161.
Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
DesJardins, J. R., & McCall, J. (2014). Contemporary issues in business ethics. Cengage
Learning.
Dubbink, W. (2013). Assisting the invisible hand: Contested relations between market, state and
civil society. Springer Science & Business Media, (Vol. 18).
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