Business Ethics Literature Review: Sustainability & Apple's Case

This literature review examines the importance of business ethics, exploring its definition, benefits, and relevance in both large corporations and small businesses. It uses Apple Inc. as a case study, analyzing the company's ethical practices, challenges, and the impact of ethical considerations on its operations, including issues like privacy, sustainability, and intellectual property. The review also highlights the significance of ethical behavior in fostering a positive corporate culture, building consumer confidence, and minimizing financial liabilities. It concludes by emphasizing the role of ethics in various industries and its connection to long-term profitability and investor confidence. The paper provides a comprehensive overview of business ethics, offering insights into how ethical conduct can drive business success and sustainability.

Running Head: LITERATURE REVIEW 0
SUSTAINIBLITY & ETHICS
AUSTRALIA

LITREATURE REVIEW 1
Table of Contents
Introduction....................................................................................................................................2
Benefits of the ethical organization..............................................................................................3
Relevancy of business ethics in Apple’s maintaining a strong root case..................................3
The Ethical issues faced by company.......................................................................................4
Relevancy of ethics in small scale business..................................................................................6
Importance of Business Ethics..................................................................................................7
Conclusion......................................................................................................................................8
References.......................................................................................................................................9

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Introduction
The needs of ethics in the business organization will be reflected via literature review by
considering the example of ‘Apple Company Inc.’ But before getting started it is first important
to understand the general definition of ethics and business ethics along with its importance in the
small scale businesses. Ananny defined Ethics as the rules or the behavior which are based on
the ideas of good or bad and right or wrong but this cannot be considered as an appropriate
definition because every person has different thinking strategies, the things correct for one may
be wrong for the other, there is no universal definition of ethics (Ananny, 2015). Oates and
Dalmau in the year 2013 had specified ethics the part of knowledge which deals with “the
universal principles study which determines right from wrong (Ananny, 2015).” According to
Crane, ethics can basically be of two types i.e. individual ethics and organization or corporate
ethics; in the individualistic ethics determines that the concept of right and wrong is hereditary in
the individual discovered from their parents, teachers, religious education and the personal
experiences of the life, while the organizational ethics means the presumption, faith, knowledge
about the aim and rules which are occupied or used by the employees of the business
organization (Crane et al., 2019). Ethics can also be called as moral philosophy. The main fact
of the business ethics or organization ethics is the managerial ethics which refers to the
resolution, movement and etiquette of the managers whether they are taken correctly or not.
Durkheim in the year 2018 stated that the basic and the most important work of the manager is to
take a decision which is correct, good and beneficial for his business it also has an undue effect
and impact on the world at large due to the growth of the technology. For doing an ethical
business moral must be incorporated in all its sides i.e. not only in the practices of the leaders
and the employees but in the entire structure of the organization (Durkheim, 2018).

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Benefits of the ethical organization
Walumbwa, Hartnell & Misati stated that mostly all the organizations today are having suspicion
to push their members to run their business on the rules which are ethically sound because it has
numerous advantages and benefits in instituting the ethical behavior and some of them are as
follows increased satisfaction and production among the workers, raised and maintainable gains,
highly technical social status and loyalty and acknowledged information in between the buyers
and the sellers (Walumbwa et al., 2016). Unethical practices and the persons not following the
ethical norms may diminish and destroy the value of the shareholder due to the high cost which
are related with the unethical practices like fines and penalties, audit costs and costs associated
with the buyer’s loss and stake to their reputations whereas the workers may be increased due to
operating the high ethical corporations. Many businesses get collapsed due to the unethical
behaviors as it result in loss of credibility amongst the shareholder and businesses (Walumbwa et
al., 2016).
According to Peterson & Ferrel Ethics is thus considered as that complex construction which
interprets and understand the things and business in a very different way, where each individual
has its own opinion regarding the constitution of a qualified ethical operation and there is no
unique terminology which can be considered correct for ethics (Peterson & Ferrel, 2016). In the
recent year the business ethics literature has explored in both volume and importance and
because of this sheer volume and diversity of the literature it has raised its value and has
attracted a lot of media action (Peterson & Ferrel, 2016).

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Relevancy of business ethics in Apple’s
maintaining a strong root case
The headquarter of Apple Inc. is situated in Cupertino, California and has experienced a lot of
success and challenges as well as ethical issues in the journey of its business history just like
many other technological industries, The Apple brand serves as the quality, prestige and
innovation for millions of consumers, though there are many companies who tries to copy the its
model but none have been able to discover what it was made by the Apple (Guardian, 2016).
This company had its own principles of ethics which were followed by them on the regular basis
like firstly it has always tried to display best and appropriate of its conduct to all its employees
and the persons it worked with mostly in all the situations. Secondly it tried to create innovative
and high qualified products an\d services, thirdly has reflected integrity, honesty, respect,
confidentiality and compliance in every of its business transaction. Fourthly they had drafted a
code of conduct for their business which was applied to all its operations including the overseas
ones, fifthly it has also formulated some specific policies relating to the corporate governance,
conflicts of interest in the directors and the guidelines on website referring to the question
relating to the questionable conduct of company. Finally A proper business conduct helpline plan
for the workers were made where the misconduct was reported to the Audit of the Apple and
Finance Committee (Sekaran & Bougie, 2016).
The Ethical issues faced by company
Though Apple has regularly won the top most place in the world’s most preferable company, in
the recent years it has come across many ethical issues which can have diverse effect on the
success of company in the future, some of them are as follows:

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Privacy- company’s ability to track its customers have raised due to the increase in the growth of
internet, social media and mobile devices but this have also made the tracking of the customer a
controversial issue. Though for Apple information about its customer can help them to
understand the latest trends and the various other products of the market more efficiently, but this
privacy breach has also resulted in backlash against company.
The Guardian referred this price fixing issue in faced by Apple Company in US and stated that-
it is an allegation and a very big ethical issue raised against the Apple Company. In a case
against it the judge ruled that price fixing was done by company on eBooks, with five other
major publisher of the books (Guardian, 2016).
Laura talked about rioting-During the sale of iPhone 4s in the year 2012 in China riots beginning
of riots were traced because the population had to wait for hours and hours outside the store to
purchase the phone, it also grew tensions between the buyers who waited overnights and tried to
reach or come in front of the lines (He, 2012).
David talked about sustainability in his article and conveyed that- for becoming a bigger
company Apple has taken many steps and in that while reduced the environmental impact of its
facilities, restrictions in the use of manufacture use and recycling of its products were also
addressed here (Price, 2017).
In reference to the article presented by the Burgess the theft of Intellectual property was
determined and concluded that-the theft intellectual property is the key concern and a big issue
faced aggressively by this company Apple is very serious about keeping its ideas as secret and
prevented from other companies (Burgess, 2017).
Threats from other companies- It creates various types of threat for the other companies and
brings collusions which are highly unethical, it also faces the supply chain management issues.

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With reference to Martin’s word ethics is related with the moral decisions about correct and
wrong and the decision taken within the business organization may be delivered by a single
person or the group of individuals, but the authority taking these decision must be affected by the
rules and regulations of company (Martin, 2015).
Relevancy of ethics in small scale business
Cornee defined the ethical behavior and CSR can bring a huge amount of benefit for the business
of all the types whether small or big. For example it attracts customers, increase in production,
boost up sales and increases profits, it attracts the continuity of the employees for staying
connected with the business for a long time, which reduces the turnover of the labor and cost of
recruiting new employees and it also attracts investors and keeps the share price of company.
Therefore protects the business from takeovers. Unethical behavior or lack of CSR may damage
the reputation of the business and its stakeholders, which may further result in fall of profits
(Cornee, 2017).
A good governance and the ethical behavior is that part of a business without which success is
just not possible. Following up of ethics is very important for the small scale business because it
is that policy, procedure or culture which focuses on doing the right things at the correct time or
while facing the difficult situations or any controversial issues. Ethics will help the small scale
business in the following ways
Nathanson talked about building of a positive corporate culture- The morale in the team
members grows when the employees feel themselves safe and protected due to realizing their
own morals. These norms and policies include anti-discriminatory rules, open door policies and
same opportunities for the development of the workers. It is when the workers feel really good
for being at work, then the overall feeling of the business becomes positive (Nathanson, 2018).

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Boost up the confidence of the of the consumer-The business may lose the confidence of the
customer just because of few bad online reviews, they need to retain the loyalty of the consumer
through the ethical exercise that start with fair and honest methods of advertising and continues
in every part of the sale. Negatively dealing with the complaints leads to losing the confidence of
the customers. Thus an organization must take time and identify the things that are important for
the consumers and the market it wants to target, so that it can set better ethical values to that
segments and meet the protocols of higher ethical standards.
Reduces the financial liabilities-the companies who do not make or develop ethical policies and
standards may undergo financial liabilities, most important out of them is reduction of sale.
In accordance Kilk the Potential lawsuits are minimized-It is considered as the second are of
financial liability which exist with the potential lawsuits. There must not be any kind of
discrimination, harassment, acquisitions or disgruntlement amongst the workers in a business
rather there must be consistency in dealing or executing the policies, which can further reduce
the frivolous lawsuits which bankrupts the smaller organizations (Kilk, 2015).
The theory of moral and ethical policies guides the morale, behavior and resolution of the
business and it needs to fulfil some requirements which are classified into laws, regulation
relating to the environment, the minimum wages, restrictions for the insider trading and
collusions.
According to Rafner ethics in business varies from industry to industry depending upon its
nature. For example Amazon and Google mostly conduct their business online so are not
scrutinized for their impacts on the environment in the way the companies like BP and Exxon
does. When the question arises of customer protection and their privacy and security the ethics of
all the organization are examined from very close (Rafner, 2018).

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Importance of Business Ethics
Lipska & Kijanka said that the business ethics has spread over its roots and has reached far
beyond the loyalties, morale and strengths of a management team bond and are directly and
indirectly related earning of profit in both the short and the long term. A company if found not
operating ethically then it loses its investors as they become less inclined to buy the stock or
support the operators. More and more incentives in the areas of social responsibilities and
investing are earned if the ethical standards are followed correctly and they keep growing
continuously. The consistent increase in the ethical behavior leads to the positive image of the
business in the minds of the public (Lipska & Kijanka, 2019).
Conclusion
Thus to conclude it can be said that there are many reasons which can prove that ethics is
important in business some out of them are as follows firstly it satisfies the basic human needs
i.e. the basic human need is to be fair, honest and ethical and all the employees would like to
work for an organization which practices its deeds in fair and ethical manner. Then it creates
credibility i.e. an organization is said to be driven by ethical norms is mostly given respect in the
society and even to those who do not even have information regarding the works or the business.
Next is uniting people and leadership, if an organization walks on the values it attracts the
respect from its employees also. Then it also improves the decision makings of an organization
in the very same way as it does for the individuals. It helps in earning the long term gains as it
guides the organization to earn in the long runs and even when they seem to lose money. Lastly
is securing or protecting the society.

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Ethics thus tries to create a sense of right and wrong in an organization even in the situation
when the laws fail, it is the ethics that safeguards the organization or the business from harming
the society or the environment.

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References
Ananny, M., 2015. Science, Technology,& Human Values. Toward an Ethics of Algorithms:
Convening, Observation, Probability, and Timeliness, 41(1), pp.93-117.
Burgess, , 2017. Apple means business when protecting intellectual property. [Online] Available
at: https://www.csoonline.com/article/3269868/apple-means-business-when-protecting-
intellectual-property.html [Accessed 28 2019 2019].
Cornee, S., 2017. Small Business Management. The Relevance of Soft Information for
Predicting Small Business Credit Default: Evidence from a Social Bank, 57(3), pp.699-719.
Crane, A., Matten, D., Glozer, S. & Spence, L., 2019. Business Ethics: Managing Corporate
Citizenship and Sustainability in the Age of Globalization. 5th ed. London: Oxford University
Press.
Durkheim, E., 2018. Professional Ethics and Civic Morals. 1st ed. London: Routledge.
Guardian, T., 2016. Apple to pay $450m settlement over US ebook price fixing. [Online]
Available at: https://www.theguardian.com/technology/2016/mar/07/apple-450-million-
settlement-e-book-price-fixing-supreme-court [Accessed 28 2019 2019].
He, L., 2012. Tensions High In China's iPhone Factory After Massive Riot. [Online] Available
at: https://www.forbes.com/sites/laurahe/2012/09/28/tensions-high-in-chinas-iphone-factory-
after-massive-riot/#73647cfd6bb2 [Accessed 28 2019 2019].
Kilk, A., 2015. Journal of World Business. The social responsibility of international business:
From ethics and the environment to CSR and sustainable development, 51(1), pp.23-34.
Lipska, K. & Kijanka, E., 2019. igi global. To Take or Not to Take?: The Importance of Business
Ethics, pp.137-155).

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Martin, K.E., 2015. MIS Quarterly Executive. Ethical Issues in the Big Data Industry, 14(2),
p.19.
Nathanson, E., 2018. Building Company Culture: 7 Steps for Every Small Business. [Online]
Available at: https://business.linkedin.com/talent-solutions/blog/company-culture/2018/build-
company-culture-small-business [Accessed 28 2019 2019].
Peterson, P.E. & Ferrel, O.C., 2016. Business Ethics: New Challenges for Business Schools and
Corporate Leaders New Challenges for Business Schools and Corporate Leaders. 1st ed. New
York: Routledge.
Price, D., 2017. Why Apple was bad for the environment (and why that's changing). [Online]
Available at: https://www.macworld.co.uk/feature/apple/complete-guide-apples-environmental-
impact-green-policies-3450263/ [Accessed 28 2019 2019].
Rafner, D., 2018. Examples of Business Ethics in the Workplace. [Online] Available at:
https://smallbusiness.chron.com/examples-business-ethics-workplace-10830.html [Accessed 28
2019 2019].
Sekaran, U. & Bougie, R., 2016. Research Methods For Business: A Skill Building Approach.
7th ed. John Wiley & Sons.
Walumbwa, F.O., Hartnell, C.A. & Misati, E., 2016. Journal of Business Research. Does ethical
leadership enhance group learning behavior? Examining the mediating influence of group
ethical conduct, justice climate, and peer justice, 29(5), pp.14-23.