A Comprehensive Analysis of Business Ethics at Tesco: Report

This report provides a detailed analysis of Tesco's business ethics, examining the company's ethical policies and practices. It begins with an introduction to business ethics and its relevance to Tesco, a leading UK-based multinational retailer. The main body of the report explores the ethical nature of Tesco, highlighting its commitment to ethical business conduct, its cultural values, and its approach to sustainability. It then delves into the ethical philosophies followed by Tesco, including its CSR program and the application of agency and stakeholder theories in decision-making. The report also assesses the roles of senior management and employees in maintaining the company's business standards, emphasizing their responsibilities in upholding ethical conduct and complying with relevant laws and regulations. The report concludes with a reflection on the importance of ethical practices in fostering a positive corporate image and achieving sustainable success. The report utilizes references to support its findings.

BUSINESS ETHICS

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
1. Ethical nature of Tesco............................................................................................................3
2. Ethical Philosophy followed by Tesco....................................................................................5
3. Role of senior management for maintaining the business standards of the company.............7
4. Role of employees to maintain the company’s business standards.........................................8
Reflection.........................................................................................................................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business ethics is generally studying about the appropriate policies of business and the
practices related to potential subjects that are controversial which includes insider trading,
corporate governance, discrimination, insider trading, corporate social responsibility and
fiduciary responsibilities. Ethics mainly involves learning about the right and wrong and then
doing the right thing especially in businesses. In order to maintain good image in the
marketplace, most of the companies prefer following the set of rules or principles through which
standards are set for regulating the behaviour of the organisation.
The report will focus on the ethical policies and philosophy of the British multinational
company named Tesco which is following the various kinds of ethics in its operations and
activities in order to gain rapid success and profitability. The company is headquartered in
England, UK. It deals in retailing of groceries and general merchandise and performs its
operations in different countries across the world (Ethical behaviour of UK Supermarket Tesco,
2020). The company has become the market leader in the retailer industry of UK, Thailand and
many more. The report will start by discussing the company and the reason behind its being
ethical. This will be followed by highlighting the ethical philosophies followed by the company.
The role of senior management and the employees will be evaluated for maintaining the business
standards of Tesco Company.
MAIN BODY
1. Ethical nature of Tesco
Tesco is the largest supermarket chain of UK which is considered as the target for many
campaigns due to its unique approach to business. Tesco is described as the international
company which has gained greater reputation for providing quality products and services. The
company aims to provide best services to its consumers as well as stakeholders. The company
believes in maintaining its valuable reputation and building on its success. Tesco commits to
follow the ethical business practices (Tesco Corporation: Code of Business Conduct and Ethics,
2016). All the employees of the company and even the directors, agents, officers and the
representatives of the company consider their responsibility towards following the ethical values
of the company. In order to show that Tesco is ethical, the cultural values tree of Tesco
demonstrates its commitment to the ethical business conduct. The core values of the Company
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are deeply rooted in the ethics, safety and compliance. Tesco never compromises with its value
system as the ethics is built over its foundation (Tonthat, 2017).
Tesco strives hard to provide a positive work environment which helps in supporting the
dignity, productivity, pursuit and the self-esteem of personal goals. The policies and procedures
related to the employment helps in providing equal opportunity and fairness regarding the
decisions of employment. The company do not discriminate in terms of race, ancestry, religious
belief, age, gender, physical or mental disability, source of income, family status and any other
factors. They ensure that employees are fairly treated in terms of performance appraisals,
opportunities for advancement, employment relationship etc. The company also keeps the
personal information of the employees confidential and those too using well-defined procedures.
The company ensures that the employees are treated with dignity and self-respect (Sutherland,
2021). The company also follows all the sustainability practices which ensure that the operations
of the company do not harm the environment in any way.
The three values which drive the business of Tesco are they considers the needs of the customers
as its first priority, treating the people in the way they want to be treated and also the slogan of
the company which is Every Little helps is able to make a big difference in the society as well as
the company. Tesco is considered as the company which follows all the ethical values such as
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understanding the customers, meeting their needs and act responsibly for the communities. The
company also focus on reducing the food waste globally and also ensures that the food which is
considered as surplus goes to the people in need. This makes the people to live healthier life.
Tesco also provides great quality, a sustainable and affordable product which helps in making
positive contribution to the communities in which it operates (Tesco plc ethical consumers,
2020).
Tesco is involved in bigger global initiatives which help the company in taking right actions for
restoring trust and transparency in business. The company also introduced its Tesco values which
became an important part of its culture along with becoming the main reason behind the
significant underpinning of its progress and success. Tesco ensures that every employee and the
worker realize the important things and the ways in which they need to work together in a team
whose focus is the customers (Utami, 2018). They are considered as the universal values which
also help in guiding the people of the company leading to growth of Tesco in new countries and
markets. Not only this, Tesco also believe in various ethical programmes like CSR program,
energy consciousness program which helped in adapting the policies which do not lead to any
harm to the environment and also helps in reducing the energy consumption. This is how Tesco
is considered as one of the most ethical retailer companies which is facing rapid success due to
the adaption of various ethical values.
2. Ethical Philosophy followed by Tesco
Tesco is known for its ethics and compliance policies and philosophy. Tesco introduces its
CSR program in the favour of the well-being of the environment which also helps in gaining
greater profitability to the company. The company is aware of the policies which can harm the
environment and communities in any way and which bring negative image for the company. By
knowing this, they strive hard not to adapt those sustainable policies and focus on the ones which
have positive impact on the community and the environment (Blakeney, 2019). The company
ensures that the environment of the company is healthy and also the employees are well-trained
for working in the environmental initiatives.
Tesco launched its energy consciousness program in which whole staff was forced to
participate in the campaign for monitoring the stores and offices for examining the energy use
level and also helps in reducing the waste. By using this initiative, Tesco was successful in
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reducing the energy consumption by 38% in between 1996-2005. The CSR programme builds on
the commitment of making positive contribution towards the society which is backed by its
approach of ‘Every Little Helps’.
The two theories which were agency theory and stakeholder theory were combined by the
Tesco Company before taking any ethical decisions. The agency theory stated that the social
responsibility of the business is making much money as possible regarding the shareholders but
that also within the rules. The stakeholder theory stated that the main aim of the business is the
stakeholders and their actions and that must be designed for balancing the interest of the
stakeholders (Gaur, Ghosh and Zheng, 2019).
The agency theory is used by Tesco for deciding its main objective which is providing
excellent goods and services for earning the customers’ loyalty. This helps in ensuring their
existence in the market and maximising the investment of the shareholders. Tesco company
make use of the stakeholder theory for acting on the behalf of the stakeholders’ interest like the
contribution towards the society, responsibility to the supplier chain and care for the
environment.
Various ethical policies are adapted by Tesco in order to cover different areas. These policies
include the policies of human rights, charity, ethical trading, local community sponsorship, fair-
trade, environment and animal testing. The ethical policies facilitate the customers by providing
goods and services at low prices and good value for money. The company also provides products
and services of good quality, good customer service along with fair treatment and easy access to
stores and the online platforms like websites and social networking sites (Khan, 2018). The
company also introduces the policies which restricts itself from testing on animals and harming
the environment.
The company also creates jobs for local communities, enhance the level of income and improves
the standard of living. Tesco also helps in developing the local area by supporting local
communities and charities. It helps in reducing the CO2 emissions and noise pollution, making
less use of community resources, trading fairly and not destroying the local culture of
communities. The large businesses like Tesco are taking more ethical responsibilities more
seriously and become more prepared for adapting their behaviour along with avoiding
accusations of wrong doing. For instance, Tesco is taking zero hour contracts and believes in
trading fairly. Tesco is putting pressure on their partners of trading for following policies of
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social responsibility. This is how the ethical philosophy of the company Tesco is helping in
improving its corporate image as it is been seen that the company performs its operations
ethically both externally and internally. This is why the suppliers, stakeholders, customers and
even the pressure groups like Tescopoly also considers the company as the most ethical company
which adapts most of the ethical policies for the well being of everyone whether community,
environment, stakeholders, employees etc.
3. Role of senior management for maintaining the business standards of the company
Tesco plc and corporation along with its subsidiaries is focuses on the highest standards
for ethical business conduct along with following all the laws, rules and regulations of the
government and the company. Among the senior management, the Board of Directors adopted
the Business Conduct and Ethics Code which is basically the set of guidelines which helps in
promoting the ethical and honest conduct, accurate, fair, full, understandable and timely
disclosure, complying with the governmental laws, regulations and rules and which also provides
guidance to the officers, directors and the employees for dealing with the ethical issues (Tesco
policies, 2020).
The senior management of the company also ensures that no operation of the company harms the
environment. For example, they keeps a check on the packaging of the products as it must be
done in paper bags instead of plastic bags which can harm the animals as well as the
environment. The main role of the senior management is to ensure that all the activities of the
business comply with the laws and the regulations. They do not tolerate any type of illegal
activity which is conducted for any employees’ personal gain (Gronfula, 2018). The company
also monitors that the company does not take competitive advantage by using the unethical and
illegal business practices. The senior management also plays an important role in protecting the
safety and health of the employees. They adopted all the procedures and policies which are
applicable to laws of health and safety along with the industry standards which are prevailing.
Not only this, they also strives hard for developing a drug free and professional environment as
the misuse of drugs can affect the health of the employees as well as the productivity of the
company.
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4. Role of employees to maintain the company’s business standards
The employees play an important role in maintaining the business standards of the company.
They become aware and comply with the ethics policy of the company and the related
procedures. They also report any violation observed by them related to the HR or the Executive
management team. The employees need to be familiar to the environmental standards which are
applied at the work in Tesco and must also comply with them. They also give their contributions
towards minimizing their negative impacts of their operations on the environment (Tesco
Corporation Business Ethics Policy, 2020). They do not support any illegal or unethical activity
which harms the environment, stakeholders, consumers etc.
If the employees do not perform the operations by following the laws and regulations, then
this becomes very difficult for the senior management as well as the company to adapt and
implement the ethical polices. The employees also fill a confidentiality form under which it is
ensured that none of the employee will leak the personal information of the company or the
consumers and keep it confidential which helps in building trust and the number of loyal
customers. Before taking any initiative or bringing any plan in action, the employees seek the
advice of the senior management to ensure whether it is ethical or not. This is how, the
employees of Tesco supports in maintaining the business standards of the company.
Reflection
Gibbs reflective cyclic model is considered as one of the most effective model of
reflection which was developed by Graham Gibbs in 1988 for giving systematic structure in
order to learn from experiences. A particular framework is offered by this model to examine
experiences (Sekarwinahyu and et.al., 2019). This model will be used for reflecting on the
section above which is the ethical nature of the multinational retailer company Tesco. The main
reason behind using this model is its cyclic nature which helps in analysing the repeated
experiences and learn and plan from those which go well and which do not. Ethical nature of the
company is not made by following some ethical policies once in a time but is a continuous
process which is changed according to the demands of the customers as well as the emerging
market. This model covers mainly the 6 stages which I will use to reflect upon the ethical
practices of the company Tesco.
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Description: Through the above report, I decided to explore about the ethical nature of the
company Tesco and the reason behind considering it as ethical. I also decided to examine the
roles of the employees and the senior management in maintain the business standards of the
company. I expected that complying with the ethical policies and becoming the ethical company
is much easy but after going through the annual reports of the company and its official websites,
I came to know that the company, employees and even everyone in the company have to play
their part effectively in order to make the company ethical (Sekarwinahyu and et.al., 2019).
Feelings: I felt very good as I came to know about many different initiatives taken by the larger
companies like Tesco in order to come under the category of ethical companies. I felt that I could
not be able to explore maximum things but after going through many sites, blogs, articles, books,
journals etc. I realized that I covered all the most important ethical policies and philosophy
which are followed by the company.
Evaluation: The good things about my experience was that I became aware of the ways in which
the companies strives hard so that they can be considered as ethical and also got to know that
along with earning maximum profitability and customer base, the companies also focus on the
ways which can facilitate not only the customers but also the environment, employees,
stakeholders etc.
Analysis: This can be analysed that ethical policies were the biggest reason behind the rapid
growth and success of the company Tesco and also that the foremost concern of Tesco is
following all the laws and regulations. The employees as well as the senior management also
plays their part in maintain the standards of Tesco’s business (Chun, 2019).
Conclusion: This can be concluded that conduct of ethics is basically what is correct and
honourable in terms of morals and values. Tesco is maintaining its reputation by following all the
ethical standards which are dedicated towards well being of the community, environment,
employees, suppliers, stakeholders and everyone connected to the company.
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Action Plan: If I had to do the same thing again, I will examine the ethical conduct of another
company so that I can come to know about more ways in which ethics is adapted by the
companies. Also I will become able to make a comparison of the ways in which ethics are
adapted by different companies in different ways. Overall the experience about studying about
this topic was good which increased my knowledge and confidence.
CONCLUSION
This can be concluded from the above report that ethics play a major role in the growth
and progress of the companies. The report focuses on the ethical conduct of Tesco. It highlighted
the reason behind considering Tesco as ethical company. The ethical philosophy followed by the
company was highlighted along with describing the role of the employees and the senior
management in maintaining the standards of the company.
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REFERENCES
Books and Journals
Blakeney, M., 2019. Ethical issues. In Food Loss and Food Waste. Edward Elgar Publishing.
Chun, R., 2019. How virtuous global firms say they are: A content analysis of ethical
values. Journal of Business Ethics. 155(1). pp.57-73.
Gaur, A., Ghosh, K. and Zheng, Q., 2019. Corporate social responsibility (CSR) in Asian firms:
a strategic choice perspective of ethics and compliance management. Journal of Asia
Business Studies.
Gronfula, A.G.M., 2018. The linkage between CSR beliefs and ethical behaviour and its
influences on consumer attitudes towards the retail sector in the UK (Doctoral
dissertation, Brunel University London).
Khan, M.R., 2018. The effects of culture and leadership behaviour on ethical practices in
managing labour within the UK and Bangladesh-readymade garment industry (Doctoral
dissertation, University of Bolton).
Sekarwinahyu, M. and et.al., 2019, February. Development of problem based learning for online
tutorial program in plant development using Gibbs’ reflective cycle and e-portfolio to
enhance reflective thinking skills. In Journal of Physics: Conference Series (Vol. 1157,
No. 2, p. 022099). IOP Publishing.
Sutherland, K.E., 2021. Managing Reputation, Ethics, Risk, Issues and Crises. In Strategic Social
Media Management (pp. 41-73). Palgrave Macmillan, Singapore.
Tonthat, A.Q., 2017. How Academics See The Benefits And Challenges Of Business Ethics
Teaching: Some Views From A UK Business School (Doctoral dissertation, The Open
University).
Utami, M.W., 2018. THE ROLE OF NATIONAL CULTURE IN THE EMERGENCE OF
FINANCIAL STATEMENT FRAUD: COMPARISON OF JAPANESE AND
BRITISH CULTURE IN THE CASES OF OLYMPUS AND TESCO.
Online
Ethical behaviour of UK Supermarket Tesco, 2020. [ONLINE]. Available through :<
https://studymoose.com/ethical-behaviour-of-uk-supermarket-tesco-essay>
Tesco Corporation Business Ethics Policy, 2020. [ONLINE]. Available through :<
https://www.sec.gov/Archives/edgar/data/1022705/000119312507067599/dex14.htm>
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Tesco Corporation: Code of Business Conduct and Ethics, 2016. [ONLINE]. Available
through :< http://media.corporate-ir.net/media_files/IROL/11/118467/Code%20of
%20Business%20Conduct%20and%20Ethics_19%20Feb%202016.pdf>
Tesco plc ethical consumers, 2020. . [ONLINE]. Available through :<
https://www.ethicalconsumer.org/company-profile/tesco-plc>
Tesco policies, 2020. [ONLINE]. Available through :<
https://www.tescoplc.com/sustainability/publications/policies/downloads/group-anti-
bribery-policy/>
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