Costco's Ethical Practices: Philosophy, Challenges, Stakeholder Impact

This report provides an in-depth analysis of Costco's business ethics, exploring the ethical philosophies the company follows, the ethical challenges it has faced, and the key stakeholders involved in maintaining its business standards. It discusses Costco's commitment to responsible business practices, including treating employees equally, valuing integrity, and securing meaningful employment. The report also examines the ethical philosophies guiding Costco, such as personal responsibility, loyalty, respect, trustworthiness, fairness, and community/environmental responsibility. Furthermore, it identifies past ethical challenges like unethical leadership, toxic workplace culture, discrimination, and unrealistic goals, and explains how Costco addressed these issues. Finally, the report identifies and discusses the roles of key stakeholders, including investors, employees, trade associations, governments, and management, in maintaining Costco's business standards. Desklib provides access to this and other solved assignments for students.

Personal Responsibility: In business, each person has their own
responsibility which is assigned by management and they have to
performed effectively. Every person in company have clear
vision about their duties which they need to performed in the
business. The employees of Costco Company play their assign
task more sincerely so that it helps management to attain the
objectives of their business.
Loyalty: It is very important for any business that everyone
should be loyal to each other then only management can make
effective decision for their business. For company it is also
important to maintain the relation with client or customers not
for only the good business but also for good reputation of
enterprise in market. The Costco Company have to loyal with
their employees and employees is also loyal with the co-workers,
then only management prepare effective strategies and decision
for their company.
Respect: In enterprise, respect play very significant role because
it shows the behaviours of treating employees with their other
co-worker, clients and customers. When employees show respect
to other employee then it shows valued member of their team.
The employees have to care about their opinions which have to
followed when they performing any task. In Costco Company the
employees have to give respect to the management when they
give any order to their employees then it is responsibility for all
employees to respect that order and complete the task
accordingly. This help business to resolve any problem quickly
by finding appropriate solution of their problem.
Trustworthiness: In business, the management need to
developed the trust worthiness with their clients, customer and
employees through transparency, honesty and reliability. It is
very important for employees that they trust on their company
then only they able to follow all the terms and conditions of the
company then only they able to perform their duties correctly.
The customer has trust the business of Costco Company then
only management able to perform the business process smoothly
in market and management able to increased their sales of the
company.
Fairness: Management have to fair with everyone in the
organization as well as with their customer and clients. The
management are having same expectation with the regards to
honesty, integrity and responsibility which is based upon the
employees’ level. The Costco Company have to treat with all
employees and their customers equally, so that they able to offer
the goods and services with same terms and conditions.
Community and Environmental Responsibility: The company
of ethics is not towards their clients, customers and employees
but also towards the community and the environment that how
they contribute to make clean and healthy environment. The
Costco Company also have responsibility for the community and
environment that how they need to give contribution and take
measures steps which are essential for making environment
clean.
Discuss the ethical challenges which faced by
company in past and what are the key elements
of it successful for addressing those challenges
Ethical issue is a circumstances in which a moral
of conflict is arises in their workplaces, thus it is a situation in
which moral standard is being challenged.
In the workplace, ethical issues occur when a moral of dilemma
emerges and must be resolves with in a corporation. There are
many ethical issues which is faced by Costco Company in past
and they addressed all the issues which is faced:
Unethical Leadership: It refers to the leader behaviours or
action which are illegal or violate existing moral standards. Then
organization fails to accomplished the objectives and leaders can
encourage and unethical acts within their business. In Costco
Company management faced many issues in past related to
unethical of leadership that they don't perform their duties and
responsibility correctly and it directly impact on the business
performance level. The Costco Company is not able to achieve
their goals on time and for this they suffer from big loss. The
Costco Company improve the ethical leadership by developing
and establishing the straightforward guidelines and promote
proper knowledge.
Toxic Workplace Culture: In toxic workplace culture where the
employees find it difficult to work and progress their careers
which created a negative atmosphere by their co-workers,
supervisors, or their company culture. In past Costco Company
faced the toxic workplace culture is due to the lack of
communication is core issues, constant lack of clarity around the
projects and different employees receive different messages from
the management. These all problem is faced the management but
they improve the culture of their company by improving proper
channel of communication so that miscommunication will not
occur and it not affect their business process anymore.
Business Ethics Discrimination: It is the unfair or prejudicial treatment of people and
groups which is based on characteristics like race, gender, age, etc. This
effect the placing of certain individuals in a position of subordination or
disadvantages in labour market or the work place. The Costco Company is
faced problem due to the discrimination in the business, there management
do discrimination on the basis of their employees gender that female
employees is not promoting to the high level authority in the enterprise
(Harper, 2021). This impact the business that employees is not able to
perform their task more effectively because they are not getting the positive
environment. Costco Company prepare the formal structure in which their
management get individual employees performance report and those
employee is capable then they promoted and it reduce the discrimination
level in the corporation.
Unrealistic and Conflicting Goals: The management do not set the goals
realistic which is impossible to achieve in the market. The Costco company
also set the objectives which is not realistic is possible to achieved, so it
creates problem when they don’t able to measure the performance level
correctly. Then management of Costco Company set the realistic objectives
which management easily achieved the target and measure their
performance level.
Identify 5 key stakeholders and discuss their role in
marinating the business standards of the company
Stakeholder is parties or group of parties who has vested
interest in company and it can either affect or be affected by their business
operation as well as performance. It helps the organization to developed and
run the business process by investing fund. There are many different kinds
of stakeholders are there which help corporation to run their business
smoothly:
Investors: The investor is the person or entity who source funds to the
business to run their business process smoothly in the market. The Costco
Company have the investors in the market who supply funds to their
business which help to developed and expand their corporation.
Employees: In organization, the employees are very essential factors
because they played very important roles in the organization. The Costco
company, their employees must play their duties effectively which affect the
business operation smoothly in the market. If employees don't perform their
task sincerely then it affects the business process and management do not
have potential to achieve the targets in given time frame. This is very
important for organization that their employees must play their job
responsibility effectively.
Trade Association: This trade association which have group of experts
which are gathered together for promoting the common interest who are
participating in public relations which are advertising, education, political,
etc. they are having main focus on collaboration of companies. The Costco
Company, focus on their trade association for their business process which
make awareness by various activities like they have to prepare effective
advertisement and promote the education importance in the society as well
as political factors for the business.
Governments: The government is also considered the stakeholders for the
business, because the company pay taxes as corporate income tax. There are
many different projects and activities which help management need to
perform in the market, so it need to take permission from the government to
run the project. The Costco company have to maintain the government
stakeholders interest in their business, then only they able to complete
various project which is required to take permission from the government
but due to government stakeholders it become easy to do to perform the
activities.
Management: In business, management are also very important
stockholders because they maintain the relationship with their employees
which directly impact on their work. In Costco Company it is very
important for management that they maintain their relationship with each of
the employees so that they effectively performed their task.
Conclusion
The ethical philosophy need to be followed by organization so that they able
to reduce the negativity and help employees to boost the confidence level for
performing the task effectively so that company able to achieve the goals in
time. The stakeholders are also very important for the company because it
help to run their business process smoothly in market.
References
Bernacchio, C., 2022. Business and the Ethics of Recognition. Journal of
Business Ethics, pp.1-16.
Bevan, D. and Goodpaster, K.E., 2020. The Business Ethics Pioneers
Project: An Introduction and a First Sample. Business and Professional
Ethics Journal. 39(3). pp.271-285.
Richardson, K., 2019. The business of ethics, robotics, and artificial
intelligence. In Cyborg Futures (pp. 113-126). Palgrave Macmillan, Cham.
Schauster, E., 2019. Ethics versus survival: the relationship between
advertising ethics and new business challenges. Journal of Current Issues &
Research in Advertising. 40(1). pp.90-104.
Introduction
Business Ethics refers to the study of significant business policies
and practices which includes the corporate governance, insider
trading, bribery, discrimination, corporate social responsibility and
fiduciary responsibilities.
Identify company thought to be consider ethical
and discuss the reasons why company is considered
ethical.
Costco Company was established in 1993 in Watford, UK and it
operates in international chain of membership washhouse. In UK,
currently Costco Company is operating around 29 warehouses in
market. The mission statement of the enterprise is to continually
provide its members with highest possible quality of goods and
services at lowest possible prices.
The company is considered ethical when they follow and need to be
developed the code of ethics which help company to judge the right
and wrong activities which is done in the business process. There
are some business ethics which management of Costco Company
developed in their enterprise for running their business activity
smoothly:
Shows employees that it is responsible company: In this,
management develops the code of ethics that it communicates which
employees that Costco Company which is committed for doing
business responsibly. In organization, new employees have to know
the rights about company standards and expectations. Management
adheres strictly to their code of ethics, culture consistent with code
which will help to promote employees in the company. This help
enterprise to creates a positive peer environment to maintain high
level of work consistent with the values of their organization.
Shows employees that it is responsible company: In this,
management develops the code of ethics that it communicates which
employees that Costco Company which is committed for doing
business responsibly. In organization, new employees have to know
the rights about company standards and expectations. Management
adheres strictly to their code of ethics, culture consistent with code
which will help to promote employees in the company. This help
enterprise to creates a positive peer environment to maintain high
level of work consistent with the values of their organization.
Shows customers that it is value for integrity: It is responsibility
of management to make their customer feel assured by the existence
of code of ethics within a company. The Costco Company, tend to
look the third party groups which is more favourable for their
enterprise to adopt the code of ethics which help to developed the
company culture of responsibility and honesty. This is very
important for Costco Company to gain the trust of customer in
market so that they able to generate profit for the business process.
Treat everyone equally: If management treat their employees
unequal in the organization then it creates problem for the business
process that employees is not feel comfortable and motivated for
their work and responsibility. This is important for Costco Company
that they have treat everyone equally in the enterprise. The
management do not discriminate the employees on gender basis, if
the employee is capable for doing the task then management allot
duties and responsibilities accordingly.
Secured meaningful employment: The company secured the
designation of their employees, so that they give their best to
achieve the goals of their business. This is very important for
employees that they want to secure their place in enterprise for that
they do hard work and give their full potential towards the company,
so that they able to sustain their place. Then it became responsibility
of Costco Company to secured the dignity of their employees in the
firm because employees continuously help enterprise to achieve the
objectives of their business.
Discuss which ethical philosophy the company
follows
Ethical philosophy refers to study about the concept of moral right
and wrong or moral of good and bad by follow the codes of moral
rules, principles or values. There are different ethical philosophies
which management need to follow in their business are: