MGMT11109 - Impact of Ethics & Sustainability on Business Culture

This essay provides an overview of the role of ethics and sustainability in business organizational culture, drawing upon peer-reviewed articles and literature. It discusses how ethics and sustainability are considered cornerstones of a good business environment, influencing corporate social responsibility, environmental stewardship, and customer relations. The essay also addresses criticisms of ethics and sustainability, such as increased expenses for SMEs and bureaucratic restrictions, while concluding that despite these criticisms, integrating sustainability and ethics into business is essential. Desklib provides access to similar essays and resources for students.

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INTRODUCTION TO BUSINESS
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1INTRODUCTION TO BUSINESS
Ethics in business is considered to be an important aspect for sustaining business for
future. As a matter of fact, the most of the firms formulates code of conducts with the purpose to
retain the standards of the products and services and formulating an environmental stewardship
in order to increase the market value of that company. It can be argued that ethics and social
responsibly are identified as a strategic step for the organisations to continue its business
flawlessly. Moreover, the ethic is also associated with generating positivism towards the
employees in order to reduce employee turnover and incorporate more creativity and innovation.
On the basis of this understanding, the aim of this essay is to create an understanding regarding
the impact of the ethics and sustainability in organisational culture. Moreover, the essay also
encapsulates a thorough study of the recent peer reviewed articles and literatures to get a glimpse
of the empirical point of view in this context.
According to Bishop (2013) ethics and sustainability are considered to be the cornerstone
of the foundation of a good business environment (p. 636). It is comprised with the concept of a
moral standpoint that most of the business organisations should or must imply in their
organisational framework. As a matter of fact, the role of the ethics in business is very much
dynamic and associated with the good business environment that a company should follow. For
an example, the code of conducts in the name of ethics helps to maintain a good business
environment inside the organisations. It resembles with the idea to secure the interests of the
employees by putting more emphasis on the workplace environment and prohibiting illegal
practices like the discrimination, exploitation and ensuring workplace health and safety. As far as
the study of Beeri (2013) is concerned it can be argued that the role of the ethics in business
identifies the responsibility of the organisations towards its employees (p. 75).

2INTRODUCTION TO BUSINESS
Moreover, ethics is also related to formulate a sustainability value and standard that
indicates the role of the company in developing the community and its social orientation. In this
regard, Amini & Bienstock (2014) argued that the primary focus of the organisations are
extensively relied upon yielding profit as far as it can (p. 14). However, the ethical
considerations stimulate this process by establishing a social duty of the organisations. As a
result of that social responsibility has become a strategic measure for the organisations in order
to ensure their future responsibility. In the research conducted by Baumgartner (2014) it was
seen that most of the organisations are keen to develop a suitability effort to flaunt their
responsibility as a social entity (p. 260). In this context, sustainability is associated with the
corporate sustainability and the environmental sustainability. As far as Bishop (2013) is
concerned, corporate sustainability deals with the Corporate Social Responsibility (CSR) and the
friendly attitude towards the customers (p. 633). On the other hand, the environmental
sustainability of any organisation is resembled with the idea of environmental stewardship. In
other words, the environmental responsibility is associated with the positive impact of the
organisation on environment by the means of reducing greenhouse gas emission, managing
wastes, reusable technologies and saving energies.
The CSR is defined as a strategic step taken by the company by organising social
orientation in terms of incorporating the society or the neighbouring people in course of the
organisational framework. Baumgartner (2014) advocated that for ensuring CSR the
organisations put emphasis on organising social campaigns and programs where the local and
interested people can participate (p. 270). Moreover, often the companies coordinates some
community development programs for the society. The purpose behind these strategic steps is to
develop a better image of the organisation so that in return it will maximise the customers. In

3INTRODUCTION TO BUSINESS
course of this the future of the company will also be secured by yielding more profit and
prosperity for the organisation. In addition to this, making effort to create better relationship with
the customers the organisation keep on going to introduce innovative marketing strategies and
ideas to lure the consumers robustly. In fact, it is pertinent for the organisation to maximise the
customers in order to expand its business globally (Amini & Bienstock, 2014, p. 15). In this
context, the consumers’ behaviour also has big role to play. The customers keep an eye on the
image or value of the brand and in case of any disputes regarding the brand, it faces detrimental
impact on the course of the market orientation. Therefore, the companies are always willing to
check their market capitalisation with the help of establishing ethics and sustainability.
Besides this, the role of the environmental sustainability also plays a major role in
achieving the standards of ethics and sustainability in the organisation. Environmental
sustainability is coincided with the activities such as steps taken by the organisations in order to
protect the environment from further degradation. There is no doubt that due to impact of the
globalisation the activities of the companies has been increased in a rapid pace. In response to
this, the companies are only tried to expand their market capitulation and generate more profit by
harming the environment intensely (Bishop, 2013, p. 634). For an example, indiscriminate use of
the resources and energies costs shortage in the resource and as a result of that the future
generation will face severe problem and to some extent facing a catastrophe that erase the human
kind. Therefore, the organisations express their concern on environmental sustainability with the
purpose of fostering a better and healthy world. Therefore, using sustainability measures in terms
of reducing the energy consumption by innovating new energy efficient machines and
sustainability campaigns are very relevant for the business occupation of the companies.

4INTRODUCTION TO BUSINESS
However, a number of articles are showing the negative impact of the ethics and
sustainability on the business environment. As far as Popescu (2016) is concerned, the
implementation of sustainability devices increase the expenses of the companies (p. 125). As a
matter o fact, the small and medium scale enterprises are suffering with huge loss due to
enforcing sustainability framework. Moreover, the SMEs do not have enough capital to
implement new technologies in course of the market orientation. As a result of that it will be
negative for them to continue business in the high competitive market situation. Moreover,
Baumann-Pauly et al., (2013) advocated that the ethical considerations in business creates
problem due to overpower of bureaucracy (p. 700). The bureaucratic restrictions restrained the
natural growth of the business activities and as a result of that the poor and small organisations
are failed to expand their business extensively.
Moreover, many researchers have criticised the role and relevance of CSR in business. It
was argued that CSR was just an eyewash on behalf of the companies to divert the mind of the
government on other matters. As a matter of fact, Popescu (2016) argued that the prevalence of
the legislation would increase the vocalisation of the concerns over environmental sustainability
(p. 127). In reality the corporate organisations do not have any actual concern regarding the
damages they caused over environment. Therefore, the legislative frameworks and the
importance of the code of ethics become futile and irrelevant as the companies intentionally or
due to lack of perception regarding environmental issues damage the ecology badly.
In addition to this, the role and importance of code of conducts in the shape of ethical
standpoint is also under the scrutiny of some scholars. Many researches argued about the vitality
of the code of conducts in business. According to Baumann-Pauly et al. (2013) the code of
conducts actually have no impact on the business corporates (p. 694). The giant companies hold

5INTRODUCTION TO BUSINESS
enough power to mould the government organisations into their support. Furthermore, the moral
ethics and code of conducts followed by the companies fail to convince the people about the
benevolent characteristic of it. Besides this, the wordings and choice of terminologies are very
hard to understand and beyond the understanding of the common people. As a result of that the
commoners are remain in dark about such code of conducts that any company follows or not. In
his article, Baumann-Pauly et al. (2013) tried to draw a line between the relevance of code of
conducts and the role of the ethics in business by giving examples about the Volkswagen
emission scandal where the car manufacturer giant deliberately used illegal devices to make it
seems like their cars followed the emission guidelines (p. 701). This kind of issues are quiet
normal for the big companies and the role of code of conduct is not applicable to them.
The above discussion tried to point out the relevance of the ethics and sustainability in
corporate culture by putting emphasis on the peer reviewed articles. The articles advocated their
perception of the scholarly articles regarding the role of ethics and sustainability in business
culture. In this context, it can be argued that most of the articles defined ethics and sustainability
as the cornerstone of business operations of corporate organisations. However, a few articles still
remained sceptical about the relevance and importance of ethics and sustainability in business.
They questioned the existence of such measures when the giant organisations operates beyond
the code of conducts and those companies do not care for the existence of any sustainability
measures. Therefore, it can be concluded that the essay is strictly put emphasis on the scholarly
articles to get a clear picture of the relevance of ethics and sustainability in present day business
and it can be argued that despite of having enough criticism, sustainability and ethics has to be
installed in the business.

6INTRODUCTION TO BUSINESS
Reference
Amini, M. & Bienstock, C.C., (2014). Corporate sustainability: an integrative definition and
framework to evaluate corporate practice and guide academic research. Journal of
Cleaner Production, 76, pp.12-19. [Retrieved from
http://www.pmir.it/fileCaricati/1/Amini%20and%20Bienstock%20(2014).pdf]
Baumann-Pauly, D., Wickert, C., Spence, L.J. & Scherer, A.G., (2013). Organizing corporate
social responsibility in small and large firms: Size matters. Journal of Business
Ethics, 115(4), pp.693-705. [Retrieved from
https://www.alexandria.unisg.ch/219450/1/Baumann-Pauly%20et
%20al_forthcoming.pdf]
Baumgartner, R.J., (2014). Managing corporate sustainability and CSR: A conceptual framework
combining values, strategies and instruments contributing to sustainable
development. Corporate Social Responsibility and Environmental Management, 21(5),
pp.258-271. [Retrieved from http://www.pmir.it/fileCaricati/1/Baumgartner
%20(2014).pdf]
Beeri, I., Dayan, R., Vigoda-Gadot, E., & Werner, S. B. (2013). Advancing ethics in public
organizations: The impact of an ethics program on employees’ perceptions and behaviors
in a regional council. Journal of Business Ethics, 112(1), 59-78. [Retrieved from
https://www.researchgate.net/profile/Eran_Vigoda-Gadot/publication/
257541752_Advancing_Ethics_in_Public_Organizations_The_Impact_of_an_Ethics_Pro

7INTRODUCTION TO BUSINESS
gram_on_Employees%27_Perceptions_and_Behaviors_in_a_Regional_Council/links/
0046353c2135aa45f9000000.pdf]
Bishop, W.H., (2013). The role of ethics in 21st century organizations. Journal of Business
Ethics, 118(3), pp.635-637. [Retrieved from
https://www.regent.edu/acad/global/publications/lao/issue_11/pdf/brimmer.pdf]
Popescu, A.I., (2016) In Brief: Pros and Cons of Corporate Codes of Conduct. Editorial Board,
pp.125-130. [Retrieved from
http://www.jopafl.com/uploads/issue9/PROS_AND_CONS_OF_CORPORATE_CODES
_OF_CONDUCT.pdf]