University Report: Sustainability and Ethics in Woolworths

This report provides a detailed analysis of sustainability and ethics, focusing on the case of Woolworths Supermarket. It begins by exploring the importance of ethical considerations in business, presenting arguments both supporting and opposing the implementation of ethical practices. The report examines Woolworths' ethical performance, including its response to a wage scandal, and assesses how ethical considerations impact its brand image, employee morale, and competitive advantage. It references relevant theories such as stakeholder value theory and deontology, and analyzes the benefits and drawbacks of prioritizing ethics in business operations. The report concludes by summarizing the key findings and discussing the balance between ethical considerations and maximizing profitability, providing insights into how businesses like Woolworths can operate ethically while maintaining competitiveness.

Running head: SUSTAINABILITY AND ETHICS
Sustainability and Ethics
Name of the Student
Name of the University
Author note

1SUSTAINABILITY AND ETHICS
Table of Contents
Introduction......................................................................................................................................2
Proposition 1 (Supporting Resolution)............................................................................................2
Proposition 2 (Against the Resolution)............................................................................................4
Conclusion.......................................................................................................................................6
References........................................................................................................................................8

2SUSTAINABILITY AND ETHICS
Introduction
The assignment helps in analyzing and proposing a debate on the topic-
Ability to
Understand the Importance of Ethical Considerations. The main aim and purpose of the
assignment is to take two positions which are mainly supporting and against the resolution and it
will be written with the help of logical arguments and relevant theories. The organization which
has been taken in the respective assignment is Woolworths Supermarket which was formed in
the year 1924 and it is headquartered at Australia. The organization has been highly capable as
they are serving in more than 1024 locations and due to the same; they are successful in covering
more than 80% of the Australian economy. It falls under the retail industry an in the current
scenario, they prefer to be highly innovative in nature which impacts their entire presentation in a
positive manner (Woolworths.com.au, 2020).
Proposition 1 (Supporting Resolution)
As commented by Xu and Ma (2016), the different customers, management along with
employees play a vital role in managing the ethical processes and they appreciate ethical and
honest practices in a suitable manner. In addition, as opined by Werhane (2019), business ethics
are vital for the companies as they help in maintaining the great reputation, help in avoiding
significant legal or financial issues and ultimately benefit everyone who is involved in the
respective process. Every organization should be having their own moral principles that can be
helping them in keeping and attracting the customers, employees as well as investors. As
commented by Skinner (2019), business ethics is coming to know what is right and what is
wrong and ethics need to be fixed for everyone working in the company at any level and their
implementation is mainly linked with the reward and punisher system.

3SUSTAINABILITY AND ETHICS
For instance- In case of Woolworths, it has been noted that the company is not capable
of maintaining their ethics and they faced the Pay Scandal. The supermarket giant’s
unprecedented underpayment scandal is more severe than the first thought and it has even caused
severe drop in the entire profitability of respective organization. Woolworths owes thousand of
staffs up to $300 million for the underpayment of wages and super stretching back nine years.
Due to the same, it impacted the morale of employees as they felt there is no proper maintenance
of business ethics and ethical considerations in the company and there was huge turnover.
However, soon after Woolworths realized, the company apologized to their workers and they
repaid back the wages within a short span of time (Woolworthsholdings.com.au 2020).
From the analysis of the respective company, it can be seen that business ethics and the
ethical considerations play a vital role in maintaining the brand image of Woolworths or other
organizations and there are different other benefits which are explained as follows:
Firstly, it helps in providing the competitive advantage over the different competitors
present in the market as when the company in an ethical manner, they can attract the customers
towards the different products and services (McCloskey 2017). From the Unilever survey, it can
be seen that one third of customers choose to purchase from the brands which are making
positive social as well as environmental impact.
Secondly, with proper ethical considerations, it will be helping in improving the
happiness of the employees. In such kind of business scenario, the employees will be feeling
highly comfortable working for the business which is behaving ethically. In Woolworths, the
company has been capable of repaying the salary to various kinds of employees which made
them ethically responsible (Skinner 2019).

4SUSTAINABILITY AND ETHICS
In addition, from the analysis of Woolworths, it has been clear that unethical behavior or
the lack of corporate social responsibility can be damaging the reputation of the firm to a large
extent. As described by Jones, Harrison and Felps (2018), the proper and ethical behavior are the
two key elements for the organizations for measuring the success of overall organization as the
creative along with well-managed corporate as well as social responsibility programme is in best
interests of the different stakeholders who are the crucial part of the company. In addition, any
executive of the company are required to be ethical wherein they should be capable of handling
the different responsibilities which will be making them their role model for the other
subordinates present in the market.
As per the
Stakeholder Value Theory, as argued by Hughes (2019), the only social
responsibility and ethical practice of business is to develop their profits while following the legal
norms in an effective manner. The authors have commented that function of business is doing
proper business which helps in contributing towards the society and economy and in such
scenario, the cooperation of the different employees; customers and other stakeholders play a
vital role in improving the scenario and gain competitiveness. In any kind of business, the
stakeholders are the crucial element in the business and in such scenario, maintaining ethics play
the vital role in managing their growth and revenues in a proper manner.
Proposition 2 (Against the Resolution)
On the other hand, as commented by Harrison, Felps and Jones (2019), the ethical
compliance within the company is done mainly for the benefit of the organization along with
employees. A well-crafted ethical compliance will be helping the business along with employees
in making the day to day decisions in a suitable manner. On contrary, as commented by Skinner

5SUSTAINABILITY AND ETHICS
(2019), the primary objective behind doing the business by the different organizations all over
world is for making high level of profits and creating high amount of wealth for their
stakeholders. As commented by McMurrian and Matulich (2016), when the company is
following the different ethical considerations in business, there are chances that there can be lack
of profitability in comparison to the other competitors present in competitive economy.
For instance- In Woolworths, the company has been highly involved in the different
ethical and CSR practices through which they tried to empower their employees for making them
understand the importance of the ethicality which is needed and maintained in the business.
However, in the entire process, the main loophole which was being noticed that that the
productivity of respective organization Woolworths was declining and it impacted their level of
performing the business negatively (Woolworths.com.au 2020).
Moreover, in case of Woolworths, when the company was being held for the
underpayment of wages scandal, it was being noticed that in order to rectify their mistake, the
company tried to adopt the ethical practices suitably. However, as commented by Crane et al.
(2019), the main problem which was being noticed was that it is the long-term process wherein
considerable amount of discipline and effort on the part of Woolworth or other companies is
highly necessary that will be impacting their level of profitability which could have been earned
by them.
It is highly difficult for the different sized companies to follow all the ethical practices as
the big companies like Woolworths or Wal-Mart can tend to lose some business for doing
business ethically. The same has been done by Woolworths during the time they tried to manage
their scandal in the case of payment of low wages to the different workers. As opined by Skinner

6SUSTAINABILITY AND ETHICS
(2019), in the
Deontology Ethical Theory, it has been mentioned that the different people needs
to adhere to the different obligations as well as duties while they are highly engaged in the
decision-making when ethics are in complete play (Chen 2019). However, it has been mentioned
in the theory that while managing the different kinds of activities in the company, the main
problem is the creation of balance between being ethical and maintaining the level of
profitability which is their main motive. It helps in understanding the conflict faced by the people
while trying to make the duties effectively and it can be creating pressure on them for choosing
one out of the many options which are available to them (Harrison, Felps and Jones 2019).
Conclusion
Therefore, it can be concluded that the business ethical considerations play a vital role in
managing the reputation of the business through increasing the level of profitability and sales of
the company as a whole. However, from perspective of the different business ethical
considerations, it is highly clear that development, maintenance along with maintenance of the
ethical practices can be limiting the freedom in maximizing their profitability. Luckily, there are
different kinds of ways for operating ethically which will be allowing the business to operate
which will be best suiting them.
For instance- In case of Woolworths, in case of being ethical always, the company is
losing out regarding gaining profitability. However, advertising can be capable of boosting the
brand awareness and sales of the company as a whole which will be suitable for improving the
growth of the company as a whole. Through the usage of the two major theories of the business
ethics, it can be inferred that the ethical considerations have advantages and disadvantages and it

7SUSTAINABILITY AND ETHICS
highly depends of the top management of the company whether they prefer to earn profit or want
lesser profits and high level of respect from the society as well.

8SUSTAINABILITY AND ETHICS
References
Chen, Y., 2019. Deontology to Judge the Ethical Business Actions: The Case of Takata. Open
Journal of Business and Management, 7(2), pp.783-787.
Crane, A., Matten, D., Glozer, S. and Spence, L., 2019. Business ethics: Managing corporate
citizenship and sustainability in the age of globalization. Oxford University Press, USA.
Harrison, J.S., Felps, W. and Jones, T.M., 2019. Instrumental Stakeholder Theory Makes
Ethically Based Relationship Building Palatable to Managers Focused on the Bottom
Line. Academy of Management Review, 44(3), pp.698-700.
Hughes, R.C., 2019. Exploitation, Deontological Constraints, and Shareholder Theory. Geo. JL
& Pub. Pol'y, 17, p.1007.
Jones, T.M., Harrison, J.S. and Felps, W., 2018. How applying instrumental stakeholder theory
can provide sustainable competitive advantage. Academy of Management Review, 43(3),
pp.371-391.
McCloskey, D.N., 2017. Wealth, Commerce, and Philosophy: Foundational Thinkers and
Business Ethics. University of Chicago Press.
McMurrian, R.C. and Matulich, E., 2016. Building customer value and profitability with
business ethics. Journal of Business & Economics Research (JBER), 14(3), pp.83-90.
Skinner, H., 2019. The impact of cultural values and economic constraints on tourism
businesses’ ethical practices. International Journal of Tourism Cities.

9SUSTAINABILITY AND ETHICS
Werhane, P.H., 2019. The normative/descriptive distinction in methodologies of business ethics.
In Systems Thinking and Moral Imagination (pp. 21-25). Springer, Cham.
Woolworths.com.au 2020 Woolworths Supermarket (Online) Retrieved from
https://www.woolworths.com.au [Accessed on 12th April 2020]
Woolworthsholdings.com.au 2020 Woolworths- Shop Ethical (Online) Retrieved from
https://www.woolworthsholdings.com.au [Accessed on 12th April 2020]
Xu, Z.X. and Ma, H.K., 2016. How can a deontological decision lead to moral behavior? The
moderating role of moral identity. Journal of Business Ethics, 137(3), pp.537-549.