Business Ethics

Business Ethics

Difference between being ethical and legal
1. Ethics
  1. About what is right and what is wrong
2. Law
  1. About what is lawful and what is unlawful
Benefits and possible drawbacks of behaving ethically
1. Benefits
  1. Higher Revenues- Demand from positive consumer support
  2. Improved brand and business awareness and recognition
  3. Better employee motivation and recruitment
  4. New sources of finance- e.g ethical investors
2. Possible Drawbacks
  1. Higher Costs- e.g sourcing from Fairtrade suppliers rather than lowest price
  2. Higher overheads- e.g training & communication of ethical policy
  3. A danger of building up false expectations
What are ethics?
1. Morals of the people working in the business
2. What is right or wrong
Common areas where ethics are tested in business
1. Advertising
2. Personal Selling
3. Suppliers
4. Contracts
5. Pricing
Different Approaches to How Ethical a Firm is
1. The amoral business
  1. Seeks to win at all costs
  2. Anything is acceptable
2. The legalistic business
  1. will obey the law but no more than that
3. The responsive business
  1. Accepts that being ethical can pay off
4. The ethical business
  1. Ethical practice is at the core of the business
Evidence/ Examples of businesses caught acting unethically
1. News Corp & NOTW phone-hacking
2. Banks- miss-selling of payment protection insurance
3. Electronics brands & clothing retailers using sweatshop labour in emerging markets
4. Supermarkets selling very low-priced alcohol
5. Firms accused of avoiding tax: e.g amazon; Arcadia Group and Vodafone

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	Created by laura-wilson134 about 11 years ago