Transcript Business Ethics - Philosophy & Ethics

Business Ethics
What is Business Ethics?
• The ethical relationship between
businesses and consumers
• The ethical relationship between
businesses and their employees
• The impact of globalisation on the
environment and society in general
Main issue:
the purpose of business
• Is it all about making money – unbridled
capitalism?
• Or do businesses have moral
responsibilities towards their
stakeholders?
Social responsibility
• The business philosophy that states that
businesses have a duty and an obligation to
its stakeholders. It emphasises that
business should behave as good citizens.
• They should consider the effects of their
activities on society as a whole on the
stakeholders.
Stakeholders?
Share
Management
Employees
holders
The
Business
Government
Customers
Local
Community
Environment
Suppliers
Stakeholders
•
Shareholders
Generate profits and pay dividends
•
Customers
provide good quality products at
reasonable prices.
Safety, honesty, decency and
truthfulness
•
Employees
health and safety at work, security,
fair pay
•
Suppliers
pay on time, pay fair rates
for the work done, provide element
of security
• Local Community
provide employment, safe working
environment, minimise pollution
and negative externalities –
provide external benefits?
• Government
abide by the law, pay taxes, abide
by regulations
• Management
their aims versus those of the
organisation as a whole
• Environment
limit pollution, congestion,
environmental degradation,
development, etc.
Goldman Sachs
•
THE 10-HOUR TORTURE SESSION OF GOLDMAN SACHS EXECUTIVES BY US SENATORS
ON TUESDAY 27TH APRIL 2010 DISCLOSED A VERY BASIC DISAGREEMENT BETWEEN
THE WORLD'S MOST POWERFUL INVESTMENT BANK AND THE WORLD'S MOST
POWERFUL LEGISLATURE.
•
http://www.bbc.co.uk/blogs/thereporters/robertpeston/2010/04/goldman_consequences_of_the_se
.html
http://news.bbc.co.uk/1/hi/business/8645945.stm
•
Goldman Sachs
•
•
GOLDMAN SACHS TRIED TO EXPLAIN, TIME AND AGAIN, THAT
MARKET MAKING - IN ITS VIEW - OPERATES OUTSIDE OF ANY
ETHICAL OR MORAL UNIVERSE: THE ROLE OF GOLDMAN'S MARKET
MAKERS IS TO PROVIDE A PRODUCT TO GROWN-UP INVESTORS,
NOT TO ENDORSE THAT PRODUCT IN ANY WAY.
IN THAT SENSE GOLDMAN VIEWS ITS MARKET MAKERS AS AMORAL
(THOUGH, OF COURSE, NOT IMMORAL).
Relationship between Business
and Consumer
• Originally this simply meant not conning
the consumer to buy something he/she
didn’t need.
• Quality, safety, price and good customer
service.
• Open All Hours.
Relationship between Business
and Consumer
• But now the consumer wants to see social
responsibility from the businesses it buys
from. Eg
– Good treatment of employees
– Putting back into the community
– Environmental concern (think recyclable
packaging etc)
– Not using sweat shops etc
Relationship between Business
and Consumer
• http://news.bbc.co.uk/player/nol/newsid_6
210000/newsid_6219900/6219990.stm?b
w=bb&mp=wm&news=1&nol_storyid=621
9990&bbcws=1 Tesco, Asda & Primark
found selling products made in sweat
shops. Dec 2006
HW
• Research companies that use sweat shop
workers, or some other unethical practice.
What have consumers made of it?
• Bring in information to next lesson.
Relationship between Business
and Consumer
• http://www.ethicaltrade.org/resources
Relationship between Business
and Consumer
• The Body Shop was perhaps the first
British company to realise this and
become an ethical business.
• http://www.thebodyshop.co.uk/_en/_gb/val
ues-campaigns/index.aspx
Relationship between Business
and Consumer and Employee
• Likewise, the Co-op http://www.cooperative.coop/ethicsinaction/
Relationship between Business
and other Stakeholders
• Nestle are cleaning up
their act?
• http://www.icmrindia.org/c
asestudies/catalogue/Bus
iness%20Ethics/BECG03
2.htm
• http://www.babymilk.nestl
e.com/
• http://www.thetimes100.c
o.uk/case-study-business-principlesaction---nutritionallabelling--7-263-2.php
Social Responsibility
• Also BT & ChildLine
http://www.bitc.org.uk/resources/case_stu
dies/afe1184_btchildline.html
• DHL
http://www.dp-dhl.com/en/responsibilityonline_report_2010.html
A New Industrial Revolution?
• William McDonough (architect) and Prof
Dr Michael Braungart (Leuphana
University of Lüneburg, Germany)
• “Cradle to Cradle”
• Developed tools to design eco-effective
products and business systems.
• A new paradigm of business ethics.
A New Industrial Revolution?
• While current strategies of eco-efficiency seek to
reduce and minimize the unintended negative
consequences of processes of production and
consumption, the concept of eco-effectiveness
is that we need to achieve a fully sustainable
system of consumption and production.
• Based on the successfully interdependent
nature of biological systems.
A New Industrial Revolution?
A New Industrial Revolution?
• So, when you’ve finished with your iPod you
return it to Apple for them to reclaim and reuse.
• You effectively ‘rent’ consumables, you don’t buy
them.
• It would ensure that companies make things that
last, and that what you use is reused properly.
• http://www.braungart.com/vision.htm
• http://www.mcdonough.com/cradle_to_cradle.ht
m
A New Industrial Revolution?
• This essentially is the link between
business and environmental ethics.
• Because, in short, good social
responsibility includes a concern for the
environment’s sustainability.
A New Industrial Revolution?
• Ray Anderson, Interface.
http://www.youtube.com/watch?v=OUG4JXE6K4A
http://www.youtube.com/watch?v=IkWd3cMo0yA
http://www.inc.com/magazine/20061101/green50_industr
ialist.html
http://www.interfaceglobal.com/Sustainability/OurJourney.aspx
http://www.gpiatlantic.org/conference/proceedings/ander
son.htm
http://www.ted.com/index.php/talks/ray_anderson_on_th
e_business_logic_of_sustainability.html
Summary
• Business Ethics reflects the relationship
between a business and its stakeholders.
• Major issues surround the treatment of
employees and consumers – ie social
responsibility.
• The other major issue is sustainability.
Task
• Read p247f of Oliphant re the ethical
stances to business ethics.
• Create a diagram that links up each ethical
stance with the areas of consumer,
employee and environment.
Task
• Plan an essay about environmental or
business ethics.
• Suggested format:
• “___________ is the best approach to
_________ ethics”
• Write the essay for next week.