The Role of Ethics in Business

Topics: Ethics, Business ethics, Management Pages: 6 (1789 words) Published: November 3, 2012
Public Health vs. Free Speech

Over the past years, corporate governance and business ethics have gained a great amount of public interest due to its implication in the economic health of organisation. Such cases as Enron, WorldCom, and Oracle just to name a few in recent years have made world headlines outlining the governance of unethical behaviour comprising of corporate fraud, dubious accounting, and abuse of power that shocked the world and rattled the realm of business ethics. As a result, the role of ethics in the pursuit of business has come to the forefront of many of today’s current issues.

Business ethics is the applied study of understanding the application of ethical behaviour and concentrates on the moral standards as they apply to business policies, institutions, social systems, and behavior (Velasquez, 2012). According to Ronald Sims (2003), an organisation’s moral ethics is demonstrated by how it abstains from behaving in a manner contrary to the well-being of society. Moral standards are the kinds of actions and beliefs that are believed to be morally right or wrong or otherwise good or bad. The application of the concept of business ethics is administered by the corporate governance of an organisation (Urlacher, 2008). As business ethics represent an organisation’s principles and values when conducting business; corporate governance is the organisation’s structure on how it implements to govern and protect those associated with the organisation with the actions of those decisions determining the direction of an organisation’s performance (Fernando, 2012).

Corporate governance embodies leadership that governs an organisation’s core values, beliefs, and polices that influence its strategies and decisions. It is the system by which organisations are authoritatively directed and controlled (Colley, Doyle, Logan, Stettinius, 2004). All corporate entities comprising of profit and non-profit orientated companies, public and private, partnerships, joint ventures, community organisations, academic institutions as well as governmental corporate entities have to be governed (Tricker, 2012). It is through the conduct of the basic principles of integrity, responsibility, accountability, honesty, and trust (Tirole, 2001) that leaders and managers are guided by to fulfill their goals and objectives into which is beneficial for the organisation and its stakeholders. For instance, leaders, managers, and executives face many kinds of ethical issues on a daily basis, however, unless these issues are initially sorted out and distinguished from each other it can prove to be extremely complicated and confusing. According to Bhal and Sharma (2004), three of the main business ethic issues are systemic, corporate, and individual. Systemic issues are ethical questions raised about the political, legal, economic and institutional sector within which a business operates. It also includes the morality of the laws, regulations, industrial structures and social practices. Corporate issues are ethical questions raised about a specific organisation including questions about the morality of the activities, policies, practices or organisational structure of an individual organisation. Lastly, individual issues are ethical questions raised about the moral decisions, actions, and character of an individual or group of individuals within an organisation. By identifying these types of ethical issues it helps those involved in the governance of the organisation in developing a better understanding of ethics in a more informed manner when analyzing ethical issues that deal with uncertainties

Now as opposed to using an example of a financial organisation’s unethical pathway to embezzlement or fraud I have chosen a slightly different issue illustrating systematic and corporate ethics in the world of business. The assertive anti-tobacco movement implemented throughout governments across the globe to debrand cigarette packaging is now...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Essay about Business Ethics
  • Business Ethics Essay
  • business ethics Essay
  • Business Ethics Essay
  • Business Ethics Essay
  • Essay about Business Ethics
  • Business Ethics Paper
  • Business Ethics Essay

Become a StudyMode Member

Sign Up - It's Free