Business Ethic is an Oxymoron?

Topics: Ethics, Business ethics, Immanuel Kant Pages: 9 (2410 words) Published: October 3, 2010
QUESTION 2: BUSINESS ETHIC IS AN OXYMORON?

INTRODUCTION

When car manufacturers produce cars due to their customers need cars, it damages the environment and became a causing factor of global warming. For the society, is it an ethical behavior? The organization itself think this behavior is ethical because manufacturers do the 'right' thing which is increasing profit for the corporation and meet the needs of their customers, others will regard it as an ethical problem because it destroys the living environment. There is a contradiction of business ethics and this essay will discuss whether 'Business Ethics is an oxymoron or not'. It will compare the traditional and modern role of managers and then the essay will provide some ethical theories to explain the reasons of views that business ethics is or isn't an oxymoron. In addition, it will provide the demonstration of the importance of ethics in corporations. The essay will give some examples to present how business and ethics mutually work in the business fields and evaluation of some controversial cases by using non-consequences theory as well. Finally, there will be a short conclusion.

REASONS

Ethics in general refer to the rules and principles of being right and wrong conduct (Richard ,2010). However, ethics in business environment is more complex when it involves all of organizational aspects. It has a strong influence on the effectiveness of companies (Sargent, 2007). But, not all organizations doing their business ethically and they indeed avoid doing ethically because they regarded it as a barrier to achieve their goals. The reasons that why organizations choose doing unethically is influenced by their views of the relationships between social responsibility and organizational goals. There are two main opposing views of social responsibility which are classical view and socioeconomic view. The classical view says that management's only social responsibility is to maximize profits (Branco & Rodrigues, 2007). Milton Friedman also argued that manager's essential responsibility is to operate the business and meet the best needs of the shareholders (Kelly, 2002). From this view, it regards business ethics as an oxymoron because business is seen to accomplish the pursuit of self-interest while ethics is always recognized as a consideration of others (Collins, 1994). People who hold this view will choose doing the thing which is 'good' for their organizations without caring about others.

On the other hand, the socioeconomic view states that managers should also consider about protecting and improving society's welfare when they are making profits to the company (Collins, 1994). Supporters of the socioeconomic view contend that managers should be concerned with maximizing financial returns and contribute themselves to their community (Wartick & Cochran, 1985). A more effective managerial role must be operating in an interdependent environment and they think the success of a corporation cannot be without the help of employers, suppliers and customers (Wartick & Cochran, 1985).

THEORIES

EGOISM

The key difference between these two perspectives is the people to whom organizations are responsible. Shareholders will be viewed as the main concern by classical view while others would say that managers are responsible to any group which affected by the organization's decisions and actions (Carrillo, 2007). These differences can be explained by the ethical theories. The behavior of traditional view can refer to Egoism. According to it, an action is _"morally right if the decision-maker freely decides in order to pursue either their short-term desires or their long-term interests"_ (Andrew & Dirk, 2010). Adam Smith argued that "_The pursuit of self-interest in business field is proper because it produced an ethical desirable outcome for society_" (Andrew & Dirk, 2010). People who think business ethics is an oxymoron because they think organization have to...
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