Ethical Issues in Business Essay Example

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Ethical issues in business
Ethical issues arising from the nature of markets
- The 18th Century economist Adam Smith demonstrated how in a free market the self interest of producers and consumers will produce an outcome desirable to all concerned
- But the market can also lead to inequality of income, wealth and market power: * Monopoly suppliers can exploit consumers * Monophony buyers can exploit supply firms * World wide inequality of income can result in unethical practices such as the child labor
Ethical issues and society - examples 1. Involvement in the community 2. Honesty, truthfulness and fairness in marketing 3. Use of animals in product testing 4. Agricultural practices e.g. intensive faming 5. The degree of safety built into product design 6. Donation to good causes 7. The selling of addictive products e.g. tobacco 8. Involvement in the arms trade
Ethical issues arising from internal and industry practices - examples 1. Treatment of customers - e.g. honoring the spirit as well as the letter of the law in respect to warranties and after sales service 2. The number and proportion of women and ethnic minority people in senior positions 3. Employment of disabled people 4. Bribes to secure contracts 5. Business practices of supply firms
Unethical practices in marketing - examples 1. Pricing lack of clarity in pricing 2. Dumping – selling at a loss to increase market share and destroy competition in order to subsequently raise prices 3. Price fixing cartels 4. “Bait and switch” selling - attracting customers and then subjecting them to high pressure selling techniques to switch to an more expensive alternative 5. High pressure selling - especially in relation to groups such as the elderly 6. brand piracy 7. Copying the style of packaging in an attempt to mislead consumers 8. Deceptive advertising 9. Irresponsible issue of credit cards and the

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