Business Ethics Term Paper

Pages: 5 (1692 words)  ·  Style: APA  ·  Bibliography Sources: 7  ·  File: .docx  ·  Topic: Business - Ethics

¶ … business ethics are, and what they mean to the organization and the individual. Business ethics mean different things to different people, which is quite clear in the way some unethical organizations do business. Throughout history, a high standard of ethics has been the responsibility of most businesses, but in today's world, the most important aspect of business is making money. That means for many organizations, ethics are ignored in favor of the bottom line. This essay explores the ethics of business, and what those ethics mean for the organization and the individual in the organization.

What are business ethics?

According to Answers.com, business ethics are the "Moral principles concerning acceptable and unacceptable behavior by business people. Executives are supposed to maintain a high sense of values and conduct honest and fair practices with the public" ("Definition," 2008). Another author writes this definition, "I use the word to mean the guidelines or rules of conduct by which we aim to live" (Cadbury, 2002, p. 12). Perhaps the most important aspect of business ethics is that just about everyone believes in them, and so, that makes them almost universal in their use and utility (Hunkin, 2002). Thus, ethics covers organizations, but they also cover the individuals that make up those organizations. These ethics cover every aspect of business, from the CEO on down, or at least they should.Buy full Download Microsoft Word File paper
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Term Paper on Business Ethics Are, and What They Mean Assignment

These ethics should govern decision-making and business practices throughout any organization, and there is no organization, large or small, that does not face ethical decision making at some point in time. Ethical decisions are difficult, because they force the decision-maker to reflect on the benefits the decision may create, against the negative consequences the decision could create. These negative consequences could affect an individual inside the organization, many individuals, or the entire organization. Clearly, business ethics is a difficult topic, because most decisions contain both positive and negative results. In the end, the decision should contain the solution with the least negative impact, but, since decisions are often relative, that is not always the case, and that is one of the many problems with business ethics.

Because business ethics are such a concern, several "watchdog" organizations have sprung up to help govern ethical business decisions, and some of these organizations even offer ethical training for businesspeople and others. One group, the Ethics Resource Center, offers training in character development for young people, human resource evaluation training, and conducts research on business ethics across the nation and the world. They will help organizations develop ethical standards and practices, and have been involved in education and research about ethics for over 85 years. That is a surprising statistic, because some people may believe that ethics, or the lack of ethics, in business is a relatively new phenomenon, but this organization indicates that is not the case.

The organization

There is not a business today, large or small, that does not face some kind of ethical decisions in its history. Author Cadbury continues, "It is worth noting that the majority of business decisions do have an ethical content. [...] it is really a thread which runs through all the functions and all the aspects of a business" (Cadbury, 2002, p. 11). Small or large, there are always ethical decisions for decision-makers to address. However, ethics in corporations and organizations can, at least in part, be controlled, because there are basic laws that organizations must follow, and these laws help keep the companies ethical, whether they want to be or not. Cadbury notes, "The company framework is set by the law and by regulations, which are not quite the same thing as the law, but which we have to abide by although they are not necessarily statutory" (Cadbury, 2002, p. 12). However, businesses who are the most successful at balancing ethics and decision-making are not the businesses that make ethical decisions because the laws force them to, but the businesses that make ethical decisions because it is the right thing to do. These businesses will be more successful just because they are honest and ethical, not because they are afraid of breaking the law.

Many people believe that it is not possible to make ethical business decisions and still make profits for the company, but many companies are proving that theory wrong. One of the most common ethical problems many businesses face is a conflict of interest between individuals in the business. Another writer notes, "[T]he Ethics Officer Association conducted a survey of 213 members representing 150 firms and found that the most widely mentioned reason (by a large margin) for contacting the ethics office was conflicts of interest, cited by 74% of respondents" (Vickers, 2005). Conflicts of interest can be difficult to deal with, and individuals with conflicts of interest should note them immediately, so they do not put their organization and its decision-making in a bad light.

Because business ethics is such an important topic, many schools are beginning to teach business ethics as an integral part of business education. However, not everyone believes those courses teach the right ethical solutions. Two other writers note, "Heath and other critics charge that business-ethics courses spend too much time on public-policy issues such as environmentalism and inequalities of wealth and not enough time examining such personal virtues as truth-telling and integrity that are relevant to the Enron matter" (Berlau & Spun, 2002). Enron, is of course, the poster child for an unethical organization, and in the end, their practices bankrupted the company. Enron's principles were guilty of one of the most unethical practices - greed - and that is something that can cause many individuals to make unethical decisions. As two other writers note, "Corporate executives are overachievers and are sometimes guilty of testing the borders of ethics" (Gray & Clark Jr., 2004). The organization must guard against these practices, either with internal controls, or with trusted auditors and procedures, and if they do not, they could suffer the ultimate consequences - the dissolution of the organization.

The individual

The individual in an organization represents that organization, and so, their ethics, or lack of ethics, reflects on the entire organization. For example, it is fairly common for individuals with fiscal responsibilities to embezzle funds from their organization. When this happens, it shakes the trust and faith of the individual's supervisors and coworkers, but it reflects poorly on them, as well, since they had at least some responsibility to keep such kinds of theft from occurring. It also makes the organization look bad; since they do not have accounting practices in place that would keep this activity from occurring. Thus, the ethics of an individual can affect the entire organization, and so, it is important to stress individual ethics within the organization, along with corporate ethics that covers the entire organization.

Another example of the ethical decisions an individual must face in the business world concerns the case of a fictional sales rep named "Mary," who only needs $1,000 more dollars in sales revenue to gain a large bonus from her company. She thinks about "donating" $1,000 to one of her clients, a local school, so they can purchase her products and put her sales goal over the top. However, this decision is unethical because she did not reach the sales goal legitimately, and other salespeople might do the same thing, leading to a financial disaster for the company and bad feelings toward Mary when the company found out. In the end, Mary did not feel comfortable with her scheme, and did not donate the money to the school (Horowitz, 2007). This is a simple example of an individual faced with an ethical decision, and deciding not to do something that is unethical, that could ultimately reflect badly on her and her company. She made the right… [END OF PREVIEW] . . . READ MORE

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