Discuss about the Corporate Responsibility and Ethics for Sustainability and Public Relations.
Corporate Responsibility and Ethics means to integrate corporate self-regulation into a business model. It is a self regulatory mechanism so that the business can monitor its activeness to ensure the compliance related to law and ethical standards. It aims at increasing long term profit of the organization, building shareholders trust by maintaining positive relations and high ethical standards with the public to avoid legal risk and business harm. Many consumers believe that business should not only focus on making profit but should also take social implications of the business activities into consideration. It is the obligation of the corporate to maximize positivity and minimize negativity of its business impact on the society.
The laws; and rules and regulations that basically encourages corporate to maintain high ethical standard, attitude and values are the basic ethical conduct (Mermod, A and Idowu, S, 2013). It is the duty of the corporate managers to maintain these ethical codes of conduct in an organization. The conflicts and problems that take place in a corporate can be avoided if the managers work accordingly to the ethical values and conduct prescribed by the company.
There are good reasons for maintaining ethical values in an organization.
Business ethics means to realise the difference between the wrong and right business practices in a corporate (Hill, B, 2016). When the principles of honesty and fairness are applied in a business it will develop the relationship of the workers and employees in a positive way. The advantages are as follows:
Build Customer Loyalty
Consumers can let a company take a negative advantage of them only once, when they realise that they have been treated in an unfair manner like if the customers are over charged or defective product is offered, they will not become a repetitive customer of the company. (Ferrell, O and Fraedrich, J, 2016). Therefore it is very important for a company to maintain ethical values to build customer loyalty and to attract more customers.
Positive Work Environment
The employees of the company should be honest and fair since the very beginning, from the interview itself (Stanwick, P and Stanwick, S, 2015). Ethical employees will help in maintaining sustainability in a corporate. Trust factor will be developed between the employees and the employers (Giacalone, R, Jurkiewicz, C and Dunn, C, 2005).
The multinational Corporations are usually been accused of indulging in conflicts related to human rights and many environmental issues relating to operations, and due to this they have become the targets of many social activists. Shell group of companies normally operates in the region of Nigeria. It is a multinational oil corporation which is generally being accused of irresponsibility in their operations that are seriously injustice, creates unhappiness and pain, and violates the basic human rights and hindrance to promote flourishing lives to the society. Shell is engaged in polluting the environment by producing harmful substances that are detrimental to the health and live. The Government has highlighted the unethical conduct of Shell in Niger Delta that is against the human rights.
The parent company of Shell, Royal Dutch Shell is denying its responsibility to control the pollution of its subsidiary. Due to this Shell Nigeria has been challenged by the Dutch Court, for violating the human rights and the non compliance of environment laws (Williams, C, 2009). Shell should ethically start working with the Nigerian Government and other Foreign Government to eliminate the negative impact of its operations which are responsible in causing great environmental damages in Nigeria and other local communities by making excessive release of Carbon dioxide that causes global warming.
The Government plays a vital role in encouraging the business to maintain ethical values and standards in their activities. We cannot assume that a corporate can follow the ethical values perfectly without the strict governance of the government (Pompper, D, 2015). The enforcement of various laws and policies concerning corporate social responsibility and ethical code by the government is mandatory to bring sustainability in social values. The Government has the following role:
To ensure the compliances of corporate to follow ethical obligations, legislation is necessary so that the public do not suffer because of unethical and dishonest business practices (Breslin, C, 2016). The legislature rules helps in preventing the business practices related to bribery and dishonesty. It was developed that those business which do not have legislature rules imposed by the government tends to engage in more of unethical business practices (Morrison, J, 2015).
In the context of business ethics, Government has plays a supervisory role. When organizations merges or are taken over by another business it results in anti- competitive behaviour, as a result that organization becomes a monopoly in the market thus engaging itself in the act of unethical business practices (Brink, A, 2011). These practices are detrimental to the interest of the general public. To avoid unfair practices in such acquisition and merger, Government tends to play a supervisory role.
The government has introduced the system of providing incentives to those corporate who complies with the ethical code prescribed by the government (Sullivan, P, Smith, M and Esposito, M, 2012). The companies having environmentally friendly practices are often awarded because of its effective environmental policies concerning ethical standards. Those companies that are wasting energy and cannot maintain proper waste disposal system are not entitled for such incentives (Fleming, P, Jones, M, 2012).
According to the local communities, Shell’s operation is regarded as ethically unacceptable due to lack of environmental protection and degradation of their own operations (Burger, A. (2011). Shell is a partner and a participant of National Society of that country where it operates. Therefore it is the moral obligation of the company to maintain all the rights and obligation for the aid of local government and communities; and to help them in establishing policies; rules and regulations to protect the environment by using the resource and knowledge that is available to Shell. As we know that the Government has started to take actions against companies that are causing harm to the environment by the explosion of harmful substances and creating pollution (Cross, F and Miller, R. (2008); Shell has a moral obligation to promote and ensure a clean environment to live in for the future generations. Shell no longer keep interest only in making profit but also works for the betterment of the community and promote the basic rights of the society by providing a safe and clean environment to live. It has made progress in this context, but is a little away from making it fully accomplished.
Many underdeveloped countries lack the existing rules and regulations which are related to environmental concern and social issues. So it becomes the duty of the corporate community to maintain adequate standards and not to be accused of immoral and unethical policies. Currently Shell Oil not only works to increase production but also makes sure that the company is not engaged in creating pollution that becomes harmful in maintaining sustainability.
Other industries should implement plans and policies like Shell and promote sustainability by maintaining standards and ethical values in their corporate strategy planning. Shell has begun to maintain this and hence it should be continued.
Various social active groups have been formed to stop the harmful activities performed by Shell in Nigeria. These groups are working by conducting research and imparting education related to the environmental issues and social values of the oil industry. A few of these social group includes- Environmental Rights Action and Niger Delta Human and Environmental Rescue Organization. These groups along with other social group aims at bringing a positive change in the ethical standards and values that Shell should follow. Various efforts have been taken by Shell to avoid such issues. Shell now takes initiative to clean the oil spills, and reduced the gas flaring. Shell is now showing self determination to comply with the ethical standards imposed by the government and other social activists.
Conclusion
Corporate Responsibility and Ethics plays a very important role in maintaining sustainability and stability in business activities. A good business ethical code of conduct will help the company to have competitive advantage over their competitors. Customers will be attracted and will show interest in making investment in shares by establishing long term relations with the concerned company. If a company is not maintaining good ethical policies the company will have a bad reputation in the market, it can also cause into a scandal related to fall in stock price, low morale among employees and can also lead shut down of business activities.
Local communities in Nigeria are highly disappointed by the unethical practices followed by Shell. Shell is engaged in polluting and degrading the environment; and makes it a harmful place for future generation to live in. Due to the strict action imposed by the Government of Nigeria on Shell, it is now showing helpful hands in resolving this environmental problem. Shell along with many other social activists in Nigeria cleans the oil spills, and also aims at reducing air flaring. Self realisation is very important to maintain ethical standards and value in an organization, by creating social corporate responsibility Shell has been successful in creating a feeling of morale and dedication among the workers. Employees are willing to work together to achieve the predetermined goals of Shell.
References
Breslin, C. (2016). Role of Government in Business Ethics, Viewed 27 September 2016 from https://smallbusiness.chron.com/role-government-business-ethics-65128.html done
Hill, B. (2016). The Advantages of Ethical Behaviour in business, Viewed 27 September 2016 from https://smallbusiness.chron.com/advantages-ethical-behavior-business-21067.html done
Pompper, D. (2015). Corporate Social Responsibility, Sustainability and Public Relations: Negotiating Multiple Complex Challenges. Routledge.
Fleming, P, Jones, M. (2012). The End of Corporate Social Responsibility: Crisis and Critique. SAGE.
Stanwick, P and Stanwick, S. (2015). Understanding Business Ethics. SAGE Publications.
Giacalone, R, Jurkiewicz, C and Dunn, C. (2005). Positive Psychology in Business Ethics and Corporate Responsibility. IAP.
Morrison, J. (2015). Business Ethics: New Challenges in a Globalised World. Palgrave Macmillan.
Brink, A. (2011). Corporate Governance and Business Ethics. Springer Science & Business Media.
Sullivan, P, Smith, M and Esposito, M. (2012). Business Ethics: A Critical Approach: Integrating Ethics Across the Business World. Routledge.
Ferrell, O and Fraedrich, J. (2016). Business Ethics: Ethical Decision Making & Cases. Cengage Learning.
Burger, A. (2011). Shell in Nigeria: Oil, Gas, Development & Corporate Social Responsibility, Viewed 27 September 2016 from https://www.triplepundit.com/2011/07/shell-nigeria-csr-corporate-social-responsibility
Cross, F and Miller, R. (2008). The Legal Environment of Business: Text and Cases- Ethical Regulatory, Global and E-Commerce Issues. Cengage Learning.
Mermod, A and Idowu, S. (2013). Corporate Social Responsibility in the Global Business World. Springer Science & Business Media.
Williams, C. (2009). Shell must clean up its act in Nigeria, Viewed 27 September 2016 from https://www.theguardian.com/commentisfree/cif-green/2009/dec/04/shell-nigeria-oil-spills
Woodstock Theological Centre (1990). Creating and Maintaining an Ethical Corporate Climate. Georgetown University Press.
Rajko, A. (2013). Behavioural Economics and Business Ethics: Interrelations and Applications. Routledge.
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