Ethics generally concerns itself with one’s moral judgments about wrong and right (Joyce & Rankin, 2010). Decisions taken within a given organization may be made by people or groups, but the decision maker will eventually be influenced by the organizational culture. The decision to behave in an ethical manner is considered to be a moral one, and workers must choose what they think is the most appropriate course of action. This may incorporate disregarding the direction that would result in the hugest short term benefit. Ethical behavior and Corporate Social Responsibility (CSR) tends to bring important advantages to a given business. Organizations that lack CSR or engage in unethical behavior may destroy an organization’s reputation, making it less attractive to stakeholders.
Together with effective corporate governance, ethical behavior is seen as a vital part of everything that today’s big corporations do. They ensure that workers understand the organization’s corporate values, clarifying the kind of behavior the organization seeks from employees (Erwin, 2011). The law is evidently the key starting point for any given business. A majority of leading organizations usually have their own statement of Business Principles which lay out their central standards and values. Furthermore, most organizations have also established voluntary codes of practice that control practices in their industrial departments.
When working for an organization that has firm business ethics, workers tend to be quite comfortable knowing that they are not by their individual action permitting unethical practices to persist. Moreover, customers are relaxed when purchasing services or products from an organization they know to supply their labor and materials in an ethical and responsible manner (Colistra, 2010). Today’s organizations realize that reputation is not only one of an organization’s most significant assets, but also one that is quite hard to regain should it be destroyed. Maintaining the promises made is important in maintaining an organization’s reputation. Thus, businesses that do not adhere to any form of ethical code or carry out their social responsibility experience wider consequences.
Corporate Social Responsibility constitutes four main steps namely acknowledgement or awareness of a given issue, evaluation and planning, reaction intern of policy development and implementation (Trevino & Nelson, 2014). Business experts believe CSR to be a connection between enhanced fiscal performance, and social initiatives. It also depends on profit maximization in aggressive business markets. Four main levels of CSR have recently been identified as economic, legal, ethical, and discretionary. The very first responsibility for any given organization is its economic one. This means that the organization needs to mainly focus on turning a profit. Prior to thinking about being an effective business citizen, an organization needs to ensure that it can make profits. Secondly, an organization’s legal level is concerned with the requirements place on it by the law. The organization is expected to adhere to all laws, and this has been identified as the most significant responsibility as per the CSR theory.
Once an organization has met the basic requirements, it can focus on ethical responsibilities. These are considered to be obligations that an organization puts on itself given that its owners believe it is the most appropriate thing to do, not because they are expected to do so (Griffin & Moorehead, 2012). The ethical level of CSR may incorporate paying just wages, refusing to conduct business with oppressive nations, or being environmentally friendly. On the other hand, the philanthropic or discretionary level refers to when an organization goes above and beyond what it required or believes to be right. This usually involves making an effort to better a community, for instance participating in projects that assist the environment, giving money to charitable causes, or donating services to community organizations (Adler, 2008).
In an environment where there is increased interest and activity within the area of business ethics, there exists no rational theoretical framework for organizational study and theory. However, a few theories have so far been formulated to explain ethical behavior and corporate social responsibility. These theories include Utilitarianism, Liberalism, Deontology, Ethical Relativism, Justice, and Ethical Egoism. We will take a closer look at the ethical relativism theory in relation to CSR. Its benefits and limitations will also be discussed in an effort to understand its significance to ethical behavior and management in today’s workplace.
The idea of ethical relativism is concerned about the fact that distinct groups tend to have distinct ethical standards in identifying what is considered morally wrong and right, and their beliefs are genuine to that specific group even when it may not be a basic moral principle (Banerjee, 2008). Simply, this is a theory stating that morality is relative to the norms of one’s culture. Whether an action is wrong or right is determined by the moral norms of the society in which it is practiced. An action may be seen as being morally right in one society, but be morally wrong in another. The ethical relativism theory has been used in today’s organizations to explain why some big corporations are engaging in unethical behavior just to stay ahead of the competition. A good illustration is seen with JB Morgan which was recently caught in a bribing scandal because it wanted to obtain favors so as to stay ahead of its competitors (Horrigan, 2010).
An ethical relativist believes that there are no universal moral principles and that the only moral ones against which a society’s practice can be accountable are its own. If ethical relativism is acceptable, there can be no similar structure for resolving moral conflicts or for reaching consensus on ethical issues among members of distinct societies. Another illustration that can be used to explain the theory of ethical relativism is polygamy. While having more than one spouse at a time is embraced in quite a few societies and countries across the globe, it is also seen to be lawfully and ethically wrong in other societies and countries (Joyce & Rankin, 2010). It is argued that specific practices such as torture, political repression, and slavery may be ruled by universal moral principles and thus considered to be wrong, despite the numerous other distinctions that are present among cultures. Just because some practices are relative does not necessarily mean that all of them are relative.
Similar to any other theory, the theory of ethical relativism also has its own benefits and limitation which need to be assessed so as to determine whether or not the whole idea actually holds ground or not.
Benefits of Ethical Relativism Theory
One of the main benefits of this theory is that it establishes learning opportunities that tend to make humanity stronger (Erwin, 2011). This is to say that when people’s distinctions are combined, they are able to become better and stronger as one. Furthermore, if people allow their differences to educate one another, more can be achieved in terms of cohesive societies. Ethical relativism theory tends to facilitate the adjustment in a society which is vulnerable to transformations. When there are many individuals having similar standards shared, they establish a society that is able to meet their individual needs while neglecting the needs of all others.
Studies have shown that people will concentrate on the things they do best when ethical relativism is accentuated. They no longer need to enhance weaknesses because one person’s weakness is another person’s strength (Colistra, 2010). Additionally, ethical relativism theory is quite beneficial in that it encourages respect. Evidently, different cultures have different points of view and experiences to provide humanity. With this particular theory, such points of view and experiences tend to contribute to the greater good since everyone is allowed to discover each special perspective in their own way, and learn from it. Ethical relativism generally teaches individual tolerance.
Limitations of Ethical Relativism Theory
Perhaps one of the key limitations of ethical relativism theory is that universal moral principles can actually exist even if some moral beliefs and practices are different among cultures. People can appreciate cultural distinctions in moral beliefs and practices and still believe that some of them are morally inappropriate. For instance, the practice of apartheid in South Africa or slavery in pre-Civil war American society is morally wrong despite the beliefs of those societies (Horrigan, 2010). Given that every individual is allowed to set their own moral code of conduct under ethical relativism theory, there will be those who will engage in actions that most individuals view to be bad. Actions such as child abuse, rape, murder and theft would be lawfully viable actions to take since that individual’s personal morality identifies them as good.
The main purpose of ethical relativism is a valuable one. Communities possess a particular inherent bias to them that coerces some individuals down in order to elevate others up. However, in real sense, all that ethical relativism does is to transfer the responsibility from a group perspective to an individualistic one (Trevino & Nelson, 2014). This means that promotion of an individual set of principles is the main point of focus instead of promotion of a group set of morals. An additional limitation to the ethical relativism theory is that it gets rid of the concept that transformation or modification can actually be a good thing. Under a system of ethical relativism, some of the most recognized philosophers and scholars that are admired throughout history would all be considered wrong. This is because there would be no need to transform their minds and hearts since everyone is held to their individual principles.
Paradigm: Positivism vs Interpretivism?
Positivism and interpretivism are considered to be the two main approaches to research techniques. While the former is concerned with scientific quantitative methods, the latter is focused on humanistic qualitative methods (Griffin & Moorehead, 2012). Positivism incorporates techniques such as structured questionnaires, formal statistics, and social surveys because they have efficient reliability and representativeness. Most positivists tend to view the society as shaping an individual and claim that social facts always shape individual behavior. Positivism puts emphasis on the significance of conducting quantitative research to obtain an overview of society in general, and to realize social trends. Notably, positivists believe that sociology and business management should utilize similar techniques and approaches to research the social world. Moreover, experts look for connections between two or more variables, a method referred to as the comparative technique (Adler, 2008).
On the other hand, interpretivism incorporates participant observation or unstructured interviews. Interpretivists claim that people are not just puppets responding to exterior social forces as positivists would like to believe. Instead, people are quite complicated and intricate. Different individuals understand and experience the same objective reality in distinct ways and have their own and distinct reasons for acting in the world (Banerjee, 2008). Interpretivism greatly criticizes positivism because a majority of the statistics it identifies with are themselves socially made. This approach cites that in order to understand human behavior, people need to attain empathetic understanding, where they see the world through the eyes of those doing the acting.
For this particular research paper, positivism has been used as the paradigm. Given that the subject matter in this case is ethical business management, positivism approach is the most appropriate because it researches actions in the natural world (Horrigan, 2010). Observations have also been implemented as a way of gathering information. Positivism discovers the normality and patterns of the business world by utilizing the kind of scientific techniques used effectively in the natural sciences.
Approach: Quantitative vs Qualitative?
A quantitative approach to research refers to a research technique that tends to generate hard truths and numerical information by employing mathematical, logical and statistical method (Joyce & Rankin, 2010). It can also be done by manipulation of preexisting statistical information using computational methods. Quantitative approach mainly concentrates on generalizing information collected across groups of individuals or providing an explanation on a specific occurrence. The main aim of conducting a quantitative research is to determine the connection between one thing and another, within a given population. The outcomes of this approach are founded on larger samples that are symbolic of the overall population. Given its high reliability, the study can be repeated or replicated. The overall outcome of a quantitative approach is to categorize features, count them, and establish statistical models in an effort to explain what is taking place.
Qualitative approach on the other hand, develops understanding on social and human sciences, to investigate how individuals think and feel. It is fashioned to expose a population’s range of behavior and the points of view that compel it with reference to particular subject matters or issues (Erwin, 2011). The outcomes of this approach are more descriptive than predictive. Qualitative techniques in the field of marketing and business management research today incorporate comprehensive interviews with people, group discussions, in-context observations, and journal and diary applications.
The approach that is implemented for this particular study is qualitative because its various aspects generously contribute to valuable and insightful outcomes. Ethical business management incorporates associations between individuals and qualitative approach establishes synergy amongst people as they build on one another’s concepts and comments (Colistra, 2010). Following the dynamic nature of group discussion process or interview, people are more actively engaged than is possible in a more organized study. Furthermore, the chance to probe or dig deeper allows the researcher to reach further than initial reactions and rationales. Qualitative approach in ethical business management is significant in that it provides the chance to observe, account for and interpret nonverbal communication as part of an individual’s feedback which is worthy in the course of discussions and interviews.
Tools and techniques (i.e. survey, interviews, focus groups, and others)
As already indicated above, some of the tools that have been utilized in this research study include interviews, questionnaires, and observations. Surveys, interviews, and focus groups are considered to be the main research instruments and techniques. They are significant in that they assist the researcher in gathering novel or unique information (Trevino & Nelson, 2014). One main advantage of carrying out one’s own research rather than utilizing secondary data such as publications and internet sources is that a person can formulate their questions explicitly to their business and collect more detailed data.
Surveys refer to fixed sets of questions usually utilized to gather quantifiable information such as the number of individuals who believe that corporate social responsibility is valuable to a company. Surveys are most effective when conducted face-to-face (Griffin & Moorehead, 2012). Focus groups and interviews, on the other hand, are founded on discussion points or a set of questions. When preparing for interviews or focus groups, it is important to formulate a list of key points and questions so as to have a constructive conversation with the respondents.
Findings
The findings in this research study have been based on primary and secondary research. It has also been based on lived experience. Across the world, corporate social responsibility and ethical behavior is now intertwined with how individuals lead their lives. Consumers perceive CSR to be a personal responsibility to be incorporated and encouraged (Adler, 2008). Recent studies have indicated that customers have become apprehensive of corporate acts and no longer take organizations at their word. A majority of them cite that they need to see evidence of an organization’s CSR inventiveness to believe and trust them. If organizations participate in constructive CSR, they are expected to set daring goals in addition to having consistent and clear corporate social responsibility communications.
Various observations have been made in the course of business transactions with regards to ethical business management, and reveal a rather mixed understanding and implementation of corporate social responsibility by individual organizations. These observations also show that CSR can be seen as a trend, a form of business concern which is connected to fashion and popularity (Banerjee, 2008). It is common for stakeholders outside the organizations to presume that branding is the key motivating factor for CSR, whereas it is actually sustainability. What most organizations perhaps do not realize is that employees are also concerned with CSR and a constructive correlation between this, commitment and perception is vital.
Notably, to increase employee loyalty means being able to demonstrate greater concern about the organization’s own workers. That is why this approach is more effective than being accountable for society outside the organization. Given the advancements in technology such as the Internet, recent studies have shown that today’s consumers get their Corporate Social Responsibility information from a wide range of media ranging from company websites to advertising and social platforms (Griffin & Moorehead, 2012). It is thus necessary for organizations to step up their communications in a way that effectively links with their target audiences and welcomes upcoming technologies together with social routes. By so doing, they will be able to educate consumers about CSR efforts, inspire, establish dialogue, and show them how to take necessary actions.
Critical Analysis/Commentaries
The research paper has indicated that a number of theories can be applied to ethical business management, particularly corporate social responsibility. However, it has only focused on one specific ethical theory and that is the Ethical Relativism. The paper could have also considered applying the theory of utilitarianism which cites that an action is singularly determined by its contribution to the whole effectiveness in capitalizing on the happiness or pleasure of people (Horrigan, 2010). Here, it is the overall effectiveness of people which is considered significant. Furthermore, pleasure and happiness are the key focus of moral decisions, making it a form of Hedonism. This theory is applicable in that it advocates for equality by the equal consideration of people’s or organizations’ interests, refusing any discrimination between individuals. The case of JB Morgan Chase and other organizations that have recently been caught up in scandals of unethical nature can use the utilitarianism theory to justify their actions.
Conclusion
The discussion above has involved looking at how ethical business management is being implemented in today’s organizations. It has specifically touched on the topic of Corporate Social Responsibility, looking at why employees or large corporations may or may not engage in unethical behaviors. The paper has also highlighted on the differences that exist between cultures, thus prompting a diverse workforce to have a distinct outlook on what is considered right or wrong. For an organization to be more effective in CSR, it should practice transparency so as to earn the trust that is only gained by being open about its practices. The organization should also encourage sustainability while engaging in a more active role in the society.
References
Adler, N. (2008). Dimensions of organizational behavior. 5th Edition. Mason, OH: Southwestern.
Albareda, L., Lozano, J.M., & Perrinin, F. (2008). “The changing role of governments in corporate social responsibility: Drivers and responses.” A European Review, 17(4). Pp. 347 – 363.
Banerjee, S.B. (2008). “Corporate social responsibility: The good, the bad and the ugly.” Journal of Business Ethics, 74(4). Pp. 391 – 407.
Carroll, A.B., & Buchholtz, A.K. (2012). Business and society: Ethics, sustainability, and stakeholder management. 8th Edition. Mason, OH: South-Western Cengage Learning.
Colistra, R. (2010). “No bark and no bite: When addressing ethical code violators, is the society of professional journalists (SPJ) mute and toothless?” International Journal of Interdisciplinary Social Sciences, 5(4). Pp. 311 – 329.
Crane, A., Matten, D., & Moon, J. (2008). Corporations and citizenship. Cambridge, UK: Cambridge University Press.
Erwin, P.M. (2011). “Corporate codes of conduct: The effects of code content and quality on ethical performance.” Journal of Business Ethics, 99(4). Pp. 535 – 548.
Griffin, R.W., & Moorehead, G. (2012). Organizational behavior: Managing people and organizations. 10th Edition. Mason, OH: Cengage.
Horrigan, B. (2010). Corporate social responsibility in the 21st Century: Debates, models and practices across government law and business. Cheltenham: Edward Elgar.
Joyce, N.R., & Rankin, T.J. (2010). “The lessons of the development of the first APA ethics code: Blending science, practice, and politics.” Ethics & Behavior, 20(6). Pp. 466 – 481.
Trevino, L.K., & Nelson, K.A. (2014). Managing business ethics: Straight talk about how to do it right. 6th Edition. Hoboken, NJ: Wiley.
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