Ethics are the bunch of beliefs that actually deals with the ideologies of morality with well-defined principles of right and wrong behavior in terms of responsibilities, rights, guidelines, benefits to society etc. In another words, ethics is the word that is derived from the Greek word “ethos” which highlights characters, routine and norm (Ho, 2015).
Ethical theories and principles are the basis of the ethical analysis, which highlights certain viewpoints that helps in guiding and can obtain a pathway to the decisions. There are certain steps that help in making ethical decisions.
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Observation and facts |
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Appeal to principles or ideas |
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Consideration of basic obligation, duties and rights |
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Consideration of consequences |
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Conclusion |
The above process highlights that how ethical theories help in making better ethical decision making: To making ethical decisions, first and the foremost thing is to gather the facts. Even facts generates two results one will be positive and another one will be negative. If business houses attract good then the outcomes will be positive and if the facts are wrong in the beginning then moral judgement can lead business towards the wrong path.
Second step highlights to make prediction, a guess about the future. In concern to business houses, there is always an element of uncertainty. Yet, the organisations have to take guess and select the action, which they like the most to cause good.
Third step, highlights to identify the feeling, make consideration regards duties, obligations and rights. In this, they highlight what is rational and conscious and feelings are the way to check whether an individual is rationalizing.
Fourth step displays, consideration of consequences are seen for the longer run. Business houses duty is to see the consequences in a long run. Lastly, fifth step focuses on the conclusions in which company builds the hypothesis and then test it, reach the conclusion and summit it. Hence, this process helps in employing a sound process in making the ethical judgements within the organisation (Tenbrunsel, & Smith?Crowe, 2008).
A large portion of ethics helps in dealing with the approaches of the principles or standards that are used for making the ethical decisions’ making in the business houses. Certain approaches like utilitarian, virtue ethics, Deontological ethics and lastly Kantism ethics (Tenbrunsel, & Smith?Crowe, 2008).
In utilitarian approach, ethical actions produces the greatest good and does least harm for all the clients, stakeholders, colleagues and the entire community. In this approach, everyone deals with the consequences and tries their best for both- to increase the good done and to reduce the harm done. In this, the decisions making done within the business house will be fair enough because it that kind of approach which thinks of both the harm and the goodness of the individuals (Ethics unwrapped, 2018a).
Deontology ethical theory determines that what is ethically right which is more significant that what is for the larger good. In this theory people’s right are the most imperative over their body, labour and talent. It is the duty-based ethics. In this, they give emphasis on giving equal respect to all human beings. However, in decision making concern, there is a high degree uncertainty to ethical decision making because the future is unpredictable (Ethics unwrapped, 2018c).
In virtue approach, ethics focuses on attitude or character traits that enables to an act that develops the individuals highest potential likewise, honest, courage, compassion, generosity, integrity, fairness and lastly, self-control. Virtues are like habit when once it is being acquired it becomes characteristics of a person. Hence, there major focus is on attitudes, dispositions and the character traits that help in developing the human potentials. In business decision making concern this kind of approach to ethics are the best approach because it highlights the moral virtues that assist in making the ethical decisions in organisations (Ethics unwrapped, 2018b).
Business ethics displays the appropriate business guidelines and practices regarding, resolving the controversial issues like corporate governance, insider trading, subornation, discernment, corporate social responsibilities. Law often directs the business ethics, while at the other time business morals provides the basic outline that businesses implements to gain public acceptance.
Normally, it is not much difficult to attain profits if a business works with ethics. Ethics makes business to lead a correct pathway, which turn out to be profitable. Yet, in business terms, what is ethically right does always negatively affects the does not contributes towards profits. For example, in business to make deal employees have to take bribe and if they have not done so far this will automatically affects the business profits. However, ethics may not be well-suited with the short-term returns but in an long run a company do chase for both ethics and profits (Horton, 2018).
According to the question that weather the ethical business be a profitable business, answer is yes! Because due to ethics employees are more productive, employees are less likely to leave the organisation, customers respond more actively and positively to organisation. Moreover, it was analysed that the vendors and the other suppliers prefer to deal with those companies, which are ethical strong and the ethical companies attract those companies, which have higher talented executives and employees. All the above factors highlights that ethical companies are more profitable (Parrish, 2016).
Nevertheless, in some of the companies’ cases, it was seen that due to the usage of unethical practices they earned many profits. Just like the WorldCom, it was a long distance discount service company. The truth behind the scandal within a company was the unrealistic financial targets and inability to meet them. When all the scandals were scanned, other got to know that WorldCom use to hide it expenses, inflate its cash flows and reports profits instead of losses.
Similarly, the Bhopal gas tragedy played many unethical practices. Besides many given warning they have not changed their unethical behaviour towards the society and hence, by the use of the unethical aspects they never earned a good amount of profits. Hence, this leads to the closure of the company. Another company Asbestos poisoning company, the main reason behind their liability was a continuous increase in claims by victims who were suffering from the mesothelioma, it was an uncommon form of cancer, which was mostly affecting the lungs, and it was specifically caused by the asbestos experience. Due to all this, the company has to suffer a loss of those who were bearing that a problem, which was, arises out of that disease.
Lastly, the Enron scandal, the company’s failure in 2001 signifies the biggest business insolvency, because there was a moral failure within an organisation. In this, the charismatic leaders sought of express at the expenses in their community and their employees. At the completion, those erroneous morals destroyed the company and damaged the entire organisation employees who had gone for the same ride (Dsouza, 2017).
Hence, all the above discussion shows that none of the company gets successful if they use unethical practices to earn more profits. Hence, every business first responsibility is to endure profitability and produce income for the stakeholders and the people. No business can be great, strong or wealthy if it works with the unethical practices. So at last, business needs to endure ethical for its personal good. Unethical judgments may produce profits only for short period. Therefore, for the better and the long run presence and continuous effectiveness of firm, business needs to behave itself ethically and to track its activity on ethical lines. Doing so ethical organisation will continue to survive and grow in their profits whereas the unethical organisation will quickly diminishes.
References
Dsouza, S. (2017). Importance of business ethics for profitable business. Retrieved from: https://medium.com/workethics/importance-of-business-ethics-for-profitable-business-3ed5de0083b
Ethics unwrapped.(2018a) Utilitarianism. Retrieved from: https://ethicsunwrapped.utexas.edu/glossary/utilitarianism
Ethics unwrapped.(2018b). Virtue Ethics. Retrieved from: https://ethicsunwrapped.utexas.edu/glossary/virtue-ethics
Ethics unwrapped.(2018c). Deontology. Retrieved from: https://ethicsunwrapped.utexas.edu/glossary/deontology
Ho, D. (2015). Making ethical progress without ethical theories. Retrieved from: https://journalofethics.ama-assn.org/article/making-ethical-progress-without-ethical-theories/2015-04
Horton, M. (2018). Are business ethics are important for profitability?. Retrieved from: https://www.investopedia.com/ask/answers/040715/how-important-are-business-ethics-running-profitable-business.asp
Parrish, S.(2016). The profit potential in running an ethical business. Retrieved from: https://www.forbes.com/sites/steveparrish/2016/02/04/the-profit-potential-in-running-an-ethical-business/#16b5cef67687
Tenbrunsel, A. E., & Smith?Crowe, K. (2008). 13 ethical decision-making: Where we have been and where we are going. The Academy of Management Annals, 2(1), 545-607.
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