Business Ethics & Corporate Social Responsibility

Business Ethics & Corporate Social Responsibility

Introduction

Ethical Business Behavior

According the Meyers (2004), business ethics and organizational culture, ethical or unethical, are a function of numerous individual factors and contextual characteristics. Cohen (1993) believes that organizational culture is the most important influence on business ethics within an organization. He adds that these cultures are a multifaceted mix of various formal and informal processes and interactions. They comprise leadership, organizational structure, company policies, employee reward systems, socialization and the decision process within the framework of formal organizational culture. According to Trevino & Nelson (2004), informal culture depends largely on more implicit behavioral norms, role models, rituals, historical anecdotes and language.

Trevino et al. (1999) define an ethical business culture as an edifice of equal distribution of authority and shared accountability. A clear code of ethical conduct is clear and communicated, and there exist expected practices understood and enforced. Trevino & Weaver (2001) add that, in addition to economic outcomes, corporations must focus on execution of their code of ethics and non-economic goals. An ethical business culture needs a system of unswerving role-modeling since it becomes the basis for a strong, predefined culture that everyone in the organization adheres to. Myths of “heroes” within the organization who upheld ethical practices inspire others in that organization to behave ethically. Lastly, language plays a crucial part in maintaining ethical culture. Leaders who regularly engage in “talking the talk” illustrate the ethical dimension of problem solving in business (Ardichvili et al., 2009).

Given the examination of these research findings, we can conclude that business ethics refer, and adhere, to a system of ethical practices in business. Also included in this is corporate social responsibility, which refers to responsible business activity, within the confines of social and environmental constraints. The purpose of this coursework is to examine two companies, Anglo-American and Primark, as models of ethical behavior and conduct an analysis on to what extent do these companies observe corporate ethical behavior and social responsibility.

Discussion

Ethics in Practice

Anglo-American

Anglo-American maintains an ethical culture through its code of practice which the company calls 'Good Citizenship'. The language suggests the importance of these values to the company and how the company aims to instill these in its employees. Anglo American participates rigorously in initiatives promoting business ethics such as the Extractive Industries Transparency Initiative and the U.N. Global Compact and Reporting Initiative. It also gave to the Voluntary Principles on Security and Human Rights. Additionally, the company ratified the Universal Declaration of Human Rights and uses it as its main reference in promoting ethical practice (thetimes100.co.uk, 2013).

Paying particular attention to externalities of its operations, Anglo-American engages actively with its stakeholders and communities. It improves infrastructure in communities, as well as resettlements to protect communities from harm. Even though this is a controversial matter, Anglo-American makes an effort to restore and improve the livelihood of re-settlers, as well as play fair compensation.

Primark

Primark's code of conduct is based on the international Labor Organization's (ILO) ...