ETHICS & CSR

Ethics, CSR and Leadership

Introduction1

Business Ethics1

Importance of Ethics2

Most Common Organisational Ethics Issues3

Unethical Businesses4

Apple's new leader and Foxconn Dilemma4

Deepwater Horizon Oil Spill5

It Can Pay To Be Ethical5

Standard Chartered Bank Penalized for Unethical Operation6

Corporate Social Responsibility6

Lessons From Past6

Theories Relating Banking Industry and CSR7

Legitimacy Theory of Environmental Information Disclosure7

Stake Holder Theory7

CSR in the Modern Era- The strategic perspective8

Barclays- CSR Leader8

Role of Leadership in Ethics and CSR Promotion9

Train Your Employees9

Nike Leadership on Ethics & CSR9

Primark Leadership Response10

Conclusion10

Recommendations11

References13

Appendices15

Ethics, CSR and Leadership

Introduction

Businesses and organizations have gone through a major change of globalization and diversity. Workforce today is a set of people from multiple nations, culture, religion and economies. Every person possesses his own set of values, goals and beliefs. All these attributes contribute towards the organizational ethics and culture. As awareness about ethical practices is increasing, consumers expect organizations to do the business for society and environmental benefits. Businesses routinely claim that they are not in the industry just to earn profits but that intending to serve the society. The authorities to monitor such practices are now more active than before. The attention to CSR and ethical practices increased after many issues regarding business responsibilities came into light. Technological advancements created more consumer awareness. This report critically analyses the business ethics and corporate social responsibility by evaluating various theories and examples prevalent in UK industry, specifically the banking sector.

Business Ethics

The basic concept of ethics can be stated as knowing what is right and wrong and then applying in real time scenarios keeping in mind effects on affiliated people (Trevino & Nelson 2010, pp. 150). Business ethics goes beyond “be good” and “do not lie” philosophy. It includes corporate values, policies and conduct which provide directions for an act in a certain manner. This guides in decision making and positive behavioural actions (Trevino & Nelson 2010, pp. 155).

A diverse workforce when works in coordination as a single team, many differences arise which can create pressure on them to protect their own interests. Added to stress is the competition increasing at an exponential rate (Mitchell, et al. 1997, p. 861). Employees face many issues related to job security, promotions or front runner achievements which can lead to the need of compromising his personal and corporate integrity (See appendix 1).

To have an internal control on such issues, organizational have defined ethical code of conducts made up of values, policies and activities that affect organizational behaviours. The dilemma is that mostly do not know how to practice them (Fassin & Van 2009, p. 575). Managers often more consider to be reactive to a situation at the point it occur rather to be proactive. Similarly, in highly complex situations, they have no clear guidelines how to handle it according to law and values.

Importance of Ethics

Not all measures of success are financial. Ethical standards and practices of companies play a prominent role in brand name and reputation. Increasingly social-economic factors need to be assessed which create a conflict of priorities opposite financial ...