Running Head: Business Ethics Business Ethics name school The modern theory of the firm, which is central to finance and corporate law, views the corporation as a of contracts among the various corporate constituencies. Upon this foundation, finance theory and corporate law postulate shareholder wealth as the objective of the firm. Research in business ethics has largely ignored this contracts theory of the firm except to reject the financial-legal model as normatively inadequate. Philosophers generally bring philosophical theories of ethics to bear on problems of business, and they regard the contractual theory of the firm primarily as a subject for criticism using the resources of philosophical ethics. In particular, stakeholder theory, which stresses the importance of all groups that affect or are affected by a firm, has been proposed as a more adequate theory of the firm for studying business ethics. An important benefit of business ethics research conducted within such a framework would be a narrowing of the gulf between business ethics and the fields of financial economics and corporate law. Business ethics is widely dismissed as irrelevant by researchers in these fields because of its failure to recognize the existing financial and legal structures of the corporation, which are built largely on a contractual foundation. Hence, a common framework could increase the relevance of business ethics research and create a mutually beneficial dialogue. As a framework for identifying and analyzing many common business ethics problems, the contractual theory focuses our attention on the need to provide adequate safeguards for each constituency's interests. Corporate governance is concerned primarily with protecting shareholder interests, in part because the special contracting problems of shareholders are best met by the residual claims that the law of corporate governance creates. The comparative neglect of other constituencies in corporate law is not a matter of concern as long as their interests are adequately protected in some way. How the interests of each constituency are protected--whether by means of corporate governance structures or other means--is a matter of what works best in practice. Before we can devise means for protecting the interests of each ... ... middle of paper ... ...act but on the efficacy of the actual claims of the group in question. Business ethics problems can be identified mainly as wrongful harms, misallocations, and misappropriations. These categories are commonly employed in economics, finance, and corporate law in the analysis of various kinds of problems, which are usually attributed to market failures, imperfect contracting, and other causes. However, many of these other kinds of problems arise from larger economic and political forces that would affect any theory of the firm. References Kenneth E. Goodpaster, "Business Ethics and Stakeholder Analysis," Business Ethics Quarterly, 1 (2001), 53-73; Allen Kaufman, Lawrence Zacharias, and Marvin Karson, Managers vs. Owners: The Struggle for Corporate Control in American Democracy (New York: Oxford University Press, 1995. Alderson, A. and Kakabadse, A., (1994), 'Business Ethics and Irish Management: A Cross-Cultural Study', European Management Journal, Volume 12, Number 4, December, pp. 432-441. Abelson, R. and Nielson, K., (2003), 'The History of Ethics', in Edwards, P. (Ed.), Encyclopaedia of Ethics, Macmillan, New York, pp. 81-116.
Ferrell, O.C., Fraedrich, J., & Ferrell, L. (2009). Business ethics: Ethical decision making and cases (7th ed.). South-Western College Pub;
Importance of ethics in the business world is superlative and global. New trends and issues arise on a daily basis which may create an important burden to organizations and end consumers. Nowadays, the need for proper ethical behavior within
Incorporating ethics into everyday decisions in the business world can greatly reduce the scandalous behavior that has as of late has run ramped. Obviously, we have seen the results and consequences of business conducted absent any moral or ethical boundaries. When decisions are made without the consultation of ethics there is no direction from the moral compass and surely consequences will follow. Choices contemplated by managers may often seem difficult, but assessing the options against ethics can assist the manager in making the best decision.
Business is an organisation or economic system where products and services are traded for money, a product or services. Businesses need investment or customers to make a profit and survive. In business, ethical issues may arise for example false advertising, misleading the public, exaggerations and disclaimers. In this case study the ethical issue identified is an exaggeration of how much the company makes and falsifying of documents by signing off on an order that has not yet been finalised. Business ethics is the study of business situations, activities, and decisions where issues of right and wrong are evaluated. “Business ethics, ultimately, is just business in its larger human context” (Solomon, 2009, p.37). Ethical dilemmas such as financial management, corporate social management, corporate governance, shareholder relations, insider trading, and discrimination are examined by business ethics. Ethical dilemmas arise in situations where there is no right or wrong answers, usually a complex moral issue that needs to be resolved, a choice needs to be made between ‘right’ and ‘right’; choosing the best of the worst. It is not normally easy to reach an outcome but the dilemma can be solved in different ways depending on each person’s situation, background, personality, beliefs, life experiences as well as taking factors of law, morals and society norms into account when analysing, processing and making a fully informed morally ethical decision. The process of solving such complex issues involves analysing the issue itself, looking at possible consequ...
The concept of business ethics refers to a set of guiding principles that encourage individuals in an organization to make decisions based on the company’s stated beliefs and attitudes toward business practices within its industry (Lisa McQuerrey., 2016). Ethical and Unethical business decisions have long been a predicament encountered by organisations, these practices are concerned with how the companies interact with the global business world, and to their one-on-one dealings with individuals (Garry Crystal, 2016.) The concept of ethics and social responsibility emerged into the business world in the early 1970s after the end of World War I, saw these organisations become more profit driven resulting in negative impacts on society at large.
Murphy, Patrick E.. (2009). The Relevance of Responsibility to Ethical Business Decisions. Journal of Business Ethics. DOI 10.1007/s10551-010-0378-4
Ferrell, O.C. "Business Ethics." Ethical Decision Making and Cases. Michele Rhoades, Joanne Dauksewicz. Mason: South-Western Cengage Learning, 2011. Print.
Nelson, K., & Trevino, L. (2004). Managing business ethics: Straight talk about how to do it right (3rd ed.). New York: Wiley
O'Neill, O. (1986). A Simplified Account of Kantian Ethics. Matters of life and death (pp. 44-50). n.a.: McGraw-Hill.
Each article that was researched had the key concept/term in common and each article contained information on the issues and problems as well as solutions related to ethics, might it be international, global, etc. These articles gave insight into business ethics, the definition of ethics, the differences in ethics across cultures and each one examined different countries on a global scale and the discipline dealing with what is good and bad and with moral duty and obligation” (Satterlee, 2009).
From a long-term, global perspective he believes that business ethics is paramount to all societies at the turn of the millennium. Because major driving forces for business ethics lay in an increasing importance of business, a growing diversity of ethical beliefs and an ever more pressing need to address th...
Ethics is concerned with the study of morality and the application of reason to elucidate specific rules and principles that determine right and wrong for a given situation (Crane & Matten, 2010). Since law does not necessarily cover the morality of many controversial issues, moral reflection ought to be performed on any action, regardless of its lawfulness. The growing power of business in today’s society has enabled businesses to significantly impact the world. Hence, business ethics is highly relevant as it could determine whether businesses contribute or cause harm to the society at large.
In the business world there are many fundamental aspects and situations that can lead to several issues. In order to find an optimal and professional solution, business decision makers need to apply moral and ethical standards. And it is at that moment in which business ethics perform its role. Business ethics, which is in charge of examine how companies and individuals should act in business situations, is very essential in order to reach a common agreement and to work within the laws of business and solve an arisen dilemma. Working of the hand of ethical business companies, employees, investors, directors, and even individual officers can be beneficiated and obtain most favorable outcomes.
Fieser, J. (2009, 5 10). Ethics. Retrieved 3 26, 2011, from Internet Encyclopedia of Philosophy: http://www.iep.utm.edu/ethics/
In the past decade, concern with the ethical accountability of companies has continued to grow. Consumers increasingly look to support and buy from companies that make ethical decisions. The government has also created new legislation that requires a certain level of ethics and creates encouragement for companies to go as far as to create ethics programs. The idea of “business ethics” is not new, but there is more pressure now than ever before on companies to prove they are making an honest effort to be ethical. This additional pressure on companies can be largely attributed to a change in the neoclassical view of a company as only needing to take care of stockholder interests by creating profits (Wines & Hamilton III, 2009). Today, people view the organization as a complex unit made of up many different groups that must be considered. This new definition of an “ethical corporation” requires not only compliance with the law, but also consideration of the ethical implications of all actions (Epstein & Hanson, 2006; Thornton, 2009). “Ethics are a system of moral principles and behavioral norms intended to express and support an underlying set of values” (Post, Lee, & Sachs, 2002). Following the meanings given by several professional sources, business ethics is defined as the study of moral standards in the context of all business situations (Columbia University, 2008; Knapp, 2001; Crane & Matten, 2007). Because of this change in consumer and regulator concerns, a corporation cannot survive unless it takes care of and strives to respect the interests of all of its stakeholders by applying ethical standards to actions (Post, Lee, & Sachs, 2002).