Social responsibility

        In the increasingly social responsibility focused marketplaces of the 21st century, the demand for more ethical business practices is increasing. A business that behaves ethically will have positive influence to other associated businesses. In the interdependent economy, organizations need to cooperate with others to achieve their objectives. If a company cares about meeting responsibilities to employees, customers and suppliers, the company will be awarded with high quality of products, high degree of honesty and loyalty. Employees who are treated ethically will be more likely to behave ethically themselves in dealing with customers and business associates. Good ethical practice may cost money in short term. But ethical behavior could generate money in the long run. The argument is that some people believe ethical practices are conflict with profit making, and others think that behaving ethically makes good business sense good intro, Doc.

 

Behaving ethically makes good business sense

         The goal of businesses is to make money and maximize profit. Its Business is to pursue self-interest, while ethics is about the consideration of others. Some people think that, in today's highly competitive world, it is hard to be always ethical, and a lot of people choose profits over principle (Anderson,1996). Growing regulations in established markets have added costs.  During the past several decades, competition has been intensified and driven the costs down, which pressured businesses to find low cost source and consequently some companies ignored ethical compliance. Business ethics are moral rules and regulations guiding business activities yes.  A great deal of attention has been paid to ethical behaviors nowadays. It is destructive if the

 

leadership of a company does not behave ethically. WorldCom and Enron are examples of companies that ignored the ethical practice of their business. The Enron’s former CEO Jeff Skilling was sentenced 24 years in prison after being convicted of 19 criminal counts.  Ex-WorldCom chief executive Bernard Ebbers was sentenced to 25 years in prison for his role in the biggest corporate fraud in the nation's history. In the wake of corporate scandals that cost employees and investors billions of dollars, the federal government passed legislation that requires publicly-registered corporations to have a corporate code of ethics, which provides a way to legally address such behaviors. The Federal Sentencing Guidelines for Organizations provide an additional incentive for having corporate codes of ethics. Companies that follow the guidelines to prevent unethical and illegal behavior are likely to receive less severe punishment in case something unexpected happened. Though Enron and WorldCom cases are extreme, the growth of the global economy is drawing more attention to the ethical spotlight. Google and Yahoo, both respected Internet search engine companies with good reputations, were criticized heavily for complying with the Chinese Government's efforts to control the flow of information in order to enter the market. Google in particular came under attack from the media, due in part to its informal corporate motto: "Don't be evil"excellent example. Therefore, industry is under more pressure to improve business ethics through new public initiatives and laws (higher UK road tax for higher-emission vehicles, 2009). Ethical problems are not simply freak occurrences; they are problems of choice.  Problems in ethical decision making and behavior occur when individual interests and social norms conflict with each other.  Every organization has (or should have) its own accountability towards its stakeholders (employees, capital investors, consumers, government, competitors, suppliers, and other community members). 

Good ethical practice may cost money in short term. But ethical behavior could generate money in the long run. Company’s activities are interdependent on each other for success. Organizations need to cooperate with others to achieve their objectives. For example, a company

 

cannot succeed without the help of its employees, suppliers, and customers. Managers cannot succeed without the help of superiors and subordinates. Good work ethics can produce high quality work.  In addition, ethical practice “increases in customer loyalty, enhancement of brand image, and tiebreaker effects for customer purchasing decisions” (Verschoor, 2001). It saves money if employees work hard to do things right at the first time. Japanese cars demonstrated the competitive advantage of good job. Actually, Japanese industries had been dominating world markets in the area of auto, semiconductor, and consumer electronics sectors with the highest customer satisfaction and lowest manufacturing costs. Japanese workers' hard work ethics changed the way people think about the cost and benefit of ethics indeed.   Considering the current economy, the demand for high output driven performance, and reward linkages in organizations, it is no wonder that that short-term interests tend to win out with those organizations that do not have an ethically sound foundation. 

            Modern management theory indicates that financial strategies need to be aligned and supported by employees. To achieve financial goals, companies need employees to stand behind the organization's strategy. The ethical behavior of the leadership can promote employees commitment. Ethical practices not only can ensure moral conduct but also can gain business advantage. Establishing, applying and continually improving a company's code of ethics is one of the steps that can be taken to establish an ethical workplace to increase productivities. . “The primary ethical concerns of businesses fell into four categories: equity, rights, honesty, and the exercise of corporate power” (Heil, 2010). Joseph stated:

Executives are seeing value in actively promoting ethics within their organizations. The list of potential benefits linked to an effective ethics program includes the following:

 

·         Recruiting and retaining top-quality people;

·         Fostering a more satisfying and productive working environment;

·         Building and sustaining your association’s reputation within the communities in which you operate;

·         Aligning the work efforts of staff with the association’s broader mission and vision. (2000)

More and more firms realized that behaving ethically is important for business to success. Ninety percent of the Fortune 500 firms, and almost 50 percent of all other firms, have ethical codes. Increasingly, customers, clients and employees are deliberately seeking out those who define the basic ground, rules of their operations (Jain, 2010). Without being ethical, companies cannot be competitive at either the national or international markets.  Adhering to unethical practices may seemingly pay off, in the short term, and be the “quick fix.”  However, the temporary fix is usually short lived.  Unethical practices cost industries billions of dollars a year and damage the images of corporations.  Although benefits may not appear immediate, ethical behavior will have positive, longer lasting affects for the organization as a whole and for its stakeholders.  Organizations are responsible for building a framework for understanding and ethical decision-making in the workplace.                              

Work experience reflection

          South Dakota State University Veterinary Department is responsible for administering South Dakota state animal disease control and eradication. This department, in cooperation with USDA, has moved beyond traditional perceptions of animal disease control and eradication by addressing public health issues and major economic impacts. The obstacles for US beef export indicates that United States need strong active mad cow disease monitoring and eradicating program in place with an open line of communication with public officials.

           Several prion (mad cow) disease–related human health risks from an exogenous source had been identified in the United States including the potential zoonotic transmission of chronic wasting disease (CWD). Although cross-species transmission of prion diseases seems to be limited by an apparent “species barrier,” the occurrence of bovine spongiform encephalopathy (BSE) and its transmission to humans indicated that animal prion diseases can pose a significant public health risk. Recent reports of secondary person-to-person spread of vCJD via blood products and detection of vCJD transmission in a patient heterozygous illustrated the potential public health impacts of BSE.

             South Dakota State University Veterinary Department had a contract with USDA to establish a laboratory for prion disease test. The issues are that it is very expensive to build a monitoring laboratory with efficient waste treatment system. There is no evidence that the CWD can transmit to human. USDA and other laboratories in US did not have such special treatment system, and the local EPA does not have technology to check the contamination in the waste. This department can make a legitimate case for not spending money to build the waste treatment system. Considering the ethical issues, this department made a decision to spent large amount of money to build a system treating the waste. Later, USDA and other laboratories also added similar waste treatment system to their facilities. This decision gained reputation which helped this Department obtain federal and local government funding for more scientific researches. Anyone practicing great ethics should be you folks who work in your industry, Doc Fan. Our lives depend on you all and if you begin to “cut corners” or ignore potential risks just to save money, can have severe consequences…as you already know.

Positive effects of ethical behavior discussed in our textbook

             The argument of positive effects of ethical behavior in our textbook is that doing business ethically is good for business. Solomon and Hanson stated that ethics is the keystone for smooth, effective, and efficient operation of business organizations. If we cannot trust another person's word or feel confident that a person will keep contractual agreements, business as we

 

now understand would stop. In addition, Soloman and Hanson took a long-term view of ethical management. They noted that behaving ethically can be more costly in the short term than behaving unethically but Solomon and Hanson did imply that behaving ethically has long-term benefit. Attention to ethics ensures fair policies and procedures are protecting the organization as well as its’ stakeholders.  It is far better to incur the cost of mechanisms to implement ethical practices now, than to incur costs of litigation later.  Implementing these ethics programs may aid in detecting issues and violations early on, so they can be reported or addressed.  In some cases, when an organization is aware of an actual or potential violation and does not report it to the appropriate authorities, this can be considered a criminal act.

 

Conclusion

 

          The goal of business is to make money and maximize profit. But it is destructive if the

leadership of a company does not behave ethically. Federal government had already passed legislation that requires publicly-registered corporations to have a corporate code of ethics. The growth of the global economy is drawing more attention to the ethical spotlight.  The demand for more ethical business processes and actions are increasing globally.

 

          Good ethical practices may cost money in short term. But ethical behavior could generate money in the long run. The ethical practices of a company can promote employees commitment.  Increasingly, customers, clients and employees are deliberately seeking out those who define the basic ground, rules of their operations (Jain, 2010). The non-profit organization: South Dakota State University Veterinary Department gained reputation and financial reward from federal and local government because of the ethical decisions. Solomon and Hanson stated that ethics is the keystone for smooth, effective, and efficient operation of business organizations. Without being ethical, companies cannot be competitive at either the national or international levels. Therefore, behaving ethically makes good business sense.

                                                             

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