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Business Ethics -A Contested Terrain
Business ethics is a contested terrain. There are economists and business gurus who claim ethics is irrelevant to the field of business. For instance, the neo-liberal Chicago school economist Milton Friedman held that corporations are amoral and CEOs have only one duty to maximize the profits of a company. He also said in an interview that business cannot have social responsibilities Similarly Peter Drucker, a business guru, also observed, “There is neither a separate ethics of business nor is one needed”. However, Peter Druker in another instance and observed that ultimate responsibility of the directors of the companies is above all not to harm – primum non nocere The ideological position of excluding firms from ethical obligations is contested as it deifies scholarly understanding, age old wisdom and commonsense.
Business ethics is a contested terrain not just because celebrated persons in the field of economics and business questioned the relevance of ethics in business, observe editors of respected business ethics textbook, but also because what is presented in the name of ethics is either sentimental common sense, or a set of excuses for being unpleasant. What is presented as ethics in many of the Business Ethics manuals and books are just premature responses to questions that look like answers or mere procedural form filling exercises unconcerned about the real ethical dilemmas. For instance, a manual of business ethics published by good governance program of US Department of Commerce treats business ethics as nothing more than set of instructions and procedures to be followed by ‘ethics officers’ and downward in the hierarchy of business Campbell Jones et al., in their text book, “For Business Ethics” point out six foreclosures, something has been closed down before it should have been, by the proponents of business ethics: foreclosure of philosophy, society, the ethical, meaning of ethics, politics, and the goal of ethics. Ethics is hotly debated throughout the twentieth century and has been one of the major sources of philosophical reflection up to the close of the millennium. The field of business ethics, it is contested, has insulated itself from the new developments in ethical debate, either ignoring them altogether or misrepresenting. Arguments in Business Ethics often downplay the role of social context, social arrangements, social processes, history, politics and structural aspects constituting individuals and individual actions. Issues taken as ethical dilemma by business ethicists are often of narrow in scope such as behaving politely with customers, following office etiquettes, privacy of employees, discriminations, bribery, kickbacks etc., while issues like inequality among global labour, ethics of lobbying, intellectual property alienation, biopiracy are broadly neglected. The term ethics connotes different thing to people oriented differently. There are arguments from virtue, deontological, utilitarian and pragmatic schools of thought about ethics. The differences are not just a matter of talking about the same thing in different ways. Rather, these different ways of talking about ethics seem to be talking about different things, about different ways of imagining ethics itself. Like discussions of ethics in any other fields, business ethics too should be treated along the percepts of various established, neglected and emergent schools of ethical thought. Business ethics is assumed to be something that does not really trouble basic assumptions about the normal practices of business. Instead of looking at the politics the corporate firms play in modifying rules of accounting practices, diluting labour laws, weakening regulatory mechanisms etc., and it tends to look at the ethical collapse of firms like Enron and Arthur Anderson as if it were isolated instances of individuals slipping away from their ethical responsibilities. Further, Business ethicists often foreclose the goal of being ethical. They attempt to convince that being ethical serves a strategy of image management or sustained profit making. Others hold being ethical and making profit are equally valid goals of firms, some others claim being ethical is just for the sake of being ethical. Further, Ethics, when remodeled as business ethics it suffers the fate of business expediency thus business ethicists prepare themselves for unambiguous quick and standard answers while ethics is not a matter of stable solutions but one of endless openness and difficulty and beyond the limits of normativity.
Why Business Ethics?
Discussion on ethics in business is necessary because, business can go unethical, and there are plenty of evidences as in today on unethical corporate practices. Even Adam Smith, in whose name neo-liberal laissez-faire is advocated opined that ‘People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices’ Business does not operate in vacuum. Firms and corporations operate in the social and natural environment. By virtue of existing in the social and natural environment, business is duty bound to be accountable to the natural and social environment in which it survives. Irrespective of the demands and pressures upon it, business, by virtue of its existence is bound to be ethical, for at least two reasons: one, because whatever the business does affects its stakeholders and two, because every juncture of action has trajectories of ethical as well as unethical paths wherein the existence of the business is justified by ethical alternatives it responsibly chooses One of the conditions that brought business ethics to the forefront is the demise of small scale, high trust and face-to-face enterprises and emergence of huge multinational corporate structures capable of drastically affecting everyday lives of the masses.
What is Business Ethics
Ethics, the search for ‘a good way of being’ for a wise course of action, as it could be practiced by business firms is called business ethics Ethics in business deals with the ethical path business firms are convinced to adopt. Afflicting the least suffering to humans and the nature in its entirety, achieving the greatest net benefit to the society and economy enriching the capability of the system in which it is functioning ., being fair in all its dealings with its proximate and remote stakeholders , being prepared to correct its mal-habits and nurturing an enduring virtuous corporate character in totality, can be called business ethics . It is often suggested from extended utilitarian/ consequentialist position that businesses can often attain short-lived gains by acting in an unethical fashion; however, such behaviours tend to undermine the economy over time. For those who uphold the principles of virtue ethics, all that matters is corporations maintaining character of honesty, fairness and humaneness than being ethical for the sake of better consequences. On the other hand experts of deontological ethics and virtue ethicspostulate that what matters is the motive to be ethical than the consequential fallout Jacques Cory, a noted business ethicist observes, “companies should behave ethically and be profitable in parallel, and even if ethics diminishes the profitability of the company, they should still behave ethically”. Seen from the Kantian Ethical perspective Business has to consider its remote and proximate stakeholders as ends in themselves and not merely as means toward some other end. . A business becomes ethical by assuming the responsibility of ‘’’translating’’’ the abstract ethical injunctions into series of obligations. However, while translating, we do not just abide by the ‘’’a priori’’’ ethical injunctions or codes rather respond to the situation in its contextual singularity pragmatically choosing the best alternative course of response from the multiple possibilities. In other words, ethics is a matter of 'responsibility in the experience of absolute decisions made outside of knowledge or given norms' .
Business Ethics as Applied Ethics
Business ethics (also known as Corporate ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical problems that arise in a business environment. It applies to all aspects of business conduct and is relevant to the conduct of individuals in business and business organizations as a whole. Applied ethics is a field of ethics that deals with ethical questions in many fields such as medical, technical, legal and business ethics.
In the increasingly conscience-focused marketplaces of the 21st century, the demand for more ethical business processes and actions (known as ethicism) is increasing. Simultaneously, pressure is applied on industry to improve business ethics through new public initiatives and laws (e.g. higher UK road tax for higher-emission vehicles). Businesses can often attain short-term gains by acting in an unethical fashion; however, such behaviours tend to undermine the economy over time.
Business Ethics as Normative and Descriptive Ethics
Characteristically, business ethics can be both normative and descriptive. It is said to be normative because it takes the practical task of arriving at moral standards through advocating good habits a business firm should necessarily acquire, duties it should follow, virtues it should maintain and the overall utility it should maximize. It is sometimes evaluated as descriptive ethics because it outlines ethical be
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