Ethical Values as Part of the Definition of Business Enterprise and Part of the Internal Structure of the Business Oganization

The orientation of this paper is that there is no special science of "business ethics" any more than there is one of "medical ethics" or "legal ethics". While there may be issues that arise in medicine or law that require special treatment, the ways of relating to such issues are derived from a basic ethical stance. Once one has evolved such an ethical stance and thus has incorporated a fundamental mode of relating to her or his fellow human beings, the "how" to deal with various ethical "issues" will follow as a natural consequence of one's ethical stance or modality. It is not necessary, in the formation of one's fundamental ethical stance to know if one is a utilitarian or a deontologist. It is doubtful whether Buddha knew what kind of ethics he was practising. If one conceives of ethics as something extrinsic to various disciplines and attempts to first practise a discipline and then to apply ethics to modify the results of that discipline it is entirely possible that conflicts will result between what is perceived of as the proper pursuit of that discipline and the ethical considerations. The argument of this paper is that it is more efficacious (in addition to being more true) to take ethical considerations into account in the construction of the definition of the discipline. This paper is devoted to showing that business and ethics are not two different and competing fields of interest (thus requiring a discipline of business ethics to be grafted onto the study of business enterprise), but that ethical concerns are part and parcel of the very concept of a business enterprise and the internal operation of a business organization.     

Is there “no such thing as business ethics”?

What are we to make of the claim that we often hear, that there is no such thing as business ethics? This essay first examines two arguments that might be in people's minds in making such a claim — that business is a “game,” and hence the ordinary constraints of morality do not apply, and that one cannot survive in business if one is too “ethical.” The critique of these arguments begins the process of making clear what business ethics is. The paper then proceeds in a more positive vein to define and explain for the sceptic what business ethics is. Everyone must confront the question, what should I do in my business relationships? Business ethics is defined, then, as the effort to develop Socratically one's answer to this question, that is, through the critical examination of alternatives. In the process of explaining this notion, several other senses in which someone might say that there is no such thing as business ethics are explored and the basic distinction between the moral point of view and ethical egoism is introduced.     

Should I invest with my conscience?

This paper discusses the idea that investors have moral reasons to avoid investing in certain business areas based on their own moral views towards these areas. Some have referred to this as 'conscience investing', and it is a central part of the conception of ethical investing within the socially responsible investment (SRI) movement. The paper presents what is taken to be the main arguments for this kind of investing as they are given by those who have defended it, and discusses the plausibility of these arguments from the point of view of moral philosophy. The paper argues that focusing on the moral views of individual investors is not very fruitful – there are strong reasons to think that investors do not have moral reasons to invest 'with their consciences', or, to the extent that such reasons are allowed, that they are very weak compared with other sorts of moral reasons pertaining to ethical investing.     

Non-compete agreements: How fiduciary duty and covenants not to compete restrict managers’ mobility

Companies spend time and money training employees; in the case of a merger or acquisition, they spend resources such as cash, stock, and debt. It makes sense, then, that they do not want an employee to take the expertise the company underwrote to a competitor. Thus, employment contracts will often include non-compete clauses—sometimes known as covenants not to compete—which state that the employee cannot move to a competitor for a certain period of time. Though not all employees have the heightened fiduciary duty of board members and officers, they frequently have signed agreements that, at least on paper, restrict their employment mobility. Not only have officers and board members often signed such agreements as well, but they also have fiduciary duties further restricting their new employment plans. In decades of teaching courses in the legal environment of business as well as in business ethics, no topic flummoxes students more than this one. After all, in a free country, a person should be able to work where they wish, right? How can such restrictions be fair? Legally and ethically, this is a complicated area and one in which the old lawyer’s answer—it depends—is true. This article provides some parameters for employees and employers to know when fiduciary duty precludes certain employees from moving to a new company, including when those are legal in what ways they are fair.     

The Why's of Business Revisited

One can determine the nature of something by asking what it is for. For example one understands what a chair is when one understands it is for sitting on. This involves understanding its purpose. One type of corporation is the for-profit-corporation. This seems to indicate that this type of corporation, the business corporation, has as its purpose to make a profit. Is that as obvious as it first appears? The favorite way for philosophers to arrive at the "purpose" of anything is to ask the question "Why?" But there are at least two answers to the question "Why"? when addressed to a social practice such as business. One might be asking for a psychological account (explanation) of "Why" a person does business, and this is primarily answered by discovering the motives behind business activity; or one might be asking for a justificatory reason (justification) for the practice – what purpose legitimates business as a human activity. These two answers are often conflated and thus the purpose of business is often considered to be answered by giving the psychological account of the self-interested profit-making motive. This paper will attempt to highlight the importance of making the distinction between motive and purpose clearly, show what confusions arise when the distinction is ignored, and hint at some of the structural philosophical reasons why the distinction got blurred in the first place.     

The Role of Infomediaries: CSR in the Business Press During 2000–2009

Given the important role that business media play in corporate life, scarce attention has been paid to the role of media in the construction and popularization of corporate social responsibility (CSR). In this article, we understand media as a key infomediary and examine how the business press has framed and presented CSR over the last 10 years. Based on a content analysis of how CSR is presented in two English-language business newspapers with an international readership, we develop a framework for understanding the role of business media setting the corporate CSR agenda. The results show that business media contribute to the construction of what CSR means in corporate practice by creating links between CSR and certain corporate activities, between CSR and arguments that strengthen the view of CSR as a business case, and between CSR and certain spokespersons. These links contribute to create a notion of what CSR stands for, what it means in practice, and why it is important that one should pay attention to.     

The Business of Boycotting: Having Your Chicken and Eating It Too

We assume that there are certain causes that are morally wrong, worth speaking out against, and working to overcome, e.g., opposition to same sex marriage. This seems to suggest that we should also be boycotting certain businesses; particularly those whose owners advocate such views. Ideally, for the boycotter, this will end up silencing certain views (political or otherwise), but this seems to cause two basic problems. First, it appears initially to be coercive, because it threatens the existence of the business. Second, it runs counter to the intuition that we should not force unpopular opinions out of the marketplace of ideas. Boycotting is by its very nature a coercive act, and thus we have to carefully consider what types of actions may warrant this type of coercive action. In this paper, we will argue that an organized boycott is justified if and only if the actions taken by the company have negative consequences that outweigh the negative outcome of the boycott.     

One hundred years of excellence in business education: What have we learned?

The quality of the next generation of business leaders will be determined by the ways in which business schools respond to a host of dramatic changes emerging in the environment of higher education. While specific initiatives will vary widely, one thing seems certain: business schools will need to be more nimble, more innovative, and more efficient than ever before. The Kelley School of Business, Indiana University has consistently been at the forefront of business education. Over the past century, the School has developed a set of capabilities that has enabled it to capitalize on the forces that have shaped the evolution of business education. In this article, we review several significant trends affecting the future of business education and share the success principles that we believe are most applicable to thriving in the new world that is on our doorstep.     

Bridging the Gap Between Theory and Practice: Using the 1991 Federal Sentencing Guidelines as a Paradigm for Ethics Training

Although Business Ethics has become a topic of wide discussion in both academia and the corporate world, questions remain as how to present ethical issues in a manner that will effectively influence the decisions and behavior of business employees. In this paper we argue that the Federal Sentencing Guidelines (FSG) offer a unique opportunity for bridging the gap between the theory and practice of business ethics. We first explain what the FSG are and how they apply to organizations. We then show how discussions of the FSG might be used in business ethics courses in a way that is both theoretically sound and practically applicable. Finally, we show how the requirements of the FSG can be used by companies to develop effective ethical compliance programs. As such, we maintain that the FSG provide a powerful heuristic tool for the teaching and training of business ethics.     

Are your cash-flow tools recession ready?

In good times like those most businesses have enjoyed for the past decade, business owners have typically watched their income statements with pleasure, as year-to-year performance gains have fattened their dividend payouts and increased the valuation of the companies they own and run. All too often in such times, scant attention is paid to what’s between the top line and the bottom line of the income statement. Worse, most business owners, in my experience, give little more than a cursory nod to the balance sheet. Why does this matter? When a recession lands on their doorstep with a sudden thud, as it apparently just has, many of these same people will find themselves having sailed too close to the wind, with cash running out and a dearth of tools to help them weather the storm and understand what has gone wrong. But it need not be so, for there are four simple tools to help any business owner answer these four important questions: (1) Where is cash going in my business, and where is it coming from? (2) To what extent are my profit margins improving or declining, and why? (3) To what extent am I effectively managing the cash-flow relationships with my customers and my suppliers? (4) What, if anything, can I do to better manage the cash that flows into and out of my business? If your business is threatened by the COVID-19 pandemic, here are some tools to help it survive.     

The use of NDAs in the IT service sector

Business people are advised to use contracts for the protection of their assets when entering business transactions with other strategic partners. Non-disclosure agreements (NDAs) are examples of such contracts that limit what those with access to certain knowledge can do with the privileged information. However, knowledge is constantly changing as soon as someone gains knowledge and adds personal knowledge to that knowledge. As such, the NDA may be redundant soon after it is signed. IT service professionals realize the boundless nature of knowledge and regularly work with professional colleagues to provide technical services to their customers. I provide a qualitative analysis of interviews with four IT service professionals on their use of NDAs in formal business transactions and in informal consultative sessions. I find positive attitudes toward the use of NDAs in formal business transactions such as in strategic partnerships but limited use of NDAs in informal consultative sessions.     

A Model of Business Ethics

It appears that in the 30 years that business ethics has been a discipline in its own right a model of business ethics has not been proffered. No one appears to have tried to explain the phenomenon known as ?business ethics’ and the ways that we as a society interact with the concept, therefore, the authors have addressed this gap in the literature by proposing a model of business ethics that the authors hope will stimulate debate. The business ethics model consists of three principal components (i.e. expectations, perceptions and evaluations) that are interconnected by five sub-components (i.e. society expects; organizational values, norms and beliefs; outcomes; society evaluates; and reconnection). The introduced model makes a contribution to the creation of a conceptual framework for business ethics. A few tentative conclusions may be drawn from the introduced model of business ethics. The model aspires to be highly dynamic. The ultimate outcome is dependent upon the evolution of time and contexts. It is also dependent upon and provides reference to the behaviours and perceptions of people. The model proposes business ethics to be a continuous and an iterative process. There is no actual end of the process, but a constant reconnection to the initiation of successive process iterations of the business ethics model. The principals and sub-components of the model construct the dynamics of this continuous process. They provide guidance on what and how to explore our common efforts to understand the phenomenon known as business ethics. The model provides opportunities for further research in the field of business ethics.     

Business Ethics in South Africa

In this paper an assessment will be made of the state of Business Ethics as an academic discipline as well as on the extent to which theory on Business Ethics has been translated into practice within the South African society. First the way in which Business Ethics is defined will be examined. Then the issues within the field of Business Ethics that is considered to be most important will be addressed, as well as the reasons why it is believed to be important to address them. From there the attention will be shifted to the way in which Business Ethics has been institutionalised at tertiary education level. An overview of important initiatives taken by the business sector themselves will also be reviewed. Then co-operation between business and academia on Business Ethics will be discussed. Finally an assessment will be made of what can be learned from Business Ethics elsewhere in the world and what can be offered in this regard. Also some future prospects of Business Ethics in South Africa will be explored.     

Professional Ethics and The Culture of Trust

The cause of ethical failure in organisations often can be traced to their organisational culture and the failure on the part of the leadership to actively promote ethical ideals and practices. This is true of all types of organisations, including the professions, which in recent years have experienced ongoing ethical problems. The questions naturally arise: what sort of professional culture promotes ethical behaviour? How can it be implemented by a profession and engendered in the individual professional? The answers to these questions are of interest to business ethicists since the causes of ethical problems in business are often the same and the professions, as ethically challenged organisations, make useful and informative analogues for the measures to be adopted or avoided when the attempt is made to raise the ethical standards of business. Given this focus on the professions, it will be argued that the usual, direct attempts to control unethical behaviour by using codes of ethics, legislation and self-regulatory regimes, are not successful. The answer, it will be argued, lies in using an enforced self-regulation model that aims for ethics indirectly. Such a strategy seeks to develop a goal-orientated professional culture which is actively promoted by the leadership of the profession as well as the members. Specifically, the culture is one that seeks to promote trust in the profession and trustworthiness as a virtue exemplified in each individual. It will be argued that in order to develop a professional culture that cultivates trust a profession will need to develop certain institutions, programs and structures within the profession. I conclude by setting out a model of these trust-cultivating structures.     

Strategic Choice of Sales Channel and Business Model for the Hotel Supply Chain

In this paper, we study whether a hotel should cooperate with an independent online travel agency (OTA) to sell rooms, and, if yes, using what business model—the Merchant model or the Agency model. In the Merchant model, the OTA purchases rooms at a discount wholesale price and sells them at a profit, but takes on the risk of having unsold inventory. In the Agency model, the OTA passes reservations booked by its customers to the hotel and receives an agreed commission fee on each transaction. We demonstrate that there is no one strategy tailored to all situations: the choices of channel and business model are closely tied to certain conditions, like the hotel’s room capacity, consumer acceptance of the OTA channel, the increase in market size with the OTA channel and the commission rate charged by the OTA. The hotel’s equilibrium strategy indicates that adding the OTA channel does not increase the hotel’s profit if the hotel’s capacity, the increase in market size with the OTA channel, and consumer acceptance of the OTA channel are relatively small. Regarding the selection of business model, in general, larger hotels offered a larger increase in market size with the OTA channel, and where the commission rate is low, will prefer the Agency model; otherwise hotels will prefer the Merchant model. Managerial guidance regarding channel and business model selection is provided.     

Managerial and Other White-Collar Employees’ Perceptions of Ethical Issues in their Workplaces

Understanding what types of issues working adults perceive as ethical in their workplaces will allow better teaching of business ethics. This study reports findings of a thematic analysis of 764 ethical challenges described by working adults in a part-time MBA program and combines its findings with the other published studies on perceptions of ethical issues in the workplace. The results indicate that most people are assured about what they describe as ethical transgressions although experts might disagree. It also highlights certain issues and contexts as being more frequently perceived than others. Ideas for future research in this area are also explored.     

Designing and Delivering Business Ethics Teaching and Learning

The recent corporate scandals in the United States have caused a renewed interest and focus on teaching business ethics. Business schools and their faculties are reexamining the teaching of business ethics and are reassessing their responsibilities to produce honest and truthful managers who live lives of integrity and ethical accountability. The authors recognize that no agreement exists among business schools and their faculties regarding what should be the content and pedagogy of a course in business ethics. However, the authors hold that regardless of one’s biases regarding the content and pedagogy, the effective teaching of business ethics requires that the instructor in designing and delivering a business ethics course needs to focus particular attention on four principal questions: (1) what are the objectives or targeted learning outcomes of the course? (2) what kind of learning environment should be created? (3) what learning processes need to be employed to achieve the goals? and (4) what are the roles of the participants in the learning experience? The answers to these questions provide the foundations for any business ethics course. The answers are major determinants of the impact of a business ethics course on the thinking of students and the views on the ethical and professional accountabilities and responsibilities of managers in the workplace.     

Compliance and the Illusion of Ethical Progress

It has become common for business practitioners and management scholars to distinguish between compliance and ethics. According to the conventional distinction as expressed in Paine’s formulation of Integrity Strategy, compliance is ordinarily a necessary but insufficient condition for ethics. Now that this distinction has been institutionalized in the most significant judicial, legislative, and regulatory developments in American business conduct management since the Enron failure, it is worth asking whether the current emphasis on ethics represents progress. Does it make logical and practical sense to impose ethics as a compliance requirement, or have we come full circle? I argue that assertions of organizational ethical progress, usually involving an increase in the number and or severity of compliance restrictions, do not get the conventional distinction quite right. Moreover, under the consensus distinction, there can be no such thing as organizational ethical progress. However, our ordinary ways of talking about business conduct management often betray logical confusions about the ethics–compliance relationship. While the metaphors we employ – “higher standards,” “raising the bar,” “gray areas,” and “crossing the line,” etc. – perform a worthwhile function as standards for external evaluation of business conduct, they also have a tendency to limit and impoverish our conception of what it is to be ethical. The idea that ethics matters is fundamental to Integrity Strategy’s implicit claim, consistent with conventional wisdom and moral theory, that the objective of responsible conduct cannot be achieved solely by imposing from outside what is required but must also appeal to what is desired.     

Business policy,ethics and society

This section will cover (a) definition of business policy: strategic decisions in the enterprise; (b) ethical behaviour above and beyond the requirements of the law: what might this involve e.g. in respect of products and markets in which the business is prepared to operate? (c) does business have a responsibility towards ‘society’? For example, should businesses decide without being legally required to do so, to undertake activities which they think are in the national interest even if this may appear to conflict with strictly commercial interests? (d) if ethical/social decisions are required, who is to make them — at what levels of an enterprise — e.g. does the board make them all or are they also expected below board level? This section will also cover: (e) practical examples in the light of changing attitudes towards business and market behaviour in the 1980's and 1990's; (f) implications of attitudes towards corporate crime and of behaviour which may not be illegal but which may be regarded as ‘unacceptable’: this will be discussed with examples from experience in Australia and other countries. The section will first explain the meaning of the phrase ‘business policy’ and will briefly outline the kinds of strategic decision which have to be made in business enterprises. It will go on to consider whether there are things a business ‘ought’ or ‘ought not’ to do even if they are within the law. The section will illustrate these problems with examples in the light of changing attitudes towards business policy and market behaviour in the 1980's and 1990's. It will take into account some recent cases of corporate crime in Australia and elsewhere and also of behaviour which while neither against the law or outside the power of the board, might be thought ‘inappropriate’.     

Unapplied Ethics: On the Need For Classical Philosophy In Professional Ethics Education

The central claim of this essay is that thoseof us who teach applied ethics courses shouldconsider infusing those courses withdiscussions of central issues in classicalphilosophy, issues which lie beneath thesurface of contemporary ethical problems in theprofessions. I will argue that the current,widely-used approach of discussing traditionalethical theories as an introduction to andfoundation for such courses may not adequatelyserve what should be the overarching goal ofpre-professional ethics education which is toteach a kind of ethical thinking which is notto be identified exclusively with ethical``decision-making'. Such thinking, it will beargued, is both practical and theoretical innature and therefore has a greater breadth thanthe more delimited ethical decision-makingoften taught in applied ethics courses. In whatfollows, I will therefore advocate thatteachers include a substantive ``unapplied'component in professional ethics educationcourses. While I believe that my argument foran unapplied approach to professional ethicseducation is relevant to many professionalfields, I will focus on business ethicseducation.