Business Ethics In The Workplace

The phrase “the business of business is business” by Milton Friedman is often translated into a mantra that excuses hurtful or cold behavior as the nature of business. Through the lens of a free market economist, they see acting in self-interest as being ruthless and inconsiderate. Due to the nature of free-market economists following a laissez-faire ideology, they would justify actions as what needs to be done to meet supply and demand or to be successful within the free market. Any action can then be justified within those terms, meaning that if someone were to perceive something as hurtful or impersonal, the company can blame it on business. Many films in pop culture have also taken this perspective. Notably, I think of the movies The Devil Wears Prada, Trading Places, and 9 to 5. This concept reminds me of a scene in the movie You’ve Got Mail. Tom Hanks' character has a large bookstore chain and forces a local small business owned by Meg Ryan to go out of business. Tom Hanks' character's justification is to say that “it's not personal, it's just business.” Meg Ryan’s character responds with “What is that supposed to mean? I am so sick of that. All that means is that it wasn’t personal to you. But it was personal to me. It’s personal to a lot of people. And what’s so wrong with being personal, anyway?” Seeing this culture in film and hearing about how businesses would willingly put down the livelihoods of their own employees, their communities, or the environment to gain a slight margin above the competition can feed into this school of thought. The ethical implications of this mindset are often that it encourages people to turn a blind eye to unethical behavior because it's just the nature of business. In my opinion, this is completely incorrect. The organizational culture and the way that the media portrays business can encourage silence and inaction for change. What is notable about Porter and Kramer’s Strategy and Society: The Link Between Competitive Advantage and Corporate Social Responsibility is that they have developed a framework and ideology that challenges the notion that success in business means that you must cheat or betray society. Porter and Kramer also emphasize that a healthy society needs businesses to innovate, create jobs, goods, and services, and pay the taxes that support societal activities. This means that the best corporate social responsibility initiatives are good for business and good for society.

I believe that Porter and Kramer would disagree with Milton Friedman's notion that the business of business is business. I think they would argue that aligning business interests with a societal gain is more beneficial to create a healthy long-term relationship with customers, employees, and their stakeholders. There's also a new emphasis on businesses being in line with consumer values. The greater expectation from consumers for businesses to be in line with their personal beliefs can be explained by the interconnectivity of the values of the business with the external values of social responsibility.These are overlapping more because of an organizational culture that has been created with moral foundations in mind. An example that comes to mind is Patagonia. When you go to their website you are not just directed to products. On the page, there is an activism menu that has educational resources on climate justice and action items to influence the environment. This shows how the brand is solution-oriented and what makes them noteworthy over their competitors through their activism and environmentality. Employers are also looking for companies that share similar values. This also leads to why it's an ethical issue to be concerned with corporate responsibility. This is because the best ethical decisions are the ones that create the greatest societal good.

Corporations should commit to delivering value to customers, dealing fairly and ethically with suppliers, supporting their communities, and finally delivering long-term value for shareholders. This frame of view is called the stakeholder perspective. Businesses as a part of society have a responsibility to behave ethically. Deciding which issues a firm should prioritize is part of ethical decision-making. One reason that it helps to be mindful of impact and meaningfulness in terms of prioritizing ethical and philanthropic policy as a corporation is it attracts the best employees. This in turn leads to more productive work. People are also willing to be loyal to a branch that reflects their personal ideologies, acting virtuously often leads to fewer lawsuits and negative outcomes due to unethical behavior. It's also a benefit to using social responsibility initiatives to be competitive within their market. by addressing a societal need they expand their ability to gain more brand loyalty and sell more of their product or service.

In my Environmental Economics and Policy class, we talked about how government regulation is a huge part of the business industry. We often focus on topics such as air quality which looks into the issues of industrial pollution. When products are being manufactured there is a negative externality of carbon emissions. In this AEC class, we have talked about policy proposals that would tax or cap the number of emissions that would be acceptable for businesses to produce. This can be extremely costly and businesses often don't have much leeway into interpreting or responding to the policy. In my response, I believe that if businesses are able to regulate themselves on these issues they don't have to worry about government intervention. They're able to create their own policies and control their own timelines and budgets. This requires some intrinsic thoughts and oftentimes costs initially to implement systems. On some level though, there should be an industry standard or an expectation set often by a government or an association that has a societal impact in mind. This would also hold businesses accountable to make their own policies.

Corporate Social Responsibility translates into firm performance because it results in higher support from the public. One of the examples that the textbook mentioned was how American society began to resent capitalistic practices after the 2008 financial crisis. This is because of widespread income inequality and wages that were unable to cover the cost of living. Corporate and social responsibility translate to firm performance when they exercise a stakeholder model. This puts the organization at the center focus of the model and the owners, customers, employees, suppliers, government competitors, community interest groups, the media, and financial institutions. The reason that the organization is at the center of all of these stakeholder influences alters and influences the success and economic prosperity of the business. This means that the best decision is going to be in line with all of those factors. This ties into the idea that the best ethical decisions are the ones that create the most societal good and the best business decisions are the ones that make the stakeholders the happiest.

Businesses also emphasized staying ahead of the curve and being innovative. By prioritizing Corporate social responsibility are able to anticipate and meet the stakeholder's needs as well as continue to advance their own business practices. Another significant influence on businesses acting in line with corporate responsibility is to protect their reputation as good citizens. they want to be seen as brands that people identify with or share common values.

Since corporate and social responsibility are positively related to a firm's financial performance, I would highlight its importance as a manager. Due to the fact that it improves reputation, mitigates risk, and increases innovation, then as a manager I would prioritize ethical decision-making as it would have the greatest impact on societal good. Depending on the firm, there may be an emphasis on particular outlets such as environmentality or philanthropy. I understand that acting in line with corporate social responsibility isn't always the most cost-effective route. The externalities of acting against it would be too costly to the reputation and goals of the firm. For me, as a manager, it is really important to prioritize the impact and meaningfulness of work. One of the ways that I derive satisfaction is through the philanthropic goals and missions of an organization. I'm also able to create meaning when I know that the work that I do in my career benefits my community and the employees that work there. It provides an extra incentive and motivation to put in the best effort to be successful. Another reason why I would emphasize social responsibility is as a way to differentiate my business from its competitors. By creating creative opportunities to interact with the community you're able to allow the community to better understand your brand. It also helps to have initiatives that people associate with the firm. It may be an annual event around the holidays surrounding a charitable cause or they sponsor a 10K run that raises awareness for a cause. It may even be prioritizing fair trade materials or sustainably produced inputs that can set your business apart from the rest. These are mutually beneficial because you are prioritizing fairness and social justice and fostering a competitive edge. I am excited to find a way to capitalize on my passion for the community within a business environment.