Information and Communications University

INFORMATION AND COMMUNICATIONS UNIVERSITY

COURSE NAME: Business Ethics and Corporate Social Responsibility

An assignment submitted in partial fulfillment of the requirements for the BA Degree in Human Resource Management

Assignment: Question Two Student Name: Akende Boyd SIN: 1701169476

Lecture Name: Choolwe Ngosa Semester: Two Year: 2017

Question: Discuss the relationship between business ethics and corporate social responsibility and the difference in the two concepts thereafter explain how the two concepts are applied in organizations Introduction

Over the years Corporate Managers are becoming more concerned about problems affecting their organizations in relation to the society and the business world. These problems can only be solved by answers to this question: What is the best way to sort out these problems? Secondly does the business have a social responsibility? If so, how much and what kind? The increased expectation of various parties involved has forced organization to become more socially responsible. ’The public recognizes that today's business organization has evolved to a point where it is no longer the sole property or interest of the founder, the founder's family, or even a group of owner-investors. Unless today's organizations recognize the importance of developing and sustaining a reputation that is built on "doing the right things" and "doing things right" as viewed by their key stakeholders, they will not survive or thrive.” (Sims 2003, P: 9). On the other hand the societies which we live in, have defined for themselves values which they choose to emphasis. This in itself is a problem because organizations have to fill in the gap. And this can be done by what is now known as “Corporate Social Responsibility” (CSR).” How and what will be done about the problems is called “Business Ethics.”

The aim of this assignment is to discuss the relationship between business ethics and Corporate Social Responsibility, the deference in the two concepts and thereafter explains how the two concepts are applied in organizations

Corporate Social Responsibility refers to “an organization's moral obligation toward others who are affected by the organization's actions. (Sims 2003, P: 44). This can further be explained as the as an organization that assumes to maximize its positive impact and minimize its negative impact 0n society, Socially responsible business win the trust and respect of their employees, customers, and society and, in the long increase profit. In today’s increasingly competitive economy, the Corporate Social Responsibility (CSR) has become not just a general practice, but almost a necessity for business development. Indeed, a growing number of companies promoting their corporate social responsibility in response to a variety of social, environmental and economic pressures. The aim is to send a signal to the various stakeholders with whom they interact: employees, shareholders, investors, and consumers, public authorities to assure them that profits and increasing shareholder value don’t overshadow the need to behave ethically to their stakeholders. It is an obligation of business to society. Being socially responsible means maximizing the positive effects and minimizing the negative effects on society. CSR is the use of a business's resources to respond to help solve social problems and achieve social goals. An example of a company practicing good CSR is Zambia Electricity Supply Corporation (Zesco) that supplies energy serving bulbs sustainable homes which use less energy. Their stakeholders are satisfied that the homes are paying less but using more power supply. Despite its positive impacts, Some critics argue that corporate social responsibility (CSR) distracts from the fundamental economic role of businesses; others argue that it is nothing more than superficial window-dressing, others argue that it is an attempt to pre-empt the role of governments as a watchdog over powerful corporations though there is no systematic evidence to support these criticism.

Ethics is a philosophical term derived from the Greek word "ethos," meaning character or custom. Ethics can also be regarded “as a set of moral principles or values. Morality is a system or doctrine of moral conduct. Moral conduct refers to that which relates to principles of right and wrong in behavior. Business ethics therefore, is concerned with good and bad or right and wrong behavior and practices within a business context. Concepts of right and wrong are increasingly being interpreted to include the more difficult and subtle questions of fairness, justice, and equity” (Sims 2003, P: 15), Business Ethics refers to principles and standards that define acceptable business conduct. Acceptable business behavior is defined by customers, competitors, government regulations, interest groups, the public and each individual personal moral principles and values. It is important in business because it builds trust and confidence in business relationship. Unethical actions my result negative publicity, declining sales and even legal action. (Whitehead 2012: P 46) The two key branches of moral philosophy or ethics Normative (what ought to be" or "what ought not to be" in terms of business Practices and the establishing of norms, customs and values) and Descriptive Ethics (concerned with describing, characterizing, and studying the morality of a people, a culture, or a society. The “rules or standards governing the conduct of a person or the members of a profession. (Thefreedictionary, 2000). Individual, are the ones who chart the ethical course. For example the means to acquiring contracts may be by honest business deals or corrupt business deals.) The concept of ethics has attracted some contra dictions and dilemmas despite its effectiveness in aspect of maintain good company reputation

Differences .  Companies though they are committed to being socially responsible for the company, employees behavior have been found to be engaging in acts that cannot be called ethical. Meaning the two cannot always be uniform.

 Social responsibility is thought of in general terms of environment impact and giving back to the community, and business ethics deals with issues that run through the organization such as honesty, keeping promises, fairness etc…

 What is good for the society is sometimes not good for the business and what is good for the business is almost always not good for the society. For instance societies become accustomed to receiving alms/ help but at times organizations has some form of obligation to its employees e,g Salary increment’s that motivate them to be diligent and honest workers.

 Social responsibilities is easy to understand because it’s all about public interest that benefit the community, while business ethics is based on conscience and causes much confusion when dealing with it.

 Ethics is focused on the good and bad, right and wrong which means the company must follow the right behavior to benefit the good of everybody but in some cases it is not so, because others do crooked things just to get their desired profit. Social responsibility has an obligation to perform beneficial activities for the society, while business ethics, despite of its moral obligations, is focused on profits and personal interests.

Business Ethics is an umbrella term that covers all ethics-related issues. We can rightly say all professionals in all areas of business face ethical challenges and this applies to both public and private companies. Corporate Social Responsibility is commitment of corporate contributes to the society in order to maximize the benefit to all the related stakeholders. The stakeholders include the owners, investors, employees, customers, government, suppliers, competitors and the community.

The relationship between ethics and social responsibility is one that is often discussed, but sometimes interpreted differently. For our purposes, ethics deals with issues pertaining to the organization and its stakeholders in day to day business transactions. Social responsibility refers to a company's posture relative to the community (either narrowly or broadly defined). Ethics tends to be more internal in orientation, while social responsibility is more external, but the orientation is not an absolute one. Ethics usually deals at the individual manager level, while social responsibility is associated with the corporate/organizational level. Some view ethics in marketing as being synonymous with social responsibility. Many companies that are highly ethical also exhibit heightened levels of corporate social responsibility (CSR), but they are not the same. In fact, the term “corporate citizenship” is used now to denote many of the activities that fell under CSR umbrella. (Maignan and Ferrell 2000)

 Corporate Social Responsibility is as indeed growing and a number of companies are promoting their corporate social responsibility in response to a variety of social, environmental and economic pressures. And by doing so, there comes even a greater need to pay attention to ethics.

 Organizations are adhere CSR because that found that they cannot survive without the society support. Ethics is vital in corporate. For instance, a non-ethical company using poisoned water recourse to make the drinks, and they try to cover it up instead of use other recourse because it will cost them more money. Then, it ends up with some lawsuits and band from sales. The success of any businesses, is dependent on meeting the expectations of the society.

 Ethical values and standards should underpin everything that an organization does and the way its employees conduct their everyday business. And because ethics is about "doing things ethically". It will automatically influence how organizations approach the business operations and its voluntary contribution to the wellbeing of the global and local communities in which it operates. Corporate Social Responsibility (CSR); it is often about "doing things ethically

 The importance of corporate social responsibilities in relation to the ethical responsibility, is that, ethics is applies into difference level of social responsibilities, which is economic, legal, ethical, and discretionary responsibilities. There are six main areas of social responsibility, where ethics are applied and useful, these are:- the employees, providers of finance, consumers, community and environment, government, and other organizations or groups.

First and foremost the Corporate begins with an obligation with an ethical nature and accountable to its stakeholders in all its operations and activities with the aim of achieving sustainable development not only in the economical dimension but also in the social and environmental dimensions so as to produce an overall positive impact. Firms should be operated in order to serve the interests of customers, employees, lenders, suppliers, and neighboring communities as well as stockholders.. ”that to perform well, managers need to pay attention to a wide array of stakeholders (e.g. environmental lobbyists, the local community, competitors), and that managers have obligations to stakeholders which include, but extend beyond, shareholders.” But how it is done becomes more important than just having it done. (Bowie 2001, P:7)

Corporate Social Responsibility

 Companies try to create a positive impact on society while doing business. Corporations and their consumers identify potential risks associated with a product's lifecycle and enable end users to confirm the corporation's practices adhere to social responsibility ideals.  Passive responsibility done by a company, - avoiding engaging in socially harmful acts eg waste management by dumping of waste away from the communities , or Active Responsibility - by performing activities that directly advance social goals. E.g Financial Donations to the community towards construction of a borehole for water supply to society.  Intergenerational Social responsibility- being mindful that actions of one generation have consequences on the next generations. E,g the timber supplier industries must ensure planting other trees even as they continue cutting to avoid leaving bear land for the sake of the next generation. Responses to CSR and ethics concerns to the public interests, for example, despite tobacco companies, that selling cigarettes which may be harmful to one’s health, they are still socially responsible, in that they put cautions on their packages to show that excess intake of tobacco is harmful to a person’s health.

 Internal audits role; CSR encourage internal audits to reduce unethical practices within organizations. Organizations have codes of conduct which if violated by any employee, becomes a measure of right or wrong conduct. This helps to keep in check the workers.

 At individual level; a person can deal with situations ethically when faced with a situation that may require for them to decide what is right or wrong for example in a case where a person makes a purchase and is given extra money to the initial change. Will he h keep the extra one give it back?

Ethics and CSR must be ever going to allow organizations gain the credibility and maintenance a stronger record of professionalism and be accountable for any action that they take. The advantages and important of corporate social responsibilities & business ethics is that, the suppliers, business associates, and customers would be more confident on the organization’s products and services. This in turn leads to profit maximization. This is more sustainable because corporate social responsibility, if well integrated with business ethics it becomes an integral part of the wealth creation process which if managed properly should enhance the competitiveness of business and maximize the value of wealth creation in society at large. References

Akrani G, (2011), what are Business Ethics? Meaning, Definitions, Features Retrieved at: [http://kalyan-city.blogspot.com/2011/09/what-are-business-ethics-meaning.html?m=1]. Available at: Kalyan City Life Blog, 9/30/11

Bowie N, E (2001), Business Ethics (Business and Management Ethics –Applied Ethics eISBN: 9780631221234, Black Well Publishing, USA

Available: [April 27, 2016]

Kalinda, B. (Ed.) (2001). Social Responsibility and Organizational. Ethics Encyclopedia of Business and Finance (2nd ed., Vol. 1). New York: (Macmillan Reference)

Maignan, I. and Ferrell, O. C. 2000: Measuring corporate citizenship in two countries: The case of the United States and France. Journal of Business Ethics, (23), 283 97.

Pride, William M., Hughes, Robert James, & Kickapoo, Jack R. (2008). Business (9th Ed.) Boston, MA: Hough-ton McFarland Company. ISBN 0-618-77091-7

Weiss J.W. (2014) Business Ethics- A Stake Holder and Issues Management Approach, 6th Edition, Berrett –Koehler Publishers, Inc, 235. Montgomery Street. Suite 650. San Francisco, California 94104-2916. U.S.A Available at: [www.bkconnection.com]

Sims R. R. (2003)Ethics and Corporate Social Responsibility: Why Giants Fall. Available at: British Library Cataloguing in Publication, Greenwood Publishing Group, Inc. United States of American.