Unit VIII: Importance of Business Ethics

Importance of Business Ethics
Name
Institution
Importance of Business Ethics
Introduction
For many years now, the link between organizations and the society has evoked various financial, social and moral environmental challenges. Although the business has served the society in an ideal manner, the relationship between the two has become strained in recent days. This criticism is a clear sign that the organization has taken advantage of the numerous benefits that can be derived from having a working relationship with the society. The criticism in the manner in which the society deals with the community first came to light in 2001 and has continued to be in the spotlight up to the modern day although on a different capacity. The emergence of the strain between the community and the company first became evident when Enron filed for bankruptcy in 2001. What followed the filing for bankruptcy became a series of accusations that led to the implication of numerous people in to the Enron scandal. In the process, 30 states ended up siding with the Enron shareholders in demanding for compensation from the company's management (Silverstein, 2013). In 2009, the leading Enron investigator concluded that the rot in the company was enough evidence that the management was not attentive to what was happening in the company. One major conclusion he made was that the general managers did not have a keen interest in the things happening within the firm. After the Enron expose, numerous other companies across nations were found to have engaged in unethical practices that made investors to lose large sums of money. This expose led to a redefinition of the manner in which organizations relate with the society (Joseph, 2013). Despite the example set by the Enron debacle on the damage that the absence of practicing ethics can do to a business, many businesses still ignore ethics in their practice due to the downsides associated with the concept but this often comes with detrimental effects.
The general study of ethics highlights issues to do with justice and fairness while business ethics addresses the moral issues that crop up in a business enterprise (International Statistical Institute, 1986). While many people think that business ethics only dealt with the Enron saga, the truth is that even the Wall Street collapse that was witnessed in 2008 was a question of organizations not adhering to business ethics. Ideally, the major role of the management in a business is to ensure that they deal in an ethical manner with the shareholders, as well as to ensure that that they address the conflict that occurs between the company and its customers. At the center of this task rises the ethical dilemma that all businesses have to deal with in their day to day undertakings. On top of the challenge of ensuring that the customers are dealt with in an ethical manner, the management also has to ensure that all the employees act in a manner that is consistent with the organization's ethical principles. This is crucial as the manner in which the employees act affects not only the organization but the entire community as well (Dewey, & Tufts, 1932).
Social Responsibility and Responsiveness
One thing that has been at the center of business ethic...