Discuss The Need Of Adopting Ethical Cons

Economics concerned solely with wealth and profits has led to un-ethical practices and climate change

Climate change and greenhouse emission, deforestation, urbanization, shortage of fresh water and so on are the very many issues that need to be addressed with proper ethical behaviour. These issues, along with others, are responsible for creating the environmental liability. Therefore, for meeting these liabilities it is essential to make appropriate changes in our present lifestyle and this requires an understanding of how organizations can take part in a way that is profitable and leads to appropriate ethical behavior.

Impact of sole focus on wealth and profits in business

Unethical practices leading to human rights issues: The workplace has changed drastically over the last one decade thanks to globalization and consequent liberalization of the economy. Most organizations today concentrate on their profitability by upholding profit as the sole criteria of success, disregarding non-economic factors like social responsibility. This has resulted in neglect of corporate governance and ethical business practices resulting in violation of human rights of various ethnic groups and lower socio-economic sections across countries.

Climate Change: Climate change is one of the biggest environmental and scientific issues of our time. Actually, it is a clear violation of environmental norms and laws with little or no regard to profit-making. The argument behind the global climate change is mostly based upon the rapid increase in the level of CO2 emissions which result from various anthropogenic activities. The basic cause of the global warming is considered to be an increase in the concentration of greenhouse gases (GHG) mainly carbon dioxide emitted by human activities for their materialistic needs as well as growth over the past 100 years.

Decrease in public trust and confidence: Wealth creation and profit maximization have emerged as the prime determinant of performance evaluation of management. “Greed is good” is an oft-repeated thing in the business world. This phenomenon has led to a decrease in public trust and confidence in the business industry’s ability for self-governance, it is frequently pointed out that there are significant issues concerning both economic inequality and social inequality.

Inequalities: Inequality is a worldwide issue. Inequality refers to disparities in the distribution of power, status, and material wealth. Income inequality refers to disparities in income and wealth where all individuals can have a better standard of living regardless of gender, age, geography, ethnicity, or other materialistic conditions. This is a global phenomenon; as per estimates by international organizations such as United Nations Development Programme (UNDP), International Monetary Fund (IMF), World Bank, etc.

Importance of Business Ethics

Corresponds to Basic Human Needs: The concept of human need is very broad and hence we would be looking at it from the point of managerial and ethical needs. Ethical needs imply that every organization wants to respect the values of its employees. The managers also want to imbibe the managerial needs so that the employees can be a part of an ethical, transparent, fair, and responsible organization. Ethics are important for business and its corporate culture. The concept of ethics is very broad and covers a wide range of fields.

Credibility in the Public: Good ethics and values are vital for any organization to achieve success. It helps in reflecting the true image of the company to the public and this is the basic premise of establishing a credible reputation through which any business can gain a competitive advantage in the eyes of mass people.

Credibility with the Employees: Ethical values at the workplace are the foundation of a company’s credibility. Propriety in the personal and professional life of an employee separates the good work from the simply good worker. It defines work standards, professional goals, and ethics to be upheld by an employee in his or her organization.

Better Decision Making: Business ethics are the moral values and the moral principles that guide an individual private organization and public organizations. Business ethics control the attitude of the employees toward the customers, investors, and the competitors of its organizations in executing its daily affairs. A poor economic environment can lead to unethical decision-making.

Profitability: A successful organization is one that has a clear vision and mission. A successful organization that also has a reputation for ethical practices will likely enjoy a positive impact on future cash flows. A profitable organization does not need to sacrifice ethics to secure profits; in fact, it would be difficult to do so in the long run.

Protection of Society: Ethics is the tool that is more effective to protect the society as compared to the legal system of any country. It is used to guide the society in every field. The government cannot regulate all the activities that are harmful to the society. But ethics can take care of all these harmful actions and restrain these activities. Law is mandatory but ethics always remains personal. One must remember that laws vary from country to country but ethics never varies from one culture to another.