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Ethical and Socially Responsive Business Essay

Describe key areas of the selected company’s code of conduct that are of significant importance to the business, and explain why.

The first question we should ask ourselves “what is ethics?” I think ethics are a collection of principles and practices that a business believes in, statements and more specific policies about conduct to give employees, partners, vendors, and outsiders an idea of what the corporation stands for and how it’s staff should conduct themselves . The Cheesecake Factory was established in the 1940s by Oscar and Evelyn Overton. In 1972 they open their first business store to Los Angeles, CA known as the Cheesecake Factory. Now The Cheesecake Factory has over 170 locations around the world. Having such a large corporation like Cheesecake Factory brings a lot of ethical and business problems when it comes to having such a large stores and staff.

We should always remember that everyone has their own set of moral ethics that they live by at tend to take those same ethics to the work place. When writing a code of ethics it is important that these will cover every staff member from the top of the corporation to the lowest lever employee. Key areas that are of significant importance to The Cheesecake Factory start with the general standards of conduct in how all its employees will be treated by fellow employees and by management. The standards deals the basic values that we all have, with the expectation of building trust, loyalty, honesty, respect, and a high level of professionalism within the company.

The cheesecake Factory has an established code of ethical conduct that is an essential factor in maintaining a proper balance in the human aspect of ethics and the link to the business success. Corporate leaders and managements need to be careful about their behaviors and how they make important decisions. Although all areas of the Cheesecake Factory’s code of ethical conduct is important for the success of the company, there are a few key areas of the company’s code of ethical conduct that are of significant importance for The Cheesecake Factory.

1-The first occurs in Article IV, in the “Conflicts of Interest,” section that pertains to transactions and investments. This specifically states that an officer or a director” should avoid participating in any transaction or investment that conflicts with, or gives the appearance of a conflict with, the interest of the company.”(Reference 1) This is key in maintaining ethics because a person who is in a leadership / management positions must be loyal to only their organization; otherwise, all decisions that are made and act are suspect as to the integrity of the choice, especially concerning money matters.

2- A second key area of The Cheesecake Factory’s code of ethical conduct that is of significant importance is in Article V, in the “Compliance with Company Policies and Procedures,” section that pertains to confidential information. It is very important and essential for the success of any company and business especially, the confidentiality of information, especially for third parties, be maintained. This leads to another key area that is also in Article V of the company’s code of ethical conduct. In the section that pertains to insider trading. In the section that deals with prohibiting insider trading it states that, “An officer or director shall observe the Company’s policy prohibiting trading on the basis of material, non-public information.”(Reference 1)

2.Explain the key steps that the company should take to ensure that employees follow the code of conduct. There are some key steps that a company can take in order to ensure the employees follow the code of conduct.

1-The Cheesecake Factory should have a “compliance department” that handles all disputes and investigations regarding violations of the code of conduct. This specific department at Cheesecake Factory should have designated employees that govern the entire company’s employees and handle any issues that arise.

2-The Cheesecake Factory can take to ensure the employees follow the code of conduct is to have each employee sign and date, the code of conduct when they hired and give it to the employee a copy and keep another copy in the employee files. This makes it possible for the employee and the company to be on the same page from the beginning of the working relationship. This process can repeat every year for the existing employees to follow the code of conduct.

3-The Cheesecake Factory can take to ensure the employees follow the code of conduct is complete mandatory “ Business ethics” training videos for new and existing employees every year. These videos make sure reminder of all employees’ business ethics and code of conduct.

3. Suggest three (3) ways in which the restaurant can engage in socially responsive activities in the community within which it operates

The Cheesecake Factory can engage many socially responsive activities in the local community.

1-The Cheesecake Factory can donate foods to local food banks, soup kitchens and homeless shelters. Restaurants always have extra food that does not used for any reasons or left over foods. As a respectful company being able to donate fresh food to shelters and feeding someone who is unable to have a meal, would be wonderful social responsive project and activity.

2-The Cheesecake Factory could engage in socially responsive activities in the community would be to help raise money for a local non-profit organizations, charities, children hospitals or cancer associates. This could be done by donating money, ask costumers to participate or fund rising which will show that the company is giving back to the local community in which it is a part.

3- The Cheesecake Factory could engage in socially responsive activities in the community would be to offer free meals to shelters for specified holidays, such as Thanksgiving and Christmas. 4- Also Cheesecake Factory could run campaign for “Local Food Drive” to contribute as a company and ask their costumers donate dry and canned foods to reach local families who needs help .This is one of excellent way of giving back to the local community.


1. (March 16, 2004) The Cheesecake Factory Incorporated. Amended and Restated Code of Ethics for Executive Officers, Senior Financial Officers, and Directors. Retrieved from: http://investors.thecheesecakefactory.com/phoenix.zhtml?c=109258&p=irol-govconduct.

2. (January 2001) C.B. And R.L. “The Legal Environment of Business: Text and Cases: Ethical Regulatory, Global, and Corporate Issues.” Cengage Learning, 8th edition.

3. (January 2012) Ferrell, O.C. And John Fraedrich. “Business Ethics: Ethical Decision Making & Cases.” Cengage Learning, 9th edition.

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