Ethical issues are constantly around us be it in school or at work. These issues represent one of the most fundamental aspects in the working environment in relationships or interactions between different stakeholders. The relationships between employers and employees or clients are a vital factor which drives the company’s objectives and goals. An organization’s social responsibility to the surrounding community is also, a vital factor through creating a favorable climate, for the smooth running of the company within the society.
Social responsibility recognizes the values and traditions encompassed by the community. Moreover, ethical issues may surround an institution in its daily operations, and consequently require professional consultation, regarding options which are appropriate in tackling a specific issue, on the basis of ethics and professional standards. Introduction Business ethics and social responsibility are found in many of the organizations that are adopted, by the management which enable the company or firm, to conduct its business operations upholding the welfare and wellbeing of its employees and the clients it serves.
By embracing ethics, codes of conduct and social responsibility in the businesses processes, an organization becomes transparent to its stakeholders and shareholders, thereby creating an image of competence and accountability in the actions it undertakes. Moreover, there has been an increase in the competitive nature of business in the modern society, where various and diverse businesses have flooded the market.
This competitive environment requires businesses, to redefine their objectives and goals in respect to ethics and corporate responsibility, in order to have a competitive advantage over rivals. Many organizations have failed in business ventures because of not embracing appropriate ethical behaviors, towards employees, clients and the society. Ethics are primarily dictated by individual or corporate beliefs encompassing social concepts in the day to day running of an organization. In addition, ethical issues vary among businesses, individuals, cultures or in particular circumstances.
The aim of this study is analyze the importance of ethics and social responsibility, in business operations with companies such as the Wal-Mart Store, and how ethical issues are handled so as to remain competitive in their market segment. Ethics and Social Responsibility Business ethics are vital to the operation processes in a company in relation to both internal and external factors, which influence the success of the business. A cohesive interaction between customers and a business is vital, for the optimal performance of the company.
This would comprise of customer satisfaction, employee motivation and positive business attitudes that would enable a company to successfully deliver its services or products. Formulation of code of conducts and ethics enable an organization to run its business operations, without overlooking the needs of stakeholders (Lisa, 2005 p. 24). Employees in any given business or industry, play a major role in working towards the accomplishment of goals and objectives set by the organization’s management.
The relationship between management at all levels with the employees, influences the overall output of the organization, and consequently affecting its relations with customers and performance in the competitive market environment. Ethics and codes of conduct can be defined as principles or standards set by the organization’s management, which illustrate the expected behavior of employees and the management while conducting business, on behalf of the company. They also encompass the beliefs of the organization influenced by their goals and objectives.
These conducts may entail principles such as treating customers as a priority, by serving them with a positive attitude while upholding integrity, respecting other employees, striving for excellence, and optimum service to customers. Customer satisfaction is put as the key in the overall corporate responsibility for the optimal performance of the business (Velasqez, 2005 p. 35). A company can also create a code of ethics, where both the management and the employees should follow the set guidelines, while deviation would call for actions against the individual.
They help employees to recognize situations where certain actions are deemed as a violation to the company’s ethics. In addition, business ethics influences the organizational culture of a company, where employees undertake behaviors that foster the success and growth of the company. However, even with set code of conducts, ethical behaviors and social responsibility of an organization, the bottom line dictates that trusting in an individual’s good judgment of what is wrong or right, will affect the image and performance of the organization.
Therefore, management and employees’ behaviors, culture and attitudes are crucial as they depict the ethics of the company which would ultimately, influence the perception and attitude of clients towards the organization. Effective organizational ethics entail that, firms lead with integrity at the workplace, marketplace and in the community. Social responsibility encompasses business ethics and company practices that govern how, the company runs and its role to the community.
Corporate social responsibility has become a key initiative a crucial tool for growth in a company or industry. Multinational corporations and successful businesses have adopted this powerful tool in various countries across the globe. With rapid globalization and advancement in technology, organizational ethics and social responsibility must be flexible to encompass new aspects, to the changing customer needs while still maintaining integrity and accountability, in the competitive market environment (Hartley, 2004 p.
55). Social responsibility definition varies across businesses and groups, depending on the perception towards their situations or circumstances, but generally social responsibility illustrates the role of companies to conduct their business operations, in a way that promotes human welfare and respects individuals’ rights, whether at the work environment or within the society. Additionally, the two concepts of social responsibility and ethics work hand in hand in order to provide, benefits for all stakeholders.
Moreover, difficulties or challenges that impede successful implementation of social responsibility or business ethics, by an organization should be mitigated before effective changes can be realized. The Wal-Mart Company Wal-Mart has grown to be one of the largest retailers in the world, when it started out as a single discount store more than five decades ago. It has dominated the retailing business with its numerous stores and clubs that are associated with the organization. Moreover, even through the transformations over the years, Wal-Mart has been able to uphold its integrity and culture of ethics constantly (Entine, 2008 p.
22). Ethics and social responsibility as put by the Wal-Mart’s management, has been able to define the company from its inception, and consequently influences how the organization associates with its employees, customers, suppliers and the general community. Wal-Mart has been using statement of ethics in their entire business processes, which define the types of conduct and attitudes that it upholds for its stakeholders. The business conducts create an atmosphere of fairness, honesty and the aspect of legality in the work environment.
Codes of conducts influence the overall organizational culture to adopt behaviors and working processes that enhance the performance output of an organization. Wal-Mart being in the service industry, customer relations has been its priority without overlooking the interests of employees, shareholders and the surrounding community needs. The retailing business has been striving to make considerable changes, through reviewing its business process in order to attain sustainability and commitment towards an ethical and social responsible culture (Nicholas, 2009).
This been attributed to the rapid changing external environment in ethics and business operations, constantly requiring organizations to redefine their ethical standards and principles, that put to test their sense of responsibility, integrity, fairness and honesty. Consequently, ethics at the workplace become a vital factor that influences the overall performance of the company, coupled by responsibility and accountability. The level of ethical issues has grown in significance over the years, where unethical behaviors such as those observed in the Enron Company, resulting to loss of jobs and consumer confidence.
This is detrimental to any organization as it losses its market credibility, leading to its downfall. Moreover, stakeholders in an organization who include customers, shareholders and employees are always being observant of internal decisions made, and how they impact on them. In addition, governmental agencies are constantly becoming involved and monitoring ethical issues in various organizations, with pressure directed for enactment of laws from citizens and shareholders that protect them, which may follow unethical practices in an organization.
Social responsibility at Wal-Mart has enabled it to realize significant savings, amid criticisms of not being accountable towards its employees. The company adopted a program, scorecard, to enable it review how products are manufactured, merchandised and the availability of recyclability in its goal towards green sustainability. In such cases, the company has been able to cut costs in operation and conserving energy, but it is yet to reach total sustainability and social responsibility in its operations.
Observers have appreciated the organization’s intentions, but the company has many challenges to overcome, to become a business entity that is fully environmental sustainable, coupled with the influence it has had upon suppliers, consumers and employees. The success of the giant retailing store has not been smooth sailing, as it has rubbed many of its employees and clients in the wrong way. Wal-Mart has been at the center of criticism, regarding its unethical business behaviors at one time or another. Some of the policies adopted by the retailing business have, had a negative impact and image in the corporate scene (Zimmerman, 2005).
Example, their strategy of outsourcing for manufacturers have led to loss of jobs in United States. In addition, the organization’s policy towards suppliers based on Wal-Mart’s prices, puts pressure the suppliers that results to closures of plants in the US and job layoffs. These aspects have consequently raised the question, whether the organization is an ethical company in the society. Wal-Mart’s problems can be attributed to the focus of management, towards the company’s growth and therefore neglecting important issues as brand image, social responsibility, and ethics in business operations.
Additionally, communities in the US have been debating whether to allow the Wal-Mart retailing business, to operate in their towns or cities. This comes amidst the perception of the organization and how its influences the community, customers and employees through its business operations. Protests from these communities culminate from the fact that, Wal-Mart buys its goods from Third World countries that it deems cheaper, instead from American suppliers causing those businesses to close down. Issues stem from sustainability and ethics adopted by the retailing giant, which are perceived by the communities to be wrong.
More so, the company has had its fair share of bad business practices observed in discriminatory promotion and hiring, and forced overtime among other issues. A recent incident where an announcement that was made in a New Jersey Wal-Mart store, that all black people should leave the shopping store over the public-address system, rubbed the shoppers with a negative perspective infuriating most who were shopping at the time. Some of the workers threatened to quit until the matter was resolved, which caught them by total surprise.
The management to its defense, stating they were doing everything to determine the person responsible, but the damage had already been done. Moral evaluations from the communities and critics have put the organization into the limelight, for its unethical business practices. However, Wal-Mart has positive attributes towards the community, by being a retailer that focuses on price as their business model (Cris, 2006). Consumers are sensitive to price and Wal-Mart ensures that it caters to all levels of consumers. The organization has also been good at delivering products, which are decent at varying prices.
Conclusion Wal-Mart has a potential future, but it has to address some of their business ethics, corporate citizenship, and corporate social responsibility in order to stay ahead of its major competitors, compounded by the intense public scrutiny of the organization’s business practices. Moreover, it has all the components and ingredients in resources both organizational and financial that will propel it to success. There is no doubt concerning the potential rewards and risks that are attached, to a company’s ethical considerations in the context of business practices and operations.
Integrity, accountability and responsibility do matter to stakeholders in a company, encompassing the society on the conducts and decisions made by such a company. Organizations need to strive towards the balance of sustainability and corporate decision making, which affects them in the short and long term consequences. References 1. Cris, M. (2006). The Business Ethics: Saying Nice Things About Wal-Mart. The business ethics blog. 2. Entine, J. (2008). Wal-Mart: Ethical Retailing. The question of Wal-Mart’s Social Responsibility. 22-24.
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