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In order to explain this subject in the most direct and easy way we have to identify and find the difference between ethics and morality. Additionally to this we have to highlight that business ethics is not only related to social responsibility or some social actions the enterprises do, this is a very common mistake even experts in the subject do.
Commonly, ethics and morality have been used as synonyms, however, they are very different and should be very well identified in order to avoid confusion.
Morality refers to the way a person acts and reacts according to their values, and to be clear, each person have different values. This leads to different individual moralities.
Ethics are philosophical subject which studies if the morality used is adequate or not. To be simple with this subject, it can exist moral without ethics, however, it cannot exist ethics without moral, because as explained before ethics are used in order to analyze the moral.
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When we talk about ethics, in fact we are talking about moral philosophy.
In order to evaluate moral there have been established some ethical principles, which are universal and must be shared and respected by everyone even though their values, and morality are different. Brugger (1948) states that rules of customs are added to the laws of moral, which apply precepts of themselves to specific actual situations.
As part of philosophy, ethics is more focused on the why something is done, and comes from the ethics principles mentioned before, while moral focuses on what should be done, according to the inherited values of each person.
Moral is also related to norms and judgments. Norms are the generic behaving rules, and judgments are the application of them to a particular case.
In the enterprises exist a wide range of morals. It is the business ethics which are in charge of confirm if what the people inside the company are doing the right thing or not, based on the ethics principles the enterprise relies on.
When the enterprise is involved in order to make a decision, the moral of each person inside of it is not enough, they have to look for a group moral. Business ethics is important because in this way people can create organizational values, and think about every consequence that will happen according to their actions, and take the responsibility of it.
The ethical principles mentioned before, all together create a concept of a person, who has dignity (autonomy principle), someone who is sensitive (non-maleficence principle), that is social (justice principle), and with aspirations (beneficence principle). These principle do not define the person as someone that can be buy easily, and makes agreements with other in order to maximize their interests. Talking about business ethics without taking in consideration people and their dignity is nonsense because the respect towards someone is really important. Enterprises have a really big contribution to this because they are in charge of providing wealthy, work security, development of the employee in an integral way.
Enterprises function according to the people who are working within it, so it is important that a corporate ethos exist in it. Corporate ethos is the union of characteristics which help an enterprise to create products or services and to fulfill goals and benefits (not only economic). Most of the time this corporate ethos is a goal for the stakeholders of the company, in order to have a company managed ethically.
Conscience and practice are important in business ethics. Being conscious means having the knowledge and the will to do something voluntarily considering moral and their own values.
There are different levels of corporate ethos, the first level is the preconventional, where the individual’s criteria to differentiate the good from the bad, while the bad is questioned towards positive consequences. In this level exists two states, ‘orientation to punishment and obedience’ and ‘instrumental and relativist orientation’, in the first one the goal is to avoid harm, and the fear to a punishment as a consequence of an action, while the second one is when the actions are made by convenience, in order to fulfill the own needs. According to Logsdon (2005) some companies are located in this level, because they look for their own interests (state 2) and avoid bad consequences for the company (state 1).
The next level is the conventional, where the goal is to fulfill desires and achieve social approval. In here there are also two states, ‘orientation to concordance’ and ‘orientation to law and order’. The first state, says that an action is not bad if the intention behind it was good, and the other is the respect towards the law and the search of the social order. Enterprises in this level works in the same way as the other enterprises in the same sector.
The last level is the post-conventional, where the social approval is not necessary, it mainly focus on the own criteria. Two other states are included, ‘legal orientation of the social contract’ and ‘ethical principles orientation’. The one related to the social contract seeks social consensus accepting the conflicts that can happen in the conclusions, and the other one are based in a consistence and logic universality. The enterprises which are in this level respect other enterprises and look for having an ideal enterprise and which is the benefit it gives to society.
Moral development occurs not only in people but also in organizations and enterprises, by the principle that in these groups exist people coordinated in order to achieve a goal. If enterprises develop themselves as moral agents they can develop stakeholders as well.
Baurmann (1996) explains that the existing cooperative forces of the market are not strong enough to ensure a reliable moral behavior. The continuous networks of exchange relationships and personal dependences in a market society is too narrow to match the cooperative behavior with the own interests of the participants of the market. As a result, people start having an asocial and non-cooperative behavior in order to accomplish their goals. Cortina (1997a) explains this problem, in a different way, when doing business in the market, the goal is not to make only one part the winner, but to make all of them winners of something, in other words, all stakeholders should have a positive result after business were made, and not only the actionists.
According to Cortina (1994), human reason is dialogic, meaning that in order to solve problems dialogues are required, this principle is applied as well to morality and ethics. In order to establish which regulations are morally correct it is necessary the existence of dialogue among the affected people and giving as a result a mutual agreement stating that these regulations are correct. Apel and Habermas formulated a position called dialogic ethics, where every person that have the ability to communicate is a valid interlocutor, without exceptions. García-Marza (2003: 42) says the objective of establishing this in enterprises, is to change the conflict culture that has reigned among the enterprises for decades, with a cooperation culture, where dialogue between stakeholders exist in order to seek a greater benefit for all the participants.
Freeman (1984: 25) defined stakeholders as ‘all the groups that can be affected by the attempt from the enterprise to achieve its goals’. The stakeholders’ theory bases mainly on the existence of a multiple comprehension in the enterprise, every participant in the actions of the enterprise have interest in the enterprise, not only the workers or owners of the enterprise.
Argandoña (1998) affirms that the common good theory, is suitable enough to develop the stakeholders’ theory, because the common good theory indicates that the main duty of the stakeholders is contribute to the enterprise goal, not only by doing their job or investing money on it, but also by creating the adequate environment where all the participants get what they think they deserve from the company, not talking only about dividends and wages, but about something deeper, the acknowledge of having contributed to something bigger.
The importance of companies surpasses the economic aspect, it affects directly into the sociopolitical system, and it plays a great role in a society. The social performance a company offers is crucial to the maintenance of society.
The Importance of Business Ethics in the Workplace. (2021, Dec 20). Retrieved from https://studymoose.com/the-importance-of-business-ethics-in-the-workplace-essay
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