A summary of business ethics and social responsibility
Business ethics encompass the practices and concerns that should be incorporated into businesses as they strive to improve their market operations. Typically, business operations are geared toward boosting revenues and decreasing expenses. In order to achieve this objective, businesses engage in a variety of techniques, some of which are not compliant with the regulations and laws governing business activities. Ethics entails the observance of established business regulations and norms as organizations attempt to maintain their operations in their operating environment (Shumway, Elenkov & Badgett, 2012). A crucial responsibility of businesses is to protect the environment in which they operate. The environment in this context refers to the community and the resources that support the members' livelihoods. Thus, ethical considerations or practices are frequently equated with corporate social responsibility. Companies frequently face criticism from pressure or interest groups in the economic and socio-environmental spheres when they fail to conform to laws, rules, and expanded duties. The best way to determine the extent of ethical considerations in a company's operations is through an external evaluation of the business model and approaches used by the company (Scott, 2005).
In the course of their operations, a significant number of businesses seek to solve the environmental challenges that exist in their operating environment. Anglo-American and Primark are two such businesses. According to the business ethics model created by Svensson and Wood (2008), the best way to analyze business ethics is by adhering to three crucial components. They consist of expectations, perceptions, and assessments. Five subcomponents interconnect these components. These consist of organizational values, attitudes, and norms, societal expectations, outcomes, reconnection, and society evaluation. Business ethics is an iterative process in and of itself.
Corporate ethics at Primark
Primark is a retail division of the larger Associated British Foods. However, the corporation does not deal with food, but rather distributes apparel from manufacturers through its chain of stores. A major portion of ABF's revenues and profits are generated by Primark. The fashion or textile sector is extremely dynamic in terms of fashion changes, which reflect alterations in consumer tastes and preferences. The company collaborates closely with many manufacturers and suppliers to guarantee that it can adapt to industry changes. This indicates that the corporation not only deals directly with clients, but also with a number of third-party suppliers in various locations of the world. Thus, ethical sourcing is one of the most important ethical factors to which the organization must pay attention. This is a result of working with a variety of suppliers in order to meet the needs and expectations of clients, thereby improving the company's well-being. Customers anticipate receiving the most value for their money by receiving the needed level of fashion quality. The corporation must strike a balance between the value of the customer-facing products and services and the value related to the manufacturers and suppliers (The Times 100, n.d.).
Perceptions and assessments
The company's ability to retain favorable relationships with its consumers, manufacturers, and supply chain is indicative of its commitment to ethical business practices. The company's mission encompasses both profitability and sustainability. Sustainability is one of the essential components that direct a company's response to the prevalent social and environmental challenges in its operating environment. It is believed that the incorporation of sustainability into a company's aims and operational goals is a significant aspect of respecting business ethics and enforcing corporate social responsibility. However, it has been apparent in a number of instances when firms simply emphasize sustainability and corporate responsibility in their strategy. The majority of the concerns expressed in the goals and objectives remain unimplemented. This case is irrelevant to Primark's operations. At this juncture, it is necessary to determine the nature of Primark's actual business ethics and corporate social responsibility. Research indicates that Primark has a clearly defined code of behavior that contradicts the company's principles, particularly its sustainability policies. The company works in close proximity to its suppliers and manufacturers to ensure that its products adhere to ethical standards (The Times 100, n.d.).
Primark demonstrates its absolute dedication by providing training to its producers, suppliers, and purchasers on ethical problems surrounding the creation and consumption of its products. This is a significant aspect of the company's ethical considerations. Rarely do most businesses include customers in their activities. Buyers are viewed as a means to a goal, where the aim is profits. The adoption of external and internal auditing of the company's different operations and activities is another crucial aspect of Primark. Ferrell, Fraedrich, and Ferrell (2013) discovered that internal and external audits are crucial for identifying deviations from the desired operational standards. Four significant factors have contributed to the record of compliance with ethical norms of operation. These include ethical sourcing, periodic auditing of the company, the suppliers, and the manufacturers, buyer participation in shaping the quality and standard of products, and adherence to the International Labor Organization's employee management requirements. What the corporation lacks is the implementation of a significant number of corporate social projects to bolster its ethical base (The Times 100, n.d.).
Ethics in Anglo-American business
Anglo-American is one of the largest mining companies in the world. The company is international in scope. The company's operations are conducted in Europe and Africa. As a mining firm, issues of sustainable development are crucial to the company's operations. This is due to the fact that a considerable number of corporations involved in the active mining industry have been in the news for violating ethical rules of corporate development, such as the use of child labor and environmental degradation. In addition, there is the question of adopting the laws of the nations in which Anglo-America works. This is due to the fact that minerals are natural resources, and mining corporations must adhere to the laws and governmental regulations that allow them to conduct mining operations. There are also concerns over the care and compensation of people living in mined areas. Unethical business practices have persisted in the mining industry, which begs the question of whether any company functioning in the field can overcome the industry's odds by adopting ethical business practices. Anglo Americana is expected, as a corporation that values corporate ethics, to support external practices that can assist streamline the industry, in addition to ensuring that its internal operations are sustainable (Anglo American, n.d.).
Perceptions and assessments
Anglo-America supports a number of programs that are crucial to fostering an ethical business climate in the mining industry. The corporation has been instrumental in three major sustainability efforts. The United Nations Global Compact, the Global Reporting Initiative, and the Extractive Industries Extraction Initiative are these. These three initiatives are highly significant in influencing the external business environment's sustainability.
Anglo American prioritizes corporate social responsibility, having acknowledged the importance of striking a balance between profit maximization and business sustainability. The organization recognizes and encourages stakeholder input in the formulation and execution of its strategic plans. Ihugba and Osuji (2011) determined that stakeholder participation is a sure way for a firm to address all concerns of business ethics and sustainability that arise in the company's operational environment. The corporation takes the needs and concerns of its employees, government, consumers, communities, and suppliers into account. Consequently, none of the stakeholder organizations have exerted significant pressure on it (Anglo American, n.d.).
It is essential to ensure that the organization pays attention to all relevant stakeholders. Through the monitoring of industry trends and the expression of concerns, stakeholders determine the company's direction. This aids a corporation in maintaining its desired course toward sustainable business objectives. Anglo American has created a ‘Socio-Economic Assessment Toolbox’ in an effort to foster healthy relations with the communities in which it conducts mining operations. This tool assists the company in measuring the influence of its business operations on the company and, more crucially, the community in which it conducts mining operations. The toolkit assists the organization in identifying sustainability issues that cannot be recognized by management and personnel. Using the toolkit, corporate social actions are designed and implemented in response to the identified challenges. Social corporate activities based on the community in which the company operates have a greater impact on the community's standard of living, consequently enhancing the community's commitment to the enterprise. In South Africa, Anglo American supports the efforts of the government to improve the economic empowerment of black communities neglected during the colonial era (Anglo American, n.d.).
The conclusion that can be drawn from the study of business ethics and corporate social responsibility in the two firms is that organizations respond to ethical business practices and sustainability with varied approaches. The industry in which a company operates also influences the nature of ethical challenges. Certain businesses, like as mining, have a poor track record of observing ethical issues. In response, Anglo American has fostered a collaborative atmosphere for addressing ethical challenges in the business world.
Anglo America (n.d.). Anglo-American: corporate social responsibility and business ethics. The Times 100. Internet.
Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2013). Cases and ethical decision-making in business South-Western/Cengage Learning, Mason, Ohio.
Ihugba, B. U., & Osuji, O. K. (2011). Corporate citizenship and stakeholder engagement: ensuring a balanced distribution of power 16(2) Electronic Journal of Business Ethics and Organization Studies, 28-38.
Scott, G. (2005). A strategic answer to the critique of business ethics by Friedman. Business Strategy Journal, 26(6), 55-60.
Shumway, K., Elenkov, D. S., & Badgett, T. F. (2012). A meta-theoretical approach of business organization ethics. 12(5) Review of Business Research, 1-12.
Svensson, G., & Wood, G. (2008). Exemplary business ethics. Journal of Business Ethics, 77(3), 303-322.
The Times one hundred (n.d.). Primark: Providing consumers with ethically sourced garments. The Times 100. Internet.