Business Ethics and Social Responsibilities

Though the main objective of business is to profit generation, it has to maintain the concept of ethics and the matter of social responsibilities. As a part of the society, the entrepreneur and business organization has to bear in mind and uphold the idea of social values, morality and positive attitude towards society. In this chapter, we shall learn about the different aspects of ethics and social responsibility of a business.

After reading this chapter, we shall be able to –

·         Explain the concept and importance of business values, honesty and ethics explain the concept of business social responsibilities.

·         Explain the mode of responsibility towards state, society, buyer and worker.

·         Explain the features and effect of air pollution, water pollution, sound pollution and land contamination.

·         Identify the social responsibilities of business.

·         Describe the various types of developmental works of social responsibilities of different business.

Concept of Business Ethics and Values

The concept of ethics and are values indispensable to each other. Value is the wisdom and attitude of the society which is treated as valuable and eligible to be followed by others. It indicates the positive, well-being and goodness of human life. Ethical principle means the ability to differentiate between good and bad, justice and injustice, does and don’ts etc. It is really necessary to follow the ethical standard of the behavior of people to form a happy society and country as a whole.

Ethics

The word ethics has evolved from the Greek ‘Ethos’ which means the standard of human behavior. Ethics is related to our daily activities. We know that the responsibility of teacher is to teach the students properly. This is not the end. He has to ensure whether the students understand the lessons. He should also look after the attentive-inattentive students, to examine the home works of the students and make correction if there is any mistake; all these tasks are included in his ethical responsibilities. Like a teacher a student also has some ethics; such as going to school in time, doing homework and follow the ideology of the teacher. Ethics means the capacity of analyzing the good and bad and accepting the right things. It is the part of ethics to carrying out responsibilities by the teacher and student properly.

Business Ethics

In a business there are lots of task related from the very beginning to the operational level. To proceed with the tasks with proper, decent and correct measures, ethics works as a guideline for this. Besides, the business ethics or ethical value helps us to be well behaved in the business world.

Business is a societal institution. A business organization is formed and continues to meet up the demand for various goods and services for our daily use. An entrepreneurs or businessman sell the products to the consumers with addition of profit with the production cost or purchase price. Profit is the difference between the selling price and buying price or selling price and production cost. If anybody creates an artificial demand for a product to gain extra profit, then it will go against ethics. There are some ethical values in operation of business. The pricing of the product should be fixed in such way so that the seller can make profit along with keeping the price within the purchasing power of the buyer. On the other hand, the business person should not supply such products which are harmful for the society. It means that business should be operated through maintaining the interest of the stakeholders. Other ethics of business are as follows:

·         To maintain honesty

·         Not to produce and market harmful products Not to cheat with the customer

·         Not to sale expired product and goods

·         Not to make any artificial scarcity of products

·         To follow the commercial and industrial law of the state Not to pollute environment

·         To contribute to the welfare of the society.

Necessity of Business Values and Ethics

Every day we can see a lot of negative news in the dailies. For example we can say selling of dead chicken, contaminating food, producing & selling of low quality products, cheating in weight, fish and fruits with formalin, giving false and exaggerate information of products, using low quality of products in construction, contaminated medicine, plying of vehicles ineligible to run on the road. The impact of these unethical activities is severe. A number of children have been becoming sick and dying from tainted medicine. People are getting diseased from eating various poisonous foods. If this is not stopped immediately; very soon we shall find ourselves in an ailing society. The result of which will be devastating. For the following reasons necessity of business values and ethics are immense:

·         Man is the best creation of Allah (SWT). Unethical activities and attitude is not expected from them.

·         A businessman lives on selling manufactured or supplied goods. It is their ethical obligation to supply right goods and services

·         At present, people are falling sick of complex and severe diseases from eating contaminated foods. It has a dire impact. Only, business ethics can save us from this direly situation.

·         Medicine contamination causes death in many cases. The ethical mentality of the manufacturer of medicine can save from this devastating consequence.

·         Business is a social institution. It is responsible to look after the good –bad, welfare of the society.

·         Though, generation of profit is the main objective of business, it has some social responsibility as well. To avoid the social responsibility is not good for the business.

·         To carry out social responsibility is obligatory for the business.

·         The role of ethics is immense to maintain and operate the business with sound and proper way. The decision of the business are correct if the general rule for ethics are followed

·         Though, temporary financial gain is possible from unethical activities of the business. But, there are many businesses that has gone ashtray by involving in the unethical works.

·         Everybody hates the businessman involved in unethical activities. There is no alternative of respect and honor for the businessman other than availing ethics and right path-ways of business.

Concept of Social Responsibility and Its Importance

The social responsibility of business means to contribute to the well-being and welfare activities of the society along with earning profit. From the early age, the objective of the business has concentrated on profit only. But, the concept has been changed now. Business is a social organization. Its activities also revolve around the society. To estimate the demand for goods and services and manufacture and supply them accordingly to meet up the demand are the main activities of business. To live a sound life there are some more demands such as education, health service, entertainment etc. It is the duty of the government to arrange to supply the expensive necessities for the people, since individual cannot arrange to supply them because of the incapacity. Recently, some business organization are coming forward to perform various public welfare task like establishing schools, college, hospital, providing scholarships to the meritorious poor pupils, etc. Since business is a social institution, its existence and profitability largely depends upon the support of the mass. To carry out the social responsibility by every business is their ethical responsibility.

In real sense, a business person is a creative and well aware member of the society. He is creative, mindful and effective. He has the right to receive something form the society and similarly he has some responsibility to give something back to the society. If he spends a part of his earned profit, it will increase his honor and status in the society.

Case Study

Mr. Williams David is an intelligent, brave, trustworthy and honest young man. He plays a role to organize every program in his society. He used visit a pharmacy on his way to school while studying. Sometimes, he used to help the owner of the pharmacy in various tasks. In this way, he acquired some knowledge on pharmacy business. He failed to continue his studies after SSC, so he sold some ornaments of his mother and started a pharmacy with the small amount of capital. He remembered some advises from his father such as ‘Never deceive a person, ‘Give honest advice, if sought by anyone’ ‘never tell lies’ ‘Respect your elders’ ‘Help the destitute’. Mr. Williams David always followed ethics in operating his business. He always gave good advice to patients about good doctors. Many patients with complex diseases have been benefited from his advice. Besides, he used to sell genuine medicine. He never tried to make more profit by taking higher price or selling duplicate medicine. For all these reasons, his profit grew rapidly and he became reputed as an honest business person. Besides, his business also prospered.

After a period of time, his son, Mr. Williams David took responsibility of the pharmacy. But, out of his greed, he started to sell duplicate medicine. Many people suffered from buying medicine from his shop. He gained disputation within short span of time as a dishonest businessman. Gradually, the business lost its fame and has to shut it down.

Social Responsibility of Business to Various Stakeholders

In this competitive business world, the business person has to carry out responsibility to various stakeholders along with maintaining sustenance as per profit growth. The stakeholders of business are State, Society, Buyer, Worker etc. These parties are involved with the business by some means.

Responsibility to State

The objective of the state is to ensure that business is done protecting the interest of the people. Government is happy if demand for goods and services of mass is met through establishing business and developing employment as well as providing tax regularly. The following responsibilities are to be carried by the business to the state:

·         To pay Tax to the government regularly

·         To follow the rules and regulations properly

·         To contribute for employment generation and economic development

Social Responsibility in Business

The business is developed from enjoying various facilities from the society. So, business has to carry out the following responsibilities favoring the society.

·         Producing quality products and supply them as per demand of the society.

·         Creating opportunity for employment generation

·         Assisting in various public welfare works

·         Stand by the people at natural calamities

·         Safeguard the environment from pollution

·         Not to storage of goods for making artificial scarcity to make extra profit.

Responsibility to Customer and Consumer

The success of business depends upon the trust and cooperation of buyer and consumer. So, the businessman has to carry out the following responsibilities:

·         To keep stabilized the product market

·         To Supply quality products

·         To make products easily available

·         To provide various information on products and market

Responsibility to Employees

The profit of the business is earned through the untiring effort of employees and staffs. Thus, business cannot be operated ignoring their interest. With the progress of business their salaries and wages should be increased, bonus and increment to be awarded and as a whole their condition should be improved. A business person has to perform the following responsibilities towards the employees:

·         To provide proper wages and financial benefit.

·         To provide job security

·         To ensure suitable working environment

·         To arrange training and promotion

·         To arrange for residence and treatment

Environmental Pollution and Business

River Pollution from the industrial wastage

The main disadvantage of business especially of industry is environmental pollution. Industrial wastage and liquids are polluting the river and canal water. Because of contamination, water becomes toxic for the living things under water including fish. On the other hand, throwing wastage here and there, and fumes from the vehicles pollute air. Factory machine and generator with their awful noise cause serious sound pollution. Besides, in the name of industrialization trees are cut down and hills are planed without any limits and environments are polluted. In the name of land development for residence, filling up the canals and water reservoir for residential purpose, river erosion, plying the ineligible vehicles in the roads and extensive use of air conditioning machines are responsible for environmental pollution. For this reason health hazard is increasing and on the other hand living creatures are being seriously endangered.

Government has introduced new law to be free from pollution. But, lack of proper implementation of the law is increasing the level of pollution day by day. Lack of awareness about the effect of pollution, disposing wastage here and there and fault sewerage system are also responsible for environmental pollution.

It is necessary to increase awareness through mass media, proper application of law, developing wastage management and inclusion of course on environmental pollution in the curriculum, if we want to make us safe from the environmental pollution.

End

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