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In normal business operations, difficulties arise in five broad areas: employment practices, consumer protection, environmental protection, political involvement, and human rights. Laws define the minimum standards for ethics and social responsibility, but ethical conduct should exceed legal requirements. The best guides for good ethics are ethical business leaders and three principles: utilitarian ethics to maximize benefits, respect for individual rights, and fairness. Marketers can determine if decisions are ethical by asking if they are legal, right, and can withstand public disclosure. While the U.S. leads against bribery, European firms are promoting corporate social responsibility through studies linking social responsibility to investment attractiveness. Examples of corruption fighting include Norway investing oil profits only in ethical companies, a construction CEO calling

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Esha Amir
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26 views1 page

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In normal business operations, difficulties arise in five broad areas: employment practices, consumer protection, environmental protection, political involvement, and human rights. Laws define the minimum standards for ethics and social responsibility, but ethical conduct should exceed legal requirements. The best guides for good ethics are ethical business leaders and three principles: utilitarian ethics to maximize benefits, respect for individual rights, and fairness. Marketers can determine if decisions are ethical by asking if they are legal, right, and can withstand public disclosure. While the U.S. leads against bribery, European firms are promoting corporate social responsibility through studies linking social responsibility to investment attractiveness. Examples of corruption fighting include Norway investing oil profits only in ethical companies, a construction CEO calling

Uploaded by

Esha Amir
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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In normal business operations, diffi culties arise in making decisions, establishing poli cies, and engaging

in business operations in fi ve broad areas: (1) employment practices and policies, (2) consumer
protection, (3) environmental protection, (4) political payments and involvement in political affairs of
the country, and (5) basic human rights and funda mental freedoms. In many countries, laws may help
defi ne the borders of minimum ethical or social responsibility, but the law is only the fl oor above which
one’s social and personal morality is tested. The statement that “there is no controlling legal authority”
may mean that the behavior is not illegal, but it does not mean that the behavior is morally correct or
ethical. Ethical business conduct should normally exist at a level well above the minimum required by
law or the “controlling legal authority.” In fact, laws are the markers of past behavior that society has
deemed unethical or socially irresponsible. Perhaps the best guides to good business ethics are the
examples set by ethical business leaders. However, three ethical principles also provide a framework to
help the marketer distinguish between right and wrong, determine what ought to be done, and properly
justify his or her actions. Simply stated, they are as follows: • Utilitarian ethics. Does the action optimize
the “common good” or benefi ts of all constituencies? And who are the pertinent constituencies? •
Rights of the parties. Does the action respect the rights of the individuals involved? • Justice or fairness.
Does the action respect the canons of justice or fairness to all parties involved? Answers to these
questions can help the marketer ascertain the degree to which deci sions are benefi cial or harmful and
right or wrong and whether the consequences of actions are ethical or socially responsible. Perhaps the
best framework to work within is defi ned by asking: Is it legal? Is it right? Can it withstand disclosure to
stockholders, to company offi cials, to the public? Although the United States has clearly led the
campaign against international bribery, European fi rms and institutions are apparently putting more
effort and money into the promotion of what they are calling “corporate social responsibility.” For
example, the watch dog group CSR (Corporate Social Responsibility) Europe, in cooperation with
INSEAD (the European Institute of Administrative Affairs) business school outside Paris, is study ing the
relationship between investment attractiveness and positive corporate behaviors on several
dimensions. Their studies fi nd a strong link between fi rms’ social responsibility and European
institutional investors’ choices for equity investments. 54 All this is not to say that European fi rms do
not still have their own corporate misbehaviors. However, we expect more efforts in the future to focus
on measuring and monitoring corporate social responsi bility around the world. Finally, we mention
three notable examples of corruption fi ghting, ranging across the levels of government, corporate, and
individual initiatives. First, the government of Nor way is investing its vast oil profi ts in only ethical
companies; it recently withdrew funds from companies such as Walmart, Boeing, and Lockheed Martin,
in line with its ethical criteria. 55 Second, Alan Boekmann, CEO of the global construction company Fluor
Corp., is fed up with the corruption in his own business. He, along with colleagues at competitor fi rms,
has called for a program of outside auditors to determine the effectiveness fi rms’ antibribery programs.
56 Third, in 2001, Alexandra Wrage founded Trace International, an Annapolis, Maryland, nonprofi t that
provides corruption reports about potential foreign clients and training for executives involved in
business in diffi cult areas. 57 We laud all such efforts.

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