Business Behaviour For Surviving In The Current Market
The word ethics in a business sense is derived from the Greek word ethos which correlates to the basis of morality, thus in turn configures moral judgments which is a standard or rules of conduct followed by moral principles and values which govern the behavior of people relating to what’s right or wrong (Ferrell, 1997).
Corporate social responsibility, is inclusive of morality towards the economy, business competition, shareholders and profit earning (Carroll, 1989). These factors must abide by rules and conduct of which does not harm society, consumers, employees, the local community and the physical environment, as evaluated Steinhoff conducted unethical business by falsifying aspects of their company records and accounting.
Public relations and the media advocate for organizations to establish corporate social responsibility programs, these consist of human rights and environmental sustainability a company with various CSR projects is the Shoprite Group – they have student funding programs and soup kitchens. Consumers have become vital for organizations and now they insist on transparent CSR programs, community engagement, profit sharing is encouraged, and volunteering is advocated for all in an effort to serve both the business and the community (Smith 1996).
Many organizations are working to help their community and simultaneously enabling greater value for customers, employees and improving operations. CSR advocates for the investment of environmental cohesion and regulation, this is positive for public relations and allows for a decrease in cost as the organization becomes less dependent on natural resources, CSR programs replace costly and polluting processes with cheaper, cleaner alternatives. Analysis on the impact of an organization’s actions or lack thereof needs to be considered and evaluated, compliance is the backbone of morality it advocates for the elimination of corruption.
Steinhoff did not analyze the consequences of their action on pensioners, who have invested their savings in Steinhoff, Finance Minister Malusi Gigaba conveyed concern relating to retirement and savings funds. Steinhoff incident was intertwined with the so-called state capture saga.Business ethics and social responsibility are interchangeable to an extent, the company must acquire resources to operate however must maintain and establish the control and coordination of internal activities and evaluate environmental/social implications including uncertainty of profit generation (Ferrell, 1997).
Norms for ethics lie in intrinsic features of actions while attaining resources. For an organization to survive in the current market a fine balance between desire for profit against desires of society need to be evaluated, principles and developed rules or standards of conduct must be created, these directly relate to legality and implications if misconduct occurs. The legal responsibilities of an organization basically outline the laws and regulations they must adhere to. Malusi Gigaba, finance minister said Steinhoff had also put taxpayers at risk as the government stands surety for the PIC, legally there is much backlash for their action towards the taxpayers on a legal/moral platform.
Legal frameworks of corporate social responsibility thus refers to adhering to local, national and international laws regulating competition, protecting workers, human rights, the consumer, and the natural environment (Shaw, 1995). Norms for ethics are determined strictly by consequences of actions in a normative view. KPMG was under the spotlight for certain legalities which directly lowered their customer base and turnover due to their actions. Ethical obligations are behaviors or processes such as transparency and rule of law which society demands especially in current economic times.
Businesses face enhanced uncertainty in modern times however this factor should not be seen as an opportunity to allow for misconduct or unethical activities. Steinhoff used privacy and coverups to withhold valuable information from independent sources, transparency was nonexistent. Society's perception of ethical responsibility undergoes a phase of fundamental change as time transgresses, a dynamic ethical approach should be carried out to adjust for modern ethics all in an effort to adjust for customer demands (Ferrell, 1997).
The business backbone relies heavily on the following contributors and factors: consumer protection, environmental protection, political aspects, human rights, employee practices and policies. The current question at hand is, how is Steinhoff going to pay back the money? Clearly of the factors mentioned many were compromised, the consequences for the greatest good for the greatest number of people has been blatantly ignored as investors, taxpayers and pensioners were all affected by Steinhoff’s misconduct.
In 2015 Toshiba a computer company, similarly fraudulent forged their accounts to meet expectations, they inflated their earning by more than two billion dollars. Normative ethics delves into the consciousness of self-gain, in many companies it’s all about individual gratification as opposed to helping others.Modern ethical thinking Evolution is inevitable, agriculture morphed into industrial economization which is currently transforming into a digital economy, this directly stems from innovation (Aldrich, 1999).
An example of innovative change occurred in Nokia, which initially produced safety boots then moved to cell phones eventually creating the qwerty keyboard, innovation was a must. As innovative ideas morph, ethical dependency and formfactors change, refreshed economies base technology as its main instrument for wealth generation/production. Land, labor and capital were the main focus factors in the past, nowadays information is a vital commodity and managing it adequately through strong constructs against ethical frameworks allows to create a divide between winners and losers in the current modern business market (Aldrich, 1999).
Steinhoff tampered with their information and portrayed it falsely to the public thus destroying their validity. With information and technology cycle times being drastically reduced, information is leveraged and flows freely in the digital age which consolidates the customer at the center of business priorities and strategies (Coyle, 1999).
These consumers demand an environment that advocates for accountability unlike Steinhoff. Social Accountability has a benchmark to adhere to, which is SA-8000 being a worldwide standard SA-8000 is inclusive of auditing organizations through independent assessor authorities regarding a vast array of issues, comprising of underage labor, occupation health and safety, association freedoms, the right to collective bargaining, discrimination, disciplinary practices and compensation (Fabian, 1998).
Companies honored with Corporate Conscience Awards in the past include Kellogg, Hewlett-Packard, and Fuji XeroxEthics does not have a new viewpoint the same concepts are relevant, there is no one size fits all for the human race, various principles and different thought processes harbor various situations for ethics. Modern ethics engages in justifying moral norms linked to traditional thinking however, still relying on human reason. The fundamental basis of all rules for a modern civilian is to enhance/maximize personal gain and freedom while maintaining the equilibrium and limiting the harm inflicted towards other individuals by ones’ actions (Carroll, 1989).
As in Steinhoff’s case they did not evaluate their actions. Modern individuals require the freedom to pursue their own agendas, norms for ethics lie in promotion of human flourishing as determined by natural inclinations. The limit of freedom is where another may be harmed, and in essence modern ethics are required to compile a series of rules and procedures.
Business behavior has had a substantial impact on the global environment, the public act in specific context towards ethical or non-ethical corporate behavior thus they mold and shape the way businesses operate. Customers have a sense of empowerment in an organization, they have in essence become stakeholders in modern business societal ethics, information needs to be readily available and transparent, all in an effort for organizations to remain competitive (Shaw, 1996).
Responding to enhanced customer information supply, coupled with the consumers ability to react negatively or positively to companies translates to a very dynamic complex market. In order to adapt innovation must occur and cannibalization of core functions and processes must give way to refreshed ones in order for businesses to survive in the current market.