The organization's sustainable benefits can be determined by its ethical ability. The ethical ability of the organization is the duty of the right action. Some organizations, such as Enron, Sathyam and Tyco, made false statements in their accounts and deceived both the stakeholders and the government. This kind of issue meant the importance of business ethics in the world's business schools.
Defined as a beneficiary of sustainable benefits that defines the organization's long-term goals, where goals generate economic development richness and meet current generation needs while saving the environment so the future generation can meet their needs. There are several factors that determine the sustainability of an organization, which is in the current position, a human resource of an organization that is a competitive advantage, but it does not provide sustainability. The sustainability of an organization depends on its impact on man, in the form of trust, honesty, integrity, respect, quality and responsibility. Organizations with weak sustainability will fall back, as happened with Enron and Sathyam.
In 1985, Enron founded an American energy company with Kenneth Lay, following Houston's merger of gas and internment (citetation). In the early 1990s, Enron sold electricity at market prices. At about the same time, the US Congress adopted a law on the liberalization of natural gas that had a positive effect on Enron to deliver energy at a higher price. In 1992, Enron was the largest gas trader in North America. The online trading model known as Enron Online in November 1999 developed and expanded its trading and negotiation capabilities. By 2001, Enron owned and operated international gas, pulp and paper mills, broadband devices, power plants and waterworks. The price of the Enron kit was $ 83.13, and market capitalization exceeded $ 60 billion, and Enron was rated the most innovative company in America by the most amazing companies. By the end of 2001, the Enron scandal turned out. Chief Executive Jeffrey Skilling, some executives, demanded hidden billions of failures and projects. Financial Manager Andrew Fastow and other Managers could mislead the Board and the Audit Committee presenting them with psydo account statements. After the scam was published, in 2000, the estimated $ 90 per share of Enron's inventory dropped to less than $ 1 by the end of November 2001. This decline in share value caused a $ 11 billion loss to its shareholder. Employees of the organization received a limited amount of their salary and retirement when they went bankrupt. Many laws have been issued against the company's CEO and other executives
Similar to Sathyam computers, which are termed the Indian Enron scandal. Sathyam computers are an IT company that produces a software development center in Hiderbad, India. Ramalinga Raju's chairman made a book of accounts, involving 7,000 crore cheats. The main inspectors could not identify this adjustment. Due to this fraud, workers lost their jobs and the president was jailed for fraud.
These two cases reveal how the country, the world's public and its economy can affect their unethical practices. That is, if the organization does not practice ethics, there will be no sustainability.
The need for business ethics: the next
1. Businesses Work in Society
2. Irrespective of size, all businesses are of greater ethical significance, or fully take into account social concerns about survival
. Businesses should be responsible for corporate citizenship in the country.
Business is part of a subsystem of society, so its operation must contribute to the well-being of society. If a business gets social sanction in society where it exists, it will be able to survive, develop, and excel in activities because only by acquiring social sanctions the business can get loyal customers. Loyal customers enjoy a sustainable advantage and thus survive the markets without which they will collapse and die. Large organizations are more interested in public opinion, leaders welcome public opinion and always try to maintain the company's proper image in their minds.
However, the daily minimum profits are not the only priority in business, which can only be achieved through ethical practices. Every large or small organization must follow ethical practices as it creates a social sense of responsibility that ultimately provides sustainability to the organization. Business must also be a responsible corporate citizen that does not allow for narrow mentality goals and motivations.
The country or society's ethical practice on various factors, such as religious, beliefs, history, traditions, social habits, existing political and economic rules or policies. For example, in Asian countries such as Japan, China, etc. The loyalty of working groups and companies has strong ethical values. This kind of ethics has taken place through centuries of tradition, so it does not think about itself, but rather thinks about family, government and other people working with it, thus providing social sensitivity.
Ethics of Ethics
ethics only deals with people, as they only have the freedom and means of choosing free will. One can distinguish between good and evil, right and wrong, and just and right. For example, a Japanese employee believes that he is unethical in taking part in an interview with another company when he is still with the current company. So you can find the goal and the tools you want to achieve. Ethics is, however, a science that has become a set of systematic knowledge of moral behavior and behavior today. Ethics is concerned with human behavior that is voluntary and under no circumstances compels it.
Business ethics and profit
Enron and Sathyam cases suggest that ethics and profit are at odds with each other, the organization results in an ethical short-term profit, and if the organization has an unethical, enormous benefit. The same cases prove another thing that brings enormous benefits in a non-ethical way, but does not keep it on the market. Ethical companies not only gain profits but overcome their competitors and other turbulent changes over the years and have contributed to social well-being. Ethical firms have social responsibility, enabling them to flourish and enrich themselves. The Tata Group is a company that follows ethical practices. They say that Tata's CEO is also the chief ethical officer. Ethical policies pursued by the company include national interests, support for an open market economy, gifts and gifts related to social affairs, political non-alignment, health and environmental protection, quality products and services, legal compliance, etc. Ratan Tata's current chairman of the Tata Group denied the aviation industry because they were told to be bribed, then the minister entered the venture, according to her unethical and the group's policies pursued. Later JRD Tata created the first commercial airlines "Tata Airlines" in India, later besieged by the Indian government and was named Indian Airlines. So, besides the pioneer of the aviation industry, they could not get it because they felt they would not uphold them and give the company a bad picture. That's why people are very respectful of the Tata group and their ethical practices and policies have created brand loyalty that helped them survive on the market, even though many competitors came.
It encapsulates cultural contradictions
when companies are not capable of doing business at home, so other societies where ethical policies are liberal or favorable. At home, they can not afford products because they are unethical use of unsafe products but can be sold in other countries where ethical standards allow them to sell these products. This is especially the case with pharmaceutical products. Some factories issue polluting gases in neighboring countries because ethical standards at home do not allow the factory to conduct business. These pollutants are dangerous to humans and the environment. Still, it is ethical in some countries. Such questions result in cultural contradictions and exploitation. These problems arise for managers and companies to solve. Therefore, business is responsible for their country, but belongs to four main groups: society, employees, customers or consumers and investors (eg drugs)
Business ethics factors
Leadership, Strategy and Performance
A leader is a man who leads people towards reaching a common goal. The leader can be good or bad, big or small when they come from the needs and opportunities of a given time and place. Not every leader is considered perfect in decision-making because it depends on the personal nature of each decision. The nature of a person includes their born talents, their learned and acquired features, which they have set upon their lives and experiences. Leaders are their models and mentors for their followers, so they follow the path set by their leaders. In a large organization, senior executives or CEOs are the executive and supervisory leaders. The CEO is firmly committed to ethics and ethics and must continue to take the lead in renewing the values of an organization. They play a key role in the creation, maintenance and alteration of ethical culture. It is necessary for the leader to set good examples and follow the ethics. One of those good leaders is JRD Tata, who is a good example of his successor and is still following. Where good leaders are concerned, there are good ethical practices in business.
Corporate Governance is a set of systems and processes followed by the company to ensure the interests of stakeholders. Stakeholders are shareholders, employees, clients, creditors and the community.
Sustainability has three components in accordance with Johnson's tripartite concept: economic, social and environmental. According to Elkington, the business has no purpose to gain profits but to add environmental and social values. Thus, sustainability has become a new goal of the organization
Environmental aspect: natural resources
Economic perspective: the future generation
Social perspective: exploitation of workers and non-equality of gender, castastrian religion and religion employment through child labor
Organizational culture: common values, beliefs, goals, norms, etc. Organizational culture places emphasis on ethics, but as it grows, it can change as in a tycoon where its organizational culture supports unethical practices. If the company makes huge profits in an unethical way, individuals who join the organization also have to practice unethical things in the life of the company. For example, in the case of enron where many executives and executives knew that the company followed some illegal and unethical practices, but the leaders and the board were not aware of how to make ethical decisions and corporate ethics. So they fall back and executives have to pay fines and jail terms.
Business ethics is the application of ethical principles in the organization or business. The organization has to create or create its own moral cultures, but this ethical culture must be formulated from the ethics of everyone, not the organization. Employees of the organization follow the same ethical principles. The ethical organization will provide some social responsibility, for example, it does not harm the idle people, the public and the society. "their dignitaries and honors work a great deal of moral and productivity" (Frederic, Post and Davis).
There are three major ethical issues in a business relationship that is faced with ethics, corporate ethics, and ethics in the functional area. Ethical issues are faced by the organization's staff during their daily organizational life. the employee faces these ethical conflicts when their personal standards differ from what their work demands. The ethical issues of corporate policy arise in the company's basic operations. Senior management, including the board of directors and the chief executive officer, is responsible for the organization's ethical practice. Ethical issues in the functional area arise at all functional levels of the organization. For example, in the accounting department, if unfair pressure is imposed on employees to produce an audit report that has changed or failed to present the entity's current accounts, it would not be ethical because it does not follow the organization's standards and guidelines.
The causes of unethical issues:
The organization has many reasons to track unethical practices: personal benefits and selfish interests, competitive profits, business goals and personal goals, crossing cultural contradictions. When an employee attaches greater importance to greed or personal concern than any other thought, irrespective of the damage it may cause to the body, it is called unethical practices that result from personal gain and selfish interests. If a company has tough competitors in a limited or static market; may commit unethical practices to pursue business or protect profits. If your organization uses an unethical tool to ensure that stakeholders do not accept your goal, ethical issues arise between business goals and personal goals. Here, the organization set a goal that would be contrary to the owners' personal purpose. In such circumstances, the individuals concerned have two options to follow the ethics of the organization or "blow the whistle" on the body.
The environmental perspective is related to the business exploitation of natural resources. The company must ensure that natural resources are not used; you have to keep the resources so that future generations can enjoy them just like we do. One such example is the limitation of fishing in the North Sea in order to maintain shrinking fish for consumers
The economic aspect of sustainability is linked to economic growth and the decline of society. Companies such as bribes and cartel short-term adjustments take only a short time, will never sustain the organization's behavior over the embedded environment in the long run. If your organization does not pay taxes, it says it is acting internationally for an organization that does not donate to public institutions such as schools, hospitals, police and other justice systems.
The social perspectives of sustainability refer to the social future
Business ethics, if properly functioning in an organization, provides stakeholders (which includes employees, clients, shareholders, banks and other credit institutions, governments) , personal political level, level of social level and internal policy
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