Define ethics in a business context.
A specific definitions to business ethics is difficult if not impossible (Lewis, P. V. (1985). From the business literature, I think that defining Business ethics as the study of the application of the moral code in a business context regarding controversial issues can be a concise definition. These issues have a larger context in itself. That is when we should decide that an issues has reached a stage where a decision about ethical and non-ethical business practices is required. In a business life cycle there are controversies about the application of ethical standards e.g. ethical issues related to corporate governance, bribery, discrimination based on the color of skin and/or religion and Corporate Social Responsibility (CSR). Businesses have to be cautious when dealing with such ethics in such situations. Following business ethical issues may seem to be financially non-feasible in certain circumstances but in my opinion, not following these standards may be more disastrous in the long run. For example an organization may try to avoid ethical standards at one time but the same issue might raise as a scandal against it some other time causing severe financial and ethical and moral damages.
Do you believe ethics have an impact on profit? Why? Why not? Provide specific examples.
Yes, I do believe that ethics have an impact on profitability. The goal of a business should not be to just maximize the profits only. It must follow the business ethics in its business processes and beyond. In my opinion when a business follows the best standards of ethical responsibilities, it helps them earn more profits. Though these profits could be gained over a long term instead of eminent profits. I short I must say that each business must apply the concept of moral minimum that states that “Compliance with the law is insufficient for an ethically responsible business” (Desjardins, 2014).
I would like to provide a few scenarios where a business can increase its profitability by following the ethical standards.
Consider a company is fulfilling its ethical responsibilities related to environmental protection. They are not exhausting waste product to the environment that could cause damage to the ecosystem. They are also helping in planting trees and other environmental safety drives. These ethical steps would add to the business sustainability as the environment that the business is done in is not destroyed and the business can stay there for a long time profiting financially.
Now consider a business that fulfils its CSR. It spends its resources on educational opportunities for the society that it exists. The youth of that area can utilize this opportunity and develop their skills with the educational opportunity and after they have mastered these skills they might come to the same business to work for it. So the business initially invested with no profit in its mind but it did return in the form of the necessary human resource to the same business.
Investing in the local community can also provide the political support that a company may need to operate in an area. In short, following ethics can be a source of profits and a good name for a business.