Bussiness ethic as a key factor in corporate success

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Business ethics is an interesting branch of business theory, primarily because of the fact that they are inherently interesting in a market economy. People tend to be extremely distrustful of corporations in market economies and the bigger they are, the worse that problem of trust usually gets. Business ethics therefore are politically charged in many different circumstances and that in turn serves to make them interesting. Aside from this academic interest however, are also important for a company and its success. Here are some ways in which this is true.

Ethics concern an individual’s moral judgements about right and wrong. Decisions taken within an organisation may be made by individuals or groups, but whoever makes them will be influenced by the culture of the company. The decision to behave ethically is a moral one; employees must decide what they think is the right course of action. This may involve rejecting the route that would lead to the biggest short-term profit.

Ethical behaviour and corporate social responsibility can bring significant benefits to a business. For example, they may:

· Attract customers to the firm’s products, which means boosting sales and profits

· Make employees want to stay with the business, reduce labour turnover and therefore increase productivity

· Attract more employees wanting to work for the business, reduce recruitment costs and enable the company to get the most talented employees

· Attract investors and keep the company’s share price high, thereby protecting the business from takeover.

Knowing that the company they deal with has stated their morals and made a promise to work in an ethical and responsible manner allows investors’ peace of mind that their money is being used in a way that arranges with their own moral standing. When working for a company with strong business ethics, employees are comfortable in the knowledge that they are not by their own action allowing unethical practices to continue. Customers are at ease buying products or services from a company they know to source their materials and labour in an ethical and responsible way.

Public Image

It is impossible to discuss business ethics as a branch of academia without taking a look at the relationship between business ethics and public image. Each corporation has a particular public image, which represents the way in which the public views the corporation.

A corporation's environmental policy, the way they treat their employees and the way they treat the communities they exist in are all part of their overall behavior and this in turn is the principle factor in determining their public image. Since public image is largely a result of company behavior, business ethics play a large role in determining public image since they determine behavior. And public image is important to success in most cases, which is one of the reasons as to why business ethics are important to a company's overall success.

Investment

Another reason that business ethics are important is the relationship they have to investment. When a person or an entity is considering investment in a particular stock, there are a number of things they take into account. Therefore, a company that would like to encourage extra is a company that has a strong sense of business ethics. Part of business ethics is responsibility to the investor and for that reason companies with strong reputations in the field of ethical business behavior are also companies that tend to attract more investment from people that are new into the market. Investment is most definitely important to success.

Partnerships

In the business world, joint ventures happen all the time. They happen all the time because they are ultimately of great importance to the bottom lines of businesses. A business can be made or broken on just one joint venture and part of the reason that joint ventures are successful is that they combine the forces of two extremely powerful companies on occasion.

If you want your company to do well in joint ventures, then you need to have good partners. The only way to get good partners is to have a good reputation both in terms of a track record and in terms of your business overall. And of course, the best way to get a good reputation is to ensure that your company has a strong tradition of ethical business behavior.

Examples of corporations that use business ethics as the key to their success

McDonald’s Business Ethics

Aim and Purpose

This report on the CSR and business ethics for McDonalds will aid the management and executives in the board of McDonalds to better deliver their CSR to their strategic business partners and the public in general. The report also illuminates areas that perhaps McDonalds should consider incorporating into its CSR plan for the next operating year.

This report shall assume certain factors. Firstly, that McDonalds CSR is uniform throughout all the countries that it operates fast food restaurants in. secondly, the report shall also assume that the CSR and business ethics that McDonalds has implemented and will implement have gained general acceptance amongst its business partners, customers and the public in general.

Situation Analysis

In each and every country, McDonalds has thrives to develop a menu that fits the tastes and culture of the people in those countries. This has made McDonalds unique in its delivery of fine and quality fast food products. Its CSR strategies have helped it to identify the needs of the people within these destinations and develop fast food solutions that best fits their needs. McDonalds is thus mindful of its customers’ diverse needs. In addition, McDonalds strives to promote healthy diets that benefit its customer.

Factors and Discussion

McDonald’s core values are all aimed at promoting the Corporate Social Responsibility of the firm. This is achieved through giving value to the customers, the supply chain as well as the other business partners with whom McDonalds does business. McDonalds indeed acknowledges the fact that its customers are the reason behind its success and existence. McDonalds values its employees and states that it is committed towards the career growth and development of its employees through a comprehensive training plan.

Sustainable supply chain

McDonald’s suppliers are required to adhere to the strict Code of Conduct which enhances the supply chain ensuring that the fast food giant gets the best quality products as raw material for preparing the fast food restaurants.

Nutrition and wellbeing

McDonalds is always committed to the wellbeing of its customers through producing fast food products that have no adverse health effects on the customers. The company follows the strict advice of its nutrition experts. There have been concerns about obesity that McDonalds has taken seriously and strived to avoid producing fast food products that may lead to obesity among its customers.

Environmental responsibility

McDonalds takes its social responsibility concerning the environment seriously. The firm established its very own Global Environment Commitment (Houk and Williams, p.134). The company has continued to focus on improving its commitment towards the environment. As far as McDonalds CSR regarding the environment is concerned, the fast food giant has in the past and present focused on three main areas namely; energy efficiency, sustainable packaging and waste management as well as green restaurant design. McDonalds has sort to use more energy efficient strategies such as the use of natural gas in the fast food restaurants. McDonalds continues to seek ways of increasing energy efficiency. Furthermore, the fast food giant also seeks to reduce the impact of its operations on the environmental impact.

Employment experience

McDonalds has a policy within all its subsidiaries and fast food restaurants worldwide of giving its employees a priority over all other things. The firm indeed identifies that employees are core in the company’s success. McDonalds has in the past devised training programs aimed at employee development. Moreover, the firm empowers its employees to take up new challenges in the fast food market. Furthermore, McDonalds supports human rights which forms part of it global business conduct.

Community responsibility

For ages, McDonalds has been supporting the Olympic Games through feeding program aimed at feeding the athletics. McDonalds is also involved in various charities and also supports education in the developing countries where it has its franchises and fast food restaurants. As part of its bid to return back to the society, McDonalds has sponsored several children programs involving eradication of illiteracy and poverty.

Conclusion

McDonalds has been able to achieve high success through its identification of the elements that make it succeed most. These elements include its employees, customers and the suppliers. McDonalds values its employees and has various training programs to support their bid towards an excellent service provision. The company draws its success mostly from its employees. McDonalds also hires quality and highly valuable employee’s thus ensuring continued success for the company.

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Source :

https://www.slideshare.net/y4ss1r/business-ethics-14811885

https://www.streetdirectory.com/travel_guide/161760/corporate_matters/why_business_ethics_are_important_for_a_company_and_its_success.html

https://blogs.accaglobal.com/2014/11/25/why-is-ethics-important-to-business/

https://www.ukessays.com/essays/business/mcdonalds-business-ethics.php