Utilitarianism is a teleological ethical theory based on the idea that an action is moral if it causes the greatest amount of happiness for the greatest number of people. The theory is concerned with predicted consequences or outcomes of a situation rather than focusing on what is done to get to the outcome. There are many forms of utilitarianism, having been introduced by Jeremy Bentham (act utilitarianism), and later being updated by scholars such as J.S. Mill (rule utilitarianism) and Peter Singer (preference utilitarianism). When referring to issues of business ethics, utilitarianism can allow companies to decide what to do in a given situation based on a simple calculation.
It also presents and critiques the argument in favour of the stakeholder model that claims that contributions are made by all stakeholders and therefore businesses should act in everyone’s interest. It demonstrates the flaws and strengths surrounding each argument and ultimately establishes the more favourable model and through this answers the questions as to in whose interest to act when faced with a conflict of interest. The first argument in favour of Shareholder Primacy claims that businesses that seek profit above all else, businesses that prioritise the interests of its shareholders, benefit
Employees: Employees can be acted towards ethically by organizations, by creating an occupational structure that fairly and equitably rewards them for their valuable contributions, health and safety at work, security, fair play. Shareholders: When operating ethically shareholders would like to maximise their return on investment. They would likewise need to guarantee that supervisors are behaving ethically and not risking investors’ capital by engaging in actions that could hurt the company’s reputation. Shareholder’s may not be happier as the return on investments would be lower when a business attends to operate ethically but it is possible to persuade them by clarifying the long haul results of the business. Customers: They are the most critical stakeholder for a business.
My primary ethical principle that I most practice is justice as fairness. I think that in everything a manager does they should be fair and everything they do should be executed with the utmost of justice as well as fairness. The pros of my ethical principle are that the employees come out ahead if something goes awry within the company. If a company I ran were to hit a financial crisis due to something that an executive in my company made, I would have to choose the fairest thing to do for not only that executive employee that made the said decision, but the fairest decision for all employees within the company. My primary ethical principle would create a balance in a state of crisis and establish the company’s values to the employees by not only what is written in them but also by the company’s actions.
Firms view their stakeholders as part of an environment that must be managed in order to ensure revenues, profits, and ultimately, to provide returns to shareholders. Attention to stakeholders issues my help a firm avoid decisions that might prompt stakeholders to undercut or thwart it objectives. This possibility arises because stakeholders can control resources that can facilitate or enhance the implementation of corporate decision (Pfeifer &Salancik, 1978): in short stakeholder management is means to reach an end: something what you have to do that you can achieve else. The end, or the ultimate results, is generally not the welfare of stakeholders. Instead the firm’s goal is the advancement of the interest of only one stakeholder group; its shareholders.
It involves emphasize transparent, trust, responsible personal, and organizational marketing policies. Not having any ethic will damage consumers and other stakeholders. Therefore, it is equally important for both small to large companies but it does differ from one another. Just like how, generally speaking, the term “ethics” refers to the way people relate in a moral manner toward others in all of their various interactions, marketing ethics refers to the application of this morality in reference to the way companies conduct businesses with their consumers and other related parties. Marketing ethics may also refer to the manner in which a business presents its products to consumers generate more sales and make more profit.
Position: Companies and business people should be ethical Point 1: Being ethical in business strengthens the systems and relationships that support and sustain it Individuals, through corporations, have the right to amass wealth, but morality dictates that they do so ethically. Frist, principles of justice argue that unethical business practices, although may be legal, are unfair
Concerning influential types of management/leadership in ethical behaviour, findings contain mainly the following types- as they were described by Trevino & Brown (2004): Transformational leadership: these relationships entail future obligations that are unspecified and are enforced by norms of reciprocity. Without the protection of contractually specified obligations, the perceived trust-worthiness of the partners and the fairness of the exchange become important for developing and maintaining lasting relationships. The obligation is voluntary and the benefits may be non-monetary, hence the loss of reputation plays an important role here. Leaders, in this category raise followers’ level of moral development and focus followers
As explored in the previous section, ethical behaviours can contribute to long term profit and sustainability, whether it is through building trust of customers or avoiding legal problems. However, this is obviously not always the case. Many corporations have turned to unethical practices and since their decision making process is rational, these corporations must have reasoned that the profit of the unethical behaviour outweighs the safer, long term benefit of ethical behaviour, a view that is contrary to popular belief. This is especially true in large multinational corporations, where they have the ability(in terms of wealth and establishment) to face up to consequences of their unethical behaviour, and ultimately still
Business must adjust their yearning to augment benefits against the needs of the stakeholders. Good business morals would mean moral standards acknowledged by the general public as right ought to be actualized throughout behaviour of corporate undertakings. Schedule IV of the Companies Act, 2013, deals with the code of independent directors. It deals with the guidelines of professional conduct and also with their role, functions and duties. Good business morals in the administration of the corporate undertakings would essentially include proper money related dealings in their managing which would in this manner help the organization to succeed.