Q.1
There are several benefits of business ethics and these benefits have close relationship with company’s product, service quality and profitability. As a well-known fact, long term ethical business methods are more profitable than unethical behaviors. Already many companies know that business ethics is not a need but a responsibility. In addition, through the business ethics, company will get high level of reputation which is related not only with their profitability but also in maintaining the image of company. When we look at the Walter’s case, he faced with two companies’ attributes. The first firm promised higher returns than the second firm. However, from the facts, the company mentioned that we have no time or patience to bend the rules (“Facts”). It means that the probability of the risk will increase and one might lose some of his investment. On the other hand, the second company value longevity than a quick dollar. Although the first company’s profitability is better than second firm, the second one wins favor due to their ethical practice of giving more value and trust of their customers. Through this, the company can establish more solid business relations which then can possibly be exposed to other possible clients through media.
Q2
In this case, the two different theories have a close relationship with each suggestion of the two companies.
The first firm tries to maximize the profits for customer and it is related with the theory of the Social Responsibility of business. This type of theory observes higher level of behaviors considering the triple bottom lines (financial, social, and environmental). In a free-enterprise and private-property system, owners of the business will make as much money as possible. Likewise, the first firm assured the high level of profit return to Walter. Although, free competition opens, there are still rules of the society.
On the other hand, the second firm’s offer has a relationship with theory of corporate social responsibility. Corporate social responsibility is a key for any company aiming for long term sustainability. Similarly, the second firm said that “our business and longevity is worth more to us than a quick dollar” (“ Facts”). This theory engages in free competition without deception and fraud. In addition, it is involved in increasing pressure on organizations to make a positive contribution to society, or at the least, reduce their negative impacts on possible environmental problems and other ethical considerations.
Q3
Corporate ethic codes defined as effective instruments for shaping ethical behavior and guiding employee decision-making. Moreover, it is useful way to guide employee or corporate behavior. There are two types of approach can adopt. First one is aspirational code which set out ideals off best practice but is generally impossible. In contrast, prescriptive approach is much more specific and breaches are subject to punishment (“Text”. p291.). There are several appropriate principles of corporate ethics code for those two companies.
a) Companies should consider the effect that their actions may have upon others
b) Companies should strive to minimize pollution
First, A principle will be appropriate to the first form. From the fact, the first form said that they will use hare-line debt recovery techniques. Actually, we do not know about this strategy exactly. It can be harmful or useful to customers. Likewise, this kinds of important decision need company to consider about effect that their action.
On the other hands, the second firm is different. They are trying to minimize the risk. Therefore, principle B will be suitable for the second firm. This principle will contribute for longevity.
Q4
United Nations Global Compact is one of international initiative regarding business. Compact consists of nine principles which are related to human rights, labor and the environment. Obviously, several principles will be helpful and useful to Walter. There are several benefits by joining the Global Compact.
a) Developing specific Know-hows
b) Developing a network with other organizations.
c) Improving the reputation and increasing the trust in the company
d) Sharing best and emerging practices to advance practical solutions and strategies to common challenges
In addition, all company needs to submit their annual report to for ensuring correct information. Through these reports, ethics will change. Size and property of company influence to ethics. Moreover, many of the existing standards support the principles of the Global Compact and are therefore are quite consistent with its overall objectives.
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