Spiritual Dimension of Business Ethics

Discuss about the Spiritual Dimension of Business Ethics.

Effective ethical programs are an essential regulatory environment for all companies in 21^st century as it helps in setting protocols that prevents any unlawful conduct and helps in promoting compliance culture within the business organization. Organizations often create programs for promoting effective ethics in business organization through investment of resources and time and are also known as effective compliance and ethical program. According to Bampton (2013), effective ethics helps management of the organization to obtain accurate and timely information regarding potential legal problems and successfully redress them. On the contrary, if an organization violates any federal law, an effective ethical program helps in imposed penalty reduction and persuades the prosecutors to remove any penalty imposed. The ethical programs help in regulation of operations, merchandising, supply chain management and human resources within any business organization along with its decision-making process.

The internal factors of effective ethics in business and its decision-making process are precisely assessed with SWOT analysis. Major strengths of business ethics involves larger business, internal organizations like OECD, ICC etc., governments along with general public tend to recognize and follow a business that has a good and effective ethical framework. Majority of the business establishing standards of ethics are increasing and more than 50% of the corporations having code of conduct and ethical programs has a higher profit margin and are less susceptible to any disputes (Beadle 2017). Moral issues within the company are also addressed by effective ethics leading to potential solution that helps in developing business purpose and objectives. Companies as if Exxon valdes, BCCI, Shell and Brent Spar and Daiwa bank after implementing effective ethics improved their brand image due to rise of public concern in business corruption like bribery and personal profits. Effective ethics also helps in development of responsibility and communication skills among employees and makes them aware of the organization norms of rules and regulations.

Weakness of effective ethics involves non-existent and obscure nature of regulations. Majority of the organization evolving discussions for production of global statement in principles of business fail to follow and get involved into those standards efficiently (Zsolnai 2015). Any additional business ethics implemented are highly susceptible of misinterpretation by the employees without proper information and awareness. Thus, the HR is responsible to promote the new ethics to the employees. However if there is a lack of proper communication, it leads to issues that causes loss in business and destruction of brand image. As per Crane (2016), around 25% of the businesses in Australia have not successfully promoted their effective ethics to employees that caused loss in company and poor brand image. In addition, several disputes among employees arise in business that leads to loss of fairness, reputation, integrity and trust among workplace employees.

Growing demand of public regarding accountability and transparency in corporate and public life is a major opportunity for effective ethics. The understanding of the basic human rights importance and the standard of environmental standards is another opportunity for business ethics to flourish. Finally, the economic activity potential for going global is another major opportunity for effective ethics. Decision making worldwide at a lowest possible cost implemented by organization requires effective ethics. Companies in Australia are facing great opportunity in domain of effective ethics as business partners and customers are highly involved in deals and making business partnerships with organization that has an effective ethical standard in their organization. The growing government policies and regulations regarding application of effective ethics is a major opportunity for organization to implement effective ethics as it helps and promotes Australian business to sustain business culture and workplace integration.

Threats of effective ethics include regulation and law that gradually helps in taking effective position and power for the nature of discretionary of ethics. Measurement demands for ethical performance helps in concentrating negative aspects of the project rather than positive aspects of the projects. Drumwright (2015) stated that corporate courses and training of wrong standards are also a problematic due to its complicacy and interlinked dilemma of effective ethics. Due to several religious and ethnic groups present in a workplace, the diversity provides a challenging threat towards effective ethics. As different religious groups have different perceptions and restrictions, conflicts arise during compliance with the organsational effective ethics. For example in Biosis Pty Ltd., Australia, there is a corporate rule that no employees can leave the office before lunch that is until 2:30 pm in the afternoon. Hence, Islamic employees have a conflict, as they require leaving the office premise during 12:00 pm afternoon for praying.

PESTEL analysis for external environment of business ethics highlights those political factors in Australia regarding budget repair and agenda for growth and hence effective ethics are developed for coping with those factors in Australia. Governmental acquirement of numerous private companies also leads to change of framework of effective ethical standards that makes companies revise their effective ethics as per Australian government. Economical factors have a positive impact, as there is a low risk of risk in Australian economy due to strong GDP growth, rising rates of exchange, stable interest rates, low inflation rate and high employment level (Hoffman 2014). Sociological factors like customer perceptions also cause companies to revise their effective ethics and their decision making process as organizations develop their decisions for creating brand image and create employee morale. Technological factors like implementation of various computers and advanced IT equipments make companies in proper decision-making process and make the organization to incorporate effective ethics. Environmental standards maintenance and regulation as per governmental needs also makes organization to involve an effective ethics to create less negative impact on environment (Weiss 2014). Finally, legal framework of Australian government and business makes them competent in development of effective ethics. The legal environment also creates an urgency to incorporate ethical standard in Australian businesses.                                               

According to Klikauer (2015), effective ethics creates a positive environment at workplace and create a sustainable culture in organizations. It also creates an ethical standard and prevents any unlawful or immoral conduct within the organization. Ethical standards implemented enable the workers to get motivated and truthful within their organization and hence increases organizational productivity. Effective ethics enables each employee including manager and CEO to be just and equal in decision-making process. The organization implementing effective ethics gets a market advantage over other competitors and thus customers readily provides investments in companies through market shares that helps in establishing business relations of long duration with the organization. Performance of employees also increases with ethical policies presented within the organization. Employee morale increases and they feel obligated in putting their efforts towards success for the organization and achieve organizational objectives.

According to Michaelson (2014), effective ethics within organization creates a management of reputed stature while on the contrary an unethical behavior leads to a scandal of brand image and company reputation. Often company faces issues such as stock price fall, low employee morale, anxiety among employees and is subjected to government as well as public scrutiny followed by inquests. Incentives followed by companies are of high quality and high ethical standards ensure those incentives to be morally just and according to the rules of regulating bodies. Koslowski (2013) commented that often effective ethics has a positive effect among Australian firms boosting their sales and maximizing their profits. A proper ideological platform is followed by effective ethics and builds organizational honesty and reputations.

Effective ethics is very important in contemporary business and decision-making as it helps the business to follow a right course of action and prevent following a short route to short term profit through unfair means. Applying effective ethics in businesses and decision-making helps the organization to attract potential customers towards firm’s product and boost profits and sales. Labor turnover within the business is also decreased and employees tend to like the workplace increasing productivity. For example, Boag’s Brewery, a food and beverage firm of Australia after implementing effective ethics has increased its employee morale by around 40% evaluated using an employee satisfaction survey (McFarlane 2013). Brambles limited, another Australian industrial firm that deals with construction and materials, after implementation of effective ethics, increased the productivity by 67% and decreased labor turnover by around 88% (May 2014). Thus, investors are attracted towards organization more and keeps high share price of the firm protecting business from possibility of takeover.

However, if effective ethics are not applied to a contemporary business, damages company reputation making it less appealing towards the stakeholders. As a result, profit falls rapidly and the company becomes highly susceptible to financial loss and takeovers. For example, BHP Billiton, Australian oil and gas producers has seen noticeable drop of market prior to corporate social responsibility and effective ethics. The company almost lost its reputation and was supposed to be acquired by British Petroleum however, after incorporating CSR strategy and other effective ethical standard within workplace regained its reputation within Australian market. Therefore, it is highly recommended to follow the effective ethics in contemporary business and decision-making. Effective ethics helps to make major decisions such as takeovers, investment and marketing strategy following an ethical standard devoid from any unethical and unlawful conduct.

Reference list

Bampton, R. and Cowton, C.J., 2013. Taking stock of accounting ethics scholarship: A review of the journal literature. Journal of Business Ethics, 114(3), pp.549-563.

Beadle, R., 2017. MacIntyre’s Influence on Business Ethics. Handbook of Virtue Ethics in Business and Management, 8(3), pp.59-67.

Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and sustainability in the age of globalization. Oxford University Press.

Drumwright, M., Prentice, R. and Biasucci, C., 2015. Behavioral ethics and teaching ethical decision making. Decision Sciences Journal of Innovative Education, 13(3), pp.431-458.

Hoffman, W.M., Frederick, R.E. and Schwartz, M.S. eds., 2014. Business ethics: Readings and cases in corporate morality. John Wiley & Sons.

Klikauer, T., 2015. Morality, Competition, and the Firm: the Market Failure Approach to Business Ethics. Philosophy of Management, 14(3), pp.223-228.

Koslowski, P. ed., 2013. Contemporary economic ethics and business ethics. Springer Science & Business Media.

May, D.R., Luth, M.T. and Schwoerer, C.E., 2014. The influence of business ethics education on moral efficacy, moral meaningfulness, and moral courage: A quasi-experimental study. Journal of Business Ethics, 124(1), pp.67-80.

McFarlane, D.A., 2013. The importance of business ethics to small ventures. Entrepreneurship and Innovation Management Journal, 1(1), pp.50-59.

Michaelson, C., Pratt, M.G., Grant, A.M. and Dunn, C.P., 2014. Meaningful work: Connecting business ethics and organization studies. Journal of Business Ethics, 121(1), pp.77-90.

Weiss, J.W., 2014. Business ethics: A stakeholder and issues management approach. Berrett-Koehler Publishers.

Zsolnai, L. ed., 2015. The spiritual dimension of business ethics and sustainability management. New York: Springer.

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