describes the social implications of ethics in the different areas of business activity to include:- ethics in finance eg bribery, executive pay, insider trading, lobbying; ethics in human resource management eg discrimination, worker surveillance; ethics in production eg animal testing, genetica...
In financial dealing and payments, there is scope for several kinds of unethical behaviour. Regulations and
voluntary codes try to make sure that ethical practices are observed.
Bribery - This is a form of corruption. It is the straightforward use of financial muscle to gain
unfair advantage over others. This is when business pay money to have things their own way. Businesses may
pay money to a planning officer just so they can get planning permission. Tesco may give others money for
planning permission so that they can expand the business or they can pay money to the decision maker in a
business and gain award of a contract. Tesco wouldn’t use bribery since their business is fair and ethical.
Executive pay - Companies in the US now have to include in their annual reports a single figure for the total
pay of their executives. This tells shareholders exactly what their top executives are earning. Businesses may
pay excessive money for top executives at Tesco. This shows shareholders what their top executive are
earning. The top executives of Tesco would want that information as then they can plan other ways of raising
profits.
Insider trading - This refers to illegal use of privileged information in dealing on a stock exchange. Detected in
the UK by the Securities and Investment Board and in the US by the Securities and Exchange Commission. For
example a manager of Tesco who has a privilege to confidential information is trying to scam Tesco by using
this privilege and accessing employee’s information.
Lobbying - This means to approach an MP or minister with requests for actions or information. The intention is
to persuade politicians to adopt a particular cause or issue to benefit it. It can be a source of corruption. Tesco
may use lobbying to change their policies which are given for their business such as pay policies.
ETHICS IN HUMAN RESOURCE MANAGEMENT
The law is used to ensure that when jobs are advertised, there is no discrimination. People are entitled to feel
that job selections are made on the basis of merit rather than on the basis of race, nationality, gender or other
unfair grounds. This is why human resources professionals are trained to avoid discrimination of all kinds.
Discrimination is very unethical for example treating people differently over their sex, age or religion. Tesco
could not be doing this when picking people for promotions.
Abuse of employees also cannot happen. Abuse of employees is child labour and not paying employees correct
wage. It would not be ethical if Tesco were using child labour in other countries like poorer African countries
and Tesco would also be expected to pay employees the minimum wage. Worker surveillance is cameras in the
workplace watching workers work. Implications for a big business like Tesco due to these circumstances would
be employees are not happy. The business could be took to court and fined if it was caught not paying
minimum wage or using child labour in other countries. Other implications for Tesco would be an increased
membership in trade unions against them.
ETHICS IN PRODUCTION
The production of goods can lead to ethical problems for business, e.g. animal testing - British law requires
that any new drug must be tested on at least two different species of live mammal. The Animals Act 1986
insists that no animal experiments should be conducted if there is a realistic alternative.
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