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What Are the Different Ethical Issues in Business?

Corporate social responsibility is an important aspect of business ethics.
One issue of ethics in business is child labor.
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  • Written By: Sheri Cyprus
  • Edited By: Heather Bailey
  • Last Modified Date: 03 October 2014
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Ethical issues in business include concerns of quality, value and honesty as well as the category of corporate responsibility. In addition to proper treatment of all workers, business ethics basically boil down to being honest about what products and services are in relation to their origin and price. Corporate responsibility involves a sense of protection in offering safe products for consumers that are created through decent working environments for the people who manufacture or create them. To be dishonest in what ingredients are included, where they originated or where a good was made is an example of poor business ethics and a lack of corporate responsibility.

The supply chain is the path of getting a product to the end user. Different ethical issues in business that involve the supply chain involve the workplace, workers and the marketing mix. The marketing mix includes the product, packaging, price, place or distribution and promotion. Each of these components can create a different ethical issue. For instance, unethical advertising would promote an unsafe product as being safe. Fruit that was actually grown in Mexico, yet stamped as being imported from Canada is an example of unethically representing the distribution part of the supply chain in the marketing mix strategy to sell the goods to unsuspecting consumers.

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Charging a price far above the suggested retail one is another of the ethical issues in business. Using packaging that doesn't contain warnings such as for a cleaner with harmful fumes to be used only in a well-ventilated area is a different kind of unethical business issue. Most countries have strict regulations and laws on what manufacturers and marketers must reveal about a product created for sale. Consumer advocate groups are another source for advocating ethical issues in business. If a company knows that unethical issues surround its products or services, yet doesn't take any action to correct it, this can in itself be a breach of ethics.

Workplaces and the workers involved in manufacturing products relate to ethical issues revolving around being paid fairly for their work as well as being treated humanely. Ethical issues in business that are relevant to these concerns are often categorized under the term corporate social responsibility (CSR). They include slave and child labor or wages that are so low that healthy survival is close to impossible. Dangerous workplaces or work environments in which staff are beaten or treated violently are other types of CSR ethical issues.

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oasis11
Post 4

@Icecream17 -Oh I remember that story. It was so sad. I also think that companies have an obligation to sell products that are safe for consumers. For example, many toys were found to be laced with lead when they were made overseas in a factory in China. If the company was aware of the situation and had not done anything about it, it would have clearly been an ethical violation because they would be putting profits ahead of the general public’s safety. Thank goodness that they did a voluntary recall.

This happened recently with a Japanese car manufacturer after it was proven that they tried to hide problems with the sudden acceleration and faulty brakes that have killed several people. I think that once a company’s reputation is damaged this way, their business will continue to suffer long after they resolved the problem because the public will have a hard time trusting the company again.

icecream17
Post 3

@Suntan12 -I agree and wanted to say that some companies do their own recalls in order to protect their customers once they know that there are problems with some of their products. These are honest companies that value their clients.

I also wanted to say with respect to honesty that the many of the recent business ethics issues revolved around disclosing poor accounting practices and misleading investors.

Some companies in the past have lied about their earnings in order to pump up their stock price. One of the most devastating examples was the Enron collapse in which all of the employees lost their life savings because the company not only lied about its finances but it knowingly encouraged employees to invest even more money.

suntan12
Post 2

@Sunny27 -I know that there will always be controversy regarding the cigarette companies, but I also think that the financial sector also requires proper disclosures so people know what they are investing in.

As a matter of fact, only a licensed professional can talk to you about investing in securities. In fact many banks have to have a designated section for investments and have to have a sign that states that certain investments are not FDIC insured and can lose value.

I think that a lot of business ethics issues in the news are resolved through additional governmental regulation. Although businesses should do this on their own at least the government steps in to protect consumers and keep businesses honest.

Sunny27
Post 1

When I think of business ethics issues I always think of a company’s responsibility to tell consumers of the potential risks associated with their product or service so that consumers could make an informed decision.

For example, cigarette smoking has long been proven to cause cancer I read that it wasn’t until 1996 that the first warning labels came out on the packaging. When you consider that one of the biggest cigarette companies began manufacturing cigarettes in the United States in the early 1900’s it really was almost one hundred years before we started warning the public about cigarette smoke.

Some say that we did not know the hazards of cigarette smoke, but I know that if the Food and Drug Administration would have known then what it knows now I don’t think that cigarettes would have ever been approved for sale in the United States.

I saw the movie, “The Insider” with Al Pacino and Russell Crowe that was a true account of the tobacco companies and their prior knowledge of the dangers of cigarette smoking. I believe that ethics in business really requires that you tell the truth about your product no matter how it impacts your sales.

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