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Ethical issues and examples

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Related resources: Study materials about bus ines s ethic s on the Bus ines s Studies blog Related Study Notes

Et hical issues and examples

Youll find lots of examples of business ethical decisions and dilemmas in areas such as:

What is Strategy? Ansoff Matrix Boston Matrix Benchmarking C ompetitive Advantage C ompetitor Analysis C ore C ompetencies GE Industry Matrix McKinsey Growth Pyramid Mission Objectives

Lets take one of the above suppliers. A business cannot claim to be ethical firm if it ignores unethical practices by its suppliers e.g. Use of child labour and forced labour Production in sweatshops Violation of the basic rights of workers Ignoring health, safety and environmental standards An ethical business has to be concerned with the behaviour of all businesses that operate in the supply chain i.e. Suppliers Contractors Distributors Sales agents The two articles below provide a good example of the ethical issues that arise in the supply chain: click on the images to read the stories:

PEST Analysis Five Forces Model Strategy and Marketing Strategic Resources Strategic Audit SWOT Analysis Value C hain Analysis Vision

Pressure for businesses to act ethically

Businesses and industries increasingly find themselves facing external pressure to improve their ethical track record. An interesting feature of the rise of consumer activism online has been increased scrutiny of business activities. Pressure groups are a good example of this. Pressure groups are external stakeholders they Tend to focus on activities & ethical practice of multinationals or industries with ethical issues Combine direct and indirect action can damage the target business or industry Some examples of business-related pressure groups can be found from the following links:

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Ethical issues and examples

Direct consumer action is another way in which business ethics can be challenged. Consumers may take action against: Businesses they consider to be unethical in some ways (e.g. animal furs) Business acting irresponsibly Businesses that use business practices they find unacceptable Consumer action can also be positive supporting businesses with a strong ethical stance & record. A good example of this is Fairtrade.

Is ethical behaviour good or bad for business?

You might think the above question is an easy one for businesses to answer? Surely acting ethically makes good business sense? As with all issues in business studies, there are two sides to every argument: The advantages of ethical behaviour include: Higher revenues demand from positive consumer support Improved brand and business awareness and recognition Better employee motivation and recruitment New sources of finance e.g. from ethical investors The disadvantages claimed for ethical business include: Higher costs e.g. sourcing from Fairtrade suppliers rather than lowest price Higher overheads e.g. training & communication of ethical policy A danger of building up false expectations

Other Strategy Revision Notes: Ansoff Growth Matrix | BCG Matrix | Balanced Scorecard - Intro | Balanced Scorecard - Perspectives Business Planning - Intro | Business Planning - Process | Writing a Business Plan - Introduction Business Plan - Contents | Benchmarking | Corporate objectives | Functional objectives | Types of Change | Change Management - Intro | Change Management - Lewin Change Management- Barriers |Change Management - Implementation | Competitive Advantage Competitor Analysis | Core Competencies | CSR - Intro | CSR - Issues | CSR - BITC Ethics - Introduction | Ethics - Issues and Examples | Growth - methods of development | Acquisitions (Intro) | Acquisitions evaluation Industry competition and profitability | GE Matrix | McKinsey Growth Model | Globalisation Intro | Globalisation Drivers Mission Statements | Risk (Introduction) | Risk Management | Contingency planning Business Objectives | PEST Analysis | Porter's Five Forces | Resources & Strategy |Seasonality Strategic Audit | Stakeholders - Intro | Stakeholders - Interest & Power | Strategy & Marketing SWOT Analysis | Value Chain Analysis | Vision | What is Strategy? SWOT - Strengths | SWOT Weaknesses | SWOT Opportunities | SWOT Threats

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The rise of Zero-hours contracts You wont find this term in a crusty old business studies textbook, but the use by employers of zero-hours contracts is becoming increasingly common on the UK. Companies using zero hours contracts dont give their employees guaranteed hours, but expect them to be available 34,954 people like Tutor2u.

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