4.4.2 business ethics

• what is unethical business practices?

  • when a business engages in practices which are morally wrong
  • unethical behaviour can damage brand image/reputation
• why might businesses adopt unethical practices?

  • unethical practices are often pursued because they are the cheaper alternative
  • they result in higher profit margins for owners/shareholders
  • in VW's case, it was to hang on to market share
• ethical considerations

  1. supply side considerations
  2. environmental considerations
  3. marketing campaigns
  4. stakeholder group
• ethical considerations: supply side considerations

  • exploitation of workers:
  • paying lower wages from LEDCs than their developed world equivalents and unsafe working conditions
  • child labour:
  • school age children working very long hours with little pay
  • eg, starbucks found <13 year olds working for £5/day
• ethical considerations: environmental considerations

  • emissions
  • waste disposal:
  • LEDCs wont have regulations in place
  • so MNCs are not legally obliged to reduce waste, dispose of it safely and limit emissions
• ethical considerations: stakeholder group

  (stakeholder conflict)

  • management vs workers
  • management vs owners
  • company profits vs resource depletion