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Running head: BUSINESS ETHICS TASK 1 1

Business Ethics Task 1

Name

Institutional Affiliation

BUSINESS ETHICS TASK 1 2

Business Ethics Task 1

A. Three Corporate Policies reflecting on TechFite’s cultural and ethical viewpoints.

1. TechFite is committed to upholding ethics when it comes to bonuses, even at executive levels

and therefore, executive and employee bonuses will be paid out based on merit, completion of a

specified task and reaching a given predetermined goal. Therefore compensations are given for

long-term performances and fraudsters who seek to have more bonuses through illegal means will

be faced with serious penalties.

2. TechFite requires its directors, officers, and employees to maintain high standards of personal

and business ethics as they conduct their responsibilities and duties. TechFite employees and

representatives should practice integrity and honesty in the fulfillment of responsibilities and

compliance with regulations and laws.

3. In accordance with its core principles, TechFite is committed to social justice when it comes

to removal of organizational structures and acts which may oppress, limit, discriminate and

exclude on the basis of disability, age, religion, sexuality, financial ability, gender, and race. It is

therefore imperative that all TechFite services and programs make a reflection of its adherence to

social justice.

A1. The rationale behind the policy and the role of the corporate policies mentioned above.

The first policy deals with executive bonuses which are at a record high. This compensation

has led to unethical behavior which has progressively turned into a fraud where the executive

benefit from the employees and in the end reap high financial gains for doing very little in terms

of the organization’s goals (Chandler, 2014).

BUSINESS ETHICS TASK 1 3

A whistleblower is an employee or a member of a given organization who makes a report

of company’s misconduct to entities or people who can take actions to correct the problems.

Whistleblowing is important because it ensures that employees stay happy in the organization.

Whistleblowers who in this scenario are employees complaining about wages, benefits and

working hours need to be protected from being bullied in the workplace by the employer and other

high-ranking members (Hutton et al., 2014)

The third policy is concerned with diversity in the organization whereby it is important to

make a commitment to eradicating discrimination in practices while encouraging and fostering

equal opportunities via removal of barriers in the organization. This policy seeks to bring about

reinforcement in terms of compliance with the legislation of basic human rights while also being

a statement of the values of the organization (Decamps et al., 2016).

A2. Difference between legal and ethical issues

Ethical and legal issues are common in organizations in every type of business. Ethical

issues are held deep within morals and often call for a company or individual to make a decision

on the alternatives which can be considered as either wrong or right where wrong is unethical and

right is ethical. It is mainly founded on the way wrongness or rightness of a situation or act is

perceived and therefore affect the entire society or other people.

Ethical issues tend to raise a lot of questions on virtues and it is mainly under the guidance

of an individual’s sense when it comes to right and wrong. In the context of business, the most

common ethical issue is firing and hiring of employees, regardless of whether or not the affected

employee will be able to support himself or herself after being fired by his employer.

BUSINESS ETHICS TASK 1 4

Legal issues, on the other hand, are questions or situations that solely entails the application

of legal principles. These issues mainly come up due to the lack of adherence and compliance with

law principles thereby going against the law. At this point, the issues are punishable by the law of

a country and consequences are harbored within it. Organizations which participate in businesses

which are illegal would bring about legal issues and therefore the company can be subjected to a

penalty for conducting its operations in an unlawful manner (Limber, 2013).

Laws are founded on ethics and it is due to this reason that both legal and ethical issues

many times overlap and it becomes very hard to make a clear distinction between them. However,

it should be noted that both issues are different and they must be handled differently. Rules do not

govern ethical issues and therefore they are not punishable by law. Legal issues have stipulated

guidelines and if an organization goes against the guidelines, they are punished as per the law.

Another difference is that even legal issues can be unethical for example the act of firing an

employee is not considered legal but it is unethical. Again, ethical acts can be considered illegal

(Shaw et al., 2015).

A3. Ethical issues which is at stake in the scenario

An ethical issue which is observed in this scenario is executive bonuses which is unjustified

and excessive. The reaction may be observed when regulations and reforms are implemented in

any organization but the firms themselves have to always uphold their fiduciary ethics and duties.

Ethics of executive bonuses are outside and subjective of the laws which regulate the contracts and

agreements between the firms themselves, their CEOs and the directors (Limber, 2013). This

scenario clearly highlights high executive compensation and places it in the context of financial

fraud which will not change unless great penalties are put in place to deter this unethical behavior.

BUSINESS ETHICS TASK 1 5

But basically, the solution comes from the firm itself from the board of directors to employees who

will agree and join compensation with a long-term philosophy.

According to Chandler (2014), executive bonuses in the current work environments are

complex because of the package of itself apart from being over the base pay, it also includes other

bonuses which are short-term and paid out each year (Chandler, 2014). What the company in the

scenario has failed to note is that a bonus is paid out to reward or thank the employees or the

executive for working hard to achieve a given goal. This is also used as an incentive to ensure that

employees and the executive will achieve certain predetermined goals.

Another ethical issue which is seen in the scenario is TechFite's failure of being committed

to its promises. A promise is basically a commitment which is spoken or written to one person or

a group of people. When a company is committed to doing something for a given group of people,

a promise is made because of the statement of commitment. In the scenario, TechFite made a

commitment to sponsor events in the community including supporting the youth and investing in

infrastructure so as to help rebuild the city. However, the promises have not been kept.

According to Article 7 of the American Constitution, every individual has a right to enjoy

favorable conditions at work and include, fair wage and equal remuneration at work without

distinction. In TechFite, employees are complaining about benefits, wages and weekly hours which

fell below a number of hours which guarantee the ability to receive fulltime benefit.

A4. Duties, responsibilities, and purpose, of ethics officer in an organization.

An ethics officer is the individual who is responsible for overseeing all aspects related to

the procedures of an organization so as to ensure consistency within the organization’s code of

ethics. The ethics officer’s duties include being accountable for the development and supervision

BUSINESS ETHICS TASK 1 6

of an organization’s ethics because he or she oversees and confirm continuity of the organization’s

business conduct. Apart from that, they are leaders and give expert opinions so as to ensure

development and following of ethics, policies, and programs are observed by the company.

The ethics officer also do investigations based on objection and accusation of a

misdemeanor which reaches him or her from other departments. According to Chandler, an ethics

officer then guides the employer in the development of ethical codes so that there can be standards

that ensure penalty is given when one goes against the codes. Another duty of the ethics officer is

to ensure that ethical codes are imposed while also making changes whenever it is required

(Chandler, 2014).

The responsibilities of an ethics officer are to develop and disseminate the organization’s

ethics statements and policies while also making provisions of other corporate policies’ internal

review so as to ensure consistency and even integration with the organization’s philosophy in terms

of ethics. At TechFite, the ethics officer would be the company’s point of control for improprieties,

ethics, complaints, and conflicts of interests. Additionally, ethics officers provide leadership and

expert opinion and advice on issues which might be encountered in corporate governance. For

TechFite, an ethical officer would be responsible for overseeing all aspects related to the

procedures of TechFite so as to ensure consistency within the organization’s code of ethics.

B. Corporate Social Responsibility and its importance to business

According to Tai Corporate Social Responsibility (CSR) are initiatives by a given

corporation to make an assessment and become responsible for the organization's impacts on the

environment and the well-being of the society. Simply put, CSR applies to efforts that go beyond

the requirements by groups protecting the environment or regulators. Often, it involves the

BUSINESS ETHICS TASK 1 7

incurrence of short-term costs which do not ensure instant benefits financially and instead promote

positive changes in the society and environment. CSR in generic terms is important in business

because almost all stakeholders in any business look for ways to understand and value the

company’s mission and reasons as to why they should support and invest in it. CSR is important

to the employee of the future because at the moment there is high demand for employees who are

focused on the people, Earth as a planet and returns in terms of revenue (Tai et al., 2014).

TechFite benefits from being socially responsible because it will be more appealing to

employees and consumers who are socially conscious. The City of Dellberg will be positively

impacted as a community because being socially responsible entails acting in an ethical manner

such that social and environmental impacts of TechFite are considered. For employees they will

prefer working for TechFite because with CSR they will be able to attract and keep the staff of

high caliber, this will happen when CSR makes TechFite include the aspect of work life balance,

improve working conditions and bring about flexibility at the work place (Pedersen, 2015).

B1. Ethical desirability of improving the company’s reputation in the community

i) TechFite has failed to make a contribution to the economic and social development of the

community.

ii) Employees at TechFite seem not to be valued even though they are the ones bringing life to

the company while also being ambassadors with customers, community, and prospects.

iii) TechFite has failed to manage its finances in a responsible and transparent manner in

accordance with corporate governance and best practices.

Within its community, it is important for a company to be viewed as socially responsible

because it is there that it is seen as being more philanthropic as compared to those that do not have

BUSINESS ETHICS TASK 1 8

a corporate social responsibility because once it is socially responsible, consumers become aware

of the programs they offer. Once viewed as socially responsible, a company can boost the

engagement of its employees and ultimately improve its entire business operations. If TechFite is

viewed as socially responsible, it will gain a lot from citizens of Dellberg. Most importantly it will

attract and maintain investors because once it donates money to various non-profit organizations

in the community, they will clearly show investors that they do not care much about profit

(Scholten et al., 2015).

B2. Socially, ethically and environmentally responsible course to address the examples

mentioned above

A socially responsible course of action to address the failure of making a contribution to

the social and economic development of the community is supporting nonprofits by making

monetary, product and services donations while building a concrete partnership with the

community. For example, TechFite should pledge its commitment to sponsor events in the

community, give support to the community-based leadership development program for youths and

invest in infrastructure which will help in rebuilding Dellberg city using techniques which will not

harm the environment. An ethical course of action to address the problem of undervaluing

employees is to cut the excessive bonuses being paid out to top officials and supplementing it with

the meager pay of employees. Finances can be managed effectively if the cultural and legal divide

existing between the United States’ and United Kingdom’s policies in regards to working hours

and benefits are addressed (Weiss et al., 2014).

B3. How each course of action from part B2 is ethical, socially, and environmentally

responsible

BUSINESS ETHICS TASK 1 9

Making a contribution to the social and economic development of the community is

supporting nonprofits by making monetary, product and services donations while building a

concrete partnership with the community as a course of action is socially responsible because it

seeks to bring about good to the people of the city of Dellberg. Because TechFite pledged to rebuild

the city of DellBerg using environmentally responsible techniques, this is an important course of

action which ensures that the environment does not get damaged and polluted.

The employee environment has to also be addressed because they should not complain

about the wages, benefits and hours within the week which fall below the necessary hours to

receive benefits as per the policy of TechFite. Employees should not be undervalued and high

bonuses should not be paid to the personnel in executive positions while those in full-time and

part-time basis get little or no benefits at all (Crane et al., 2016).

BUSINESS ETHICS TASK 1 10

Reference

Chandler, D. (2014). Organizational susceptibility to institutional complexity: Critical events

driving the adoption and implementation of the ethics and compliance officer position.

Organization Science, 25(6), 1722-1743.

Corporate policies of Republican managers. Journal of Financial and Quantitative Analysis, 49(5-

6), 1279-1310.

Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and

sustainability in the age of globalization. Oxford University Press.

Décamps, J. P., Gryglewicz, S., Morellec, E., & Villeneuve, S. (2016). Corporate policies with

permanent and transitory shocks. The Review of Financial Studies, hhw078.

Ferrell, O. C., & Fraedrich, J. (2015). Business ethics: Ethical decision making & cases. Nelson

Education.

Hutton, I., Jiang, D., & Kumar, A. (2014). Corporate policies of Republican managers. Journal of

Financial and Quantitative Analysis, 49(5-6), 1279-1310. Hutton, I., Jiang, D., & Kumar,

A. (2014).

Limber, S. P. (2013). Ethical and Legal Issues. True And False Allegations Of Child Sexual Abuse:

Assessment & Case Management, 334.

Pedersen, E. R. G. (Ed.). (2015). Corporate social responsibility. Sage.

Shaw, W. H., & Barry, V. (2015). Moral issues in business. Cengage Learning.

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