World's Most Ethical Companies Research Paper
- Length: 6 pages
- Sources: 4
- Subject: Business
- Type: Research Paper
- Paper: #14653055
Excerpt from Research Paper :
population of the world, the scarcity of resources, and a threat to the ecosystem, it has become the responsibility of all institutes in society to play an effective role in protecting the environment. It is no more a concern of the government alone but needs the inclusion of businesses to take responsibility as well- and so they have with many major corporations initiating campaigns for corporate social responsibility. Businesses are liable to function in a way that not only fulfills their motive to maximize profit; but, they should also serve the interests of consumers and the environment. It is the responsibility of companies to foster consumer trust, provide safe products, and ensure affordability. These can be attained by providing consumers with absolute information about the kind and location of the business. Advertisements should be honest and free from any misleading claims. Businesses also bear the responsibility of informing customers about the effect of their choice to the society, the environment, and economy. One of the important things that companies need to look into is social inclusion. It should be realized that the products sold are affordable by all parties. To protect the environment, businesses need to comply with the rules set by the government. Waste should be properly managed; it should be stored, treated, and released to the environment only if it is not hazardous. Paper, plastic, metal, or food items should be separated and recycled. Permission should be cited from Water Company before releasing effluents and chemicals into the sewerage system. If air-conditioning or refrigerating equipment is used in offices, then firms must regularly check for leakages, undergo repairing, and embrace prevention techniques to reduce the discharge of harmful gases to the environment. Furthermore, businesses may examine the location of their offices or industries. They should be able to identify the protected areas around their offices if any and special considerations should be made to prevent any damage to those protected areas (national parks, national nature reserves, national scenic areas etc.)
The concept of business ethics and business ecology explains the importance of implementing the above mentioned procedures. Everything that exists in this world is interrelated, and every single thing performs a function that contributes to the cohesiveness and discipline of the environment. Since human beings are a part of natural habitat too, their activities should complement the environment in which they live rather than destroy it. Therefore, businesses should refrain from indulging in activities that disintegrate the society to attain long-term benefits for their own company.
A competitive company plans for the future and devices necessary steps to avoid potential threats and minimize risks. However, it should also take environmental ethics into consideration and invest in managing natural resources that are heading towards depletion. This should be done to safeguard future generations.
American Express has repeatedly funded various organizations that worked to conserve wildlife, protect endangered sites, and fought to eliminate global issues such as poverty. In 2010, the company took the initiative towards environment protection by rewarding customers who shopped eco-friendly products. A ZYNC card was launched that gave customers discounts and points if they bought environment friendly goods or services. Along with the pack, eco concierge service was also provided for free that guided customers to shop greener. (Mother Nature Network, 2010) The company also became partners with New York Restoration Project and conducted a program that aimed to plant 140 trees at New York City.(NYCGO, 2013) It also encouraged people to volunteer and serve for this project. (NYCGO, 2013)
American Express promotes diversity and appreciates differences. In 2001, the company earned the Catalyst Award for building a 'Winning Culture'-one that realizes diversity as its key component. Every company has a moral duty to eliminate racial, class, and sexual discrimination and provide equal opportunity to all. At American Express, leaders are supposed to complete a 24-month long management-training curriculum so that they gain awareness about how diversity can be further integrated in the workplace. Vacant positions also remain open for people from diverse background culture. Consequently, the number of women at senior positions has increased from 19 to 31% during the years 1990-2000. (Catalyst, 2001) In addition to that, the company also takes the responsibility of taking care of its workers. Even though the company is not liable by law, it still volunteered to provide autism benefits to its employees. The 2014 health plan of American Express will include coverage for treatments that cure autism. The treatment also includes Applied Behavior Analysis (ABA). (Autism Votes, 2013) The level at which the company fulfills its responsibility towards consumers can be determined by the level of customer satisfaction. Generally, excessive rates, high fees, and complicated terms and conditions make credit card holders difficult to feel satisfied with the service. However, a rise in customer satisfaction has been evidenced with American Express ranking highest with a score of 786. (The Christian Science Monitor, 2011) One of the factors that contribute to American Express's success is that the company over communicates with its' customers. It uses various channels such as website, mail, and collateral to inform consumers about the changes in existing products and services and to update them regarding the introduction of new products. Through this strategy, the company seeks to acquire customer's trust and ensure brand loyalty. (UniBul, 2012) Apart from that, the company makes certain that it provides excellent customer service. In addition to resolving queries in every possible way, American Express takes an extra step and encourages consumers to voice their complaints by sending them a 'Thank you' note by mail. (2013)
Businesses thrive because of customers. Even if companies do not consider themselves socially responsible, they still need to improve customer relations. Customer satisfaction eventually leads to profitability and lifelong success. American Express functions ethically because it also believes that it eventually results in profitability. By paying heed to its' moral responsibility, the company enjoys benefits such as the establishment of brand status, reputation, and innovation. Brand status is achieved when the company's market share increases. Research suggests that attracting a new customer cost five to eleven times more than retaining an existing one. Therefore, if American Express operates in a morally responsible way, it will be able to gain customer's trust, which would in turn cut down costs for attracting new ones and will have a positive effect on the firms' bottom line. A focus on customers' satisfaction also paves the way for innovation. The company gives priority to the consumers' feedback and suggestions. It also works to provide quality products and services to low income groups. Consequently, it will not only gain a competitive advantage but will also increase its' market share by catering to different segments of the society.
American Express embodies the spirit of Ethisphere's credo: Good. Smart. Business. Profit. World's Most Ethical Companies (WME) is an organization that scrutinizes the way businesses perform in various industries and determine their level of ethical practices. It carries an in-depth evaluation which includes the study of the firms' reputation, leadership, and innovation; corporate governance, ethics and compliance program, and corporate citizenship and responsibility. (Center for Public Trust, 2011) American Express scored high on all of the sub-categories and was eventually declared to have fulfilled Ethisphere's criterion. The company regularly conducts research to identify the means of strengthening their position in the market. It invests immensely in training leaders, and conducts meetings to enhance the flow of communication amongst employees. It has also skillfully outlined the code of conduct which is accessible to all employees, and enforced firm system of appraisal to ensure that workers comply with the rules set by the company. It is essential to note here that, even when the firm regularly spends towards environment protection and global causes, its' profits continue to rise. By the end of 2013, American Express experienced a 9% increase in quarterly profits. This clearly fulfills Ethisphere's criterion of running a business ethically and earning profits at the same time.
Even though American Express places strong emphasis on the need to collaborate with leaders and workers, it also stresses the importance of reporting a fellow worker if he/she is found to be indulged in unethical behavior. (American Express, 2012) To facilitate the employees even further, the code of conduct clearly mentions that anyone who retaliates against the person who has reported the issue will be subjected to disciplinary action which may be as severe as termination. (American Express, 2012) This ensures employees' trusts over the management, safeguards them, and gives them lease to report unlawful behaviour fearlessly. At the same time, the organization also acknowledges that to inculcate expected form of behavior within employees, the leaders need to set an example for them. Therefore, leaders are rigorously accounted for their management style and practices. An employee survey is conducted annually where 12.5% of the questions are directed to assess the leaders of the company. (Catalyst, 2001) Consequently, it fosters an ethical work environment where everyone is held accountable.
The company also follows its' mission…