Ethical principles applied in business

Business Ethics

Generally, ethics consists of four types of conceptual concerns: Autonomy, Beneficence, Justice, and Non-malfeasance (Hursthouse, 2005; Mihaly, 2007). Autonomy refers to the obligation to allow competent adult individuals to make decisions and to control their lives without the interference of others. Beneficence means doing that which is beneficial to others. Malfeasance is any action or deliberate non-action that causes harm to others without justification. Justice is the balancing of respective rights and obligations through the application of objective principles and values (Hursthouse, 2005; Mihaly, 2007).

Ethical Theory and Business

In business, autonomy requires that business organizations refrain from profiting by misleading their prospective customers by dispensing deceitful information or by withholding information necessary for them to determine for themselves whether or not the consequences of purchasing goods or services is associated with negative consequences (Halbert & Ingulli, 2008; Svensson & Wood, 2008). Typical examples of situations requiring businesses to respect the autonomy of others would include the marketing of drugs, foods, and consumer goods known to be associated with negative or dangerous consequences (Halbert & Ingulli, 2008; Svensson & Wood, 2008).

Even where the manufacture or sale of the product is permitted by law, the business always has an ethical obligation to disclose the truth publicly to permit prospective customers to make choices (Halbert & Ingulli, 2008; Svensson & Wood, 2008). To do otherwise, such as by failing to disclose that information for fear of losing revenue generated from sales would violate the ethical principle of respect for autonomy (Hursthouse, 2005; Mihaly, 2007).

Ethical Theory and the Need for Accountability in Business

In business, accountability means that business organizations must accept full responsibility for their actions that cause harm to others (Halbert & Ingulli, 2008; Svensson & Wood, 2008). Typical examples of the appropriate exercise of accountability as required by ethical principles of beneficence and justice would be automobile manufacturers recalling cars to make repairs necessary to preserve the safety of their customers at their own expense and oil companies admitting fault in major oil-spills that trigger environmental catastrophes and absorbing the costs associated with the cleanup and the cost of compensating communities hurt economically by the disaster. To do otherwise, such as by refusing to acknowledge responsibility, exacerbating the damage instead of mitigating it out of concern for profits, or barring clean-up crews from wearing protective gear to minimize public awareness of the danger would violate the ethical principles beneficence and justice by virtue of that denial of accountability for the consequences of corporate activity (Halbert & Ingulli, 2008; Svensson & Wood, 2008).

The Connection between Social Responsibility and Business Ethics

In business, social responsibility means that business organizations must avoid harming the environment and the general public in the pursuit of revenue (Halbert & Ingulli, 2008; Svensson & Wood, 2008). Social responsibility in this context exemplifies the ethical principles of beneficence, justice, and non-malfeasance. More specifically, examples of beneficent corporate responsibility would be the use of corporate profits to return a benefit back to the community from where those profits were made, such as through financial support of education and social services in the community (Stevens, 2008).

Examples of justice and non-malfeasance would include purposeful decisions to avoid profitable policies and procedures that are perfectly legal but that are also associated with greater harm to the community than policies and procedures that are somewhat less profitable but safer for the community (Halbert & Ingulli, 2008). Typical examples of corporate beneficence would include the use of company profits to fund welfare organizations, to promote education and health in the community, and to provide scholarships to disadvantaged youth in the local community (Halbert & Ingulli, 2008).

More global examples of corporate beneficence would include donating relief funds to foreign countries (Svensson & Wood, 2008). In the contemporary environment of modern business practices, the ethical principles of beneficence, justice, and non-malfeasance often apply jointly to the use of foreign labor. Specifically, during the latter decades of the 20th century, many American and other Western business organizations began outsourcing their factory work to foreign nations to capitalize on the much cheaper working wages in those countries. Numerous highly-publicized ethical violations came to light in that regard, such as in connection with corporate conglomerates using foreign factories to manufacture clothing, sneakers, and other consumer goods for sale back in the so-called "First World" (Halbert & Ingulli, 2008; Svensson & Wood, 2008).