Business Ethics

I feel that Costco falls under the "engaged" section of the ethics continuum. This means that the company believes that taking an ethical position is beneficial to its operations, and is active in taking such stands. Costco has long been known for its strong commitment to its employees, for example. Their code of ethics begins with the law and then moves onto people. At Costco, workers receive wages and benefits that are above the industry average. This has resulted in the company having the lowest employee turnover in the retail business. With respect to customer service, even the CEO answers his own phone. This means customers do not get lost in an automated call system; instead they have their problems addressed. The CEO only gets paid $350,000 as well, much less than CEOs are comparable-sized companies.

The company's ethical stance is directly tied to their business model. The company has strong loyalty, such that the employees become ambassadors for the company. They also provide strong service that keeps customers returning. As a result, Costco spends nothing on advertising and promotions. This savings contributes to their ability to sell at the lowest price, a key component of the business model.

The U.S. Navy falls more towards the engaged end of the continuum but they are not as actively engaged as Costco. The Navy's ethics relate to its core values. In many respects, honesty and integrity are crucial to the Navy's success. This is certainly the case with respect to internal interactions. With respect to external interactions, however, the Navy moves away from active ethical behavior towards relative indifference to the issue. To some degree this is necessitated by the work the Navy must do. Combat work and other issues relating to national security occasionally require that the Navy not treat all stakeholders equally well. Such activity, secrecy or lack of public accountability is not actively unethical; it is simply necessitated by circumstances. However, the majority of activity of the U.S. Navy is conducted according to high ethical standards, which puts them towards the engaged end of the continuum.

Works Cited:

Goldberg, Alan B. & Ritter, Bill. (2006). Costco CEO Finds Pro-Worker Means Profitability. ABC News. Retrieved April 11, 2009 from http://abcnews.go.com/2020/business/story?id=1362779

US Navy Ethics site. (2009) Retrieved April 11, 2009 from http://ethics.navy.mil/