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(4/29/08 16:39)
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corporate ethics
According to business experts, ethics in business are an essential key factor to be able to survive in the long run. Plauder GmbH currently faces a situation where its reputation with stakeholders is damaged due to a collusion scandal. As a result of this, the entire managment board has been dismissed. The main goal of this report is to offer solutions with which to improve the ethical behavior of Plauder GmbH's employees.
The report will discuss these issues in the following order. First, the report will give a definition of the term "corporate social responsibility". Following this, the author aims to compare tho terms, namely "collusion" and "price gouging". Finnaly, the report concludes with a few suggestions for Plauder GmbH how the new management board can improve ethical behavior among its employees.
Before adressing practical considerations, the theoretical basis must be taken into account. This includes a proper understanding of the term "corporate social responsibility". According to business experts, this term refers to the attempt of a business to balance its commitments to groups and individuals in its environment, including customers, investors, local communities and other businesses. These groups and individuals are also called "stakeholder". This means that they are directly affected by the practices of an organization and therefore have "a stake" in its performance. Furthermore, another point of interest must be taken into account. This incorporates a comparison of the terms "collusion" and "price gouging". Firstly, collusion can be defined as an illegal agreement between two or more companies to commit a wrongful act. One example for collusion would be price fixing. Secondly, price gouging occurs when companies respond to increased demand with overly steep price increases. One example for this would be, when residents are warned in the case of a catastrophe/hurricane and therefore stock up on food and in return retailsers take advanteage of this pattern and increase their prices.
How can this above theory be put to use in the case of Plauder GmbH to improve the ethical behavior of its employees? One potential solution immediately appears. Plauder GmbH could introduce written codes of ethics which announce how the entire organization behaves ethically in certain situations. This could be one possibility to make the whole company aware of the ethical standards in the organization. Another possible solution for Plauder GmbH would be to make use of ethic programs. In such programs the entire company would have the chance to participate. They would be reminded of the importance of ethical decision making and wuold receive information on the current laws and regulations which are especially important in their branch. Moreover, the new managment could make the employees aware of the existing ethical hotlines where they can get support if they worry about certain ethical decisions and where they can also report unethical behavior anonymously.
To conclude, the author would recommend for Plauder GmbH to introduce written codes of ethics. In the author's opinion this would be the best method to improve ethical behavior among the employees because with these codes employees would have a guideline for ethical behavior and due to this they would know how to behave best/ethical in certain situations.
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