Corporate Social Responsibility (CSR) is an essential aspect of organizations since it helps them work according to the government’s laws and regulations. Many companies have also implemented policies to ensure that institutions do not engage in operations that can harm the workers or the environment. American Express Company (Amex) is a multinational financial and network services provider. The corporation provides individuals with various services such as charge and credit cards, travelers’ cheques, and other stored-value products. Different aspects can be analyzed to determine how Amex ensures that it meets the acceptable ethical standards encouraged by CSR.
Amex Ethical Behaviors and CSR Theory
There are different positive and negative issues that one can analyze when focusing on Amex’s behaviors. One of the positive aspects is its concern for employee satisfaction. The company offers promotions, bonuses, and allowances to workers, which is an essential aspect of CSR. Supplier management is another positive factor since it creates meaningful relationships with suppliers, customers, communities, and colleagues. Adverse elements have also been experienced in the company. For instance, the company stated that smokers cost the company some money (“American Express-Moving to a Low-Carbon Future”).
Thus, it ensured that it avoids hiring smokers, which is unethical as it is a form of prejudice. Disallowing their merchants to encourage customers from using competitors’ cards because their processing costs are lower is another negative issue about Amex.
In capitalistic economies, profit is the first goal, while some people say that it is the only goal. However, this is not a valid criterion to measure Amex’s success. Although companies ensure that they increase their production and limit losses, other factors such as their contribution to the community and environment can measure their success. Therefore, Amex’s success can be evaluated using factors other than its profits.
Pricing is an ethical consideration involved in CSR since it ensures that companies do not overcharge customers. The idea of pricing is used by Amex since the company involves financial services and, many people have argued that Amex’s merchant interchange fees are higher. The high charges have led to a decline in the number of people who use Amex. Moreover, some people argue that MasterCard and Visa are cheaper than Amex. Therefore, pricing as an ethical consideration that exceeds maximizing profits can be applied in Amex since it involves offering fair prices to consumers and ensuring that their demands are met.
The theory of ethics that best supports the concept of responsibility or sustainability in Amex is the CSR theory. The idea is vital since it entails various aspects such as pricing and its contribution to the community’s growth and development. The concept also focuses on a balance between economic growth and the welfare of society and the environment (Ferrell et al. 493). Thus, Amex can use the theory to ensure that it maximizes its output while engaging in programs that give back to the public.
Amex has grown to be a Fortune 500 company, whereby it has increased its operations in different countries. The company has attracted many users due to its excellent services in the financial sector. Amex’s mission is to “provide the world’s best customer experience every day” (“American Express-Moving to a Low-Carbon Future”). The mission statement is used to encourage workers to offer outstanding services to the customers. Moreover, the declaration reveals Amex’s resolute willpower to meet customer demands and guarantee that clients are impressed by its services.
The company’s vision statement has also enabled Amex to achieve its goals. It states “to become essential to our customers by providing differentiated products and services to help them achieve their aspirations” (“American Express-Moving to a Low-Carbon Future”). The vision shows that the organization is ready to provide amenities to the customers and guarantee that they can rely on the organization when in need of financial services.
Amex’s vision and mission statements are crucial to the company since they entail customer satisfaction, which is an essential aspect of every organization. The strategy to meet customer demands and focus on ethical considerations has enabled the company to become one of the leading companies in the financial sector. Amex is also a global organization as it offers charge and credit cards, travelers’ cheques, and other stored-value products in different counties.
The company supports responsibility and sustainability, whereby it has listed some of its activities on its website. For instance, Amex focuses on moving to a low-carbon future (“American Express-Moving to a Low-Carbon Future”). It has ensured that it encourages its colleagues, customers, and communities to limit carbon emissions by operating responsibly and protecting the environment. The company has informed individuals about its commitment to supporting the transition to a low-carbon economy to meet the science-based recommendations of the Intergovernmental Panel on Climate Change (IPCC).
Analysis of the Organization’s Ethical Standards Linked with Course Content
CSR is one of the concepts that have been discussed in the course since it impacts how companies work. It is a management theory that ensures that businesses focus on their social and environmental concerns in their business practices and interactions with their stakeholders (Ferrell et al. 491). CSR guarantees that corporations engage in ethically-oriented practices and do not engage in operations such as high prices and pollution. Thus, CSR is a theory that can be utilized to analyze Amex’s contributions to society.
The normative theory is another essential framework that can be used to analyze Amex since it involves what is right and wrong, desirable or undesirable, just or unjust in society. Having moral principles is encouraged because it enables organizations to build a good relationship with their customers (Bender 368). Some institutions fail to offer what they advertise, which is unethical. Failure to meet the standards of the services and products that a company promotes has been discouraged since it is dishonest and against laws and regulations that protect customers.
Some examples can show how Amex observes social responsibilities. As a financial services company, Greenhouse Gases (GHG) emissions come from the operation of its internal data centers and office facilities and employees’ business travel. In 2018, Amex became a CarbonNeutral company and began powering its operations with 100% renewable electricity through on-site solar, renewable energy credits, carbon offsets, and reduced (GHG) emissions (“American Express-Moving to a Low-Carbon Future”). The company also volunteers in developing the next generation of diverse leaders and sustaining equitable communities. Additionally, Amex helps preserve natural resources for future generations and limits the environmental impact of its operations.
Amex has observed the normative theory by guaranteeing that customer satisfaction is achieved. The company is ranked as one of the World’s Most Ethical (WME) companies due to its practices that involve helping clients in various exercises concerning finances. Moreover, globalization and Foreign Direct Investment (FDI) have enabled many people to invest in multiple countries (Berger‐Walliser et al. 168). Thus, investors are using Amex to access their funds in different states with ease.
One of the course theories that illustrate Amex’s approach is the normative theory. The concept is linked to the company’s overall performance as it focuses on desirable and undiscoverable practices of an organization. In this case, Amex has promoted the conservation of the environment, which is vital. Improving people’s lives and preserving natural resources for future generations is another factor that can be linked to the normative concept since it is a desirable action.
Recommendations and Conclusion
One of the recommendations is that the company should ensure that it offers fair prices to its customers. Pricing is a significant issue that can impact the performance of Amex. Moreover, CSR has focused on charges to ensure that customers acquire products and services from companies at reasonable prices. For instance, Visa has guaranteed that people can acquire different services at low fees. MasterCard has also ensured that it offers discounts to customers when making various transactions. These approaches can help the company to attract more clients and remain ethical since they focus on customer welfare.
Another recommendation is that Amex should ensure that it educates more people about conserving the environment. It should also ensure that workers are educated about moral values to enable them to interact with customers and offer quality services. For instance, employees can be trained to relate with the clients and help them with financial services. Assisting clients is essential since it is analyzed in normative theory as a just and desirable strategy. Amazon is one of the companies that has attracted many customers by training their employees to use consumer feedback and guide clients on using different products. Apple Inc. has also educated people about various products and how they can benefit them. The approaches used by Amazon and Apple Inc. can be utilized by Amex to show its support to the clients, which is an ethical approach.
To conclude, CSR is an essential factor that organizations should learn about. Many companies do not focus on social responsibilities, which has led to increased pollution. Moreover, some companies do not support various programs that develop the community. Many people are also encountering challenges during the pandemic. Thus, organizations can offer various services and products to help people from low socioeconomic families experiencing financial difficulties. Amex can focus on CSR and normative concepts to develop their production and help in society’s growth. In essence, CSR is vital, and companies can be encouraged on how to take social responsibilities.
“American Express-Moving To a Low-Carbon Future.” American Express. Web.
Bender, Philip M. “Limits of Personalization of Default Rules: Towards a Normative Theory“. European Review of Contract Law 16.3 (2020): 366-409. Web.
Berger‐Walliser, Gerlinde, and Inara Scott. “Redefining corporate social responsibility in an era of globalization and regulatory hardening”. American Business Law Journal. vol. 55. no.1 (2018): 167-218.
Ferrell, Harrison Dana., Ferrell, Linda, and Hair Joe.” Business ethics, corporate social responsibility, and brand attitudes: An exploratory study“. Journal of Business Research vol. 95 (2019): pp. 491-501.