Business ethics has emerged as a useful field that guides corporations to engage in desirable practices. In the recent past, many people have become aware of the roles and responsibilities of companies towards supporting the needs of their stakeholders. This field has been studied by many professionals in order to come up with ethical theories that can foster organizational performance (Burrell, 2017). Business ethics has been expanded to analyze a wide range of issues such as employee empowerment, social inputs, and moral practices. This discussion gives a detailed summary and analysis of two articles that analyze the issue of business ethics. The paper goes further to offer a synthesis that can be used as a guide for companies that want to become ethical and relevant in their respective industries. Similarly, the ideas can be embraced by governments to design evidence-based policies and laws that can dictate the ethical practices of more business organizations.
The first article selected for this analysis is “The Social Responsibility of Business is to Increase Its Profits” by Milton Friedman. The author acknowledges that corporations are artificial in nature (Friedman, 1970).This means that companies can only have responsibilities that are guided by the owners. The idea that a business can be said to have responsibilities is a fallacy (Friedman, 1970). Friedman goes further to indicate that businessmen are the ones who should be responsible. In free-enterprise systems, corporate leaders are workers who must support the needs of their employers. These employers are the owners of such companies. According to the economist, the executive is therefore expected to act in accordance with the expectations of different stakeholders. The main goal is usually to maximize profits.
An executive undertaking voluntary roles such as supporting his or her family uses personal resources. This kind of social responsibility is only a personal role. A leader who seeks to engage in corporate responsibility will definitely be acting against the expectations of his or her employers. This means that the executive makes it hard for the firm to record enough profits (Friedman, 1970).
The author goes further to acknowledge that “the difficulty of exercising social responsibility illustrates the greater virtue of competitive enterprise” (Friedman, 1970, p. 3). This kind of enterprise is what forces persons to be responsible for their mistakes or actions. Such actions will make it impossible for them to exploit members of the community in attempt to achieve their goals. Any company that promotes something good is therefore believed to do so at its own expense.
Although Milton Friedman’s article is outdated, the most outstanding fact is that it outlines meaningful ideas that continue to dictate a wide range of topics on the issue of social responsibility. The article begins by explaining how corporations mainly focus on the best approaches to maximize their profits and eventually meet the needs of their stockholders (Burrell, 2017). This admonition has been used to explain how companies can operate successfully in free markets and civilized societies. The ideas presented in the article go further to indicate how companies can utilize their resources to engage in appropriate agendas and activities that are capable of maximizing products. The most important thing is for such corporations to act in a lawful manner.
The use of political forums emerges as the best strategy for dictating the right laws to guide companies. The implementation of effective frameworks and legal mechanisms can guide corporations to engage in transparent actions or responsibilities. Such actions will make it easier for more firms to maximize profits while minimizing different externalities that might be potentially injurious. The outstanding observation from Friedman’s argument is that the means used to make profits by companies should be taken seriously. The final observation is that a firm that seeks to maximize profits will definitely follow different laws and eventually support the notion of social good (Friedman, 1970).
The second article selected for this discussion is written by Albert Carr. The title of the article is “Is Business Bluffing Ethical?” The author indicates that profits and legality are the two major guidelines that should be used by business organizations. These two standards can be used to inform the functions and behaviors of corporations. In the article, Carr gives a detailed comparison between the game of poker and the rules of doing business (Carr, 1968). According to the argument, the rules applied in poker are similar to the ones applied in business. He goes further to acknowledge that bluffing is one of the commonest practices or parts of the game of poker. Bluffing is usually common and must be accepted by every player in the game. This means that the players would never consider bluffing to be something immoral.
With the above foundation, the article goes further to examine how bluffing (or cheating) would be something wrong in business. The article describes how bluffing would be considered to be moral in the world of modern business functions. The moral rules and principles associated with business operations differ significantly from those applied elsewhere. According to the author, bluffing is something that should not be treated as cheating. This is the same case with the practice in the game of poker. It can only be described as a form of deception. Additionally, bluffing can be extended to refer to the exaggeration of a given fact or truth (Carr, 1968).
The article by Carr seeks to give a detailed analysis of the issue of morality in the world of business. He uses the game of poker as the best analogy to present his thoughts. He seems to believe strongly that there is a huge difference between a business’ moral context and the concept of private morality (Carr, 1968). The analogy makes it easier for the scholar to describe how the game of poker allows cheating or bluffing. The same idea is applied in the world of business by the author. He indicates that there is a striking difference between the world of business and private life. The concept of morality will also be applied differently to private and business worlds.
The outstanding argument is that a company that wants to succeed might decide to deceive. By doing so, the firm will be able to engage in a wide range of activities that have the potential to promote business performance (Carr, 1968). Bluffing, according to Carr, becomes a positive approach that can be used by businesses in order to succeed in the global market.
The author goes further to develop the argument using the concept of business law. Businesses should always be ready to follow every presented legislation or law. It would be inappropriate for a given company to go against the existing laws. From this kind of analysis, it becomes quite clear that Carr gives a comparison between ethics and law in the business world (Chan, Fung, Fung, & Yau, 2016).
The issue of bluffing and the desire to follow existing laws appear to work synergistically. Due to the level of competition experienced in the world of business, it is mandatory for companies to follow every law. A firm that ignores such laws will definitely find it hard to operate successfully in the targeted country. At the same time, bluffing should be guided by the existing laws (Carr, 1968). A company that reveals the truth might be deregistered depending on the facts presented against it.
Carr indicates clearly that business ethics is something that borrows a lot from the concept of public relations (PR). Although there is no single person who would do business with a firm that bluffs, the remarkable fact is that the information presented is what guides the consumer-company relationship (Carr, 1968). Businesses that focus on the ideals of ethics will definitely protect themselves from the government. A good game in business ethics is presented as an evidence-based practice that can save many companies from regulators.
The above two articles use different arguments to present similar ideas or concepts that can be used to redefine the world of business ethics. The outstanding observation from the articles is that dishonesty is something common in business corporations (Tastan & Gucel, 2017). This kind of malpractice emerges since companies focus on specific approaches that can make it easier for them to realize their potential. This concept of corporate responsibility is something that has been supported by many researchers because it can promote organizational effectiveness (Burrell, 2017). Unfortunately, different analysts have managed to prove that most of the practices used by companies to pursue the agenda tend to be deceptive.
Based on the arguments presented by Friedman, it is agreeable that businesses follow existing laws in an attempt to operate legally in their respective environments. Unfortunately, most of these legal frameworks are ineffective and incapable of supporting the welfare of the people (Tastan & Gucel, 2017). It would be argued that most of the regulations and laws dictating the manner in which business operations are executed are usually crafted by partisan players in different industries (Tastan & Gucel, 2017). Politicians and policymakers are some of the biggest stakeholders in the world of business. Such individuals have managed to design political systems and laws that favor or support their business operations.
Business firms have catalyzed new rules that might not even be enforced by the government. This happens to be the case because many economies have been functioning in accordance with the existing social norms (Tastan & Gucel, 2017). For instance, these developments have dictated specific issues such as social responsibilities, gender roles, salaries, tax policies, and business-consumer relationships (Chan et al., 2016). These issues tend to change over a period of time. This knowledge therefore supports the fact that Friedman’s notions of corporate responsibility have continued to transform how societal norms are established in different regions.
The discussions presented by the two economists show conclusively that the world of business has not been clearly understood. The important question that emerges from this scenario is how the issue of business ethics should be treated in the future. The arguments call for new analyses in an attempt to understand how business ethics can be improved to serve more stakeholders and communities (Tastan & Gucel, 2017). The two theorists acknowledge the fact that businesses will lie and even cheat. However, this kind of practice might be unjustifiable. Such ideas can be considered in an attempt to present new models and laws that have the potential to promote the functionality of every business firm.
It is agreeable that some procedures and laws are effective depending on how they are applied today. It would also be appropriate to consider specific laws and notions that have led to different malpractices in the world of business. This move will result in new changes that can make the situation much better. As more companies pursue their profits (since this is their biggest objective), they will find it easier to meet the diverse needs of the people living in their respective regions. From an ethical perspective, it would be necessary to change the playing ground and make it more appropriate for companies that want to pursue their corporate social responsibilities (Chan et al., 2016).
The maxim that the ultimate objective of an organization is to increase its productivity is therefore something embedded in business ethics. Business firms will consider every strategy to ensure maximum profits are recorded in the long run (Chan et al., 2016). Some economics continue to use these insights to describe how the need to increase profits can be widened to focus on the best approaches to increase a company’s economic position or value (Belle, 2017). This is a clear indication that different stakeholders in the world of business will be considering how bluffing can be applied to dictate the profits and gains made by a company. This is something pursued without necessarily disobeying the existing regulations or laws.
The arguments presented by both Carr and Friedman give a distinctive analysis of the concept of business ethics. From the above discussion, it is quite clear many businesses will engage in deceptive approaches that might seem to support the idea of corporate responsibility (Belle, 2017). This can be achieved through deception whereby different stakeholders are forced to believe that most of the business’ actions seek to promote the living conditions of the greatest number of people.
Business ethics is therefore a revolutionizing field characterized by diverse ideas from scholars and researchers. The reality is that most of the successful organizations or corporations today are the ones that make profits. The fact has encouraged more people to believe that the pursuit of profits is something secondary to corporate responsibility. However, the notion that social responsibility of every successful business across the world is to seize existing opportunities and eventually increase its profits (Chan et al., 2016). The concept of bluffing is embraced by firms to ensure the world believes that their operations are informed by existing legal frameworks and policies. This understanding can be borrowed by policymakers to come up with convenient laws to ensure this goal is pursued without undermining the expectations and rights of the societies in which such firms operate. This will be the right path towards benefiting from the reality of business ethics.
Belle, S. (2017). Knowledge stewardship as an ethos-driven approach to business ethics. Journal of Business Ethics, 142(1), 83-91. Web.
Burrell, G. (2017). Virtual special issue on ‘sociology and business ethics’. Journal of Business Ethics, 144(1), 1-4. Web.
Carr, A. (1968). Is business bluffing ethical? Harvard Business Review, 1(1), 1-20. RWeb.
Chan, K., Fung, A., Fung, H., & Yau, J. (2016). A citation analysis of business ethics research: A global perspective. Journal of Business Ethics, 136(3), 557-573. Web.
Friedman, M. (1970). The social responsibility of business is to increase its profits. The New York Times Magazine. Web.
Tastan, S., & Gucel, C. (2017). The impact of employees’ perceived business ethics and ethical climate on organizational social support. Turkish Journal of Business Ethics, 10(1), 47-76. Web.