Question

1 (a) Describe 4 benefits of Business Ethics for organizations? (4 marks – 200 words) (b) Provide a practical, real life example of how business ethics has proved advantageous for an organisation of your choice. (3 marks – 100 words)

Answer 1

(a): 4 benefits of business ethics for an organization are:

· Competitive advantage in terms of customer loyalty and retention – When an organization behaves in an ethical manner then it is able to attract a higher, larger number of customers to its products and their loyalty and retention levels also increases.

· Improved morale and happiness of the employees – When employees work for an employer that has business ethics ingrained in its operations then the employees feel comfortable. This motivates the employees, increases their productivity and increases their efficiency as well. It creates benefits for all stakeholders as improved productivity leads to better operational and financial numbers for the organization.

· Ability to attract more investors – An organization practicing business ethics increases its chances of attracting more investors. This is because investors will be safe in the knowledge that their money is being used in a responsible manner and hence they will have faith in the company and will trust the actions and decisions of the company’s management.

· Amplifies the ability of the organization to give back to the society - The organization gives back to the society through its CSR (corporate social responsibility) programs, sustainability in operations, better environmental and carbon footprint.

(200 words)

(b): An organization of my choice is Unilever. The company practices business ethics and has comprehensive policies for corporate governance, insider trading, social responsibility etc. As part of its social responsibility program Unilever provides free soaps to poor people in third world nations and even educates them about the importance of hygiene. It creates awareness about the importance of washing hands and how such a practice can prevent outbreak of diseases that is so common for such societies and its people. This has proved advantageous for Unilever and its sale of soaps have increased manifold in these parts of the world.

(100 words)