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Ethical Theories in Business

The greatest goal of a company is to maximize profit. For this reason, utilizing the ethical theory of egoism comes in handy. The theory propagates that the actions of an individual or business are oriented by personal gain. The criteria of what makes something good or bad is based on whether it satisfies ones desires. A business should be based on these criteria to produce their goods and services. A business whose foundation is based on this theory produces products that are not end-user oriented but conform to standards. This is because its concern lies within the internal business environment as opposed to the external. If such a company becomes successful, it has no high regard for its personnel as the business comes first. During the acquisition and utilization of resources, the tactics used may be aggressive just for the company to get what they want. Such companies lie to their end users for the benefit of the firm.

Companies should be run on morally obligated duties (Deontology theory). The organizations are guided by their principles and obligations as outlined in the performance charter. The employees, customers and the production and acquisition of resources are done by the book. Running a business using this theory ensures that the Golden rule is observed where the firm will do to others what ought to be done to it.

The theory of utilitarianism advocates that the best cause of action is the one that yields overall happiness to the greatest number of people. A business may be based on this principle as it strives to provide goods and services to its customers. Since this theory advocates for the concern and the well being of others, the products that the company offers are tailored to meet end-user specification. As a result, the personnel of such a company are highly valued as the company realizes it is core to the success of the firm. The business does not come first when consideration on goods and services adjustments are to be made. The customers are also valued as essential to the business. Therefore, the firm is responsive to their demands and questions. Any adjustments that the customers propose are integrated in the products. Before, the introduction of any changes to existing products, customers are consulted and their opinions taken into account as integrals in the new product. Manufacturing of the products is also done with care and takes in account any effects the manufacturing process may have on the environment. If the firm becomes successful, they mainly plough back their profits to community development and enhancing the environment. The firm becomes a critical part of the society.

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Punishments that accrue to a firm for unethical behavior include; fines– imposed when an organization breaks the law. It is a financial payment by the firm to deter it from repeating such an act. Equity fines – a fine that gives away the market value of a firm. It is more crippling to a firm as compared to fines. Corporate Shaming – the law requires that the firm apologize publicly for it wrong doing. This action makes the firm dent its image to the public. There are several threats that a firm faces in running an ethical business. Strategic misrepresentation – one of the core arties of a firm are kept in the dark. For example, customers may be unaware of harmful ingredients in a product. The profit motive – the end result of making profit is challenged by social responsibility of the business. Group think –involves making collective decisions. It poses a threat to a firm as it eliminates creativity and imagination.

From my own opinion, I believe that morality should be upheld in all spheres of life. Basic ethical standards should be upheld as well as practicing the golden rule. If citizens are expected to behave and conduct themselves morally, the same should also be asked of the business world. Business should function effectively by incorporating the well being of the society into their actions.

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