Business Ethics & Corporate Social Responsibility
Business Ethics refers to different principles and standards that guide business behaviour, but also
what can be acceptable or not regarding the company's acts. It is defined by two principles: the
Ethics of conduct and Ethics of character.
Behave ethically is an essential issue today. Companies have to adopt practises in order to satisfy
the public opinion, and have to be ready to face the consequences of their behaviour.
The Corporate Social Responsibility (CSR) refers to the obligation a company has towards the
society, but also to the way to limit the negative impact of their activities and maximize the benefits.
The company has to deal with economic, social, ethical and social responsibility.
The ethical challenges concern both domestic and international companies: human rights, labour
issues, environmental protection...
The companies should behave ethically because of many different reasons: first, to avoid a bad
publicity and promote a good reputation, secondly, to keep doing profits (more 'ethical consumers
and investors'), but also because the companies have responsibilities towards its stakeholders.
On the other hand, the companies that want to act ethically have to face many problems, such as the
lack of international values or international ethical rules, how to determine what is right and what is
wrong regarding the differences between the home country and the host country culture where the
company is acting (political, norms, social, environmental issues).
However, some initiatives can help the companies to adopt an ethical behaviour, like the Code of
conduct, incorporated at different levels (professional, industrial, group codes...).
A Code of conduct (for example the Caux Principles, the Sullivan Principles or the United Nations
Global Compact) is a set of principles that provide a framework and foundation for the development
of individual company's codes.
To understand better how companies can behave ethically or unethically, we can take the examples
of two international firms: Nike and Sodexo.
Unethical practices: Nike refuses to fully compensate its workers with fair wages in some factories.
Some of its factories workers are working in unsafe and unsanitary conditions. But the worst of all
is the use of child labour around the world for the production of their product. This behaviour led to
a boycott of the brand, and a bad publicity for the brand.
Ethical practices: Sodexo is a French multinational corporation providing food services with 380
000 employees around the world. It is one of the most ethical companies for its diversity and
inclusion of policies regarding its employees: respect of people, transparency of the activity,
business integrity, and fight against hunger with the movement “Stop Hunger Initiative.
The absence of global standards in these aspects explain why firms have trouble acting ethically and
why measures from the Government have to be implemented to prevent abuse of power from
companies.
There is nothing wrong about doing profit, but how the companies do it is important.
Vocabulary
Business Ethics: rules, principles, and standards for deciding what is morally right or wrong
when doing business:
Corporate Social Responsibility: A company’s sense of responsibility towards the community and environment (both ecological and social) in which it operates. Companies express this
citizenship through their waste and pollution reduction processes, by contributing educational and
social programs, and by earning adequate returns on the employed resources. See also corporate
citizenship.
Ethical consumerism: Ethical consumerism (alternatively called ethical consumption, ethical purchasing, moral purchasing, ethical sourcing, ethical shopping or green consumerism) is a
type of consumer activism practiced through 'positive buying' in that ethical products are favored,
or 'moral boycott', that is negative purchasing and company-based purchasing.
Ethical investment: the practice of investing in companies whose business is not considered
harmful to society or the environment
Ethical dilemma: An Ethical dilemma is a complex situation that often involves an apparent
mental conflict between moral imperatives, in which to obey one would result in transgressing
another
Code of conduct (code of ethics): a set of rules about how to behave and do business with
other people
UN Global Compact: The United Nations Global Compact, also known as Compact or
UNGC, is a United Nations initiative to encourage businesses worldwide to adopt sustainable and
socially responsible policies, and to report on their implementation
Caux Principles (Caux Round Table): The Caux Round Table is an international organization of senior business executives aiming to promote ethical business practice
Sullivan Principles: The Sullivan principles are the names of two corporate codes of conduct,
developed by the African-American preacher Rev. Leon Sullivan, promoting corporate social responsibility
Cultural imperialism: The imposition of a foreign viewpoint or civilization on a people.
References

Johnson, D. and Turner C. (2010), International Business, London: routledge
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Ethical Problems and Issues of Corporate Social Responsibility:
http://www.ehow.com/info_8203385_ethical-issues-corporate-social-responsibility.html
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Business ethics issues : http://www.tutor2u.net/business/strategy/business-ethics-issues.html
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The world’s most ethical companies:
http://www.forbes.com/sites/jacquelynsmith/2012/03/15/the-worlds-most-ethical-companies/2/
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NIKE: Nike Shoes and Child Labour in Pakistan: http://www1.american.edu/ted/nike.htm
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Unethical companies: http://www.actionforourplanet.com/#/unethical-companies/4540107786
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World’s most ethical companies :http://ethisphere.com/past-wme-honorees/wme2011/
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Sodexo’s ethical principles: http://www.sodexo.com/en/group/fundamentals/values/ethicalprinciples.aspx
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http://www.businessdictionary.com/
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What is Stakeholder Theory? Edward Freeman
http://www.youtube.com/watch?v=bIRUaLcvPe8
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Cambridge Business Dictionnary: http://dictionary.cambridge.org/dictionary/businessenglish/