10th International Conference on Business Management - 2013
and bad consequences. The term, business refers to all aspects of the world of work in contemporary society (Adams and Maine, 1998, p. 1). Accordingly, the business ethics involves the application of standards of moral behavior to business situations (Ghillyer, 2008, p.21).
are connected with an unethical situation. For example, who should bear the burden of the costs those accidents or inquiries incur?, who is or ought to be responsible for paying for the costs of defective merchandise or products?, is it fair to leave these costs with whoever is unlucky enough to incur them?, is there a morally defensible basis for shifting the costs over to the producer?, etc. The consumer protection laws and the strict product liability provide criteria and conditions for those questions of public policy and ethics. Also, the formal code of ethics that has been established by the firm is one of the key indicators for evaluating the extent of the firm’s responsibility in relation to such situations.
In a firm level, the functional areas such as sales and customer service, finance, information technology and management have operational policies that reflect the overall ethical culture on that firm’s particular business process concerned. The crisis events of a firm are characterized as the most important and unexpected ethical situations (Hagan and Jo Long, 2005) that are under the firm’s existence (Muller, 1985).
Firm’s Advances for CSR At present, many of the firms are under the increasing pressure from multiple stakeholders that they have to be socially and environmentally responsible. Further, irresponsibility, CSR, and corruption are also encountering an increased scrutiny by consumers, government, and academia (Putrevu et al., 2011). Armstrong (1977) as cited by (Putrevu et al., 2011) has described that there is a tendency of managers to overlook irresponsible and dishonest practices and he has suggested some techniques for directing managerial attention to social issues. According to Jim Roberts, the Professor of Marketing in Hankamer School of Business as cited by Ghillyer, (2008, p. 62) the CSR simply means that “doing well by doing good”. Further, Ghillyer (2008, p. 59) has defined CSR as “the actions of an organization that are targeted toward the achievement of a social benefit over and above maximizing profits for its shareholders and meeting all its legal obligations”. Further, he has
However, all types of crises are not involved the ethical responsibility of a particular agent (Pauchant et al., 2007) and the scrutiny of the public (Seeger and Ulmer, 2001). According to Vassilikopoulou et al. (2011) and Collins (1989), amongst type of crises, the product-harm crises can be recognized as business issues that can cause physical harm to human beings, occur in the output stage of the transformation process, are likely to be highly scrutinized by stakeholders and entail a great likelihood that the firms will be regarded as highly responsible. Hence, product-harm crises can be regarded as unethical situations because not only they can impose harm to individuals (Härtel et al., 1998), but also it can happen due to the involvement of a technological failure, malevolence, distorted values and dishonesty (Lerbinger, 1997; Vassilikopoulou et al., 2011). As a result, it may raise several moral questions about the responsibility and fairness that
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