Business Ethics: An Essential Element of Modern Corporate Practice - Essay Sample

Introduction

A few decades ago, business ethics received little attention not only from business scholars but also from business leaders. However, the upholding of business ethics has become a critical element of business practice among business organizations today. In essence, it implies that corporate organizations are no longer engaged solely in the business of maximization of earnings of stakeholders, but have become more engaged in ensuring that their efforts to make profits are conducted in a way that upholds ethics in business dealings and interaction with the local communities (Byars, & Stanberry, 2018: Adda, Azigwe & Awani, 2016). The new practice in relation to business ethics is based on the idea that organizations do not exist in isolation but have a responsibility to attend to the needs of the populations within their vicinity.

Is your time best spent reading someone else’s essay? Get a 100% original essay FROM A CERTIFIED WRITER!

Save 25%

Business Leaders and Business Ethics

One of the leading business leaders who have embraced business ethics in their business dealings is Warren Buffett. He is not only one of the richest persons in the United States but also in the world. Buffet believes that business ethics is essential in business practice for businesses to achieve their objectives sustainably. An ethical practice that is dear to Buffett is businesses meeting the needs of the community in which they are located. This is in line with corporate social responsibility (CSR). The corporate guru also believes that it is essential to tell the truth in regards to the business dealings to ensure that business organizations make genuine profits while satisfying the needs of the customers.

Many of the world business leaders, such as Warren Buffett, conduct their business dealings based on ethical philosophies that have been in existence for many centuries. One of the ethical philosophies that fit with Buffett's business model is utilitarianism. This ethical philosophy holds that outcomes of actions are essential for one to do the right thing. As such, the most ethical action is one that will confer the greatest benefit to the most number of people (Utilitarianism, 2017). In this regard, Buffet believes that businesses should not only make profits for shareholders but also benefit communities through employment and CSR activities.

At the same time, business leaders such as Warren Buffet exhibit elements of the categorical imperative, a vital ethical philosophy. The categorical imperative emphasizes that it is the moral duty of each individual to do the rational thing, mainly engaging in actions that do not harm others. In this respect, Buffet regrets that the wealth for the top 1% of the wealthiest persons in the United States has increased syste over the last three decades, yet the life of the people on the bottom of the socioeconomic pile has worsened. For this reason, it is necessary for businesses to be rational in the sense that they uphold the duty of ensuring that the earnings from their activities are distributed well in the society in a manner that benefits everybody.

The emphasis on business ethics by Warren Buffett has been well captured in his interactions with people and organizations such as the media. Notably, Buffett has been captured saying thus; "It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently." The statement suggests that every business organization must uphold ethical values in its business dealings. The reason for his emphasis on being ethical is that bad business practices can lead to the collapse of any organization if their reputation is damaged. In a way, he emphasizes on good business practice and engagement in CSR activities for sustainable business operations. He adds that "Sell cheap and tell the truth." in any business dealings. The idea is to ensure that an organization's products are as affordable as possible and meet the needs of the consumers. Such a practice builds reputations and promotes customer loyalty.

Warren Buffet versus Bill Gates

Bill Gates is one of the top richest people in the world and the founder and CEO of Microsoft Corporation. Until recently, Gates was regarded as the wealthiest person in the world. Like Buffett, Bill Gates believes that a successful business must take care of the interest of the people it serves. Caring involves engaging in business practices that uphold the utmost ethical standard. At the same time, Bill Gates has been at the forefront in fighting economic inequalities not only in the United States but also in many parts of the world. Consequently, he has donated billions of dollars over the years to charity to ensure that most people benefit from the economic gains his business makes. Similarly, Warren Buffet has donated a considerable amount of money to charity. However, the two business leaders differ in many ways. For instance, Warren Buffett believes that the economic system should be designed in a way that wealth trickles down to everyone in society while Bill Gates supports the idea that people need to be supported to scale up the socioeconomic ladder. For this reason, they have dedicated billions of dollars to fight disease and poverty in many parts of the world. Buffett has not devoted his efforts to charity compared to Gates.

Conclusion

In conclusion, business ethics has become the norm in modern business practice. Many corperate leaders such as Warren Buffett, and Bill Gates see the upholding of ethical business standards as vital to sustainable business operations. Buffett believes that earnings from a business should be well distributed in society, and businesses must be truthful in their dealings. Bill Gates also believes in the philosophy of ethical behavior and well being of the community through business.

References

Adda, G., Azigwe, J. B., & Awani, A. R. (2016). Business Ethics and Corporate Social Responsibility for Business. European Journal of Business and Innovation Researcg, 4, 26-42. Retrieved from http://www.eajournals.org/wp-content/uploads/Business-ethics-and-corporate-social-responsibility-for-business-success-and-growth.pdf

Byars, S. M., & Stanberry, K. (2018). Business Ethics. Retrieved from https://cnx.org/contents/[email protected]:KCyr9xii@3/Introduction

Utilitarianism. (2017, February 17). Retrieved from https://ethicsunwrapped.utexas.edu/glossary/utilitarianism