Business Ethics

29 Jun

Business Ethics, It’s more than stay away from corruption, more than obeying law, it’s more than keep your product competitive, its more than share some of your profit to build a hospital. It’s not only Stakeholder theory (Milton Friedman) but it’s Shareholder theory (Edward Freeman).

What is business ethics? The basic thing is do it legally, do not break any law. Business is the practice of making one’s living by engaging in commerce (Dictionary). Ethics is a set of moral principles, esp. ones relating to or affirming a specified group, field, or form of conduct (Dictionary). While moral means concerned with the principles of right and wrong behavior and the goodness or badness of human character (Dictionary). I could say that Business Ethics is ways of corporate to make high profit with right attitude, honors, moral, integrity, proud and do goodness to any group that related to corporate.
My lecture, Mr. Peter who explained business ethics as simple as possible, said that if there is some line to determine business ethics, we could find 3 lines and found 4 groups of ethic’s company level. First is basic line, it called “Law Line” means do it according to law. Any company below the line, are companies that break the law, e.g. company who does corruption, illegal logging, play with tax, did not pay minimum salary, you can add any bad criteria. I’m sure a lot of things we saw in daily life about illegal act.

Second line is “best governance practice line” Companies whose stand between Law line and best governance practice line is common company. Who made profit, did not break rules, but it just like that. There is nothing special about them.

The third line is “Integrity Line”. Any company between best governance practice line and integrity line is companies who not only make good profit, but they also known as good company, they have reputation, people know them from the product quality, from their process efficiency, they do something good for shareholders.

But, the hard thing to achieve is to be stay above integrity line, which will be very very hard to achieve. This position only deserve for any company, any business, and any acts that not only keep their high quality, earn profit, but also they do something that makes another- change to be better.

Be an ethics company isn’t easy, there are NGO who always watching, and people become more critical, public’s view change all the time (you don’t have to be surprise when suddenly everybody seem to be care about safety, children abuse, environment, and suddenly global warming, next month go green…).
And to be an ethical company, you need to build it and maintain it. You need to do good CSR (Corporate Social Responsibility). You need to react quickly if you slip, so your customers and all stakeholders keep their trust in you. Be an ethics company doesn’t mean you have to be good all the time without made any mistakes.

In this business ethics module, some popular cases were discussed. There are cases of Phillip Morris, H.B Fuller (glue-Honduras), Mitsubishi Motor Manufacturing of America, Nestle, Merck, Nike and Reebok, you can find a lot of companies for other samples.

So, this is it. First semester, first module, first posting in Edisi Kuliah.



Posted by on June 29, 2010 in EDISI KULIAH


2 responses to “Business Ethics

  1. business planning

    July 4, 2010 at 1:05 pm

    I am very glad to read your articles, your articles very interesting and very good, I’ll be your loyal blog readers, always make you successful. thanks

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    • Fitriani Titin

      July 14, 2010 at 12:08 am

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