2. What are the major ethical issues that business faces today?
Answers
Explanation:
From large corporations to small businesses, individuals involved in all types of business often face ethical issues. For example, whether an employee can spend work time checking personal email accounts, how a manager deals with claims of harassment and to what extent a manager can "groom" a certain employee for a promotion are all examples of ethical issues regarding employee behavior. A business needs to develop plans for dealing with problems early to help prevent legal issues as the enterprise grows.
Employee Behavior and Legal Issues
There are legal consequences for some unethical employee behavior. For example, if a supervisor discriminated against an employee based on her gender, religion or ethnicity when making recommendations for a promotion, legal action could be sought. Small business owners can help to prevent ethical problems stemming from employee behavior by drafting a clear, attorney-reviewed set of standards that dictate behavior policies for employees at all levels.
Employee Working Conditions
In addition to employee behavior, there are a number of ethical issues business people must consider about employee working conditions. For example, employers must be aware of the safety of their work environment and if they have compensated employees for all the time they have worked. The must also consider if they have required an employee to work an unreasonably long period of time or if they have him doing an unusually difficult task.
Just like there are legal consequences for some unethical issues regarding employee behavior, there are also legal consequences for unethical working conditions. For example, an employer who requires an employee to work without pay or who creates an unsafe working environment can face legal action.
Supplier and Customer Relations
In addition employees and business owners must consider the ethical issues involved with their relationships between suppliers and customers. Business owners in particular must consider whether it is ethical to do business with suppliers who have unethical practices. When dealing with customers or clients, business people must ensure that they use their information correctly, do not falsely advertise a product or service, and do not intentionally do sub-standard work.
Small Business Ethics
Although there are ethical issues like discrimination that apply to all areas of business, each business area has its own ethical concerns. For example, business people who act as consultants must ensure they are giving sound advice. In the area of small business, some major ethical issues result from hiring, firing and dealing with employees.
For example, conflicts of interest may cause ethical issues in small businesses, especially if they are family run. When personal family issues interfere with business decisions, this is a conflict of interest and an ethical concern.
Explanation:
Accounting
“Cooking the books” and otherwise conducting unethical accounting practices is a serious problem, especially in publicly traded companies. One of the most infamous examples is the 2001 scandal that enveloped American energy company Enron, which for years inaccurately reported its financial statements and its auditor, accounting firm Arthur Andersen, signed off on the statements despite them being incorrect. When the truth emerged, both companies went out of business, Enron’s shareholders lost $25 billion, and although the former “Big Five” accounting firm had a small portion of its employees working with Enron, the firm’s closure resulted in 85,000 jobs lost.
Although the Federal Government responded to the Enron case and other corporate scandals by creating the Sarbanes-Oxley Act in 2002, which mandates new financial reporting requirements meant to protect consumers, the “Occupy Wall Street” movement of 2011 and other issues indicate that the public still distrusts corporate financial accountability.
Social Media
The widespread nature of social media has made it a factor in employee conduct online and after hours. Is it ethical for companies to fire or otherwise punish employees for what they post about? Are social media posts counted as “free speech”? The line is complicated, but it is drawn when an employee’s online activities are considered disloyal to the employer, meaning that a Facebook post would go beyond complaining about work and instead do something to reduce business.
For example, a Yelp employee wrote an article on Medium, a popular blogging website, about what she perceived as awful working conditions at the influential online review company. Yelp fired her, and the author said she was let go because her post violated Yelp’s terms of conduct. Yelp’s CEO denied her claim. Was her blog post libelous, or disloyal conduct, and therefore a legitimate cause for termination? In order to avoid ambiguity, companies should create social media policies to elucidate what constitutes an infringement, especially as more states are passing off-duty conduct laws that prohibit an employer’s ability to punish an employee for online activities.
Harassment and Discrimination
Racial discrimination, sexual harassment, wage inequality – these are all costly ethical issues that employers and employees encounter on a daily basis across the country. According to a report from the Equal Employment Opportunity Commission (EEOC), harassment and discrimination cost U.S. companies $372.1 million in 2013. The EEOC states that there are several types of discrimination, including age, disability, equal pay, genetic information, harassment, national origin, race, religion, retaliation, pregnancy, sex and sexual harassment.
One type of discrimination, families responsibilities discrimination (FRD), has had an increase in cases of 269% over the last decade, even as other forms of employee discrimination cases have decreased. FRD is found in every industry and at every level within the company, according to a 2016 report by the Center for WorkLife Law at the UC Hastings College of Law. The report defines FRD as “when an employee suffers an adverse employment action based on unexamined biases about how workers with caregiving responsibilities will or should act, without regard to the workers’ actual performance or preferences.” FRD includes many types of family responsibilities and caregiving, including pregnancy and eldercare. For example, a father being fired for wanting to stay home to care for his sick child, or a pregnant employee not being allowed to take a break even though it was her doctor’s orders.
These cases are expected to continue to rise due to the growing number of family members who have disabilities, the increase in people 65 and older who need care, the increase of men who are becoming caregivers, and growing expectation for employees that they can work and provide family care. Employers will need to adjust to these employee perspectives and restructure how work can be accomplished to reduce FRD.