University of California
Type of paper: Thesis/Dissertation Chapter
Commerce: Ethics and Social Responsibility
In order to maintain social order and stability, people create a lot of rules to conduct the people’s behavior. A part of these rules of conduct is included in the scope of the law, which needs the coercive power of the country to protect its implementation. The other part belongs to the moral category, and it needs to rely on self-reflection and intervention of public opinion which can assurance its implementation. The business ethics is a part of commerce responsibility, and it is also a part of moral rules.
Commercial activity is one of the most important activities in human society, and whether the commercial activity can run orderly have a tremendous impact on a society. A responsible commerce should fully consider the moral responsibility. Abramov (2007) said that The enterprise is closely related to the profits, in order to establish the basic responsibility of the enterprise, it should strengthen the full range of responsibility and cultivate culture which concentrates on responsibility.
This essay will firstly give a brief description on the responsible commerce. Following this, it will discuss on the utilitarianism theory and its relation to the responsible commerce. After that, it will use the utilitarianism theory to analyze a case. Finally, it will give a reflection about the study. A brief introduction of the responsible commerce As a part of the social system, the responsibility of commerce attracts more and more attention.
This concern not only comes from the theoretical areas, but also comes from the groups related to the enterprise and the stakeholders. How to ensure the implementation of the responsibility of the enterprise, and make it give a greater contribution to the society when it gets benefit from the society are the hot spots. An enterprise is rooted in the society, it is impossible to be an isolated body, and it must have a broad contact with the society, then it is necessary to undertake the corresponding responsibilities.
In general, according to Jeremy (1789), the responsibility of commerce should include three aspects: economic responsibility, social responsibility and ethical responsibility. The economic responsibility refers to the economic interests that the enterprise pursuit and want to make the benefits of investors maximize. Through the process of accumulation: investment, profitability, reinvestment and re-profitability, the enterprise will grow and have a healthy development. The social responsibility should include internal and external aspects.
The internal aspect refers to establish an effective monitoring mechanism, which is both responsible for the staff, but also responsible for the society. The external aspect includes three elements, first is to provide tax for the government, this is the important social responsibility for the enterprise. The second is to make efforts for the social harmony. It means that the commerce should provide employment opportunities for the community, should protect the ecological environment, and safeguard the interests of shareholders.
The third is to provide the quality products and goods to the market. This responsibility relates to people’s lives and health, and also relates to the normal operation of the society. Peter (1981) said that the ethical responsibility is moral responsibility, unlike social responsibility, it is the voluntary acts. The enterprise should undertake these three responsibilities, and play its role for the rapid and stable development of the society and economic. The utilitarianism theory
The utilitarianism can be said as an ethical theory, which believes that the proper action is the one which can maximize the happiness of all the people. It can be also regarded as a form of the consequentialism, it means that every action has a moral worth, and it is determined only by the outcome of the resulting, people can only know all the consequences of the action, and then can weigh the morality. The core of utilitarianism is principle of the greatest happiness of most people. The personal interests can not be separated from the interests of others.
Frederick (2003) said that the utilitarianism can be accepted by human beings because of the profit nature of human. Therefore, the principle of utility is necessary to consider the personal interests and the interests of others, and also consider the interests of the stakeholders. Mill (2004) inherited Bentham’s idea of the greatest happiness principle, and pointed out that it should develop ethics according to the utilitarian purpose, in compliance with these codes of ethics, it will get the best interests of the overwhelming majority of people.
Mill’s idea makes utilitarianism which only stresses the effect of utilitarian change into the principle which not only stresses the effect, but also pays attention on the guidelines of the ethics. Kelly (1990) said that the essence of the utilitarianism is that it affirms the necessity of achieving personal interests, and also provides that realizing the overall interests is premise and precondition of personal interests. The one-sided pursuit of personal interests is a narrow utilitarian concept, which can be extended to the utilitarian concept of the modern commerce.
It can be concluded that some commercial operators with narrow utilitarian view will have one-sided pursue the commercial interests, the utilitarian view of modern commercial operators should maintain and achieve the overall interests of stakeholders and collective. Application of utilitarianism theory to analysis the company of Sanlu It has been reported that in China, the incident of Sanlu milk is a typical manmade disaster. From last year, the company of Sanlu began to receive the consumer complaints.
To August 1 when the experts make the conclusion on the milk, then to September 8, the municipal government of Shi Jiazhuang gave a report to the government of Hebei Province. During the half year, the unspoken rule which is known by every one is not timely broken, and the company of Sanlu did not take measures to reduce the damage and the losses. The incident of Sanlu reflects the corporate ethics and social responsibility, which are concerned by many people. In order to pursue the profit and gain the ill-gotten wealth, a small number of enterprises ignore people’s health and even people’ life, the corporate moral is decay.
The unscrupulous milk traders seek profits, so they devoid of conscience, and mix the milk with melamine. The management of the company lack of responsibility, and neglect lives and safety of people. The relevant department has also developed a number of systems to deal with the incident. But these systems are not specific. The incident of Sanlu milk lacks the system of third party testing. And the regulatory powers is own by the company, the profit make the system fail, and which lead to the fail regulation.
George (2005) said that the reason why the company should fulfill the responsibility is neither because the company faces many ethical dilemmas and moral hazard, nor because the ethics can be regarded as the effective tools which can help company achieve the economic purpose. The most fundamental is that the responsibility is the core values of the modern enterprises, which has a special meaning and civilized significance. There are many reasons which can lead to the unethical behaviors and the shady transactions, but the most main reason which can induce unethical behavior is too much emphasis on the performance.
So the company should correct the idea of too much emphasis on the performance and also qualify the performance. When it seeks to the purpose of self-interest, it should also establish a business concept of altruism. The company of Sanlu should have the responsibility, it should aware that the development of the company is not only for profit, but also for the fulfillment of a moral. It can use the scientific management to combine the interests of the company and the social responsibility. The company should use the greatest happiness principle as a guidance, which can make our society more harmonious.
The greatest happiness principle is an abstract concept, when using this idea to make the commercial decisions, it will often encounter the problem that the interests of all parties can not easy to achieve the largest. So the company should fully balance the interests and realize the greatest happiness of most people. Conclusion The modern commercial operators use the greatest happiness principle as its core of utilitarian, which break the western traditional idea of utilitarian, which pursues the maximize the self-interests and the interests of the stakeholders.
The principle affirms both the interests of the main groups which include the merchants and the staff, and the interests of consumers. It also affirms the interests of the society. It means that it combines the interests of individuals and others, the interests of organizations and nation, society. From the sources of the theory, it reflects the unity of the commerce and moral, and also reflects the combination of benefits and fair. It is more suitable for the modern society. In short, to make a business decision with ethical aspects, it should let the decision have the support of ethical standards.
Bernard (1973) said that from the view of utilitarian, it is necessary to meet the requirements of the stakeholders who pursue maximize of the benefits. Walters (2008) believed that if the business decision has the support of ethical standards, it can be said that it have the ethics, and then the company can avoid the risk of commercial ethics, and can also bear the ethical responsibility which the commercial operators should undertake, and this company can be regarded as a responsible commerce.