Business Ethics and Corporate Social Responsibility

Business ethics and corporate social responsibility have become an increasing area of focus for organizations today. However, this has not always been the case in the American business environment. Chapter three “Conducting Business Ethically and Responsibly” (R.W. Griffin & R.J. Ebert, p.56 - p.87) concentrates on the development of ethical codes of conduct as it relates to business. The chapter also focuses on the social responsibility an organization holds in relation to everyday decision making. Ethics and social responsibility go hand in hand. Ethics affects individuals or groups within the workplace, whereas “social responsibility refers to the overall route in which a company decides to balance its involvement with employees, stake holders and the environment” (R.W. Griffin & R.J. Ebert, p.67).

There are four stances companies have taken in relation to social responsibility. As mentioned on page 80, the four stances are; obstructionist, defensive, accommodative or proactive. One of the earliest examples of the obstructionist approach in the United States was the handling of the Homestead Strike of 1892. Management placed an emphasis on opposing any business activity that threatened profits. 3000 workers from Andrew Carnegie’s Homestead Steel Mill went on strike for better wages and working conditions. Instead of trying to come to a mutually beneficial agreement, management choose to hire a private army to quell the strike. The following confrontation led to the deaths of nine workers and three detectives. These types of incidents were not uncommon and were the result of the obstructionist view commonly taken by management during the late 1800’s. Historian Joseph Frazier Wall said, “Frick was the norm, not Carnegie, in management's relationship with labor at that time” (PBS, The Homestead Strike, 1999). Carnegie, felt remorse for what happened, Frick did not!

On the opposite end of the spectrum lies the pro-active approach. This more socially responsible approach is becoming more popular in today’s business environment. Founded in 1919, the United Nation’s - International Labor Organization (ILO) “ is the global body responsible for drawing up and overseeing international labor standards”(ILO, 2008). It has been working world wide to “promote rights at work, encourage decent employment opportunities, enhance social protection and strengthen dialogue in handling work-related issues” (ILO, 2008). In an attempt to comply with ILO standards, companies like GE are now joining organizations like the Business Leaders Initiative on Humans Rights (BLIHR) who’s goal is to create "practical ways of applying the aspirations of the Universal Declaration of Human Rights within a business context and to inspire other businesses to do likewise"(BLIHR, 2008).