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Assignment on: Business Ethics and a scenario from Anglo American perspective.

Submitted to:

Submitted by:

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Date of submission:

Table of ContentsIntroduction:........................................................4

Task 1..............................................................4

1.1. The background and development of theoretical ethical approach in business:........................................................4

1.2 Compare and contrast between absolute and relative ethics:......5

1.3. Ethical issues that can affect the operational activities of a company:............................................................6

Employment Law..................................................6

Equal opportunity...............................................6

Employment regulation...........................................6

Diversity.......................................................6

Task 2..............................................................8

2.1. The way how business objective of Anglo-American are effected byethical consideration:..............................................8

(a). Business objectives of Anglo-American:.........................8

2.2. Implication of Anglo-American and its stakeholders to operate ethically:..........................................................9

Stakeholder of Anglo-American:..................................9

Implication of a Anglo-American business that is done properly and what happened if all the stakeholders do things ethically...........9

Task 3:............................................................10

3.1. Role of Anglo American acting as moral agent in its mining project:...........................................................10

3.2. Development mechanism for employee involvement and empowerment:...................................................................11

Mechanism for employee involvement:................................11

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Mechanism for employee empowerments:...............................11

3.3. Performance of Anglo American in doing business ethically.....11

Task 4:............................................................12

4.1. Current ethical issue face by selected business:..............12

4.2. Improving Business ethics of operations whilst meeting business objective and good employer/employee relation:.....................12

4.3. Suitable ethical code for Anglo-American:.....................13

Conclusion:........................................................14

Reference:.........................................................15

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Introduction:From the very beginning people wanted to choose between profit

and moral. Many of them achieved both but it had also raised many

ethical issue. Primary task of management for doing business is

setting ethical standard. Ethics can be defined as a process of

evaluating actions according to moral principal of values. For

competitive advantage today’s most business are very much aware

of ethical issue. Business ethics known as corporate ethics which

study about the ethical rationale and problem which is arisen

from the business environment. Sometimes it is called as applied

ethics which study in the field of Medical, technical, legal and

business ethics. Business ethics is all about conduct of

individual and organization. Ethical issue consist of following

Rights and duties between a company and his employee also

with the supplier.

Fiduciary relationship with stakeholders.

Corporate governance.

Corporate social responsibility.

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Task 1

1.1. The background and development of theoretical ethical approach in business:(a) Background:

History is the good fortune teller itself. As time increase rules

are increase in ethical issues for acceptable behavior. The term

business ethics comes into consideration in early 1970s at United

States. The society for business ethics was established at 1980s.

In 1987 European Business ethics network was started and European

was started to adopt business ethics.In the late 1980s and early

1990s firms spotlight their ethical issues.

(b) Theoretical ethical approach:

Moral Objectivism: This is about what is actually wrong and whatis right in the field of behavioral attitude of individual. Moral

objectivism often said to be non-consequentiality.

Moral Relativism: The belief of individual vary from one another

and culture to another cultural so morally right and wrong are

largely depend on the person what he or she actually belief.

Different people comes from different which link an individual

belief and culture.

Consequentialism: Consequentialism is theory about whether the

consequence of individual behavioral action is right or wrong.

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The action of a moral judgment must have a proof and that should

be valid.

Deontology: It’s all about our moral duties and right. If we want

chose morally decision we must have to know what is our duties

and by which means we can adhere to those. Obey and disobey of

our duties can clearly define whether we are fulfilling our

duties or not. In according to deontology God wishes is our

duties, Obligation.

Principilism: Principilsm is about medical health care. According

to this approaches health care provider must have bound by the

ethical issues. Liberty. Generous, Non-kind and justice are the

main principle of Principilsm.

So ethics is moral principle which guide us for detecting what is

right and what is wrong and direct us to do the course of action

which is acceptable by the society.

1.2 Compare and contrast between absolute and relative ethics:For doing business ethical behavior is very much important in

society as doing what is right by obeying one’s duties that’s

guide one’s business. People Moral belief change very oftenly.

Different peoples come from different ethnic group so their moral

belief also different. Some belief in god while other not, some

wants to encourage abortion in the society while other not.

Absolute ethics: Absolute ethics says that there is only one

truth and the code of conduct of behavioral standard is

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universal and everyone must have to obedient to it and

conscious of it.

Relative Ethics: Relative ethics says that there is no

universal code of conduct, there have a single code of

conduct which should be applied to all human basing on the

fact.

(a) Absolute versus Relative ethics:

Absolute Ethics Relative EthicsUniversal Moral standard Single moral standardHave difference between right

and wrong

No difference between right

and wrong

1.3. Ethical issues that can affect the operational activities of a company:The ethical issues which can affect a business operational

activities this are following

Employment Law

Equal opportunity

Employment regulation

Diversity

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Employment Law:

Every business have comply with employment law when the

recruit an employee. Employment laws says that Wages rate,

working hour, Terms and condition must be known by the

employee in time of employment Based on structure and design

one organization is vary from other so law governing

employment law also varies.

In some organization there they provide more flexibility to

their employee in terms of the policy they adhere to. They

want ensure there employee security in case of danger

arrived, they try to trained there employee in health and

social care so they can live clean life, they provide

insurance service to their employee in case of lose occurred

to their employee.

Equal opportunity:

Every business should have provide equal opportunity in

terms of age, sex, color or where they come from Most of the

organization do not wants to hire female worker as they

think that females are weak, they can’t do the work as per

the company rules and regulation, or they will always want

take leave for pregnancy that will cause lose to their

organization and that is disadvantageous for their business.

There should be ethical behaviors in the ways employees

treat its workers, customers and all stakeholders in a

business, a business that apply ethics in the business makes

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the business to be successful and a business should be

responsible for its employees, customers, society and

supplier so that there will be mutual understanding between

all the stakeholders which mean the business is being run

ethically, running a business ethically mean providing all

the requirement that a business need to flourish which makes

the business to grow and be productive because employee are

being treated nice, by paying the minimum requirement of

wages to employees and also providing a health and safe

environment for its customers and given equal opportunities

to all the employees without being bias and promotion should

be given to employees when due, these all ethics a business

should provide for all stakeholders in a business in order

to consider the business to be ethics.

Employment regulation:

A business must have adhere to employment regulation

especially when it is going to winding up. When a business

is going to winding up they must have pay their employee

reasonable payment that shows that they have good employment

regulation which is the criteria for business ethics for

discharging their duties towards to their employee with good

manner. Employees are rendered service to the organization,

so the employer must have ensure good working condition and

good salaries for their service.

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Employer and employee must be adhere to business ethics so

that business could be productive and successful. Employer

should be sincere to their work so that the objective of

business can be achieved through employer.

Diversity:

Different peoples come from different background and

culture. The employer must have understand this and should

not be biased in any way. They should treat their employees

in same way and make a friendly environment of working in

the race of age, gender, religion.

Task 2

2.1. The way how business objective of Anglo-American are effected by ethical consideration:

(A). Business objectives of Anglo-American:Profitability: All most all business are established for making

profit and fulfill the demand of its of customer. Only some

business are established for charitable purpose.

Ethical and Social responsibility: Anglo-American business are

established on a belief that how they can make friendly

environment for their customer and safe. They have a belief that

if they provide their service to less privileged person it will

be beneficial for their business and thus increased their

reputation

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Meet the stakeholder expectation: There are various kind of

stakeholder who make contribution to the business for making it

successful. These are customers, suppliers, employees,

shareholders all are stakeholder for who contribute a lot to

organization. So every business have to maximize the shareholder

expectation as they are decision maker in some extent and make

the business success.

Sales Growth: As the business expand sales also expand thus make

more profit. So Anglo-American wants to expand their business and

want offer better product with cost differentiate strategies for

greater customer satisfaction relatively from their close

competitors.

Thus a business like Anglo-American who must be consider ethical

consideration for achieving those objective. If the business are

done ethically that will accelerate the business growth and

profitability. As example in labor there a law that employee

should get minimum wage for their service but in asia its quite

unsatisfactory, here worker gets below minimum wage that is

unethical. So Anglo-American should consider about minimum wage.

Maslow said in his needs theory if we are not careful enough

towards to our environment in terms of our thinking and

attitude, environment will affect our thinking. Thus similarly If

Anglo-American focuses on business ethics then will surely focus

on ethical and moral issue in case of profitability and meeting

the stakeholder’s consideration.

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2.2. Implication of Anglo-American and its stakeholdersto operate ethically:A business can’t run without stakeholders as they provide much

more contribution for development of the business.

Stakeholder of Anglo-American:

Implication of a Anglo-American business that is done properly and what happened if all the stakeholders do things ethically:Marketplace Advantage: If Anglo-American done business by abidingbusiness ethics by conducting itself good and reputable way then it will take advantage of marketplace and dominating the market environment and will play a market leader role in the environment. Every person wants to business with whom who are abide by business ethics. Thus if Anglo-american adopt business ethics for their operation this will attract stakeholders for doing business with them. As a result both the Anglo-American and

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stakeholders abide by the business ethics, rules and regulation this will be play greater role in the market and the organizationwill become more efficient and successful.

Investment and growth: When Anglo-American run their business by adopting ethics this will cause greater positive benefit both forthe organization. The benefit is this investor will want invest Anglo-American business as they know they are doing business ethically and their interest will be best preserved by Anglo-American business. Thus the more investment increase, the more will growth the business.

Employee performance: If Anglo-American business done ethically this will send positive message to their employees that their interest are beastly protected by the organization so they will work hard for rewarded and this lead greater employee and stakeholder relationship. Thus ultimately its increase the performance of employees and if the employees are satisfied then business will perform very well.

Development: When Anglo-American practice business ethics within their organization, both the organization and stakeholders work together for ensuring work are getting done properly, this will cause ultimate result of organizational development. Thus for increasing productivity of an organization, organization development is necessary and its possible when organization practice business ethics.

Business Goal: When Anglo-American and its stakeholders practice ethical moral, this will help to achieve both the organizational and stakeholders objective.

If Anglo-American doesn’t doing their business ethically this will cause following affect.

Bad Reputation.Low customer.

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Task 3:

3.1. Role of Anglo American acting as moral agent in its mining project: A moral agent is one who is capable of acting with reference to right and wrong and who have right and responsibility. A moral agent can be held liable for behavior or decision.

Anglo American wants to leading mining company in the world. Theywant provide best safe and sustaining mining around the world. Roles they played are following

Safety: In 2009 many peoples lost their lives for Anglo American operation and they promised to the community that they will provide most priority for people lives from keeping away them fatal injuries.

HIV/AIDS: All most 70% of the workforce of Anglo-American is in South Africa which is world dangerous zone of HIV/AIDS. Anglo-American wants to keeping their employees healthy by making them conscious about HIV/AIDS through seminar and training.

Climate change: The way Anglo American business respond to climate change issue it’s ensure their long term sustainable growth. Their aim is provide best service to their stakeholders while playing greater role in climate change issue.

Water: Many Anglo-American business were established on water stressed area. There primary concern is to ensure pure water supply both for them and the community. They want keep safe waterfrom their mining project for the best interest of their stakeholders.

Waste: Mining project produce so much waste. They took the responsibility of waste disposal for making the environment cleanand safe for the interest of stakeholders. They promised disposalof waste managed so efficiently if there is no alternative solution.

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3.2. Development mechanism for employee involvement andempowerment:Employee involvement refers taking part or having say or share opinion in decision making.

Mechanism for employee involvement:Downward Communication: Its communication through manager to employees. These includes development in house journals, newspaper, conference session and video presentation.

Upwards, problem solving form: Which include taking employees knowledge and opinion in any aspect;

Financial development: Which include providing reward for performing individually or in group for encouraging them that shows their involvement is very much precious to the organization.

Representative participation: Which includes taking representative from the group of employees and employees participate under the control of representative which give employees greater flexibility in working and involvement.

Empowerment refers creating an environment where every employee can use his or her abilities or power to satisfy the customer.

Mechanism for employee empowerments:The Leader’s role creating an empowering context: First categories the leader on whom authority are delegated on basis ofemployees need such as training, development and support mechanism.

Collaborative work as empowerment: Combining collaborative work and ensure that individual work with one another and effort should measure via quality circle or teamworking measure.

Structural and procedural change as empowerment: Bring clarity and consistency of organizational production and development goal

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and conjugate all system, management and employees towards to goal.

3.3. Performance of Anglo American in doing business ethically: Anglo-American doing their business very well abide by ethical laws and moral. Some ethical performances are as follows.

They are very much aware of negative impact and risk arisenfrom their business and take proactive effort for minimizing that.

Proactively provide socio economic benefit to host country.

They efficiently utilize allocated resource which are provided them for managing social performance.

They discriminate people in the race of gender, religion, age etc.

They aggregate their business planning with social objective and target.

Before launching any project they communicate with their stakeholders for opinion.

They have taken contingency plan in case of main plan for social development failed by consulting with stakeholder.

Integrity, accountability, transparency is their main principle to operate business.

They follow all the ethical code of conduct such employmentlaw. Employment regulation, preserving stakeholder interestetc.

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Task 4:

4.1. Current ethical issue face by selected business:Employee Behavior: Today most business are face ethical issue from the perspective of employee behavior. As example whether an employee working on work time rather than checking personal emailaccount, whether a manager take seriously harassment problem or not , whether an employee gets promotion as he deserve all are the example of employee behavior.

Employee working condition: In addition to employee behavior a business must consider good working condition for employee. As example an employer must be aware of safety of working environment and whether they compensated their employee for time an employee work.

Supplier/Customer relation: An employer and employee must be keepgood relation to their supplier and customer. Business owner should take in consideration that whether it is ethical to do business with supplier who usually practice unethical moral. A business should take in consideration when they deal with their customer that they provide full information that means no existence of asymmetric information.

External Pressure: Todays most business face external pressure todoing business ethically. As a result business should take in consideration of business ethics for their survival in business.

4.2. Improving Business ethics of operations whilst meeting business objective and good employer/employee relation:Earlier mentioned that the objective of a business are-

ProfitabilityEthical and Social responsibilityMeet the stakeholder expectationSales Growth

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A business can improve their business ethics of operation which ensure meeting business objective and good employer/employee relation by following way

Work Satisfaction: If an employee is satisfied with his work thatincludes flexibility in work, opportunity for work, task varieties, allowing individual to increase his knowledge, skill etc. That will increase her performance in organization and then can an organization easily achieved his objectives.

Pay Satisfaction: Employee satisfaction largely depend on how they are getting paid for rendering service. If employee are satisfied with his payment that ensure a there is a good relationwith management and this good relation towards the business to meet its objective.

Promotional Satisfaction: If an employee is promoted for the skill and knowledge he possess, thus encourage him to provide greater performance this lead a business to achieve its objective.

Overall job Satisfaction: If an employee is satisfied with his from all the aspect that means there is good relation with management and management are cooperative, thus also leads a business successful.

From the above discussion it can clearly say that if a business improve their operational ethics and also abide it such as employment law, Minimum wage theory, Equal opportunity and Employment regulation, thus can fulfill the above dicussed criteria and employee satisfaction. If the employee satisfied, they work hardly as a result organization can achieved its objective and if organization achieved its objective that’s will lead a good relation between employee and employer.

4.3. Suitable ethical code for Anglo-American:There several types of ethical code of conduct for Anglo

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Compliance with laws and regulation: Employees of Anglo-American

should comply with all laws and regulation on behalf of the

business.

Conflict of Interest: Anglo American business should give space

to their employee so that their employee do their duty for the

interest of the business and do not use their position and

knowledge for private gain or advantage.

Outside activities, Employment, Directorship: Anglo American

Business run for a motive that they want to contribute their

community. The business group encourage their employee to

participate in religious, charitable work for the interest of

community.

Relationship with clients, Suppliers and customers: Anglo

American should let their employee be independent for dealing

with their clients, supplier and customer.

Gifts, Hospitality and favor: Employee should not take any gifts

or favor from the supplier.

Conclusion:When a business operate ethically its benefited in very way from

the society. When a business provide good working environment for

their employee and also ensure that their safety is guaranteed

then their business flourish, sales increase and business growth

overall.

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A business have social responsibility towards the community. When

a business participate in social development programed, those

business are recognized very well and then stakeholder will

encourage to do business with that organization as they have seen

their interest is also protected by organization as the

organization doing their business by following ethical code and

moral. As result business profitability also increase as well as

growth also.

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Ethics and Business, DBA dissertation: Harvard Business School.

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