Ethical Assessment of a Business Issue Order Instructions:
Write a paper on an ethical assessment of a business issue.
Topics in the paper must include:
1. Analyze a company’s approach to an ethical issue.
2. Answer questions associated with an ethical dilemma to help clarify business decisions.
3. Analyze the role of leadership in promoting ethical behavior.
Ethical Assessment of a Business Issue Sample Answer
Ethical Assessment-A4
Introduction
Organizational ethics determines the manner in which organizations respond ethically to the entire internal and external stimulus that impact the nature of their operations. Corporate ethics expresses the values of an organization to other entities, consumers, and employees irrespective of regulatory and governmental laws. This paper conducts a study on an analysis of a Chipotle’s unethical behavior that saw the Mexican eatery engage in insider trading to raise funds for its joints. Secondly, the paper will answer questions associated with an ethical dilemma in a company to clarify an organization’s business decision and the role of leadership in promoting ethical behaviors.
Company’s Approach to an Ethical Issue
A fast-casual Mexican food chain also known as Chipotle over the past years faced ethical problems that tainted the name of its operations in the hospitality industry. According to Donaldson (2017), Chipotle’s chief executives enriched and fattened their pockets by inflating the eateries stock price by overpaying themselves with the firm’s shares of the over-valued stock. A more serious allegation was the company’s co-CEOs efforts in selling close to 108.0 million worth of the company’s stock and an inflated price through insider information that resulted in the fall of the price. Insider trading has received several connotations and definitions which include its legal and illegal activities. Insider trading is inferred to as the trading of a company’s bonds, stocks, securities, and stock options by individuals who have access to non-public information regarding a company.
However, insider trading can occur lawfully, especially when trading is done by corporate insiders such as directors, officers, employees and the stakeholders in buying or selling stocks to their company if this trading approach does not take advantage of non-public information and is conducted within the boundaries of the organization’s policies governing trading (Figar & Đorđević, 2016). In understanding the unethical aspect of insider trading, the practice engages insider parties that trade on non-public information that is gained through the performance of the insider obligation an organization, an issue that violates other relationships of assurance and faith especially when non-public information is stolen from an organization as evident in the case of Chipotle.
The managers of the company acknowledged the need to play roles in shaping the ethics of the organization and in seizing every opportunity in the creation of an effective environment that strengthens the reputation and relationship of the organization on which success lies. The firms approach detailed the need for a strategy based on integrity that required the organization to embrace robust standards (Figar & Đorđević, 2016). In as much as compliance remains rooted in negating sanctions, organizational integrity articulates the concept of self-governance in accordance with the organization’s guiding principles as defined in the code of ethics. From a perspective of integrity, Chipotle needed to have inhibited an ethics management approach that would help the organization in defining and giving life to its guiding values in a bid to create an environment that supports sound and ethical behaviors, hence instilling a sense of shared accountability in the company. The inclusion of an integrity strategy characterized by the conception of ethics plays integral roles in deriving ethical behaviors within an organization.
Questions Associated with Ethical Dilemma and Ethical Assessment of a Business Issue
What is the Nature of the Ethical Dilemma?
Allegation on the company’s co-CEOs efforts in selling close to 108.0 million worth of the company’s stock and an inflated price through insider information that resulted in the fall of the price indicates the nature of the ethical dilemma (Remišova et al 2014). In determining the nature of the ethical dilemma within the organization defining the nature of the dilemma through the application of principles and frameworks in understanding and resolving complex and moral dilemmas in Chipotle.
What actions would lead to a greater good for the greatest number?
The primary reason why several investors invest in capital into a company’s stock market remains in the fact that particular organizations mandate honest, fraud-free, and fair transactions in their stock market in a bid to uphold their image and integrity. The company needs to play a level field by holding company executives to their fiduciary practices (Remišova et al 2014). This approach allows the company executives the privilege and freedom of acting inside information in a bid to benefit themselves from such positive information, an aspect that reduces the amount of financial loss that may be incurred from negative information.
Analyze the Role of Leadership in Promoting Ethical Behavior
An organization’s ethics as alleged by Taub (2014) remains as good as its leaders. To create an effective organizational culture in Chipotle that supports and embraces ethical conduct and personal responsibility, the organization’s leaders need to ensure they serve as role models for employees. Leaders, on the other hand, need to foster an ethical culture that requires every individual within the firm to account for any conduct. This would consequently play an integral role in guiding individual behavior within the organization. Leaders need to incorporate actions that guard the organization’s reputation and long-term success through the consideration of responsible and ethical conduct. The leaders are required to show trust through accountability and transparency, with this behavior effective in supporting ethical conduct and truthfulness in the organization.
Ethical Assessment of a Business Issue Conclusion
As established in this paper, organizational ethics infers to responsibilities that organizations undertake in conducting their business functions in a transparent, respectable, and honest manner. An organization’s ethical climate has the capacity to improve employee morale and in enriching the organization’s commitment, hence fostering the involvement and retention of employees.
Ethical Assessment of a Business Issue References
Donaldson, T. (2017). Donaldsonian Themes: A Commentary. Business Ethics Quarterly, 27(1), 125-142. doi:10.1017/beq.2016.53
Figar, N., & Đorđević, B. (2016). Managing an Ethical Dilemma. Economic Themes, 54(3), 345-362.
Remišova, A., Lašakova, A., & Bučio Va, Z. (2014). Ethical-Economic Dilemmas In Business Education. Business, Management & Education / Versa, VaidyaRiStudios, 12(2), 303-317. doi:10.3846/bme.2014.238
Taub, S. (2014). The Morning Brief: Martoma Defense Rests in SAC Insider Case; Jury up Next. AR Magazine, 6(1), 49.
