Ethics and Social Responsibility in Business Assignment
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Unit 2 Assignment
Ethics and Social Responsibility in Business Assignment
In this Assignment you will read the Cengage® Case Study: “Barclays Bank: Banking
on Ethics” and then respond to the checklist items in a critical essay based on the scenario below.
Assignment Scenario:
As a new marketing associate with Barclays Bank, you are tasked with writing a critical essay summarizing what transpired during the investigation conducted by the United States Department of Justice into the abuse of the London Interbank Offered Rate (LIBOR) interest rate regulated by the British Banker’s Administration. This essay, if chosen by your new employer, will be the report presented to the Board of Directors.
Write a 2–3 page, (not including a title and references page), double-spaced, critical essay
responding to the checklist items. For assistance with your Assignment, please use your textbook and library research resources. The instructions for you to execute this task are as follows:
Directions for completing this Assignment:
1. Read the “Barclays Bank: Banking on Ethics” case study.
2. Learn how to write a critical essay: Click Here
3. Use APA format and citation style, provide a title page and references, and do not forget to use in-text citations with their accompanying references so as to avoid plagiarism.
4. In your critical essay that includes your thesis, arguments, support, and conclusion, respond to the following:
Checklist:
- Describe the level of ethical development the executives at Barclays demonstrated when manipulating the LIBOR interest rates.
- Did Barclays Bank neglect social responsibility? What could they have done to be more socially responsible?
- What actions regarding Corporate Social Responsibility (CSR) could Barclays have engaged in after the scandal broke to set things right and ensure that such an event would not happen again?
- Describe what level of morality would have been demonstrated if executives at Barclays asked themselves, “Even though manipulating the LIBOR will increase company profits, is it the right thing to do in the long run?”
- Explain the importance of ethics and social responsibility in marketing as a result of your case study analysis
SAMPLE ANSWER
Barclays Bank: Banking on Ethics
Professional ethics is a universal standard that is applicable to all professions in addition to corporate and any other business type. There are rising cases of ethics being thrown out at the expenses of unknowing customers with the primary goal being making profit (Valeentin, 2010). In relation to the case study on Barclays, it is quite evident that the executives of the Bank gave little consideration to the basic idea of ethics when they decided to falsify information so as to get better ratings and increased profit. This is in particular to manipulating the LIBOR interest rates to portray a stable economy rather than show to their customers that they were doing badly in the market. The idea that Barclays was caught and fined which led to the resignation of some of the executives is an indication that they had acted unethically (p. 1).
According to Bickerton and Louis Gruneberg (2013), LIBOR is a form of analyzing the economic outlook and creating fair competition in the market particular to banking industry. LIBOR when low the economic stability is high and when high the economic stability is low. Social responsibility refers to an ethical theory that any given entity, whether an individual or a firm, has the duty to ensure that their actions or activities are of positive impact to the society. This is aimed at ensuring that there is a balance between the ecosystem and the economy. According to the case study (p.2), the reason for Barclays being charged was because it proposed for setting of low rates to promote the idea they were stable, which was not the case. This is an indication that their biggest concern was their corporate image at the expense of all the other factors that would be impacted. Acting in a social manner entails maximizing the resources available into serving the needs and requirements of shareholders and stakeholders without breaking the set business ethics.
Following the court’s decision that British Barclays Bank had knowingly manipulated LIBOR in their quest to hide their current financial status at the time, they were fined $ 440 million (p.1). This is an indication that they had overlooked the whole basic idea of corporate social responsibility. One way that the organization can come back and entrench corporate social responsibility that would ensure no future such cases will take place is through conducting an audit from outside sources and offering their financial statements to the public to create trust. This will provide a general basis of what had led the organization to take such measures and by involving the public, strategies can be drawn up that will ensure such issues do not arise in the future.
A given company’s management is believed to have a relatively large impact on establishing how an organization comes up with and goes about to set ethical conducts. For instance, in a given organization, if the management acts on the perception that the only thing that matters in the organization is to make profits, then it is highly likely that all the employees will have this same perception. Therefore, it is the responsibility of the management to set ethical principle standards regarding what is wrong and right in relation to how the employees should carry themselves (Champoux, 2010). In essence, the top management of Barclays should not have focused largely on making profits and portraying a thriving corporate image, but rather on what impact their decision will have on all people and the ecosystem at large.
Ethics and social responsibility from their definitions should be integrated. Social responsibility comprises of the government, society at large and businesses working together to improve both the economy and the ecosystems (Paetzold, 2010). However, without the guiding factor of ethics social responsibility cannot be achieved. For instance, in the case of Barclays they were trying to market the idea that they were stable and that the economy at large was stable even with the impact of the global financial crisis still being felt in most regions globally. Although through the increased profits Barclays would have in the long run become stable, it would have created a marketing environment that would have been unfair competition wise, unstable and unethical.
Conclusion
It is apparent that ethics helps in maintaining the balance; the process of getting or achieving your overall goal should not be a justification to the outcome. This is in the case where regardless of the negative impact the process has had on people or ecosystem, it does not matter as long as the outcome is positive. Ethics should act as a moral compass that reminds us we are part of a society and whatever actions we take we will impact those around us whether for financial gain or other benefits. Therefore, the decision to fine Barclays is right in addition to hiring new executive employees to propel the organization in the right direction.
References
Bickerton, M. and Louis Gruneberg, S. (2013). The London Interbank Offered Rate (LIBOR) and UK construction industry output 1990-2008. Journal of Financial Management of Property and Construction, 18(3), pp.268-281.
Champoux, J. (2010). Organizational Behavior: Integrating Individuals, Groups, and Organizations. 4th ed. USa: Taylor & Francis.
Paetzold, K. (2010). Corporate Social Responsibility (CSR): an International Marketing Approach.London: Diplomica Verlag.
Valeentin, S. (2010). Ethics and organizational practice: questioning the moral foundations of management. Denmark: Edward Elgar Publishing.
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