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Business Ethics in a Post COVID World
Introduction:
Business ethics refers to values that businesses must adhere to in their functioning. These values showcase the purpose of the organization.
Business and ethics are not opposite and business ethics makes economic sense. Business ethics promote trust in the stakeholders – customers, regulators, governments, suppliers and wider community. Tata is an example where the organization has earned the trust of many. On the other hand, lack of business ethics leads to deep mistrust as seen in private health care.
Purpose of business is not just about profit. It is about producing profitable solutions to problems of people and the planet and in the process earning profits. Trustworthiness and values must be the foundation for any business. Only through honesty, integrity and commitment to purpose, can trust be generated.
In times of crisis like COVID 19 pandemic, ethical behaviour(Values and purpose) is a must to survive and thrive.
Business ethics during COVID pandemic:
By providing solutions to challenges during crisis through Corporate social responsibility, business will show that their purpose beyond pure profits. Examples of some businesses doing this are automotive producers producing ventilators; alcohol manufacturers producing sanitizers; fast food outlets providing nutritious food to needy. Such adaptation ensures businesses generate trust in people and also a sense of fulfillment in their own employees. This translates into economic benefit in future through increased brand value.
Dilemmas of business can be resolved through ethical values. Major dilemmas include:
- Lives vs revenues and livelihoods: Should economic activities involving physical activities restart to protect revenues? Doing so without concern for lives will be counterproductive. It can lead to outbreaks and longer closures. Hence a balance is needed.
- Pay cuts and layoffs to prevent short term losses: Layoffs result in loss of valuable skilled employees. This damages the trust of both laid off and remaining employees. Same is the case of paycuts. Hence any layoffs and paycuts to protect the financial health of the company must be deliberative and participative. Fairness, compassion and transparencyare must to protect long term trust.
Social distancing is leading to increased digital use by businesses. Technology brings following ethical issues:
- Aarogya setu and such contact tracing applications involve invasion into privacy of individualswhich is a human right. Such applications must adhere to ethical standards such as – consent, just purpose and use; data minimization; eventual destruction of data after purpose is fulfilled. These will generate trust and hence increase participation which is a necessity for success of such applications.
- Exacerbating inequalities: Unequal access to technology can accentuate socio-economic inequalities. Digital education is an example where there is rural – urban and rich – poor divide in access to hardware(mobile, laptops, broadband etc). Design of digital education policies must address all strata of population to ensure social justice to the most vulnerable.
- Enhanced automation: It results in loss of livelihoods and hence rise in poverty. Social justice must be factored in policies regarding the same to ensure a dignified life to all. Robot tax, universal basic income are some such measures
Conclusion:
Purpose, values and ethics need to be built into institutional design to build resilient businesses. By aspiring to contribute to society, employees will have a purpose in their daily work. This cultivates innovation and expand business models.
Source: www.livemint.com
Mains question:
1.What is business ethics? How is it different from corporate governance? How does business ethics help businesses in the post covid world? [15 marks, 250 words]
