Business do not have to be ethical they are guided by the law. Discuss?

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Business Ethics

'Companies do not have to be ethical, they are guided by the law; business ethics is an unnecessary consideration'

To what extent do you agree with this statement? Support your argument with company responses to ethical responsibility.

Ethics are the moral principles that should underpin decision-making. A decision made on ethics might reject the most profitable solution in favour of one of greater benefit to society as well as the firm.

Ethical dilemmas in business include:

- Should advertising agencies accept cigarette advertisers as clients even though they offer large sums of money and high employment levels,

- Should a producer of chemicals sell the chemicals to an overseas buyer if it suspects the chemicals will be used to produce dangerous weapons,

- Should firms in takeover battles hire private detectives to investigate the private lives of their rival executives if it aids in them getting the take over.

If media pressure and public opinion force firms to take the publicity impact of their decisions into account, the companies may change their decisions. This would not mean that the firms were becoming ethically minded.

An ethical decision means doing what is morally right, it is not a matter of calculation of their costs and benefits. Companies have an ethical code which is a document setting out the way a company believes its employees should respond to situations that challenge their integrity or responsibility. This code depends on the business concerned, such as banks (Cooperative bank) may concentrate on honesty and fuel companies (BP) may concentrate on pollution control.

Companies are guided by the laws of the country or collective groups of countries (European Union) in which they operate, therefore it can prove difficult to produce meaningful, comprehensive codes.

There are critics of ethical codes who believe them to...