Ethics Paper
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Ethics Paper
When explaining the role ethics and social responsibility play in the strategic management process it is necessary to consider the stakeholders needs and agendas. Social responsibility and ethics definitions include the responsibility organizations have to the community, employees, and the environment. Providing an example of a company that has crossed ethical boundaries is helpful when identifying what it will take to prevent a crisis situation. Social responsibilities include the obligation to shareholders beyond a profit (Wheelen & Hunger, 2010).
William Byron, who is a Professor of Ethics at Georgetown University, and past president of Catholic University of America, states “Profits are merely a means to an end, not an end itself” (Wheelen & Hunger, pg. 72, 2010). Halliburton is a prime example of a company that has crossed ethical boundaries. Halliburton is a fortune 500 company that made unsound, unethical choices during the Iraqi war.
Management has the responsibility to make strategic decisions that affect others in an ethical and socially responsible manner. Ethics are morals, values, and beliefs within each individual, and each organization has a set of ethical policies and procedures. Ethics encompass fairness to others, benefits to the local economy, empathy, and compassion. Business ethics include privacy, laws and what is socially acceptable. Ethical practices are achieved when an organization makes strategic decisions to include values that society has even when it is not bound by law.
Social responsibilities of business are ethical, and discretionary. Socially responsibly actions have a positive outcome on profit, and performance for stakeholders. Socially responsible actions can provide a positive reputation within the organization and the community creating a larger profit margin. An organization can benefit from careful consideration to ethical and socially responsible actions prior to completing the strategic management plan (Wheelen & Hunger, 2010).
An example of a company that violated ethical boundaries to benefit shareholders is Halliburton. Halliburton has provided services to the armed forces. Allegations against Halliburton included unethical behavior, and criminal acts against employees, and unclean cooking conditions that affected servicemen.
Halliburton had obtained many no-bid contracts to restore oil to Iraqi during the Iraqi war. These contracts given to Halliburton included influential factors from former Vice President Dick Cheney. At the time of this contract Dick Cheney was the former CEO of Halliburton. During this time Halliburtons partner KBR had overcharged operations by $1.3 billion. In addition to this incident Halliburton had allegations for bribery of Nigerian officials that resulted in additional fines. Halliburton allegations and charges cost Halliburton $559 million (Action for Our Planet, 2013).
Suggestions made to correct Halliburtons negative reputation include several factors. Halliburton has an established code of ethics in within the policies and procedures manual. Management has made changes to this code several times since 2008. Management should consider referring to the ethics policies and procedures before attempting to solve any ethical issue. Disciplinary actions can help address lack of compliance. A few examples include; counseling, written and oral reprimands, demotions, salary reduction, and finally termination of employment with possible restitution or fines.
Management can increase and improve communication between staff and managers by implementing the code of ethics in performance reviews, training programs, new policies and procedures, and as changes arise. Implementing effective communication systems will also improve this process. Halliburton can benefit from improved communication systems such as ethic hotlines, internal reporting, and compliance procedures. This process will ensure compliance throughout the organization (Wheelen & Hunger, 2010). Management should refer to the mission and vision statement