Defining Ethics And Social Responsibility Philosophy

The topic of this research entitled "Ethics and Social Responsibility". The researchers will define the term ethics and social responsibility as well as differentiate the relationship between ethics and social responsibility. Moreover, the researchers had selected a suitable theory that related to the topic, that is the utilitarianism theory. The theory will also be defined in the later session of the research.

Ethics and Social Responsibility

Ethics is the notion of what is wrong and right, immoral and moral. It refers to the code of morals of a particular person, group, profession, religion, etc. It is also called moral philosophy which is the discipline concerned with what is morally good and bad, right and wrong. Usually, behaviour that consisted of accepted moral code can be defined as ethical behaviour. Ethics can be viewed in natural law, religious tenets, parental and family influence, educational experiences, life experiences, cultural and societal expectation (Christy, 1996).

Meanwhile, social responsibility is an ethical theory that eliminates irresponsible or unethical behaviour that might bring harm to the community, people, or the environment before the behaviour happens. It claims that individual, government, organization, or corporation has a responsibility to society. Social responsibility not only correlated with governmental entities or business, but also business and governmental practices, activist groups and local communities.

Ethics in PR

Public relations (PR) practitioners play a very important role in an organization. It is because they are the people who often deal and negotiate with the clients. Everything they do and say will directly influence an organization's image and reputation. As there are rules to be followed, PR practitioners may not easily know what is right or wrong for the sake of the organisation or the public. Sometimes, it is hard for them to decide whether a decision should be taken if it will just bring benefits to the organization instead of the public. However, it is always better for PR practitioners to tell the truth. There are six cores values of Public Relation Society of America (PRSA) which PR practitioners should always follow and remember. They include advocacy, honesty, expertise, independence, loyalty and fairness.

According to the public relations legend Patrick Johnson, a PR practitioner can always follow the PRSA values by bearing in mind as well as using the nine contributions of public relations for organizations. First, a PR practitioner should always being aware and informed, predict issues that may occur and able to cope when a crisis happen in order to ensure that nobody can get advantage. In addition, a PR practitioner has to be a motivator in an organization, identifying chances and pushing an organization into social responsibility and public policy so that can avoid many unexpected situations from occurring.

It is very important for a company to give a promise to their customers. A PR practitioner has to inform the company and ask them to solve the issue if they find that the company is doing something that against the company promise. Besides, communication is crucial in acting ethically. Once the organization lack of communication with the public, then PR practitioners will not able to handle a problem as they do not know details of the situation (Public Relations Ethics, 2010).

Differences between Ethics and Social Responsibility

There are seven principles for social responsibility and twelve ethical standards. Ethics is embedded in social responsibility.

Social responsibility is related to ethical responsibility. There are six main areas of social responsibility which are the employees, providers of finance, consumers, community and environment, government, and other organizations or groups (Social Responsibility, 2009). On the other hand, ethics is the study of certain standards that we use it to judge things. It can be moral or immoral. Normally, people use it to criticize, defend, justify, promote, and suggest moral concepts and to answer questions of morality.

In a nutshell, ethics will differentiate an action is right or wrong from the aspects of social norms while social responsibility is the responsibilities for management to decide and take actions that will contribute to the welfare and interests of society as well as the organization. Social responsibility is harder to understand as different people have different beliefs on improving society's welfare if compared to ethics.

Utilitarianism Theory

Utilitarianism theory was discussed by two different theorists. The theory was first developed by Jeremy Bentham. It defines morality in terms of the maximization of net expectable utility for all parties affected by a decision or action.

According to another British philosopher, John Stuart Mill, utilitarianism means the view that "an action is right in-so-far as it tends to produce pleasure and the absence of pain". He also says that the basic principle for this theory is actions are right to the degree that they tend to promote the greatest good for the greatest number.

However, both men have different opinion toward what "the greatest good" is. Bentham states that it is the inclination to enhance or reduce pleasure or cheerfulness. There are no differences between pleasures or persons because all measurement is quantitative. For Mill, the good can be defined as well being and he argued that there is not just quantitative but also qualitative measurement in measuring different types of pleasure. Yet, they have same opinion on the word "the greatest number". They claim that it is a theory whereby it tends to expand benefits not only to the self but also to others. (Charles, 1997)

In present days, the theory is being widely used in the society where it often related to ethics on one individual in the society. It can also be the guidance for personal action as well as government on the maximization of the good. It is a code for personal and public action in order to make sure that some actions taken will not create a negative impact towards the society on a government level. It is better to choose policies which will decrease the overall harm to the majority.

Objectives of Research

The researchers aim to define the terms ethics and social responsibility as well as find out the differences between the two terms throughout the study. Besides, the researchers hope that they can find out as well as know more about the utilitarianism theory since it is closely related to ethics and social responsibility that discussed by the public nowadays. Thus, it is important for the researchers to define the public perspectives towards ethics and social responsibility of an organization in the today society.

Literature Review

When one mentions about ethics and social responsibility, one will definitely link the two terms to Corporate Social Responsibility (CSR). Thus, the researchers tend to use CSR as one of the examples that relate to ethics and social responsibility. CSR refers to how a company runs their business by producing positive impact to the society instead of just thinking to gain profit from the consumer (Baker, n.d.). It is an act that considered as ethical and giving back rewards to the society through social responsibility.

According to the working paper that written by Smith and Nystad (2006), they categorized CSR in two different group which are ethical CSR and economic CSR. They analyze the motives of the company in performing CSR and differentiate economic CSR based on their implementations on social activities to achieve the economic goal as well as ethical CSR which states that they engaged in CSR to form a superior society by doing all good deeds. Most of the companies that performed CSR will bring benefits to the society like by helping the poor that live in rural areas, lend a helping hand in environmental issues like recycle and supporting green campaigns, etc as well as provide scholarships for students and so on.

Economic CSR means that company performs CSR to make profit and view it as a marketing tool. However, the researchers state that economic CSR cannot be said that it is not ethical. They indicate that the company needs profit maximization in order to give back benefits to their stakeholders such as employees, governments, consumers, shareholders and so on. The company focuses on the economic perspective due to it is an organizations' responsibility to bring profit to the shareholders. Although a company conduct economic CSR to increase the good image of their brand may not considered as ethical, the researchers uttered that it can be explained based on the utilitarianism theory. The working paper that written by Smith and Nystad (2006) states that:

The philosophy of utilitarianism and the classical statement of this tradition has been one of the most common accepted ethical theories in business (Crane & Matten, 2004). It has been powerful in modern economics and it continues to be an influential theory today (Beauchamp & Bowie, 2004; Crane & Matten, 2004). Utilitarian reasoning is especially influential in the aria of economic, public policy and government regulation (Des Jardins, 1993).

The basic in utilitarianism can be defined as follows:

An action is morally right if it results in the greatest amount of good for the greatest amount of people affected by the actions (Crane & Matten, 2004:84).

In general conditions utilitarianism tells us to maximize the overall good or to make the greatest good for the greatest number (Des Jardins, 1993). Therefore utilitarian theory rests two basics - a description of the good and the rule for judging all acts and decisions in terms of that good. The rule tells us to look at the consequences of any particular action and judge the ethical standing of that action in terms of those consequences (Des Jardins, 1993). If the action tends to maximize good consequences it is an ethical right action, and if not the actions is wrong. (pg. 9 & 10)

Smith and Nystad (2006) have the opinion that utilitarianism theory was applied in the common business ethics nowadays. It is significant in many aspects such as the government and public policy, economic, etc. The theory stressed on the consequences of an action taken whether it will bring benefits to the majority or vice versa. The phrase "maximizes the benefit and minimizes the harm to the majority" is the main point of the utilitarianism theory. However, some of the economist critics that utilitarianism may not be correctly applied in CSR since they says that one cannot predict the pleasure or harm that will bring to the public after taking an action. They do not agree as some things are in intangible form and people cannot measure the value of it. For instance, health. They also claimed that some actions may be beneficial for the society in the present days but may not be worthy to do it for the next generation.

Meanwhile, ethical CSR refers to an organization conducts CSR based on ethical perspectives. It is often used to strengthen the relationship between the organization and society as well as to increase the reputation of the company. The company makes decision whether to take an action based on the ethics and social norms that formed in the society. Although social norms are not laws and regulations that set by the government, it can be said as another type of "moral laws" that followed by the majority in the society. An argument claimed that companies ought to have a payment back to the society since they make use of the resources from the society such as infrastructure, land, animals, air and so on. It argued that it is the social responsibility of a company to give a payment back to the society. In this case, the researchers discovered that the theory developed by Immanuel Kant can be applied in ethical CSR. Kant mentioned that every action taken by a human should be based on good will. It is the "will" that determines the motive for a human to take certain steps. He also indicates that even though the terms like wit, kind, responsible, courage, etc are respective and acceptable in many aspects; all these are still based on the good will of a person whether the action taken is right or wrong.

Thus, the researchers choose Coop, a well known member-owned food retailer organization in Norway as an example to determine the company is performing ethical CSR or economic CSR or both. They aim to identify the real ethics and social responsibility of Coop. The corporate social responsibility of Coop focuses on their members. The company gives their members economic advantage in advance, but they also concerned about the ethical business, principles as well as human rights for their sustainable expansion.

Yet, Coop may be perceived by the public that they are using CSR as a marketing tool if we view it from the perspective of economic CSR. However, with the evidence that the company care for their employees by helping them to gain employees right, profitable salary and earn a living, it is said that the company had done a good job and being responsible to their staffs. Moreover, the company pays attention on environmental and social concerns. Therefore, it can be concluded that Coop is being ethical in their business and have social responsibility towards the stakeholders by giving them economic profits as well as the public by helping on current issues around the globe including environmental issues and all kinds of social problems (Smith & Nystad, 2006).

In the following paragraphs, we will be discussing about an article entitled "The Culture of Corporate America".

The Culture of Corporate America

This article studied about corporations using the utilitarianism theory for the sake of themselves only which is to maximize the goods within internal public. They are doing Corporate Social Responsibility (CSR) based on their own profit instead of ethics or moral values in business perspective. However, the case study shows that corporation can do well in their business if utilitarianism theory expanded to concern more towards their constituencies and its most important stakeholders.

Corporations are seeking for profit in their business nowadays. Researchers conduct a study on Joseph R. Desjardins, a scholar of ethics and business. He said that standard model of market economics has direct implications for the social responsibilities in business. What is often referred to as the model of CSR argues that business managers have primary responsibilities to maximize profits within law (DesJardins). It means that corporation are putting their goal on profit making. They are profit maximization.

However, when it comes to a question of how do the corporate leaders make decisions based on ethical and moral issue, most company are unable to do it well in their business since profit maximization is put ahead of any decisions of moral and ethical values. The article also discuss about utilitarianism theory may bring a bad impact because the goal of CSR increase the good for themselves only, that is to make profit (Tyler, 2008). They are expanding the good or benefit to themselves since this theory is talking about giving the greatest good and worth consequences to the majority. Therefore, corporations maximize their profit while creating more social problem such as pollutions, health problems and so on. It can be concluded that the standard model of CSR is seen as an unethical way in utilitarianism theory.

The study comes to another point of view where research is been done on Whole Foods Market, the world's leading organization in producing natural and organic foods. John Mackey is the CEO and eco-founder of the company. He presents argument against the researcher. He agreed that investors are seeking to make profit in their business. However, he equally believes that the corporation should try to create value to all its areas and regions. He emphasizes it on six main stakeholders who are the customers, team members (employees), investors, communities and the environment. His company extends help to the community by making donations whereas 5% of the total sales throughout the year will be donated to non-profit organizations in the state. He strikes for public happiness and pleasure. He built Whole Foods a good reputation in becoming a more positive, thriving and utilitarian way. They want to tell the society that they are not only gaining more profit, but also giving benefits to the community. John Mackey prefer "healthy" business model than the profit maximization model because they encourage and tap into more powerful motivations than self-interest alone. The way he does business will triumph over time by winning the competitive test of the marketplace. He believed that adhere stakeholder model in deeper business purpose will dominate in the future market.

Throughout the article, Mackey has proved that the study that done by the previous researcher is incomplete (Tyler, 2008). Utilitarianism theory can be useful if CSR could be expanded to include the values of all stakeholders and stockholders. CSR is not playing a role as a marketing tool of a company; it strikes to be ethical and social responsible to their business as well as the community.

Conclusion

In a nutshell, ethics and social responsibility are closely related to Corporate Social Responsibility (CSR) in the business field. Companies actively engaged in CSR activities in order to show that they care for the society and do all good deeds to maximize benefits to the community. Sometimes, considerations are needed to identify whether profit maximization should comes in before ethical decisions or vice versa. Yet, no matter what are the decisions made, the management concerned about the welfare of their members as well as the community.

Utilitarianism theory are proved being applied in the common business fields since every actions that taken by a company to show their social responsibility are concerning to all the stakeholders of the company. They will predict the consequences of an action whether the decision will lead to gain a higher profit which in turns lead to the ability to pay the employees and shareholders or bring them to bankruptcy. They calculate all the costs and benefits to show that they are sincere in bringing benefits to their internal and external public.