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Current Ethical Issues in Business

Paper Type: Free Essay Subject: Business
Wordcount: 1328 words Published: 23rd Sep 2019

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Current Ethical Issues in Business


Ethics is an important ingredient in business. Many businesses have a corporate code of ethics in which they outline the principles that guide behavior in the organization. Even with those stipulations, businesses frequently face challenges regarding the breakage of the rules in their codes of ethics. At times, businesses pay penalties for failing to comply with governmental or legal codes of ethics. In the following section, the paper explores some contemporary ethical issues such as executive pay, corporate social responsibility, globalization, business ethical climate, health care, etc.


            One of the contemporary ethical issues in businesses regards executive pay. Over the recent past, chief executive officers of some of the Fortune, 500 companies have earned monthly salaries to the tunes of tens of millions. In the United States, executive pay has raised to more than 270 times that of an average worker (Umoh, 2018). The ethical part of the discussion regarding the high pay includes the role of the CEO in the process of deciding his or her pay. As members of the board of directors, CEOs could take part in deciding their salaries and other allowances. A second point is a justification for such high payments bearing in mind the contribution of junior and subordinate employees (to the company’s productivity and profits). As much as companies want to attract talent in an increasingly competitive business world, I think businesses should reconsider the contributions of all employees and not just the CEO. That way, there will be fairness in decision-making. If businesses view productivity as a product of teamwork, perhaps they would not pay the CEO such huge amounts at the expense of the average employee who works for 40 hours or more for the sake of the business. Even so, I cannot give a preferable figure because companies differ in their production capacities, the number of employees, and the profits they make. Only I believe that companies should consider other employees in the determination of CEO salary and not the perceived role of the CEO in the success of the business.

Climate and Corporate Social Responsibility

            The responsibility of reducing the footprint applies to all companies. Bill McKibben once wrote a book in which he reminded the audience of prior warnings of the dangers of climate change. In the book, Bill presents a handful of facts and statistics showing the rates of increment in the carbon footprint over the years. Companies represent one of the groups of the primary stakeholders to blame for the increment in the carbon footprint, although the author invites everyone to revisit their contributions to that trend and to make decisions regarding the future (McKibben, 2010).

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            As the discourse of climate change continues to intensify, many governments have continued to strengthen regulations regarding manufacturing and other business activities that increase the footprint. Both the private and public sectors have intensified their initiatives for keeping the footprint as low as possible. The corporate greening campaign is a fruit of those incentives. Through the initiative, companies call upon manufacturers and other players to ensure that production activities release the lowest levels of greenhouse gases (Clegg, Kornberger &Pitsis, 2015). Some companies have shown leadership in the campaign. Apple, for instance, ensures that business partners, especially those that supply raw materials, practice green business.


            The global movement of business presents new opportunities and threats to companies. Some of the new locations present different cost structures for the company. In China, for instance, the average wage happens to be lower than that of the US. A US-based company that sets up a new establishment in China, for that matter, should not take advantage of the wage difference to exploit workers in the new location. Even though government regulation might not force the company to maintain high wages, employees in the new location could reiterate once they learn the company takes advantage of the situation. In such case, therefore, the business should mind the ethical values of equality, transparency, and the regard for the human to guide its decisions before making a loss as a result of strikes or other unfavorable deeds by employees.

Health Care

            The costs if health care are high. Businesses and employees have different perceptions of the qualities of a good health plan. To the company, a health plan that enables the company to save as much money as possible is the most attractive. To employees, on the other hand, a health plan that enables the employee to pay the least deductibles when they visit the hospital is the most attractive (Snell &Morris, 2016). However, both organizations and employees agree on the need for proactive measures rather than treatment which leads to huge expenditures. In that view, companies should encourage their employees to practice measures that reduce the incidences of disease. Such measures include the reduction of obesity through physical exercises. Also, companies should encourage their employees to take insurance policies to reduce expenditure in the event of disease.

Positive Ethical Climate

            Companies should strive to ensure that employees uphold ethics. The corporate code of ethics I mentioned above provides a good starting point for the process of keeping a healthy ethical climate. Also, companies should practice transparency (openness), honesty, trust, etc. Some of the ways the company can keep that spirit are by ensuring fairness and equity in promotion procedures. Also, the company should give equal opportunities to female and male employees and not sideline any of the genders. The company should practice fairness in the distribution of benefits. Also, the company should encourage equal opportunities regarding recruitment and retention of employees.


            A company’s mission and vision statements should be the primary drivers of the practices above. In addition to the vision and mission statements, the company should also have a values statement envisioning all the above features. Companies should also asses the environments in which they operate to make appropriate decisions regarding language and other practices that affect the way the community receives the company. Mere compliance to government regulations should be the rarest attitude from the company.


  • Clegg, S. R., Kornberger, M.  & Pitsis, T. (2015). Managing and organizations: An introduction to theory and practice. Sage.
  • McKibben, B. (2010). Making a Life on a Tough New Planet. Henry Holt and Company.
  • Snell, S. &Morris, S. (2016). Managing human resources. Cengage Learning.
  • Umoh, R. (2018). “CEOs make $15.6 million on average—here’s how much their pay has increased compared to yours over the year.” Retrieved from https://www.cnbc.com/2018/01/22/heres-how-much-ceo-pay-has-increased-compared-to-yours-over-the-years.html


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