For successful business any enterprise must be able to adapt and respond to the challenges posed by the social environment, to make the environment more favorable to the organization. One’s goal in this paper is to consider ethics and social responsibility in strategic management.
To achieve this goal, the paper was organized into two sections. In the first section, one should investigate ethical principles for manager. In the second section, one should discuss the meaning of social responsibility, its pros and cons.
Ethical Principles for Manager
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Social responsibility and business ethics imply that the objective of the enterprise is satisfaction of the needs, requirements and interests of consumers more effectively and efficiently, providing always maintaining and strengthening the well-being of consumers and society.
Ethics includes different principles, and they evaluate the behavior of a person or group as correct or incorrect.
If we talk about the management ethics includes the principles of the moral evaluation of a behavior of manager to the team, the organization, partners, customers, competitors and the government.
Ethical Principles establish acceptable and unacceptable behavior of the manager from the point of view of morality, even if it does not violate the law. In contrast to the normative behavior of manager, regulated by written laws and regulations, ethics cannot be legislated, and therefore it is not compulsory. However, the success of management depends on the observance of these rules, and their violation may cause irreparable damage to the organization.
These common cases are examples of the unethical management (Gebler 3):
- immoral organization's goals with the ethical process of their achieving;
- unethical techniques to achieve very noble goals.
In some cases ethic is regulatory, which facilitates its implementation. The observance of the law can be an example (law-abiding is ethical). Deception, fraud, corruption, theft, property damage, abuse of power, defamation, extortion, forgery, negligence in work, deliberate violation of safety rules are the both immoral and contrary to the law(Lawhorne 4).
In most cases, ethical behavior of a manager is not regulated by law. Examples of violations of moral norms (without criminal prosecution, but unacceptable for a manager) are:
concealment of discoveries and inventions (if it is profitable for company) negligence of health and feelings of staff, violation of a verbal agreement, immoral behavior in everyday life of a company (harassments); recruitment on the basis of personal relationships, gossip, innuendo (insidious rumors), humiliation of subordinates, humiliation for superiors, denial of accepted obligations, accepting gifts from subordinates, disclosure of trade secrets, the disclosure of the source of information obtained by the trustee, delays of a debt.
Social, cultural, and economic development imposes new moral and ethical requirements for managers. Today, ethical management include: negative attitude to class, race, or ethnic antagonism, respect for women, recognition of her equality with men, respect for veterans and the elderly, respect for the authorities and leaders, respect to the results of the labor of others, respect to other's grief, the desire for cleanliness and order, neatness in clothing. Unethical behavior is: disrespect for other people's physical shortcomings, disrespect for other people's opinion (if it is different from yours), disrespect for science, education and others' experience, violation of the rules of social behavior, discussion of the qualities and actions of a person in his absence, lack of poise, rudeness, swearing. manager should involve staff (manager has a direct obligation to involve especially himself) to ethical behavior. To achieve this purpose, ethical work (the study of ethics management, moral education of staff, monitoring compliance) should be planned and systematically carried out (Fraedrich& Ferrell 63).
Social Responsibility in Strategic Management
In addition to the necessity of ethical behavior important moral object of the manager is the problem of his social responsibility. Social responsibility of manager (management) is the execution of social duties by his organization, necessity to participate in the solution of social problems of the country on the voluntary basis (Tabije 2).
It should be mentioned, that there are some pros and cons of social responsibility. Social responsibility is voluntary, therefore it is different from the regulatory, legislative liability of manager. In contrast to the legal, social responsibility does not have strict normative regulation, the implementation of it is poorly developed. Many important types of social responsibility do not have sufficient legal basis (philanthropy, charity), so sometimes their economic consequences are not clear for manager. This causes his fear and as a consequence he rejects their implementation
Another difficulty is that the manager has to include additional costs in the price of goods and services, spending money on social programs. It gives the advantage to his rivals.
Pursuing free social programs, the organization is forced to deviate from its main market objectives - profit maximization. It can cause a partial phase-out of high-quality products, leaving the lucrative markets.
The implementation of social responsibility is initiated and accompanied by moral pressure of society. It breaks the most important principle of the market - the market freedom. In many cases organization loses its ability to make economic decisions independently.
But for all that, there are a lot of pluses in social responsibility. Managers can use for social programs part of the resources of the enterprise which is not profitable for the company at the moment. Very often social activity of the organization meets the response of the state in the form of various benefits and other forms of support (an advantage in public contracts, the release of part of the fees and rent). Social activity raises the prestige of the organization before society and other organizations. This creates a favorable environment for innovation and business strategically.
So, ethics and social responsibility are necessary for strategic management. Despite of some negative aspects they can bring a huge benefit for any organization.
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