Business Ethics vs. Social Responsibility
How to distinguish between business ethics and social responsibility
Two terms that are often used interchangeably in society are business ethics and social responsibility. It is easy to understand the concept of social responsibility, but a little harder to understand the concept of ethics. Companies carry out social responsibility by engaging in activities that are beneficial for the community at large. Ethics depends more on conscience and it is more individual in nature. The two terms do not overlap completely and there are differences between them.
About Business Ethics
It is important first to understand the meaning of the word “ethics”. It comes from a word “ethos” in the Ancient Greek language that means “moral character”. It refers to a sense of right and wrong – good and bad. It is often hard to apply this to business because the primary objective of business is to make a profit by selling products and services to others. The shareholders of the company also have to be kept in mind because it is to them a share of the profits are paid.
Business ethics refers to the way in which a business behaves towards a community or a group of people. If they are only interested in making money and don’t care who gets hurt in the process, then there is no business ethics involved. Such people do not care about the community or how their practices affect society.
Companies that do not practice good business ethics can be charged with illegal activities and are penalized by the law. However, such occurrences are rare because they are so hard to prove and the fines associated with engaging in unethical behavior do not have a large effect on the overall profit.
About Social Responsibility
Everyone is expected to behave in a socially acceptable manner. The same expectation exists of businesses. Even though a business exists to make money and to have profits for the shareholders it is still expected to be socially responsible for its actions. An example of this would be a business that employs a disabled member of the community in a position that this person is able to do. Companies are not obligated to try to reduce pollution, but there are those who do and are socially responsible.
The difference between business ethics and social responsibility
Business ethics and social responsibility are sort of contradictory because although companies do put forth a front that makes them seem socially responsible in the community, their business practices are not completely ethical. This is because something that benefits society may not benefit a business and vice versa. When society acts in a conscious manner, it forces business to behave ethically.
Selling alcohol and tobacco products may not be illegal, but it may go against the beliefs of a community. While it is fine for adults to engage in such activities, it not ethical for businesses to sell these products to minors.