Business ethics and responsibilities

Business Ethics in Relation to Laws and Morals

Business ethics refers to a company’s code of conduct, which includes both rules and morals that regulate personnel in the business world. Laws, on the other hand, refer to what is legal and the written standards that must be obeyed in society, whereas morals refer to the rules that people construct as a result of cultural norms and values (Grace and Cohen).

Ethical Development Displayed by Barclays Executives

The level of ethical development displayed by Barclays executives while manipulating LIBOR interest rates appears to be convention morality. It is the process by which a firm behaves in accordance with societal expectations. Sometimes marketing executives make self-serving moves that benefit the company. Normally it is because of a peer influence. In the case of Barclays bank, it decided to put the interest rates too low so as to portray an image as being financially stable and built false confidence among its customers, and also maintain the reputation of the bank from negative speculations. Within the same period, other banks had also manipulated the interest rates for a selfish reason. We can say, somehow the bank was tempted to lower the rates as it assumed other banks would also manipulate theirs.

Neglecting Social Responsibility

Barclays bank neglected its social responsibility with the manipulation. Usually, a company is supposed to be wholly open to both its clients and any other body depending on it for services. In this case, they would have submitted high-interest rates which would have cautioned that the bank is not as economically strong as it usually is. This would have ensured both investors and loan seekers are not misled in a very volatile market. Also, the company should not be so much into just making abnormal profits. Such minds of abnormal profits lead to exploitation of consumers.

Moral Development Ethics and Post-Conventional Morality

If the banks marketing managers had questioned themselves if manipulating the LIBOR to increase company profits was the right strategy to execute in the long run. In such case, the moral development ethics would have been post-conventional morality. Whereby the manager can consider how his decisions are going to hurt its clients. It thus implies that the central theme is to ethically behave and do what is morally upright, irrespective of what others think of the company. Also, by the fact it is not influenced by what other banks would do implies such a firm is mature. Definitely, from the case study, the company should not have colluded with other banks to demonstrate its maturity levels.

The Importance of Ethics and Social Responsibility

From the case study, the importance of ethics and social responsibility is that the company creates a good reputation (Du et al.). A good reputation will build confidence among its clients, in that all information it gives it is trusted. This leads to attracting more customers who definitely will improve the economic health of the bank. Also, you avoid scandals that lead to penalties. Penalties drain finances of the company as it has to defend itself in courts, straining the business’s profits. Also, it can result in unemployment to the marketing managers. From the article, it was suggested that the so-called banking leaders who apparently have no ethics or integrity should be wiped out.

Actions Regarding Corporate Social Responsibility (CSR)

The actions regarding Corporate Social Responsibility (CSR) that Barclays could have engaged in after the scandal broke to make things right. And further, it could ensure that such an event would not happen again would be to set its rates as high as it was supposed to be so as to let everyone know it is not strong and it is too volatile to invest in it. Also, it ought to have refunded back its client what it lost during that period of fraud. This would put a smile in the customer and even with them back for service once it is economically healthy. Also, ensure the marketing manager during the scandal are all fired and replaced. This would give the client confidence that the company is done with the lot bringing rot in the business (Searcy).

Works Cited

Du, S., Swaen, V., Lindgreen, A., & Sen, S. “The roles of leadership styles in corporate social

responsibility”. Journal of Business Ethics, 2012

Grace, D., S. Cohen. “Business Ethics” 3rd ed. Melbourne: Oxford University Press, 2005

Searcy, C. “Corporate sustainability performance measurement systems”: a review and

Research agenda”, Journal of Business Ethics, 107(3), 2012 pp. 239-253