Ethical Considerations Flashcards
All 16 cards in this deck
Give two ways a business can behave ethically.
Any two of: good working conditions for employees; donating funds to local communities; paying suppliers on time; using fair trade resources; fair advertising; not testing on animals.
What is fair trade?
Buying from producers in developing countries at a price that covers their costs and gives them a fair income.
How can a business make sure workers in its overseas factories are treated ethically?
By setting a code of conduct the factories must follow, e.g. safe working conditions and no child labour, and inspecting them regularly to check it is kept.
What are business ethics?
Doing what is morally right in business decisions, e.g. paying suppliers fair prices.
What is the trade-off between ethics and profit?
Acting ethically usually raises costs, so short-term profit may fall even though it can attract customers and raise revenue later.
Give one benefit to a business of sourcing products ethically, e.g. paying fair trade prices.
Ethically-minded consumers may pay a premium price for the products, increasing revenue and improving brand image.
Name the five ethical considerations that affect business decisions.
Treatment of workers, treatment of suppliers, treatment of customers, how materials are sourced, and marketing decisions.
Give one benefit to a business of treating its suppliers fairly, e.g. paying a fair price on time.
Suppliers want to keep working with it, so its supplies are more reliable and it may get better terms.
What is the impact on a business of misleading advertising?
Customers lose trust and the brand image suffers, so customers are lost.
Give one impact on employees of a business having high ethical standards.
Improved motivation, because staff want to work for a business with ethical standards.
Give two examples of a business treating its workers unethically.
Any two of: paying unfairly low wages; forcing staff to work excessive hours; unsafe working conditions; employing children; treating some workers unfairly because of who they are.
Why is paying suppliers late an ethical issue?
It damages the supplier's cash flow, so a small supplier may be unable to pay its own bills and could even be forced to close.
Give one example of a business treating its customers unethically.
Any one of: charging an unfairly high price, e.g. not passing on a fall in its own costs; selling fake or unsafe goods; making false claims about a product.
What is ethical marketing?
Marketing that is honest and does not mislead, harm or offend, so customers have accurate information to make good choices.
What is the difference between a legal requirement and an ethical decision?
A legal requirement is something the law forces a business to do. An ethical decision goes beyond the law because the business believes it is right, e.g. paying staff more than the minimum wage.
Why can behaving ethically make it easier for a business to recruit and keep staff?
Workers trust an ethical employer, so fewer leave, and its reputation attracts job applicants, which cuts recruitment costs.