Costs
1 Investors Ethical businesses are open and honest about all aspects of the firm. This may reduce the amount of money that investors are willing to invest in the business.
2 Higher Production Costs
Production costs for socially and environmentally conscious businesses may be higher as they tend to:
- Pay employees a higher wage
- Pay suppliers a fair price for their raw materials.
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MEETING ETHICAL, SOCIAL AND ENVIRONMENTAL RESPONSIBILITIES
Benefits
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3 Marketing Businesses can use awards for socially or environmentally responsible behaviour in their marketing material.
4 New Products Changes in legislation may open up new markets for products or services, e.g. energy-efficient light bulbs. This can lead to increased sales and profits for the firm.
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MEETING ETHICAL, SOCIAL AND ENVIRONMENTAL RESPONSIBILITIES
Costs
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3 Staff Training Staff training should be provided to ensure that employees understand their ethical, social and environmental responsibilities. This may reduce workplace productivity as it takes staff away from their day-to-day jobs.
4 Different Ethical Standards
The business may lose out on business
opportunities, sales and profits by refusing to lower its ethical standards. Competitors with lower standards may increase their sales and market share.
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Key Terms
- business ethics
- ethical audit
- whistleblowing
- code of ethics
- social responsibility
- environmental responsibility
- pollution
- deforestation
- Environmental Protection Agency (EPA)
- sustainable development
CREDIT SLIDE
- Shutterstock
- iStockphoto.com
- Alamy.com
- Environmental Protection Agency
Thank you for your attention
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