Business Ethics And Stakeholder Analysis - Myassignmenthelp.Com

Question: Discuss about the Business Ethics And Stakeholder Analysis. Answer: Strategic Stakeholder Synthesis According to Goodpaster (1991) strategic stakeholder synthesis involves going a step further in decision making. These measures include the actual decision making and its implementation. The synthesis provides a cycle on how to move from the process of stakeholder understanding to coming up with a resolution. Further, Goodpaster supposes that businesses that operate by making use of strategic stakeholder synthesis do not qualify in introducing ethical issues during decision making. This is because the strategic stakeholder is not eligible because it is non-moral (Goodpaster,1991). This is because consequences that result from ones actions to others are confused with what people regard as moral. Being moral constitutes avoiding unfairness to the affected since it is wrong despite the retaliatory potential of the affected. Goodpasters Nonfiduciary Approach Goodpaster suggests adopting a new stakeholder synthesis by considering the morally nonfiduciary obligations entitled to the third parties. The obligations involve duties such as not coercing, not lying, cheating, or even stealing. These obligations are contained in the legislative, regulatory, and judicial arguments which constrain business activities that are profit-driven. The nonfiduciary approach is different from both multi-fiduciary and strategic stakeholder approach. Stakeholders approach gives more concern to the stakeholders as factors which may have an influence either positively or negatively to the economic interests. Multi-fiduciary approach views the stakeholders as separate from their economic, contributory, or their legal influence. However, non-fiduciary approach entails obligations surrounding the third parties, and which are morally significant. Nonfiduciary Account of Business Obligations According to Goodpaster's nonfiduciary approach, it offers enough protection for the stakeholders interests rather than those of the shareholders. This is because it offers an understanding of the corporations conscience as being logical and a moral extension of the principals. The approach has further offered a moral posture that respects both the fiduciary and the non-fiduciary between the managers and the stockholders. The nonfiduciary approach avoids the problem of treating the stakeholders as regular corporate ends. This is enhanced by identifying the ethical relationship between the stakeholders and the management that is neither too weak nor too strong. Introduction of moral reasoning consistent with Ruders belief helps in protecting the legitimacy of the private sector. The economic mission can be maintained provided that it is in line with the fundamental moral obligations. Violation of Moral Duties Based on the radio program, the primary Australian supermarket chains do violate primary moral duties such as stealing and harming their suppliers. It is evident that the margins of the food producers are squeezed by the supermarkets with the intention of attaining higher profits ("Casualties in the supermarket war," 2013). The supermarkets have gone a step further to blackmail the suppliers who have provided evidence to the ACCC. Additionally, they request for more money that is to be spent on products to keep it longer on the shelf. Moral Duties The Australian supermarkets owe specific moral duties to its suppliers. The supermarkets should limit themselves from harming the suppliers by squeezing their margins. They should target at cutting prices of their products by for example absorbing discounts of the products through efficient operation of their business rather than squeezing margins of the suppliers. Also, the supermarkets should not try not to coerce their suppliers as evident in the radio program. According to the program, there is a return on sales expected by the supermarket from the suppliers products, which if not attained, a request is made on a lump sum of money that is passed on as payment of such a shortfall. Mind the Gap and Business Ethics Mind the Gap payment that was requested by Woolworth form the supplies does not comply with the business ethics. The supermarket demanded payments from its suppliers which it had no right to do so ("Google Scholar," n.d.). Additionally, Woolworth threatened to harm its suppliers if they did not comply with the demand. According to the ACCC, the supermarket engaged in unconscionable conduct since it demanded payments which were not included in their supply contracts. If a supplier is entitled to such arbitrary demands, it is difficult for them to make investment decisions in the future due to financial uncertainties (Sarah Danckert, Sue Mitchell and Catie Low, 2015). As a result, it is right to say that Woolworth was not consistent with the business ethics. Mind the Gap and Stakeholder Theory Mind the Gap payments is consistent with the stakeholder theory since there are suppliers who are affected by the objectives of the supermarket (Low, 2016). This is because Woolworth makes demands from the suppliers to pay a certain amount of money which they have to pay if they want to be seen to support Woolworth. Every decision made by Woolworth affects its suppliers while in other instances, the suppliers influence the decisions that are made by Woolworth. References Casualties in the supermarket war. (2013, March 20). Retrieved from https://www.abc.net.au/radionational/programs/backgroundbriefing/2013-12-29/5158628 Goodpaster,K.E. (1991). Business Ethics and Stakeholder Analysis.Business economic Ethics Quarterly,1(01), 53-73. doi:10.1017/s1052150x00008782 Google Scholar. (n.d.). Retrieved from https://scholar.google.com/scholar?hl=enas_sdt=0%2C5q=K.+E.+Goodpaster%2C+%E2%80%98Business+Ethics+and+Stakeholder+Analysis%E2%80%99%2C+Business+Ethics+Quarterly%2C+Vol.+1%2C+No.+1.+%28Jan.%2C+1991%29%2C+pp.+53-73.+btnG= Low,C. (2016, December 8). Court clears Woolworths of 'unconscionable conduct'. Retrieved from https://www.smh.com.au/business/retail/woolworths-did-not-break-any-law-with-mind-the-gap-scheme-federal-court-20161208-gt6t1t.html Sarah Danckert, Sue Mitchell and Catie Low. (2015, December 11). ACCC accuses Woolworths of unconscionable conduct. Retrieved from https://www.smh.com.au/business/retail/accc-accuses-woolworths-of-unconscionable-conduct-20151210-glkfz2.html