Business Ethics and the Legal Environment. Business & Marketing Essay

Business Ethics and the Legal Environment
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Introduction
Ethical relates to morals and principles of morality which pertains to right and wrong. Ethics help in guiding organizational values, behaviors, and culture. Unethical practices are common in organizations and companies where getting money appears to take precedence over ethical decision making. Corporate ethical failures usually are costly for organizations, it attracts billions of dollars, and it also destroys the relationship between the company and other stakeholders such as customers and investors. Additionally, when a lack of ethics in business becomes public knowledge, the business loses its credibility and this may result in the downfall of a firm. This paper examines the issue of ethical failure on Facebook.
I was interested in Facebook because of the high number of people and a large amount of personal data the company hold. In recent years, Facebook has been associated with several issues related to data breaches and the company also permitted an academic research team to experiment with Facebook users. Before violating people’s trust, Facebook was regarded as clean and without controversies. Facebook’s culture is mainly based on the company’s core values which include being open, building social value and focusing on impact (O'Connor, 2019). Additionally, the firm aligns the behavioral expectation of its employees on these values. Also, the senior leadership helps in shaping the company’s culture by acting as a role model. Facebook founder and CEO, Mark Zuckerberg, role models Facebook’s value of being open.
The article “Entrepreneurship and Business Ethics: Implications on Corporate Performance” by Ogbari and colleagues examines and explains how business ethics may impact corporate performance. The authors explain that ethical practices in a company entail the behaviors which a firm must adhere to when performing its operation. Additionally, ethics determines who a company relates to the world and how it interacts with individual customers. Some firms have gained an undesirable reputation just by being in business. Before the issue of the data breach was noted on Facebook, the company was regarded as loyal to its customers, and this led to the number of users going up. However, over the years, Facebook has gained a bad public image because of its practices which have violated the privacy of its users.
The finding of the study conducted by Ogbari et al. indicated that fairness and equitable activities have a significant implication on profit margin. Additionally, the research found that there is a positive relationship between adherence to ethical standards and sales (Ogbari et al., 2016). This means that a company which operates unethically may lose its customers thus recording low profits. Facebook has faced significantly because of its ethical failure and users are adopting other social media platforms such as Snapchat and Instagram which have not been involved in fraudulent and unfair business activities.
The article “Business Ethics and Corporate Social Responsibility for Business Success and Growth” by Adda, Azigwe & Awuni (2016) maintains that ethical practices and...