Unregulated businesses have greater potentials to thrive, as they did during the laissez-faire capitalism. However, the excess of freedom can also sanction corporate corruptions in societies. Hence, ethical business practices have been imposed on businesses in order to protect consumer rights. Although such laws are essential to the wellbeing of consumers and societies, they are not always fair for some businesses. For instance, Canada’s Anti-Spam Legislation (CASL) illegalized the unwanted and spam commercial electronic messages on July 1, 2014. Furthermore, it obliged businesses to earn legal consent before using any means of electronic media to publicize or promote their products or services.

Although this law is essential to abate, if not eliminate, e-frauds, it still pressurizes smaller businesses more than larger corporations. All the businesses received a deadline of six months to prepare for the execution of CASL. Unfortunately, the smaller businesses lacked the technology and budget required to alter their marketing strategies within that time span. On the contrary, large corporations had better resources available to adjust their strategies parallel to the new regulation.

Conclusively, the impact of business laws could be debatable: they promote consumer rights and endorse fairer practices, but they also give larger corporations a stronger competitive advantage over smaller businesses.

Citations

“New Anti-spam Law.” The Globe and Mail. N.p., 24 Mar. 2014. Web. 30 Sept. 2014.

“The 45-Minute MBA: Business Law.” Margin of Excellence RSS. N.p., n.d. Web. 30 Sept. 2014.

Do ethics really hurt profits, or could they actually help elevate an enterprise’s growth in success and value? An interesting blog, by Farwah Ahmed, discusses whether Corporate Social Responsibility is beneficial or detrimental for a business. In her conclusion, the author states that social responsibility does augment profits. Then, why do some businessmen and strategic thinkers allege that ethical behaviors can abate profits?

Consider Company X and Company Y to be two competitive enterprises, both producing soaps and being equally popular. Company Y discovers a substitute chemical that can substantially lower its production cost; however, this chemical is not too great for one’s skin and could cause skin irritation. Company Y still decides to use that chemical to reduce its production costs, lower its prices,  and to increase its demand among consumers. For a while, Company Y will experience an increased demand, while Company X would suffer a competitive disadvantage despite its ethical production. However, in a longer span, when skin professionals conduct researches and consumers realize the difference in product quality, Company Y can potentially suffer a massive downfall in their profits and value.

Similarly, if any company gets exposed for conducting unethical practices, then they could lose their profits and brand name for good. Whereas, creating trust among consumers can increase a company’s value and its long-term profits.

Work Cited

Ahmed, Farwah. “Corporate Social Responsibility – Beneficial or Detrimental.” Web log post. UBC Blogs. N.p., 10 Sept. 2014. Web. 2 Nov. 2014.

“Building Sustainable Value through Fiscal and Social Responsibility” – Ivey Business Journal.” Ivey Business Journal. N.p., n.d. Web. 16 Sept. 2014.

Business ethics are fundamental to any corporate entity that aspires to create value and notable reputation in a public platform. However, despite its significance, ethics are often disregarded by managers and businessmen who tend to prioritize profits over long-term value. Apart from potentially harming the society, this approach could also hurt the business itself. In the past, a plethora of corporations and businesses have breached ethical codes in attempts to maximize their profits. However, once their misconducts get unveiled, these businesses could lose the trust of their customers, suppliers, creditors, and stockholders. With that stigma and the loss of value, a business is less likely to earn desirable profits.

Consider the stigma that Apple faced, in 2013, for illegal and unethical staff treatment in its Chinese factories. The corporation was accused for discriminating the staff, providing poor and hazardous working conditions, imposing longer working hours, and for not paying the overtime wages. Newly employed staff, including those who had perilous jobs, received inadequate training of only two hours. These reports portray violation of workers’ rights and unethical business practices. Although Apple has promised to investigate the case, the violation of business ethics could hurt the company’s long-term value and damage its reputation.

Citations

Trendal, Sam. “Apple Supplier Accused of ‘illegal and Unethical’ Staff Treatment.” CRN Channelweb. Ncisive Financial Publishing Limited, 6 Sept. 2013. Web. 9 Sept. 2014.

“Business Ethics.” Ventism. 18 Feb. 2014. Web. 10 Sept. 2014. <http://2.bp.blogspot.com/-IyTgG-5IxT8/UwOAMxYEFkI/AAAAAAAC7Js/XTq2z8Cuk74/s1600/ethics1.gif>.