ethical and social responsibility of entrepreneur

This may be due to a variety of reasons, including what researchers term a positive effect on business culture, stakeholders, and reputation.6 In other words, being ethical beneficially influences employees, investors, and customers. Chapter Objectives 1. Generating long-term value for shareholders, who provide the capital that allows companies to invest, grow and innovate. Equifax to Pay at Least $650 Million in Largest-Ever Data Breach Settlement., Ira Basen. INTRODUCTION. The settlement covers 147 million consumers, just under one-half of the population of the United States.8. (OpenStax) via source content that was edited to the style and standards of the LibreTexts platform; a detailed edit history is available upon request. Business. From an ethical theory perspective, Kantian or duty-based ethics emphasizes the underlying intent or reason behind a decision and whether that decision is good or bad. Read the following statement on the purpose of a corporation from Business Roundtable: Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. He also discusses the human ability to rationalize our behavior to justify it to ourselves. Thus, in this Special Issue, Pascal Dey and Chris Steyaert adopt a postmodern, radical humanist, approach to ethics based on the work of Foucault. (credit (a): modification of modification of "US Patent US381968A" by Nikola Tesla/Google Patents, Public Domain; credit (b): modification of Coke bottle patent by Unknown/Wikimedia Commons, Public Domain), (a) Published texts and artwork are granted a copyright, which will expire over time (usually a long period), as is the case with Thomas Paines seminal work. Small business social responsibility: Redrawing core CSR theory. Success may also mean treating employees, customers, and the community at large with honesty and respect. Organization Science, IP can take the form of a patent, a copyright, a trademark, or a variation thereof called a trademark secret. 2008). However, critical reflection suggests that this may be gained at a price. In our final section of papers, the person of the entrepreneur herself is more directly focused upon especially in terms of the social entrepreneurs position in relation to social entrepreneurial outcome. This means creating a business environment in which each member of the organization is encouraged, enabled, and supported to develop the ethical capabilities to habitually and systematically differentiate between right or wrong. What central point might constitute such a code? We respect the people in our communities and protect the environment by embracing sustainable practices across our businesses. An economic approach opens the question of a blurring of the difference between profit and not-for-profit social enterprises (Chell 2007); the motivations of social entrepreneurs; the impact of the market mechanism on business decision-making, weakening an ethical approach and raising concerns about the inadequacy of the neo-classical economic approach to business. Acting with integrity means we adhere strongly to a system of ethical values. 17, 467487. Both entrepreneurship and CSR have attracted increased interest in the early 21st century . Moore, G., & Spence, L. J. Ethical start-ups make ethics a core value of the enterprise. (2011) have acknowledged social value creation, defined as the primary mission of social entrepreneurship, as the most promising approach to set the boundaries around the concept. We are dedicated to serving as good partners to the other companies, large and small, that help us meet our missions. Regardless of its type, a firm has the exclusive rights to the ownership of its IP. Research on the performance of the Worlds Most Ethical Companies (WMEC) indicates a positive association between ethical conduct and successful long-term financial performance. What are the different ways in which social enterprises can deal with intangible aspects of the environment, in particular power and cultural norms, and how can this be carried out ethically? This information should be adequate, timely, and relevant to allow the recipient to understand the purpose and intent behind a product/service and to make a good decision about the value of that product/service. Within the process of scaling up, social entrepreneurs turn their attention to resource providers and other stakeholders, and run the risk of diluting the care offered to beneficiaries. In this special issue, we have attracted contributions from both the ethics and the entrepreneurship perspectives, and we would anticipate the readership to be similarly diverse. Both the business and employee need to follow these core values, so it's important to define a clear set that lasts long term. Taking somewhat more familiar routes for the business ethics field, Brett Smith, Geoffrey Kistruck and Benedetto Cannatelli assume an ethical framework based on moral intensity, and Begoa Gutirrez-Nieto, Carlos Serrano-Cinea and Juan Camn-Cala draw on ethical decision-making frameworks. Essentially, a commitment to treat with honesty and integrity customers, clients, employees, and others affiliated with a business. Massive Data Breach at Equifax: As Many As 143 Million Social Security Numbers Hacked., Stacy Cowley. This action is unethical since you are not giving the employer what they are due, which are your time, talents, and services in exchange for agreed-upon compensation. For example, as an IT consultant, do you recommend to a client that they buy a software product, when unknown to them, you own stock in that company? Seanor, P., & Meaton, J. It thus behoves us as researchers to consider this complexity before embarking upon research in social entrepreneurship and its complexity our objectives, orientation to and specific interpretation of the construct. Employees, for example, have an interest in producing expected work for their employer. Indeed, according to Choi and Majumdar (2014), it is complex, contested and may be conceived as a cluster of related constructs. 24, 407418. Dees, J. G. (1998). Entrepreneurs have a responsibility to consider the future ramifications of social innovation and business strategy, and to practice business ethics that prioritize the long-term health of society . These businesses often outperform their market expectations, both in periods of market growth and decline. To make amends to customers and clients in the aftermath of the hack, the company offered free credit monitoring and identity-theft protection. are not subject to the Creative Commons license and may not be reproduced without the prior and express written (2013) note that Social Entrepreneurship (SE), like its parent Entrepreneurship, has suffered the imponderable challenges of clarification, definition and differentiation. Morsing, M., & Perrini, F. (2009). As a result, in 2009, Eli Lilly was fined $1.4 billion by the office of criminal investigation of the US Department of Justice.11. This view, known as the shareholder primacy doctrine, stems from a famous Michigan Supreme Court case involving the Ford Motor Company and two shareholders named the Dodge brothers (who would go on to form the Dodge Motor Company).3 This case established a precedent that lasted for decades, built on the premise that the only thing that should matter to a CEO and their company is shareholder profits. Finally, we hope to have contributed to the maturing of the social entrepreneurship field by adding a range of critical scholarly perspectives which demonstrate at the very least that we need to continually investigate the links and fissures between the social and the ethical and better understand the implications of the assumptions which underpin policy, practice and scholarship around social entrepreneurship. Reflecting discussions well embedded in the corporate social responsibility literature around positive social change (Aguilera et al. Focusing more closely on the social perspective, Bacq and Janssen ( 2011 ), in reviewing various definitions of social entrepreneurship, stress the ideas of a visionary or innovative approach; a strong ethical fibre; an ability to detect opportunities (to address a social need); with a social entrepreneur as change agent and a mission to make a . Examples of how these have been employed in small business ethics research are reviewed in Spence (2014a, b), and the articles in this special issue make valuable contributions in developing some of these approaches. Kindness. Fairness deals with doing what is right, just, and equitable. This group of stakeholders might include employees (profit sharing), shareholders (dividends), the local community (time), and social causes or charities (donations). A legal patent gives an exclusive right to its patent holder or proprietor to use the invention in any shape or form they deem necessary. Thus, CSR is accepted as an umbrella concept which embraces other elements of business-society relations (e.g. Business ethics is the application of ethical behaviour in a business context. Weerwardena, J., & Mort, G. S. (2006). De Vries, K. (1985). Ethics should appear in business plans, in company mission statements, and in all other company documents. Clearly, social entrepreneurship is by no means a simple concept. Cheltenham: Edward Elgar. Torts are a potential area of risk for entrepreneurs. The article demonstrates how emancipatory social entrepreneurship business models and processes are designed to enable women to overcome the barriers that constrain their freedom, by such means as the development of the womens networks, their skills, and their literacy. Bull, M., Ridley-Duff, R., Foster, D., Seanor, P. (2008). This fundamental question raises a number of related questions about the ethics of the situation. The progress made in social entrepreneurship research has not been matched by a robust analysis from the ethics perspective (Cornelius et al. Truthful individuals earn a level of credibility and reliability over time because what they say and what they do are in alignment. https://doi.org/10.1007/s10551-014-2439-6. Organization Studies, They propose a model for social credit score based on applicant credit history, the present situation of the company and financial and social viewpoints of the specific project. Normative theories of ethics are primarily concerned with establishing standards or criteria that delineate what is considered ethical behavior. (2014b). In this special issue, we go beyond these somewhat polarised approaches and lay the basis, through the papers, for a more stable foundation which integrates social enterprise and ethics. This requires a very high duty of conduct and full disclosure, one that prohibits being involved in both sides of a transaction. 32(3), 836863. Ethical entrepreneurs consistently strive to apply ethics-based concepts in practice, including truthfulness and full disclosure. In this culture, every member of the organization is expected to be creative and continually improve the processes they are engaged with on a daily basis. Or it could be an external code based on ones profession (e.g., CPAs, attorneys, CFPs, and others have professional codes of ethics), or a more broadly applicable external code such as that of the Business Roundtable or Business for Social Responsibility. It is important to note that any deviation from these laws may result in long and costly legal problems. 4, 2140. What would acting ethically and with personal integrity in this situation look like? It could be a personal, internal code of conduct, or an official code adopted by a business organization. Ethics and entrepreneurship. A conscious or deliberate attempt to avoid, ignore, or marginalize that which is rightfully due an employer by addressing other interests would be a conflict of interest. ), Social entrepreneurship (Vol. In addition, ethical business practices serve the long-term interests of businesses because customers, clients, employees, and society at large will be much more willing to patronize a business and work hard on the businesss behalf if that business is perceived as caring about the community it serves. Business ethics and social responsibility in small firms. To introduce the challenges of social enterprise 3. You need to nurture an environment in which every member of your organization is able to be creative, add value, and be engaged in the continuous improvement of the firm. London: Sage. Perhaps you dont have the time, or the money, to hire a lawyer to prepare a formal written contract. We foster diversity and inclusion, dignity and respect. Successful entrepreneurs and the companies they represent will take pride in their enterprise if they engage in business with transparency, intentionality, and integrity. The Commission has defined CSR as the responsibility of enterprises for their impact on society EN and, therefore, it should be company led. This is especially true for the concept of vicarious liability, which is the area of the law that imposes responsibility upon one person for the failure of another, with whom the person has a special relationship (e.g., employer and employee) to exercise reasonable care. 5.7 Ethics and Social Responsibilities of Entrepreneurs An enterprise must earn profits for its own survival, for expansion, for bearing the risks and finally for theprestige of its management. The first draws on sociological perspectives on power, subjectivity and freedom and problematizes the context of much of the superficial assumptions around the authentic nature of the practice of social entrepreneurship.

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