Business Ethics Constituting One of Our Unchanging Agendas

Ömer Torlak*

Introduction

There have always been different opinions about the source of morality. While some views consider morality as a human phenomenon completely separate from religion, some other views, on the contrary, have argued that the source of morality is completely based on religion. Taking the following statement of our Prophet ‘‘I have been commanded to complete good morals’’ into consideration, and based on the fact that there may be a tendency towards evil and wrong as well as a tendency towards what is right and beautiful in the context of the characteristic of creation, it can be asserted that there is actually a ground for moral values in human nature. Within the scope of religious doctrine, prohibited actions, i.e. harams, have been listed and it has been emphasised that what is essential in matter is halal. It can be stated that the purpose of Allah’s communicating the actions that Allah has made lawful (halal) and unlawful (haram) to human beings through His messengers whom Allah has chosen from among human beings is to concretise moral principles and values through its messengers in order to prevent people from producing justifications such as ‘‘he is not a human being, we cannot commit what he does and avoid what he does not commit’’ (of course, Allah knows the best). Thus, while the religion conveyed its basic references to its interlocutors through the practices and words of the messenger, it also demonstrated to them the moral goodness in the attitudes and behaviours of the messenger in order to concretise these references.  Within this context, in addition to the fact that the religious references of morality are quite strong, it is also of great importance that it carries references appropriate to human nature. Hence, it would not be incorrect to state that almost every human being, even if his/her religious practice and belief is weak, has the characteristic of turning towards the moral and caring about moral principles in his/her attitudes and behaviours.

One of the reasons why I have written a long introduction is to emphasise that morality is a whole encompassing all areas of life. In fact, the basic moral references of social relations, family environment, friendship and business life that we have in daily life are nourished from the ground of human nature in one aspect of the commandments and prohibitions of religion and in the other aspect of human nature. In other words, the reference of the basic principles of business ethics, in addition to halal and haram, is the exemplary practices of our Prophet, who also engaged in commercial activities, starting from the Mecca period until the establishment of the Medina Market and afterwards.

Behaviours such as not lying, not stealing, not being unfair, not demanding more than what one deserves, not slandering and other similar behaviours are moral principles nourished by religious beliefs in almost all societies, and the commercial world also makes reference to these principles in terms of morality. In particular, as a result of the spread of secularisation tendencies all across the world towards the end of the 1800s, when the Industrial Revolution or the Enlightenment took place, life was literally divided into compartments resulting from the development of a fragmented perspective on life. A fragmented perception of life has also led to an understanding that different sets of moral principles can be employed for different areas of life. A person who takes moral principles and religious references into account while fulfilling his/her religious obligations or within the family may, for instance, act with the idea that it would be right to compromise religious references or moral principles to earn more money in order to be able to do more favours. As a result of the increase in the number of people with a fragmented mind resulting from the secular understanding, for instance, a set of moral principles may emerge in the business world. As a result of such approaches, it has been observed that in recent years, while behaviours incompatible with ethical principles have been increasingly exhibited in business life, attempts to develop ethical codes have also increased. This article aims to offer an overview of business ethics based on the above-mentioned perspective and to emphasise the increasing importance of business ethics in a constantly digitalising world.

Morality Constituting the Unchanging Agenda of the Human and Society

One of the unchanging agendas, and perhaps the most important one for human beings and the society formed by the human beings coming together, has always been the idea of being able to build a moral or virtuous society and to live in such a society. As a being with the desire to have more and the potential to act for this purpose regardless of whether it is right or wrong, the actions of human beings are obvious, and our God, who created human beings, has clearly described this characteristic of human beings. Therefore, it would be possible to read the history of humanity as a history that has never lost sight of the issue of building a society centred on virtue. Allah, through His messengers, has revealed religious teachings and basic principles for commercial relations that are a part of daily life.

As a reference to the source of morality, the five principles that constitute the Islamic ethical system and a brief explanation of them are explained in Table 1 below:

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Table 1. Fundamental Principles of Islamic Ethics

(Source: Bikun, adopted from Nakvi, 1981, 2011:36)

It would not be inaccurate to claim that the five basic characteristics mentioned in Table 1 are the basic references of the business ethics that have developed from the Medina Market to the present day. In the event that these principles are taken as a reference in the entire everyday life, every individual, whether a merchant, manager or employee in business life, will be a person who can have a holistic view, observe the rights and justice of every right holder at all costs, fulfil his/her responsibilities and help those in need to the extent of his/her power.

As a result of the fact that these fundamentals have started to be considered as highly religious references, different business ethics perspectives that cannot ignore these fundamentals have started to emerge as issues that have been emphasised in recent years. Because negativities such as the spread of injustice and unfairness, the increase in corruption, and the proliferation of inequalities have brought the need to determine ethical codes in the business world to the agenda and this issue continues to remain on the agenda. At this point, efforts towards some theoretical and philosophical justifications have been increasing in recent years.

Since the theoretical foundations of business ethics are supported by different philosophical approaches, it would not be wrong to say that each approach overlooks the entirety and fails to provide a sufficient explanation on its own. Furthermore, it is quite possible that the approaches are influenced by different philosophical schools and each other, and it is also worth noting that these approaches are not completely independent of religious references. Table 2 below lists the main determinants and limitations of three of the more widely recognised approaches to business ethics

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Table 2. Three Approaches to Moral Thinking

(Source: Post vd., 1996:125)

According to these three approaches summarised in Table 2 in terms of business or commercial activities, the questions related to the evaluation of any behaviour or action in terms of business ethics can be listed as follows:

1. Do profits exceed costs?  (Utilitarian approach)

2. Are human rights respected?  (Rights approach)

3. Are profits and costs distributed fairly?  (Justice approach)

Theoretical and philosophical justifications for business ethics can be classified in a number of different ways. According to one of the most preferred classifications in Western moral philosophy, there are three different ethical fields: (1) Metaethics, (2) Normative ethics, (3) Applied ethics (Yaran, 2010: 15). In line with another classification, philosophical approaches to business ethics are examined under four general headings: teleological (result-oriented), deontological (rule or reason-based), relativism and value approaches (Torlak, 2007: 121-134). In the result-oriented, i.e. teleological approach, the morality of the relevant action is evaluated by analysing whether the consequences of the decision or behaviour benefit a significant part of a group or society, while in the deontological, i.e. prescriptive or normative approach, a moral judgement is made about the relevant attitude and behaviour by analysing whether the attitude or behaviour complies with accepted norms regardless of the outcome. In the relativism approach, a relative evaluation can be made depending on cultural, social and situational differences. In contrast to utilitarian approach, the value approach is based on whether the outcome is valuable or not and whether the action is carried out in the context of values or not. Since the purpose of this article is not to provide detailed information on these approaches, the classification information given above has been contented with.

Scope and Limits of Business Ethics

The scope and limitations of business ethics are also among the issues that have been discussed in recent years. In the context of looking at life from a holistic perspective, it is not possible to talk about any human decision and action that does not come into contact with moral principles and values. In this regard, although the scope of business ethics appears to be limited to the relations in commercial life, in reality, the limit of business ethics is not limited to the relations concerning the business world. Because the commercial decisions and actions of a person who is selfish in his/her relationships within the family or in social life will inevitably be affected by this selfishness. When an employee with this kind of personality, for example, refrains from helping his/her colleague in a difficult situation when he/she can spare some free time for himself/herself, that employee may not be condemned according to the rules of the job or professional or work-related ethical principles, but in the context of a holistic perspective, that employee will have displayed an attitude and behaviour that is difficult to be accepted in terms of moral values. To summarise, although it may seem that the scope of business ethics is limited only to issues related to business, it must be emphasised that, from a holistic point of view, all moral values belonging to the entirety of life considerably expand this boundary. However, in the world of mind, which is fragmented and narrowed by the secular perspective, it is often witnessed that an assessment of work ethics is made from a narrow framework instead of this broader perspective. As a result of having such a perspective, employees who behave as in the example given above and do not help his/her colleagues are highlighted as the most successful employees, which in turn encourages such attitudes and behaviours.

A second aspect that needs to be highlighted in terms of emphasising how wide the scope and limits of business ethics are is the necessity of having a broad perspective caused by the fact that corporate actions have a very widespread impact from pre-production to after-sales.

Starting with entrepreneurs or business owners, in addition to the responsibilities they have towards their own families, customers and employees, the responsibilities they have towards suppliers, competitors, public institutions, media, financial institutions and society reveal how comprehensive the area of responsibility is in terms of business ethics. Just as it is possible for the actions of a simple employee to cause damage to the customer, the environment and society and to produce unethical results, it is also possible that when a payment to a supplier is delayed, for example, that supplier may not be able to pay its employees on time and thus, employees may not be able to meet the needs of their families. Taking into account many examples such as the disability of the user of the product as a result of a seemingly simple negligence in production, the disruption of public services due to taxes not paid on time, for instance, the increase in illness and related treatment costs due to uncollected garbage, it will probably be better understood how wide and detailed the issues of business ethics can reach.

When the above examples and other similar examples are considered, it would be easier to understand how wide the scope of business ethics is in the decisions taken by enterprises with their direct and indirect effects and many actions that take place inside and outside the organisation. In addition to the possible effects of decisions and actions in the context of direct relations with competitors, customers, employees and suppliers on society, environment and human health, it would be possible to show how wide the boundaries of business ethics are through wasting and polluting land, water and energy resources or through indirect negative effects such as the prevention of services to society as a result of not paying the required taxes.

It would be useful to briefly mention the effects of business ethics, which at first glance may be thought to cover a very limited area, in terms of different professions practised in the commercial life.

Professional Ethics Becoming Insignificant

It is inevitable that different professions are practised by people in order to maintain a healthy social life. Since it is unthinkable to imagine a social life where everybody performs the same occupation, it becomes important that those who perform different occupations act in accordance with the ethical principles of business life. It can be mentioned that in almost every job referred to as a profession, those who will perform that profession have to go through a certification process that constitutes the approval of competence. Throughout the historical process, it has been witnessed that professional ethics are considered very important in granting a person a licence to enter the profession. This is because every profession has dimensions that affect the whole society, starting with customers, competitors and colleagues.

Regarding the solidarity of colleagues, which has degenerated significantly over time and has become unethical by turning into the protection of colleagues who have committed a wrongful act, two dimensions of professional ethics need to be emphasised. One of them is to endeavour to be more effective, to save resources and to provide better quality goods or services to the customer by improving professional knowledge and skills. This refers to the situation where a professional, regardless of the profession he/she is practising, improves himself/herself and thus becomes more efficient, productive and effective. The second one is the preservation of professional honour. A member of a profession who acts with the awareness that a mistake he/she makes will be attributed to all his/her colleagues will be in an effort to protect his/her professional honour. A teacher or engineer who acts with the awareness that the consequences of a decision or an action taken without moral sensitivity will also damage the reputation of other colleagues is merely an effort to protect professional honour. On the contrary, exhibiting attitudes and behaviours that are not in line with moral principles and values in the belief that his/her colleagues or his/her professional organisation will protect him/her will damage the honour of the profession.

The impact of the rapid change and transformation in technology on the transformation of professions and the emergence of new professions and jobs is undoubtedly undeniable. As a result of technological transformation and advances, terms such as digital economy and platform economy are now being dealt with in the business world. Beyond naming or defining, it has also been observed that initiatives such as ‘‘minimum living wage’’ and ‘‘basic citizenship wage’’ have been accelerated in recent years in order to compensate for these inequalities in the context of issues such as new business models brought about by a digital world, inequalities caused by the loss of talent and skills. This is because there has been an increase in unemployment due to the loss of a large number of skills resulting from the dramatic transformation in technology and the increasing digitalisation of the economy. This issue alone can be read as an indicator that new issues of business ethics will continue to emerge in the context of business life.

Business Ethics in the Digital World

In the digital world, we witness a struggle between human beings and the consequences produced by the human mind. At this point, the question of ‘‘whether the human mind, which creates the digital world, is incapacitated in the face of intelligent objects’’ arises as a meaningful question in terms of business ethics in the digitalised business world.

At this point, when we talk about a digital world built with a human mind that disregards or ignores moral values, it would be a correct and appropriate assessment to state that intelligent objects such as algorithms and artificial intelligence, which are the products of such a mind, have the potential to produce immoral results. In other words, the consequences of the mind that constructs the digital world being devoid of morality and especially business ethics is an important issue that needs to be emphasised. Another important issue is whether the mind that utilises the digital world has severed its relationship with moral values. Therefore, it is clear that we are facing much more sophisticated and greater number of issues that are contrary to business ethics in digitalised economies with an intelligence that ignores and disregards moral values in terms of both the producer and the beneficiary.

Compared to the bilateral interaction between buyers and sellers in traditional markets, in platform economies, also known as digital economies, we are faced with multilateral markets where buyers can be sellers and sellers can be buyers, and intermediaries such as suppliers and payment institutions can also be both sellers and buyers. The companies or individuals who operate these multilateral markets have also achieved the ability to perform activities in digital markets or platforms, in particular the determination of the price, as well as the ability to favour certain companies, by means of artificial intelligence, machine learning and algorithms. Buyers can only make price and performance determinations with the comparison tools available to them, but when they want to make a more advanced comparison or evaluation, they either cannot access the detailed data they may need or they have to spend a considerable amount of time to access them, which may incur alternative costs for them.

In digital or platform economies, which are capable of providing a marketplace environment that can be considered quite democratic when business ethics are followed, the use of artificial intelligence and algorithms in a biased and unethical manner may raise very different business ethics issues than in traditional markets. First of all, the digital world is a very fluid and fast-paced virtual world, and in this virtual environment where there is no face-to-face contact, people can more easily abstract themselves from moral values. In many societies or communities, where religious belief has weakened in addition to social, cultural and moral values, we are witnessing that such issues are increasingly brought to the agenda.

Within this context, one of the important areas of business ethics in the digital world is that the parties to the exchange may engage in different attitudes and behaviours than in the physical world where they see the faces of each other. Another issue is that the data, which is called big data, which is incomparably large compared to the traditional market, can be used unilaterally and for a manipulative purpose, especially to the detriment of the buyer or to the detriment of other large and small companies in favour of some companies. At this point, although the legislation on the protection of personal data has been developed, the lust of the power granted by possessing this power is of a nature to encourage negative practices in the digital world in terms of business ethics.

Conclusion

To sum up, it is possible to say that unethical attitudes and behaviours arising from the ambition to earn more, which is inherent in human nature, find an intense response in the business world.

Even though it is not possible to completely eliminate the negativities experienced in terms of business ethics, which are increasingly becoming a subject of complaint in almost every part of the world, regardless of beliefs and worldviews of people, in order to at least reduce them to a certain level, it is necessary to first teach the minds that are fragmented by secular understanding to approach life holistically and then to strengthen moral values supported by sound functioning legal norms. At this point, it needs to be emphasised that there is a need to strengthen the dynamics of family, school, work and social life that will enable the individual to develop the understanding that ‘‘I must first force myself to do what is morally right, good and beautiful’’. In order to support such an approach, it is mandatory to establish legal norms that are established through social consensus, developed or modified according to need and, above all, applied equally to all without exception, in order to deter individuals who take or engage in potentially malicious and immoral decisions and actions. This is because the exchange process is a process of interaction that cannot be left to the mercy of either the seller or the buyer alone in markets of all scales, from small to large, which we can be scaled in terms of the market or the bazaar. Attitudes and behaviours that are not in compliance with business ethics stem from the immoral ambition of the parties to the exchange or those who mediate it, such as earning more and having more than they deserve. The unethical attitudes and behaviours caused by these ambitions, which will survive as long as human beings exist, can only be reduced and kept under control to a certain extent in this manner.

Bibliography

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*Ömer Torlak Istanbul Commerce University