Business Ethics and

CSR

Name
HEWLETT-PACKARD | [COMPANY ADDRESS]
Objective

Identify an organization to conduct an investigation about;

 Theories of business ethics and evaluation of it to stakeholders. Also ton explain

sustainability of business ethics in the organization
 Different elements of corporate social responsibility and critical evaluation of rewards
obtained by implementing CSR
 1. Introduction
While Business decide to operate in a responsible manner which is social, environmental and
economic; it helps them to achieve a social acceptance and good value. Therefore other than just
concentrating in profit creation, the companies also involve in Corporate Social Responsibility and
they also implement good business ethics in their organization

Corporate Social Responsibility is the process of integrating social, environmental and economic
concerns in their business operations along with involving the stakeholders. . It explain an
organization’s imperative actions on society and company itself other than just achieving the
objectives of stakeholders. Where the business ethics defines the professional ethics in an
organization which examines the morals or principles that arises in a business environment. It
defines the best code of conduct to be practised at the organization. This is applicable to all
stakeholders of the company

Here to explain the process of CSR and business ethics, we take the multinational company
Microsoft who were the world’s largest software maker.

About the Company:

1.1. Microsoft

Microsoft is an American Multi National Company which develops, manufactures, licences, support
and sells computer software, consumer electronics and personal computers [1]. It was established
by Bill Gates and Paul Allen on 1975. They are headquartered at Washington, USA. The famous
product of Microsoft are MS Windows, MS office, Xbox etc. Currently the chairman of Microsoft is
John W Thompson and CEO is Satya Nadella. Since Microsoft is very well known for their CSR
practices and business ethics, this is the best suited company to explain the CSR and business ethics.
 2. Business Ethics
It applies to all aspects of business conducts and also applicable to all stakeholders of business. It has
a typical connection with normal ethical theories but it is critically defined taking in consideration of
the business environment and the main stakeholders.

2.1. Theories of Business Ethics:

Here we discuss some of the main business ethics theories which have a high relevance in today’s
business environment [2].

 Right ethical Approach: it is based on the fact that every human has his own rights in life and
should be treated with respect and dignity. This theory has a belief that individuals behave
ethically in a way such that there should not be any mistreatment to the people while
achieving their target.
 Utilitarian Approach: This theory mainly is based on the ethical actions that promote the
best value among a society. This method also try to reduce the amount of harm that does to
the people. Utilitarianism aim to make the world a better place. It is supposed to be one of
the oldest theories of ethics. Epicurus, John Stuart Mill and Jeremy Bentham were the old
philosophers who have supported this theory.
 Common good Approach: This theory tries to promote the common ethical principles and
morals existing in a society. It may differ based on different places, countries or cultures.
Companies try to apply this theory so as to ensure the proper balance with society norms.
 Justice: this approach advice to treat people equally regardless of ranking, position or class
in the society. This approach tries to give importance to fair and equal treatment of people.
So this is also called as Justice Approach.
 Virtue Approach: This is supposed to be the most theory to be implemented in business than
any other approaches. It mainly focus on the morals that should be applicable in the society.
In fact this approach tries to replace the existing principles with new better principles so as
to develop the society and people

2.2. Evaluation of Business Ethics to stakeholders:

The main stakeholders who are a part of implementing good business ethics in a company are,
Employees and shareholders [3]. Taking our company Microsoft, we can see Microsoft has out many
guidelines to impellent good business ethics at the organization. Their main motto in Business Ethics
is ‘Great People with great values’. Based on the evaluation to stakeholders, it can explained as

Values: Microsoft’ code of conduct point out 6 values to guide employee conduct. They are [4]

 Integrity and Honesty

 Passion for customers, partners and technology
 Open and respectful with others and dedicated to making them offer
 Willingness to take in big challenges and see tem thorough
 Self-critical. Questioning and committed to personal excellence and self-improvement
 Accountable for commitments, results and quality to customers, shareholders, partners and
employees
Here Microsoft has thoroughly explained how should be the ethical principles followed by the
employees.

Compliance and Reporting: Here Microsoft has a compliance department which allows all the
stakeholders of Microsoft to raise their issue relating to ethical problems and dilemmas.

Partner Conduct: Another stakeholders who should obey the ethical principles of Microsoft are
International Associate of Microsoft Certified Partners (IAMCP). Company has a separate code of
ethics released for this group of stakeholders. And it is mainly about the protection of intellectual
property if Microsoft, Social Responsibility, Personal Conduct as a certified Microsoft Personnel etc.

Compliance with laws and regulatory: Here Microsoft explain how they manage their business in
compliance with Law and regulatory. Here the main stakeholders which are influenced by the
company ethics is the Government and Rules& Regulation Authorities. The main points of this
conduct are;

 Regulatory compliance
 Lobbying
 Political Activities and Contributions
 Regulatory Investigations, Inspections and enquiries
 International business activities
 Bribery and anti-corruption
 Anti-boycott Requirements
 Trade Controls
 Fair competition and Antitrust

Ethical practices on customers, consumers, partners and shareholders:

Here as it indicate the main stakeholders who are a part of this code of conduct are customers and
partners and suppliers. The main point of this code of ethics are;

 Product & Service Quality

 Communication
 Obtaining Competitive Information
 Fair Information Practices
 Supplier code of conduct

Ethical practices to support the employees:

Microsoft promote a diverse, cooperative and productive work environment so as to support the
best ethical practices for employees. The main elements of this practices are

 Equal employment opportunity

 Safety and health

Ethical Practices to support the environment:

They have mainly implemented citizenship and community serve to demonstrate the commitment
to the environment. They also encourage the respect for environment through many policies and
regulations.

2.3. Development and sustainability of business ethics:

Microsoft try to develop and sustain the business ethics through proper administration and strict
enforcement of ethical practices. The department of legal and corporate affairs regulate and control
the company’s Business conduct by providing enough resources to the stakeholders to implement
the ethical procedures.

The practices of Business conduct is also endorsed and supported by the Microsoft board of
Directors. They take the responsibility to oversee the compliance and to enforce the standards of
business conduct. The higher management always tries to ensure the enforcement of standards of
business conduct. Also the violation of business conduct may even lead to strict disciplinary actions
including the termination of contract. They also guide the stakeholders to strictly obey the
corporate policy guides. They have a very well defined system for establishing good business
conduct within the organization. Employees are asked to refer ‘MS Policy’ and Corporate Policy
Guide. If they want to report something related to business conduct, they can submit confidential
report through the Microsoft Integrity Site’. They can also contact the Director of Compliance at
Microsoft Corporation, Legal and Affairs. Microsoft ask the stakeholders to

 Read, understand and comply with standards of Business Conduct and policies
 To participate in training and educational programs
 To report possible violations of business conduct or policies
 To cooperate fully un all investigation
 To make a commitment to conduct MS business with integrity and applicable regulatory
requirements.

Microsoft also assure that it will not tolerate any retaliation taken against employees and they will
handle all inquiry without any biasing. All these steps help the Organization to develop and sustain a
good business ethics system in Microsoft

3. Corporate social responsibility

It is the way through which the company implement a balance between economic, social and
environmental imperatives, while achieving the expectation of stakeholders. Here we discuss about
the main elements of CSR and how it reward the organization. The main elements of Corporate
Social Responsibility are [5],

 Human Rights
 Community
 Environment
 Government
 Employees and stakeholders

3.1. Now we can discuss this based on the CSR practices of Microsoft [6].

Human Rights: Microsoft’s approach towards human rights is aligned with the UN guidelines and
principles for Business and Human rights. They realise that a leading technology provider with
multinational operations can promote human rights in many ways. They respect the human rights
and try to implement the technology and business to promote human rights throughout the world.
Their main initiatives to support the human rights are;
  Technology and Human rights centre: here they focus in promoting the integration of human
rights into work culture, business operations and strategies
 Public policy engagement: it supports the law enforcement. Technology and surveillance
which encourage the policy solutions that protect human rights
 Internet freedom
 Initiative to promote the human rights in 2014 Olympic Winter games
 Events: developing sponsors to conducts events to promote the human rights

Community: Microsoft has many programs to support and serve community. Bill Gates says, "It takes
more than great products to make a great company". With the enormous growth from a small
software company to the largest company in the world, they responsibilities and commitment
towards the society and community also is growing. The main policies of Microsoft to support and
help community are;

 Empowering youth: Here MS create opportunities for youth to empower them and to realize
their potential.
 Empowering Non-profits: MS help the non-profit organizations with software donations,
training and grants
 Disaster and Humanitarian Response: MS support humanitarian relief and disaster
management efforts in many ways. They have already supported more than 200 natural
disasters
 Employee giving: MS also encourage the employees to contribute heavily si as to support the
society

Environment: Microsoft is working with all of its stakeholders to bring the power of information
technology and cloud computing to address the worlds ‘environmental challenges. The main
practices of environmental sustainability are;

 Development of safe and sustainable products

 Reduction in disposal of water
 Conserving, reusing and recycling
 Carbon neutrality commitment by making environmental sustainability as a part of daily
business decisions
 Making environmental stewardship as a part of business relationships
 Review and asses environmental programs, practices, and goals to evaluate the progress
 Demonstrate the responsibility if stakeholders

Government: Microsoft takes part in the public policy process in variety of ways. They recognise that
they have responsibility in governance in reporting. The main actions done by Microsoft related to
Integrity and Governance are;

 Microsoft political Action Committee ‘Steering Committee;

 Regulatory board for public policy
 Commitment to publishing MSPAC and corporate political sending reports semi-annually on
the corporate site.

Stakeholders: Microsoft has implemented many practices to support and engage all of the
stakeholders. Those are;

 Responsible Sourcing: they always demand the suppliers to uphold the high standards of
corporate responsibility. They also try to promote positive environmental and social
 outcomes from their sourcing practices, which range from demand for greener computers to
demand for local organic food; so ac to encourage diverse suppliers
 Integrity & Governance: They are highly committed to practice principled, accountable and
transparent business all over the world. Microsoft has a standard of business conduct and to
ensure this. They have a Department for Anti-corruption and Anti-Bribery policies. They also
have a corporate governance policies and systems to strengthen the culture of business
integrity and responsible business practices.
 Microsoft also has many programs to encourage the employees and to promote a high
quality work environment. The employees always agree that Microsoft is the best place to
work with. They invest in employee training and career development and providing good
monetary compensations to support the employee engagement in the communities. They
also help the employees to support the work-life balance. They also conduct a satisfaction
survey among all employees to ensure the best working environment.

3.2. Rewards of CSR to organization:

CSR has in turn rewarded the organization through many means. While trying to implement the eco-
friendly and environment friendly product, company has happened to innovate many products. So
we can innovation is one bets reward obtained through CSR. Another CSR practice to save energy
has helped the organization to cut the cost to a great extent. More than this another benefit of CSR
is the impact it had made on the customers thorough social activities. The disaster recovery practices
and community helping practices has helped to create a good branding among different varieties of
communities. This has increased the differentiation and reach of our brand among other companies
[7]. They also tried to have a better perspective about Microsoft than just a software selling
company.

CSR is also a step taken to ensure the long term sustainability of the organization. Since the products
and services changes from time to time it is important to get a competitive edge on the customer’s
mind which also increases the long term sustainability. CSR also increases the customer engagement
with the company. Being a leader in CSR practices, Microsoft could raise the awareness about the
environment and eventually it could also raise the awareness to choose the products based on that.
Since it always conveys about something good, it is the best way to communicate to customer [8].

Last but not the least is the employee engagement and employee satisfaction, we can see that the
CSR practices relating to employees of Microsoft helped to reduce the attrition rate in the company.
Microsoft has been selected as one of the only thirteen companies that are included on Forbes
Magazine’s annual list of the ‘100 best companies to work for’. Microsoft is in the list since 1998. It
was found out that 85% of the employees would recommend Microsoft as the best place to work
for.

Microsoft has also earned 100 % rating for the 9 th consecutive year in Human Rights Campaign (HRC)
Corporate Equality Index Rating. Microsoft is also selected by different Magazines, different
organizations and different surveys as the best company which has implemented best corporate
social responsibility practices [10].
 4. Conclusion:
After analysing the business ethics practice and corporate social responsibility practices, it is clear
that Microsoft has given enough importance to both and it has properly implemented a good system
which supports both. Microsoft has a well maintained system which help to develop and sustain the
business ethics. This has been explained with proper references from the website.

It is also analysed that Microsoft has been practicing good corporate social responsibility practices in
all elements of the business, society and environment. They are also very well recognised for all the
actions and practices implemented by them. Enough evidence and details support for the same.

References

1. http://en.wikipedia.org/wiki/Microsoft
2. Business for Social Responsibility. (2001). BSR Issue Briefs: Ethics Codes/Values. Retrieved
December 20, 2003, from http://www.bsr.org
3. http://martinkornberger.com/includes/07ethics_as_practice.PDF
4. www.microsoft.com
5. Voien, S. (Ed.). (2000). Corporate Social Responsibility – a guide to better business practices.
San Francisco: Business for Social Responsibility Education Fund.
6. http://download.microsoft.com/download/2/5/9/2597728D-72EE-4FDC-BD93-
814AD436ABDA/FY13%20Report%20FINAL%20Oct%2013.pdf
7. http://www.iisd.org/pdf/2007/csr_guide.pdf
8. Green to Gold: How smart companies use environmental strategy to innovate, create value,
and build competitive advantage, Daniel Esty and Andrew Winston, 2006
9. Business and Society: Making a positive and responsible contribution, International Chamber
of Commerce.
10. http://www.microsoft.com/en-us/diversity/programs/awards.aspx###