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Role of Business In Society and Implications of Ethical Theories

University: University of East London

  • Unit No: 4
  • Level: Post Graduate/University
  • Pages: 13 / Words 3161
  • Paper Type: Case Study
  • Course Code:
  • Downloads: 448
Question :

Questions- This assessment will cover the following questions:

  • Evaluate and analyse the importance of individual and organisational ethical thinking and practice and that you can apply ethical decision making.
  • critically elaborate the role of business in society and how business influence the society.
  • Nike is a footwear brand. Reflected on what makes an ethical leader and manager in the context of organisation.
Answer :
Organization Selected : Nike


Nike is an American multinational corporation that is focused on manufacturing, designing, and developing sports footwear, equipment, apparel, accessories, and other services. The company launched the trendy Balaclava on 12th July at 69 pounds which became disastrous for the business because it led to an ethical dilemma where it was used by Youth black leaders of gang violence. The study will outline the report of the middle manager to the senior management which will comprise ethical issues raised from the situation and its impact on key stakeholders such as customers, media, government, shareholders, etc. Apart from this assessment will make use of Gibb's reflective model to outline learning over ethical qualities of leaders and managers which play a vital role in managing ethical and responsible practices of business.

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a. Report

Nature of ethical issue and role of business in society

This report includes various ethical problem which are lead due to balaclava product produced by Nike. This product was produced by Nike to cover the face which is used by black youths involved in gang violence. This report is made to provide information to senior manager regarding the problem to in order to reduce the negative publicity of balaclava. Balaclava was produced by Nike to be used in winters to feel warm. The use of balaclava is a ethical problem as it leads to reduced in its brand image in the society which affected its profitability to the great extent. Organisation to improve its brand image in the society relating to its misleading advertisement which has provided negative impact of the business on the society.

This ethical problem affect Nike business as the competitors will gain more customers due to reduce in the brand image of Nike. For example, balaclava misleading advertisement has provided competitors with a competitive advantage to increase their profitability and productivity by increasing their brand image(Trump and Newman, 2017). This report is prepared as a middle manager of Nike to its senior manager top address the problem which has affected the profitability of the business. Due to its uses by black youth the product sale is reduced as the customers are not purchasing this product.

Nike in order to remove h ethical problem relating to balaclava must provide advertisement relating to its proper use in order to provide understanding to society relating to the product uses. The organisation is facing serious problem due to the negative impact of society on the product produced by Nike sue to the misuse of these products for wrong purposes. This ethical problem has caused a great reducing its customers and also on the stakeholders of the company. Misleading advertisement is the main reason for the misuse of the balaclava for the wrong purpose that has lead to ethical problem.

Key stakeholders and impact on them of the ethical issue and benefits and limitation of ethical choice with the help of example

The key stakeholders of the Nike include its shareholders, employees, management, customers, suppliers etc. this problem of Misuse of balaclava by the black youth has caused a negative impact on its customers, shareholders, employees , suppliers etc. Employee turnover has been increased due to the ethical problem faced by the organisation which has caused a negative impact on its employees and they are leaving the organisation as they feel the firm is working for terrorist. Due to this problem faced by Nike the investors for Nike want their money back due to its negative image in the external environment.

Government is taking strict action against Nike for producing products which are helpful to terrorist. Also, this problem has affected its customers due to which its number of customers has reduced which is leading to reduced in its profitability in the industry (Cooper And et.al., 2015) ). Nike in order to reduce the negative impact of balaclava advertising in the mind of society. Nike must provide its various stakeholders about the actual use of balaclava to reduce its negative impact and clarify their doubts regarding misuse of balaclava by the black youths.

Ethical issue relating to balaclava produced by Nike has affected its stakeholders due to which Nike has reduced its numbers of investors and also the investors want their money back this problem has affected the business at large . Nike can make various decision to reduce the negative brand image (Burton and Bradish, 2018). Nike in order to solve this problem either must provide advertising by defining its actual used through use of various promotional tools such as advertising in newspaper, magazines etc. also Nike can provide information through the use of various social sites such as Instagram ,Facebook etc.

Nike can make choices which will provide customers with proper uses of balaclava. Ethical choice will assist in improving business profitability and publicity. For example, Nike can make use of various promotional tools to provide customers with right uses of balaclava . Ethical decision – making assist in increasing the profitability of the organisation by making the right decision for the improving its brand image.

Nike in order to gain its profitability must stop the production of balaclava to make the people understand that it is [providing products for them and not for the black youths by creating their positive brand image in the mind of customers. Ethical choices have various benefits which include increase revenue, improved brand image , improve employee motivation etc. but it also provides disadvantages such as higher cost in making advertising etc.

Nike is providing its employees higher wages to retain them in business and also it has reduced its various product price to attract customers towards the brand to provide them high quality products to reduce the negative impact caused by the misleading advertisement of balaclava.

Recommendation for company emerging for analysis

Nike in order to reduce the negative impact of the advertisement of balaclava should make proper understanding to the society by providing them information relating to the right use of that product. Nike should provide society with an understanding of their objectives regarding that product to increase their efficiency(Newman and Trump, 2017). Nike also can create a new product which will be beneficial for the customers to increase its brand image and profitability in the market. Nike should provide its employees with higher wages to retain them in business. Nike should formulate various strategies and planning to reduce its ethical issues by making and ethical decision – making. Nike should provide its employees with better service quality in order to retain its customers. The organisation should provide the balaclava to different customers free of cost to increase its brand image in the market. Nike in order to reduce the negative impact of balaclava should produce its other product by using high quality inputs to attract more customers towards the brand. It should also create positive impact by increasing its online presence to make clarification regarding the balaclava product to the people at large.

b. Implications of ethical theories

Right-based ethical theory

This theory provided with an understanding of the right of individuals and society. According to this theory, The rights are considered to be ethically correct the business must ensure that the rights of the individual are protected. Ethics involves recommending, defending concept of right or wrong(Kirchschlaeger, 2017). Right based theory is based upon the ethics. This theory includes positive and negative rights of the individual or group. Positive right is related to freedom of one choice to do something whereas negative right is related to freedom of speech and privacy. Right based theory include the right of life, the right to pursue happiness, the right to work, the right to express ideas and opinions, the right to be treated equally.

Negative right imposes negative duties and positive right impose duties which provide assistance. Natural right under right based theory include rights of humanity which are also known as moral rights(Kim, Colicchia and Menachof, 2016). Conventional rights which are included in right – based theory are created by the humans relating to social and political organisation. Examples of right based theory include the right of health care which is a positive right and are required to provide products and services by others. Torture is the conventional right which is not acceptable in any country or government.

Nike must imply right – based theory in order to give priority to the rights of society. The right – based theory is applied to Nike to make understanding of the rights of people in order to gain their trust and loyalty(Arnold and Ducate, 2015). Nike in order to reduce the ethical problem face by the company must give priority yo the rights of the people to reduce the negative impact of the issue. Right – based theory of ethical theories provide that the organisation must provide right to freedom of choice to customers in order to provide them choices on the basis of their decision (Burton and Bradish, 2018). Positive rights in right based theory are implied in Nike to perform various duties to provide them various products and services.

Negative right imposes negative duties on the organisation in which others people are not allowed. This negative right is implicated on the society to make decision for profitability of the firm . Natural right in right based theory is implied on Nike and these rights are already present in the society such as right to liberty (Achabou and Dekhili, 2015). There are various other rights which are made by humans such as conventional rights which have a great influence on the Nike business. This Right include torture etc. It the organisation is torturing the customer than action is taken on the basis of this rights by the government.

Right based theory is implied to Nike in order to make the decision by understanding the rights of society to make ethical decision which are right for the organisation and society. Nike in order to reduce the negative impact of balaclava on the society must remove that products from its product line to increase its brand image in society.

Duty-based ethical theory

Implication of ethical theory is the best for the middle manager to determine loopholes of advertisement which led to controversy with the launch and marketing. As per duty based ethical theory it is articulated that act of Nike was not wrong on the part of organization because it depends on person to person how the individual act to certain situation. The Balaclava launch was with the purpose protecting individual from direct sun light when traveling on two Wheeler. Further, the designing was done to cover every uncover part of faced when traveling. The launch was with no negative purpose but as duty based ethical theory it can be stated that Balaclava was for ethical use of people but it depends on morals of human beings who own unique capacity for rationality.

As per duty based theory it can be said that some acts are right or wrong because of the sorts of things they are, and people have a duty to act accordingly, regardless of the good or bad consequences of certain situation. The theory is known as deontological ethics which focuses on four aspects that is doing right thing, do right thing because it is the only right thing, avoid doing wrong things and do not involve in wrong things because they are wrong (About duty-based ethics, 2014). The theory is based on simple moral rules but still can be argued by people following wrong morals like Killing innocent people is wrong thing but if asked to murdered it can be right as per killer rationale. Therefore, it can be said that duty justified every act regardless of right and wrong.

Duty based ethical theory can be implied to case of Nike because int his launch and advertisement of organization was not wrong as it was deigned for specific need of people but it is misused by people according to their moral, rationale and motive. Therefore, it is important for the people to understand use of product according to own morals. The theory is effective for justifying ethical issue raised for Nike because it emphasizes on value of every human being. Further, as per this theory some facts and acts are always wrong regardless of situation and therefore the company discarded action of young black gang leaders who created violence.



This play a crucial role for the individuals as it helps the person ins deriving difference between right and wrong of the situation. The judgment over right and wrong of the situation depends on person beliefs, values, learning and morals. The reflection will outline qualities of ethical leader and manager which helps in making ethical organization. The writing will also outline views of different authors which will help in developing critical understanding the importance of topic.

Personal feeling

In my opinion ethical leadership and management plays critical role in aligning employees and organizational activities in one direction. It is based on individual point of view of managing workforce. I feel it is necessary of the company to have ethical leader because the person is responsible for coordinating staff members. Leader is the person who depict road map which is followed by employee. There, in my opinion it is important for the leader o organization to have clear understanding over right and wrong of decision in order to make staff members perform ethically. On the other hand, I feel manager is a person who is responsible for planning and controlling work of employees which implies that motivation of workers depends on management and that is why it is necessary for the manager of organization to have ethical qualities of managing.

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In accordance with my learning over ethical qualities of leaders and managers I feel it is basic thing in the organization which helps the business in managing ethically responsible business practices. These are the responsibilities and way of working which presents value of value in front of its key stakeholders. According to Johnson, 2017, it is articulates that qualities of ethical leader comprise, justice which can be related to equal distribution of work among team members. Further, ethical leaders are humane and honest which is the core characteristic that assist the person in team building and making employee works in en common direction with shared beliefs and perspective. However, as per the views of Schwepker, 2018, it is outlines that ethical leaders and managers are guiding light of the business and helps the company in managing honorable business performance. On the basis of this study I evaluated that there are three characteristics if ethical behaviors of leaders and managers which comprise consistent in which it is important for the leading ad managing person to incorporate use of ethical and good values which provides fair and equal treatment to all employees. It is based of managing successful equality and diversity at workplace. Further, I analyzed the importance of respect which is basic need of stakeholders in which focus of leaders and managers is on being honest and fair at workplace. It is the quality which supports growth and positive attitude of individuals towards organizational growth and development. Likewise, I learned about honesty as ethical quality among leader and manager which helps the individuals in spotting equality, effective communication, dignity and diversity at workplace.

As per the views of Crosby and Bryson, 2018, I learned about value driven decision making which helps the organization in making justified polices and practices at workplace. From review of different literature I explored the need of ethical organization which assist in gaining trust of all key stakeholders. Further, ethics are essential part of organization because it assists the business in gaining trust and loyalty stakeholders. As per the views of Jin, Meng and Berger, 2017, it is identified that implying use of corporate social responsibility and ethical business practices helps leaders and managers in corporate continuous improvement in motivation and in working practices of an enterprise.


In accordance with entire evaluated I learned about three common ethical qualities of leaders and manager that is consistency, honesty and respect. These are the cores practices which needs to be incorporated by leading and managing person in order to manage stakeholder satisfaction. The reflection concluded by outlining the need and importance of socially responsible practices of organization which helps the business in performing ethically.

Action Plan

In accordance with learning it is clear that it is important for the leader and manager of organization need be ethical coordinating ad cooperating employee activities. Therefore, with regard to this my focus on future will be on becoming ethical person where I will imply my person ethical qualities when working with two or ore people. This will assist me in managing coordination with other people and will assist in managing safe and ethical practices of personal and professional life.

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The assessment summarized by stating about Nike which is multinational American corporation who develops, manufacturers and design sportswear product. The company own global reach and has various types of consumers. The study outlined ethical issue arise in advertising of companies new launch that is Balaclawa which was misused by Black youth for gang violence. The part 1 of study outline report of middle manager to seniors manager by outlining ethical implication and issues which impacted stakeholders' satisfaction. Thus, it concluded by reflective writing which is based on individuals learning over ethical qualities of leader and managers which are necessary for ethical organizational performance.


  • Achabou, M.A. and Dekhili, S., 2015. Constraints and drivers of growth in the ethical fashion sector: the case of France. In Sustainable Fashion Supply Chain Management. (pp. 167-181). Springer. Cham.
  • Arnold, N. and Ducate, L., 2015. Contextualized views of practices and competencies in CALL teacher education research. Language Learning and Technology.
  • Burton, N. and Bradish, C., 2018. Discursive Power in Commercial-Rights Management: Examining the Origins of Ethical Framing of Ambush Marketing. International Journal of Sport Communication. 20(XX). pp.1-19.
  • Cooper, R.W. And et.al., 2015. Ethical Issues for Supply Managers: Then and Now?. Journal of Business and Behavioral Sciences. 27(1). p.54.
  • Kim, S., Colicchia, C. and Menachof, D., 2016. Ethical sourcing: An analysis of the literature and implications for future research. Journal of Business Ethics. pp.1-20.
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