Corporate Social Responsibility and Business Ethics in Controversial Sectors: Analysis of Research Results

Abstract

Untl recently, in business practce, there was a belief that companies were operatng solely for the proft of their owners. Few companies have recognized the need to combine their actvites with ethics, and in partcular with their obligatons toward society or the environment. However, the percepton of ethical issues has changed radically in business over the last 20 years. If a company wants to be perceived as a reliable business partner and a respected member of the business sector, it should demonstrate a high level of insttutonalizaton of business ethics principles and practces, and it must practce outstanding ethical behavior. This is exceptonally true in some controversial industries. The purpose of our study is to identfy the scale and scope of the use of these principles and practces in two Central European countries, i.e., Poland and Hungary, in three controversial sectors of the economy, i.e., pharmaceutcal, tobacco and alcohol. The data were achieved on the basis of data gathered through survey methodology. The target subjects included a group of 48 companies (25 Hungarian and 23 Polish ones). Our survey mainly focused on the degree of insttutonalizaton of business ethics (such as the presence of a code of conduct, an employee appointed to deal with ethical issues, ethical training, and so on), the perceived ethical behavior of the frms, and their relatonship with their key stakeholders. Our study confrmed that business ethics is regarded as a signifcant factor which has an influence on business success and the corporate image of companies from the sectors in queston. However, it is necessary to emphasize that the scale of this phenomenon varies, across both sectors and countries. The level of insttutonalizaton is somewhat higher at Hungarian frms while preventng and handling corrupton cases are more at the forefront of Polish companies. Although it seems that stakeholders from Polish frms have greater ethical expectatons, we did not observe signifcant differences between perceived ethical behavior in the two countries. The originality of the paper is the result of the presentaton of unique qualitatve research related to business ethics in sensitve sectors of the economy in two Central European countries. To the best of our knowledge, such research is relatvely rare (due to the sensitve nature of the sectors analyzed) not only in these two countries but also on an internatonal scale.

Keywords

• corporate social responsibility
• CSR
• business ethics
• ethical behavior
• Central European Economies
• controversial industries