Learning objectives
How do ethics in the private sector impact parliament and the public?

After studying this unit, you should be able to:

• Explain why company reputation is an important asset in the global economy;

• List some of the more pressing ethical concerns of customers;

• Discuss how companies have responded to customers’ ethical concerns;

• Illustrate in your own words the internal and the external function of the ethics reforms.

Introduction

How has globalization impacted the private sector and what role has outsourcing had in private sector ethics and the world economy?   The movement by companies, to reduce labor costs has created concern among consumers that businesses are moving production to weak states with poorly enforced labor regulations and standards, and therefore operating under the feeble regulations of the host country, rather than the companies’ official ethics standards.  In light of consumer concerns, corporations are beginning to understand the importance of preserving their reputation. The trend towards corporate social responsibility (CSR) and the adoption and enforcement of ethics regulations is intended to protect companies’ reputation and their competitiveness.  This unit considers why private sector ethics violations concern the consumer, the corporate response to ethics concerns, and the internal and external function of ethics reforms.