CHAPTER ONE:
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The
conduct of business is with respect to Nigerian organizations shrouded in
numerous unethical practices. Several cases evidencing this assertion are found
in many organizations like banks, manufacturing companies, service oriented
organizations, etc. Several cases of bank failures experienced in Nigeria in
early 2000s were caused by unethical practices exhibited by employees,
management and other stakeholders. Equally, companies like Nigercem, Niger
Steel, AVOP, Oghe cashew industry, Ikenga Hotels, Presidential Hotel Enugu,
etc, all
failed
because of unethical practices in private sector organizations in Nigeria,
unethical practices are exhibited by the operators. For instance, some dubious
traders in Ogbette market Enugu cheat their customers by using faulty scales in
measuring rice, beans and other consumable food items. With respect to banks,
there were cases where some bank employees collaborate with some of the
directors to embezzle customers’ money entrusted in their care.
In
government ministries and parastatals, there are cases of misconduct in
employee selection, motivation, training, promotion, and transfer, and even in
the administration of other fringe benefits. In fact, case of unethical
practices in both private and public sector organization in Nigeria are too
numerous to mention.
Based
on these ugly incidents, this study is set to investigate the main reason
people indulge in unethical practices in the conduct of their businesses so as
to ascertain the effect on corporate profitability and on the image of the
organization.
Surprisingly,
ethics is not taken seriously in Nigerian business terrain despite the critical
importance of ethical practices for sustainable growth and development. The
average Nigerian business sees business and ethics as oxymoron. A study on
ethics in Nigeria business has clearly indicated that 98% of Nigerian
businessmen agreed that they have engaged in one form of unethical practices or
the other (Asolo, 2001). Other research study indicates that Nigerian
businesses are rated worse in ethical practices (Oguechi, 1998, Asolo, 2008).
It also indicates that unethical practices in Nigerian business terrain are
multifarious and multidimensional. It includes short-changing of consumers by
businesses, product-adulteration, over-pricing, shareholders manipulation, tax evasions,
bribery, product misinformation, sales of expired goods etc. (Asolo, 2000). The
perception of an average international investor is that an average Nigerian
business man is not trustworthy. (Fafowora. O. 1998).
It
is not surprising therefore that Nigerian business do not have sustainability
potential. Businesses in Nigeria are founded on wrong principles that are
devoid of strong ethical anchor. Strong ethical anchor can assist Nigeria businesses
to grow and blossom into unforeseeable future (Ekanola A.B.2005). Most Nigerian
businesses are guided by narrow selfish interest. They often do not consider
ethical implications of their intra and inter
transactional behavior on critical stakeholders’ that include consumers,
society and the environment.
Unethical
business practices in Nigerian business terrain have therefore become a major
disincentive to the growth and sustainable development of existing and
potential businesses. Apart from the fact that absence of core ethical principles
exposes Nigerian existing businesses to growth retardation, honest potential
investors who might want to invest in Nigerian businesses are easily
discouraged (Purmis A. 1994, Asolo A.A.A. 2006). Nigeria currently has high
rate of dead businesses. Most businesses die because they basically abandoned
ethical
principles
from the onset. The challenge is now much more on prospective young
entrepreneurs who are also being discouraged to operate in an unhealthy and
unethical business environment. The business environment has become too hostile
for young and upcoming entrepreneurs.
With
the ongoing efforts by Nigerian government at promoting entrepreneurship due to
factors such as reduced revenues from crude oil and the need to harness
entrepreneurship potential towards sustainable national growth development,
there is critical challenge of mandatory incorporation of ethical principles
into business practices as a way of enhancing sustainable entrepreneurial
development in Nigeria. There is no doubt that entrepreneurship has been
globally acclaimed as antidote to growing unemployment. It is capable of
instigating growth towards
sustainable
national development. Beyond the call by
government for inclusion of entrepreneurship into the curriculum of Nigerian
educational institutions and the momentary policy directives by Central Bank of
Nigeria (CBN) for commercial banks to develop Entrepreneurship Support Schemes
(ESS) in their financial intervention mechanism, there is strong and urgent
need for enterprises in Nigeria to imbibe ethical practices as compulsory operational
requirements in order to attain sustainable entrepreneurial growth and
development.
It
is the position of this paper therefore that if Nigeria is to maximize the
benefits of entrepreneurial activities, enterprises in Nigeria must cultivate
ethical practices in their operational praxis. The problems of unethical practices
have caused the death of many businesses. The lack of ethical practices has
militated against Nigerian entrepreneurial development. Far more importantly,
the features of emerging economy included global outlook in which success oriented businesses and
entrepreneurs must take on character of international posture and the major
imperatives
for global entrepreneurial operation is ethical practices. The exigencies of
global business moral order has also make it mandatory for enterprises across
every nation (Nigeria inclusive) to operate within the confines of ethical
expectations both in local and international contexts. The sustainable
development of Nigerian entrepreneurship therefore must begin to acquire
ethical characters
It is common knowledge that the subject of
ethics in business has long been in focus amongst management scholars and
business leaders, alike. There is also broad agreement around the world that as
a matter of corporate policy, every business organisation should commit itself
to operating in ethically sound and transparent manner. This is seen as part of
the social responsibility of business, which hinges on the philosophy that
business ought to impact the society in ways that transcend the profit
maximisation objective (Dzansi, 2003, Deli 2003, de V Maasdorp & Van Vuuren
2004). The failure of most enterprise managers to operate in sound business
ethics has produced the monster: corruption, to rear up its ugly head.
This
topic could not have been better discussed than now having witnessed continuous
fraudulent practices and consequent despair in our countries, deriving from the
all embracing “get-rich-quick syndrome”. It cannot be over-emphasised that our
economies can be revived partly through conscientious efforts made both in the
public and private sectors to identify the problems of fraud and control them
following the principles of ethics, integrity, probity, transparency and
effective corporate governance (Deli 2003, Nieman 2006, Robbins 2001).
It
is important to present a working definition of important concepts in this
paper. The key concepts are: unethical practices, bane and enterprise
management. We shall begin by defining the concept of unethical practices. The
many faces of unethical practices have been tagged under the umbrella name:
corruption. Corruption could be variously defined. It is the use of public
office for private gains: “use of unsanctioned means to achieve unsanctioned
ends” (Johns 1996). In a broader perspective, it is the misuse of office for
unofficial ends. Corrupt acts include but not limited to (Asemota 2003): bribery,
extortion, influence peddling, nepotism, fraud, embezzlement, abuse of power.
Bane
could be defined as the “pest” destroying the effective management of both
human
and material resources in an enterprise.
Different
meanings have been attributed to the word “Management”. Management is defined
as “the process of getting things done through other people”. Scientifically,
management can be defined as the co-ordination of all the resources (human and
other resources) of an enterprise through the process of planning, staffing,
organising, directing and controlling in order to attain organisational
objectives (Robbins 2001).
Universality
of management, therefore, addresses the principles of management as generic
rather than specific. Consequently, management function is identical in all
forms of organisations whether it is profit making or not-for profit
organisations (Robbins & Decenzo 2001). This is so because all managers
perform the same type of functions. Additionally, people who occupy management
positions plan, organise, staff, direct and control. Managers get things done
through and with their subordinates. Their principal responsibility is to
achieve organisational objectives and goals through team or group efforts. The
concept of the universality of management implies that all managers
irrespective of their position in the organisational hierarchy perform at one
time or the other identical functions (Yalokwu 2002, Robbins & Decenzo
2001). This paper will therefore examine unethical practices in organisations
and management strategies adopted to curb corrupt practices. The paper is
divided into four sections. The first section analyses causes of unethical
practices, which disable effective enterprise management. The second section
examines consequences of unethical practices in enterprises while the third
section looks at the roles of employer, employees and challenges faced in
managing businesses ethically and the last part offers steps for managing
ethical behaviour in organisations, for overall enterprise and community
development.
1.2 STATEMENT OF PROBLEMS
The
conduct of business in many Nigerian organizations is inundated with a lot of
unethical practices. These unethical practices include cheating, lying, using
faulty scales for measurement, deceiving the customers/clients, etc. On the
short run, the effect of this conduct is quick profit which is ephemeral. On
the long run, however, the effect on the organization include bad reputation,
loss of customer loyalty, and low profit generation. Besides, it may trigger
off high employee turnover essentially because some of the employees may lose
confidence in the management and decide to leave the organization.
In
addition, foreign investors may be unwilling to invest in the country. The net
effect of this ugly act is low economic growth and development. Based on the
above scenario, therefore, this paper seeks to investigate the effect of
unethical practices in selected business organizations in Nigeria.
In the bid to maximize profit in the
prevalent get rich-quick syndrome of some fraudulent entrepreneurs, some
indulge in ill-practice of advertising. These unethical practice thus,
endangers the well-being of the society and the Nigeria culture in particular.
Absolute social responsibility to the customers of advertised goods and service
is not ensured due to the fact that buyers are often misted by chronic imitators.
As a result of a lot of people haven fallen victim of the unethical practice of
advertising known as passing off.
1.4 RESEARCH
QUESTIONS
To provide a framework for eliciting
solution to the research problems, it is necessary that some research questions
be formulated.
A number of research questions are
hereby given below for this reason.
1. Why do some advertisers neglect the ethics
of advertising practice?
2. What effects have unethical practice of
advertising caused?
3. Has APCON stipulated any measures to curb
illegal advertising?
4. Does advertising lack professional
application?
5. Why are the media involved in promoting
illegal advertising?
1.3
OBJECTIVES OF THE STUDY
The
broad objective of the study is to ascertain the cardinal reason that propel
people to exhibit unethical practices in the conduct of their business so as to
determine its effect on corporate image and profitability of the organization.
This research work aims at bringing to
limelight why illegal practice of advertising is on the increase. That is
evaluating why some advertisers neglect the laid down ethics of advertising to
pass through the “backdoor” it would also pin-point the set of advertisers who practice
advertising unethically.
Most importantly, it would look into
the extent of effects unethical practice of advertising has caused. This study
would also more whether APCON has devised other strict measures to penalize
illegal practitioners.
1.5 STATEMENT
OF HYPOTHESES/DEVELOPMENT
For
valid and effective work on this topic, the following key research hypotheses
would be addressed in the course of this study.
There are two types of hypotheses, the Null hypothesis that takes the
negative form and the Directional or Alternative hypothesis that takes the
positive form.
Let
H0 stand for Null hypothesis
Let H1 stand for Alternative hypothesis
H1: Some advertisers neglect the ethics of
advertising practice.
Ho: Some advertisers do not neglect the ethics
of advertising practice.
H2: Unethical advertising practice has effect.
H0: Unethical advertising practice has no effect.
H3: APCON stipulated measures to curb illegal
advertising.
H4: Advertising lacks professional application.
H0: Advertising does not lack professional
application.
H5: Media involves in promoting illegal
advertising.
Ho: Media do not involve in promoting illegal
advertising.
1.6 SIGNIFICANCE OF THE STUDY
It is the belief of the researcher that
this study would serve as immense useful purpose to its potential and
prospective users. Students, scholars, consumers of goods and services policy
makers, advertisers, advertising agencies and advertising researchers would
stand to gain a lot from the facts contained in this work. This study upholds
the high standard of an ideal advertising practice and therefore benefits the
advertisers and feaming consumers of advertised goods and services. It serves
as an eye opener to a good sense of advertising because the interest of the
consumers is paramount.
After close study of this research
work, the evil effects of unethical practice of advertising will be drastically
reduced, if not bought to an end.
1.7 SCOPE OF
THE STUDY
1.8 LIMITATIONS
OF THE STUDY
It is important to point out that the
scope of this study is to the vitafoam Nigeria Plc to determine the effects of
unethical practice of advertising in Nigeria.
The case study is a renowned company
which produces quality mattresses, cushions, pillows and upholstery sheetings.
The researcher’s choice of this area as her scope of study is for her generate
data capable of representing the needs find answers to the research questions.
Also it is to use a company that has
the same business and environmental characteristics with the within the target
population. This is to a largest extent will lead to the validity and
reliability of the instruments used for the study.
Despite all these opportunities, a lot
of obstacles were encounted by the researcher during the process of putting the
project together.
Among
them are:
a). Time
Constraints: A limited time frame was allotted to the research for
gathering of data and sourcing to research materials.
b). Finance:
Money was required at all stages of this study but could not gotten easily.
Effort was made by the research to ensure
that the research was carried out under conditions that led to scientifically
valid conclusion despite the financial problem.
This study is aimed at
investigating the impact of smuggling on the performance of our local
industries (Wood
Works Furniture, Abuja) as a model organization was used.
Because of resource constraints, Wood Works Furniture, Abuja,
was studied. All the department and
cadres of employees will be covered in the study to examine the impact of
smuggling on the performance of Wood
Works Furniture, Abuja.
LIMITATIONS:
The researcher faced
the problems of confidentiality. Wood Works Furniture employees sometimes were
not willing to give information. Although this problem was dealt with by the
researcher assuring members of staff that the information given will be used only
for research purposes and was to be treated as confidential. Another limitation
was Time. The researcher is a worker, a mother and also doubles as an entrepreneur.
Time is not always enough due to multiple events going on at the same time.
Finally, financial
constraint was another problem faced by the researcher; money to buy books,
stay connected online, moving around to various libraries etc. was one of the
major limitations. But be it as it may,
the researcher gave the project its best.
1.9 DEFINITION OF TERMS
The following are the
definition of terms used in this study, they include;
EFFECTS
The word effect can be defined in two
dimensions. On one hand, it could be regarded as negative and on the other
hand, positive. Effect is the negative, what affect the vitafoam in Nigeria in terms of advertisings both in positive and
negative.
The Oxford Advanced Learner’s
Dictionary explains effect in the form of change that yields a result. For
instance, one can ask, what is the effect of your discussion? But for this
work, an effect means the negative results of unethical or unprofessional practice
of advertising on the consumers.
UNETHICAL
This is obtainable when there is a
deviation from what is supposed to be. That is to say that one may have
exhibited an unacceptable behaviour against ones organization or society where
the person finds himself.
Negative practice by vitafoam
advertisers in Nigeria.
To this end, unethical here means
paying no regard to the laid down principles of advertising.
PRACTICE
When we say practice, if entails the
practicality of what is said, as in theory and practice. In football, for
instance, there is a time when the players are told what to do with the
football. And they yet to perfect in those lectures by practicing what is
taught them.
ADVERTISING
Advertising, like other promotional
techniques informs, persuades and reminds. It can change consumer’s, beliefs,
attitudes, images, and behaviour. But for advertising to be effective on a
national level, enormous expenditures are required. Advertising is a giant
industry.
Advertising is an avenue of creating
awareness of vitafoam in Nigeria.
NIGERIA
It is a geographical entity or area
that we practice advertising. It is also a continent in African or a country in
West Africa sub-region within the African
continent were advertisers shows unethical practice.
VITA
FOAM
It is a company which practices
advertising of foam in Nigeria. A company
under the Nigeria study of foam advert.
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