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Business ethics and corporate social responsibility
Introduction
Anglo American is one of the world’s leading mining companies. It is a UK public limited company and operates on a global scale. Anglo American operates mainly in the primary sector of the world economy. This, as the name suggests, covers industries involved in the first stage of economic activity, such asmining and agriculture. Anglo American operates throughout the world. It has extensive operations in Africa, where 76% of its employees live. It is also a major employer in Europe. Its Tarmac aggregates and construction products business employs nearly 7,000 people in the UK. As a primary producer, Anglo American plays an important role in the world economy. Anglo American produces five maintypes of raw material.

CURRICULUM TOPICS • Business ethics • Corporate social responsibility • Effects of ethical behaviour • Benefits of ethical behaviour

GLOSSARY Public limited company: a company whose shares are traded on the London Stock Exchange, denoted by the initials plc. Primary sector: the first stage in producing goods. Pressure group: an organisation formed by people with a commoninterest who get together to further that interest, for example, nongovernmental organisations. Ethics: moral principles or rules of conduct and behaviour accepted by members of society. Corporate social responsibility: the responsibility of an organisation to wider society, to a range of stakeholders including the community and society at large.

Mining operations can have a big impact on theenvironment and on the societies where they work. Since most mineral resources belong to nation states, mining companies largely depend upon a licence to operate from governments. This allows them to extract and process minerals in return for investment and the payment of taxes and royalties. Increasingly it is also important to get the consent of local communities to mining development – a ‘sociallicence’ to operate. Like all businesses, mining companies are under increasing scrutiny from pressure groups as well as the general public. Anglo American seeks to adopt fair and sound business practice. The company believes that it has an important role to play in building the capabilities of the communities where it works. Issues such as combating corruption and promoting revenue transparencyare high on the company’s business agenda. This case study shows how Anglo American seeks to make ethical choices in its business practice.

What are business ethics?
Business ethics are moral principles that guide the way a business behaves. The same principles that determine an individual’s actions also apply to business. Acting in an ethical way involves distinguishing between ‘right’ and‘wrong’ and then making the ‘right’ choice. It is relatively easy to identify unethical business practices. For example, companies should not use child labour. They should not unlawfully use copyrighted materials and processes. They should not engage in bribery. However, it is not always easy to create similar hard-and-fast definitions of good ethical practice. A company must make a competitive returnfor its shareholders and treat its employees fairly. However a company also has wider responsibilities. It should minimise any harm to the environment and work in ways that do not damage the communities in which it operates. This is known as corporate social responsibility.
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The law is the key starting point for any business. Most leadingbusinesses also have their own statement of Business Principles which set out their core values and standards. In Anglo American’s case, this is called ‘Good Citizenship’. A business should also follow relevant codes of practice that cover its sector. Many companies have created voluntary codes of practice that regulate practices in their industrial sector. These are often drawn up in consultation with...