Labor relations remain a critical ethical issue in the global corporate world. Businesses have to balance the interest of key stakeholders, majorly employees, and investors when it comes to labor relations. Striking a balance would require businesses to leverage better pay and working conditions for its employees without compromising business investment returns. Business organizations have to strike a balance between investors and their employees on modalities that guarantee the sustainability of the business through negotiations (Wanvick, 2016). Past are the days when corporations had only investors to accommodate in their decision-making process; the corporate world has had to contend with the role of stakeholders other than investors whose interests define the place of the business in its operation (Eftimie, Moldovan, & Matei, 2012). Businesses have had to re-model their strategies to fit within a confined spectrum of what is allowable in the current globalized corporate world when it comes to labor relations (Rendtorff, 2009). The discussion paper centers on addressing the purpose of business negotiation in labor relations as an ethical issue by defining the communication and implementation strategies adopted by the organization.
Negotiation as a Proposed Ethical Policy
The need for businesses formulating socially conscious labor policies has seen several firms include CSR principles among their pillar models of internal management and external relations. According to Eftimie, Moldovan, and Matei (2012), businesses have since become attentive to stakeholder opinions and position in the active management of the businesses. Key stakeholders in several jurisdictions have included their employees, local communities, local governments, and interest groups that lobby for sectorial issues (Phillips & Freeman, 2010). Successful businesses have only managed to attain such levels of greatness in the past decade based on their ability to integrate a number of these factors into what otherwise would have been considered a closed exclusive business strategy (Langović-Milićević, Cvetkovski, & Langović, 2011; Gherghina & Vintila, 2016). It is in achieving such blended success that firms have looked to incorporate labor relations among its conscious ideas. Businesses have to negotiate labor relations with their employees, calling on corporate leaders to compromise and offset several business areas as a way of emerging as winners. Other integral aspects of society integrated with business products include environmental awareness and protection, social security, and sustainable development (Jackson, Doellgast, & Baccaro, 2018).
Delegate your assignment to our experts and they will do the rest.
The Purpose of Business Negotiation
Implementing CSR-oriented labor policies have called on the needs to compromise for purposes of leveraging the gains that exist in the corporate world. Business negotiation, therefore, comes in handy in ensuring that both the business and the society as represented by employees can benefit from a mutual coexistence (Doh & Guay, 2006). Businesses are known to be primarily motivated with returns and revenues while employees in the structures of communities are billed to champion for the better welfare state through remuneration. Business negotiations, in this case, allow both parties to balance their interests and prioritize on aspects that both find beneficial in ensuring business sustainability.
Advantages of Business Negotiation
According to Baumgartner (2008), negotiations as a principle in the global corporate environment allow businesses to find solutions on labor-related conflicts that might jeopardize their relationships with their employees. In an attempt to meet employees’ interests in areas of economic and social welfare, it is the responsibility of the business administrative structure to completely trust and lay foundations that would allow for resolution of existing labor conflicts (Khakhar & Ahmed, 2017). Negotiation as a principle of CSR allows firms to improve their relationship with their employees and other interest groups in a competitive environment (Jackson, Doellgast, & Baccaro, 2018). Through negotiation, businesses meet the interests of the key players in the market environment while managing to retain their control over the majority of social resources. Yermack (2017) notes that recognition of negotiation influence requires that all firms to o balanced between the urge to achieve financial benefits and meet their obligation to the communities in which they operate.
Disadvantages of Business Negotiation Strategies
Negotiations are often regarded as the ideal method of ensuring that parties in conflict find solutions either through compromise or agreement. However, in business instances, negotiations continue to be regarded to harbor various limitations. The limitations in a negotiation often arise from the failure by parties to compromise on what they perceive as a balanced process (Monshipouri, Welch, & Kennedy, 2017). In most cases, negotiations are often one-sided hence failing to solve the conflict between parties based on unequal power by participants, the voluntary nature, and the stall tactics involved (Aguilera, Judge, & Terjesen, 2018). If parties are never genuine in the negotiation processes, the outcomes can be stalling and in most cases, non-representative of the views of both parties. Less influential parties in negotiations are always ignored, and their opinions overlooked based on power and influence.
Communication in Negotiation Implementation
Communication plays a critical role in any negotiation process. Business negotiation as a strategy in management requires that business position themselves as an approachable and compromising partner in discourses to avoid unnecessary conflicts with its employees and other stakeholders (Eftimie & Moldovan, 2011). According to Rendtorff (2009), stakeholder engagement forms the bulk of the areas where firms need to express themselves on matters of that involves resource control and activities that involve other members of the community. It is, therefore, imperative that communities work towards implementing policies that are integrated with the beliefs and considered consistent with the norms in the local community (Baddache & Nicolai, 2013). Business organizations that succeed through negotiations adopt a win-win model of negotiations where the business is often willing and in a position to support and compromise on an issue that may compromise the relationship between the business and key stakeholders.
Until the 20th century, labor issues in industries were never as regarded as today; workers had to form unions that were used to champion for their labor rights. Other issues were on the ecological resource use and management where businesses could extract resources and pollute the air without any feeling of responsibility. Espinoza, Guerra, and Velasco (2017) acknowledge that, since the turn of the century, businesses have had to conform to several environmental principles that to an extent attract high costs and human capital to address. Companies have had to employ staff competent in areas of environmental management and pollution control to ensure that they conform to the laid regulations on environmental and resource use (Broome, Homolar, & Kranke, 2018). In most cases, these negotiated terms often attract costs on the part of the businesses, but as a way of remaining compliant; businesses have often complied with permits and paid if they are liable (Caputo & Borbely, 2016). The level of compromise and ability to leverage on gains has seen the existence of a win-win model where companies remain compliant with the regulations on environmental use to the benefit of the community as the business attracts from improved approvals and customer base.
Strategies for Monitoring and Compliance
Monitoring of compliance in negotiation as a business strategy for CSR-oriented policies requires several tools and deliberate actions. Negotiations are the first complicated stalling processes that may take time to realize their materialized outcome. However, in the case of monitoring negotiation compliance, it is important that businesses review the social approval index from their immediate community (Ahammad et al., 2016). If the business continues to receive a higher approval index on its products and customers, then the negotiation processes between the business and stakeholders are working. Businesses should be able to register a higher compliance rate with several regulations as stipulated on by the local authorities without feeling coerced into taking part (Stanford, 2017). Compliance measurement can be evident when businesses integrate values and attitudes of the local communities into their principle as a means of fitting in with the community.
References
Aguilera, R. V., Judge, W. Q., & Terjesen, S. A. (2018). Corporate governance deviance. Academy of Management Review , 43 (1), 87-109.
Ahammad, M. F., Tarba, S. Y., Liu, Y., Glaister, K. W., & Cooper, C. L. (2016). Exploring the factors influencing the negotiation process in cross-border M&A. International Business Review , 25 (2), 445-457.
Baddache, F., & Nicolai, I. (2013). Follow the leader: how corporate social responsibility influences strategy and practice in the business community. Journal of Business Strategy , 34 (6), 26-35.
Baumgartner, R. J. (2008). Corporate sustainability performance: Methods and illustrative examples. International Journal of Sustainable Development and Planning , 3 (2), 117-131
Broome, A., Homolar, A., & Kranke, M. (2018). Bad science: International organizations and the indirect power of global benchmarking. European journal of international relations , 24 (3), 514-539.
Caputo, A., & Borbely, A. (2016). The firm’s strategy and its negotiation capability: the Ryanair case . Retrieved from https://core.ac.uk/download/pdf/42585541.pdf
Doh, J. P., & Guay, T. R. (2006). Corporate social responsibility, public policy, and NGO activism in Europe and the United States: an institutional‐stakeholder perspective. Journal of Management studies , 43 (1), 47-73.
Eftimie, M., & Moldovan, R. G. (2011). Choosing the Best Method for Conflict Resolution According to the Intensity. Petroleum-Gas University of Ploiesti Bulletin, Technical Series , 63 (4), 73-82.
Eftimie, M., Moldovan, R. G., & Matei, M. C. (2012). The Negotiation Role in the Corporate Sustainabilility. Case Study. Word & Text: A Journal of Literary Studies & Linguistics , 2 (1).
Espinoza, F. A., Guerra, E. M., & Velasco, N. E. (2017). A role-based model in the service industry: An ethical perspective. International Business Management , 11 , 1882-1891.
Gherghina, S. C., & Vintila, G. (2016). Exploring the impact of corporate social responsibility policies on firm value: The case of listed companies in Romania . Economics & Sociology, 9 (1), 23.
Jackson, G., Doellgast, V., & Baccaro, L. (2018). Corporate Social Responsibility and Labour Standards: Bridging Business Management and Employment Relations Perspectives. British Journal of Industrial Relations , 56 (1), 3-13.
Khakhar, P., & Ahmed, Z. U. (2017). The concepts of power in international business negotiations: An empirical investigation. Journal of Transnational Management , 22 (1), 25-52.
Langović-Milićević, A., Cvetkovski, T., & Langović, Z. (2011). NEGOTIATION AND GLOBALIZATION. Annals of the Faculty of Engineering Hunedoara-International Journal of Engineering , 9 (3).
Monshipouri, M., Welch, C. E., & Kennedy, E. T. (2017). Multinational corporations and the ethics of global responsibility: Problems and possibilities. In Human Rights and Corporations (pp. 123-147). Routledge
Phillips, R. A., & Freeman, R. E. (2010). Stakeholders . Edward Elgar Publishing
Rendtorff, J. D. (2009). Responsibility, Ethics and Legitimacy of Corporations . Copenhagen, Denmark: Copenhagen Business School Press. Retrieved from http://site.ebrary.com.library.capella.edu/lib/capella/docDetail.action?docID=10465558
Stanford, D. (2017). Are CSR and Fair Trade the New Diplomacy? International Policy Digest. Retrieved from https://intpolicydigest.org/2017/05/12/are-csr-and-fair-trade-the-new-diplomacy/
Wanvik, T. I. (2016). Governance transformed into corporate social responsibility (CSR): New governance innovations in the Canadian oil sands. The Extractive Industries and Society , 3 (2), 517-526.
Yermack, D. (2017). Corporate governance and blockchains. Review of Finance , 21 (1), 7-31.
