FULL PAPPER APPLICATION OF BUSINESS ETHICS



Application of Business Ethics Values ​​in Companies
In the Special Region Yogyakarta 



Sri Haryani
Lecturer from college of management sciences, YKPN Yogyakarta, Indonesia
(bundaninik@gmail.com)

ABSTRACT
Business ethics can be described as a business or a company whose entire activity is based on ethical values​​. The company is not only pursuing purely economic interests but also the interests of stakeholders overall. Although business ethics has been believed by many parties provide benefits in maintaining the viability of the company, but in practice it was found unethical business. The analysis of the existence of unethical business in Indonesia, among others, due to the prerequisite that has not been adequate, in example a society that uphold ethics and law enforcement are  relatively weak. Ethics violation will not cause rejection or pressure from the community. In practice, companies implementing ethical values ​​in various forms, such as codes of ethics, code of conduct, corporate social responsibility and good corporate
The results of this study indicate that in general the company's emphasis on ethics at a moderate level, which is 3.916 of the scale of 5. Time/long operation  have a positive impact on corporate emphasis on ethics. Long operation to give confidence and stability for the company to implement ethics in  business activities. Business sectors affect the level of emphasis on business ethics, in which different stakeholders gives a different effect in implementing ethics in their business activities.
Keywords: ethics, business ethics, principle of ethics, old business, and business fields


1.       INTRODUCTION
1.1. BACKGROUND
Economic globalization also led to a global business competition. Local companies not only face the same competitors in the region, but also a global company in Indonesia. Various types of local businesses such as fried chicken, grocery stores, snack, furniture, constructions, etc. must now compete with global company. In conditions as above, some companies can survive and thrive, but there is also a decrease and even go bankrupt. Companies trying hard to win the competition, but often because the situation is quite difficult, they were forced to close to unethical or even unethical. They tend to just obey the rules of law which sanctions have clear and binding, compared with the sanction of business ethics is not straightforward. This is compounded by the weak rule of law in Indonesia, so that violations of existing laws and legal sanctions are often not enforced.
Business ethics can be described as a business whose entire activity is based on ethical values. That is, in an ethical business interests of various parties (stakeholders) need to be balanced. For example, a furniture company concerned parties such as suppliers, retailers, consumers, advertising companies, government, community, physical environment, and of course the employees in the company itself.
Although business ethics has been believed to be many benefits in maintaining the viability of the company, but in practice it was found unethical business. Analysis of the existence of unethical business in Indonesia, among others, due to inadequate pre-requisite, namely people who uphold ethics.
Ethics violations will lead to rejection from society, either in the form of rejection of goods or services produced or rejection of the existence of the company. Society can sue the company was closed, as it is considered unethical. In a society that less ethical holds     (such as Indonesia), not enough or no pressure for companies that are unethical. This condition is used by businesses with no heed to ethics in business.
In addition to the requirements as above, reluctance to run the business according to ethical business due to the assumption that the application of ethics will have an impact  on  costs. This will indirectly reduce the level of benefits. While a violation of ethics does not carry significant consequences for its business.

1.2. PROBLEM FORMULATION
Formulation of the problem posed in this study is how the ethical emphasis of the companies that are in Special Region of Yogyakarta, seen from the nine (9) Principles of ethics, namely adherence to the rule or law, honesty, transparency, accountability, responsibility, fairness, empathy, togetherness, and independence. The second formulation of the problem is how this business field and time/long operation to influence the level of emphasis on business ethics.

1.3. RESEARCH OBJECTIVE
The research was conducted with the primary objective to know how the emphasis of existing business in the Special Region of Yogyakarta on business ethics. In addition, this study aims to see how the long operation  and field of business affects the company's emphasis on business ethics.
1.4. BENEFIT OF RESEARCH
Some of the benefits gained by the implementation of this research are:  know suppression of the existing business in Yogyakarta Special Region of ethics in business, give information in relation to the long operation and field of business to ethical  emphasis. The results can also be utilized by the parties concerned and interested in the enforcement of business ethics such as government, business associations, consumer organizations, the private ombudsmen institutions, and education in disseminating and enforcing ethics.


2. THEORY STUDY AND CONCEPTUAL FRAME WORK

2.1. BUSINESS ETHICS
Big Indonesian Dictionary gives the definition of ethics  is  a science of what is good and what is bad, as well as moral rights and obligations. What is considered good and bad and moral right and  obligation is to be used either in the process of determining the reason, decision making and behavior resulting from the reasons and the decision. Laura Nash defines business ethics as a study of how one's moral norms are applied in the activities and objectives. Business ethics deals with three areas of managerial decision making, namely: first, to choose how the law should be and how to follow the law. Second, choose the issues of economic and social development outside the legal domain. Finally, choose whether to give priority to the interests personal or corporate interests.

Individuals who hold a strong ethic in his life, he has a greater tendency to apply ethics in business activity. Because there has been internalized ethic in him, so that its activities will be colored by ethical values, including in business activity. Business people to formulate business ethics based on morality and values ​​are believed to be the truth, so that there is seemingly no clear distinction between business ethics with personal ethics.

Business activities are based on ethical values ​​required for long-term success. Ethical behavior is reflected in how the relationships that occur in the business chain, such as with suppliers, employees, distributors, and consumers. Each link in the relationship must always keep the ethic that underlies the belief that business relationships can be maintained. Ethical behavior is one of the main components in building corporate reputation.
Internally, the application of ethics will improve employee performance and loyalty to the company. Companies that implement ethics, it will pay attention to employees' rights fully. This will impact on increasing employee loyalty and performance.

2.2. THE SOURCE OF BUSINESS ETHICS
As a standard that will be the basis of reason, influence behavior and decision-making  processes, business ethics refers to a variety of sources. The meaning here is a reference source that something which was the reason, influence behavior and decision-making process was assessed correctly. Sources of ethics among others, come from four (4) main source of religious, philosophical systems, cultural experiences, and the legal system (Haryani and Imam: 2007).

2.2.1. Religion
Religion is a system that govern faith or belief and worship of Almighty God and the grammar rules that relate to human interaction with humans and their environment. Religion aims to lead people to salvation. The central role of religion is what makes religion as a source of ethics.
Source of ethical values ​​derived from religion is explicit and implicit in scripture, doctrine, history of the prophets, and the interpretation of religious leaders. Within each religion contains a variety of rules, calls, appointments, and threats about various aspects of life, including in business activity. For example, Al Qur'an load restrictions to reduce weight, fraud, and hoarding. Business people who adhere to religion, then he will not do weight reduction activities, fraud, and hoarding, because such actions are prohibited by religion.

2.2.2. System of Philosophy
Philosophy according to Big Indonesian Dictionary is the underlying theory of mind or an activity. While it is defined as the ethics and moral values ​​that are used both in the process of determining the reason, decision making and behavior resulting from the reasons and the decision. Therefore, the underlying philosophy of mind and human behavior is in line with ethics.
When business people will apply ethical values ​​in business activity, the majority come from the philosophy of ethics, namely as a value of the underlying nature of mind and behavior. Philosophical system can be used as the source of ethical values ​​as the result of a philosophy which is thought to underlie the nature of mind and behavior will result in an assessment of something that is judged good or bad and something that is considered right or wrong (Haryani and Imam: 2007).

2.2.3. Culture
Culture is a standard, rules and values ​​that are believed and practiced by a group, community, or society and are passed from generation to generation (Haryani and Priest: 2007). Forming one's culture so that it behaves as expected and accepted that culture. A value that is believed and considered both by the particular culture may be judged otherwise by another culture or a value which in the past is relevant, but is now considered irrelevant.
In situations where there is interaction between people of different cultures, there will be interaction between cultures. This intercultural interaction would indirectly introduce someone to a different culture, so they automatically lead to mutual acceptance of foreign cultures. They respect the culture that believed or embraced by others, so it can be said to accept the culture as something that is considered good.

2.2.4. Legal system
Law is coercive rules, created by the official authorities, which determine human behavior in society, and result in penalties against certain violations. Formally apply the law within a society or nation. Law can be codified and formalized ethical values. Yet the law can not cover and accommodate all ethical values ​​in society.
In situations where an ethics codified or formalized in law, is often seen as a decrease in the degree of ethics. Ethics should be followed by the public, regardless of whether or not there are legal sanctions. However, the presence of a law could be interpreted as an operational and practical explanation of ethics to regulate people's lives for the better (Haryani and Imam: 2007).
The legal system can be a source of ethical business behavior to determine which one is considered good and what is not good behavior, and behavior which are inaccurate and which are assessed correctly. Determining the size of the good-bad and right- wrong can be seen whether the behavior of a company violates the law in a country or not. An ethical business behavior is assessed, one of them if it does not violate any applicable laws.

2. 3. PRINCIPLES OF BUSINESS ETHICS
In practice the company basing its business activities on the values ​​that are considered good. Among the values ​​that made ethical principles,  Haryani and Imam codified into eight (8) and added one of the five principles of the togetherness.

2.3.1. Complience with the rules and principles of Law
According to the principle of complience to the rules and laws, companies and institutions must abide by the rules and laws. In general, a company incorporated in a particular country will follow the rules and laws of the country. But if the company was operating in another country, then the company must follow the rules and laws of other countries.

2.3.2. Principle of honesty
The principle of honesty  means that all individuals in the company or institution must uphold honesty attitude of duty which they are responsible. The principle of honesty in a broad sense not only about material things, but also non-material such as information, words, and deeds.

2.3.3. Transparency/openness
The principle of transparency is to be willing to do the principle of transparency in implementing the decision making process and put forward relevant material information both about the services, products, companies or institutions and policies to stakeholders. The principle of transparency is necessary to a mutual communication between individuals in the company.

2.3.4. Accountability
The principle of accountability with regard to clarity of functions, implementation, and accountability of manager, so that management  can efficiently and effectively. One way to achieve accountability is done by preparing a job  description which determine the duties, responsibilities, and accountability.

2.3.5. Responsibility
The principle of responsibility is a principle of conformity in the management of the company or institution with obligations to all stakeholders. Fulfillment of obligations concerning the scope of liability to both internal and external stakeholders about what they are entitled to.
2.3.6. Fairness
The principle of fairness based on the management of companies or institutions of justice and equality in fulfilling the rights of stakeholders that arise due to contractual and applicable regulations. Thus in the same case, then everyone should be treated equally. Because the principle of fairness is also based on justice, so that in deciding something needs to consider fairness in general.

2.3.7. Empathy/compassion
The principle of empathy is the treatment principle to the stakeholders as the company would be treated. In principle, if the company does not want to be lied to, then the company will not lie to anyone. If companies want to be treated fairly, then the company will treat everyone fairly, and so forth.

2.3. 8. Togetherness
According to the principle of togetherness of all individuals are required to further the interests of the company or institution rather than the interests of individuals or groups. Facilities and benefits enjoyed by all individuals, as well as difficulties and problems should be shared.

2.3.9. Independence
The principle of independence is a situation in which a company or institution professionally managed without conflicts of interest and pressure from any party. This principle requires the determination of management, not only because of the pressure that can cause stress but also the possibility of reduced revenues.

2.4. INSTITUTIONALIZATION OF BUSINESS  ETHICS
Awareness of the need for businesses to implement ethical values ​​in business practices intensified. This is partly due to pressure from various parties, particularly from the global society that requires businesses to pay more attention to environmental issues, human rights, labor rights, and protection to children and women.
Institutionalization of business ethics to be one important indicator of commitment in implementing business ethics at the internal level of the company. Forms of institutionalization of business ethics, among others:  code of conduct, code of ethics, corporate social responsibility, and good corporate governance.

2.4.1. Code of Conduct

Code of conduct is a set of rules outlining the responsibilities of or proper practices for individuals, groups, or organizations. Many companies develop codes of conduct that will guide the company's internal, such as Five Principles from STIM YKPN  Yogyakarta that consisting of Honesty, Togetherness, Transparency, Participa-tion, and Insights into the future.
There are many codes of conduct that would serve as guidelines for community members. For example for Muslims will obey a code of conduct Pillars of Islam (Five Pillars of Islam) which consists of the creed (belief), prayers, alms, fasting, and pilgrimage. For the whole of society Indonesia will behave in accordance with the Pancasila which consist of Divinity, Humanity, Unity, Democracy and Justice.

2.4.2. Code of Ethics
According to Big Indonesian Dictionary, codes of ethics can be defined as the norms and principles are accepted by certain groups as a basis for behavior. Corporate codes of conduct drawn up as a reference for all parties within the firm and outside parties relating to the business of the company in performing its duties and decision making. In detail, the company is preparing a code of conduct with the aim to develop good behavior in accordance with high ethical standards for the corporation, directors and all employees and to develop good relationships with external parties.

2.4.3. Corporate Social Responsibility  (CSR)
Corporate social responsibility or CSR is better known by the company's efforts to balance the commitment to groups and individuals in its environment, including customers, other businesses, employees, and investors (Griffin & Ebert: 2002).
Context of social responsibility is more emphasis on concern the company against the interests of stakeholders in the broad sense of the company's concern for the interests of the company alone. The Company is responsible for its actions and activities that impact on certain people, society and the environment in which companies conduct their business activities, so it does not have a negative impact on certain parties in the community.

2.4.4. Good Corporate Governance (GCG)
Good corporate governance (corporate governance)  a set of rules that define the relationship between internal and external stakeholders, such as managers, creditors, employees, suppliers, etc. Implementation of good corporate governance encourage healthy competition and a conducive business climate, which in turn will menunjanga growth and economic stability.
Given the importance of the implementation of good corporate governance at the enterprise or institution, the government established the National Committee on Governance (NCG) to develop Code of Good Corporate Governance Indonesia. Guidelines covering aspects of transparency, accountability, responsibility, independence, and fairness and equality. These aspects are intended to achieve business sustainability  by taking into account the interests of all stakeholders.
2.4.5. Why companies should behave ethically?
Application of business ethics in the company require prerequisite people who  uphold ethics. Thus the existence of ethics violations will lead to rejection of society, both the rejection of products (goods or services) and the rejection of the existence of the company itself. In the absence of preconditions as above, there are no consequences in the form of moral sanction, social sanction, as well as legal sanctions for companies who ignore ethics. However, when analyzed further, then there are consequences.
2.4.5.1. Companies will lose competitiveness
 Competitiveness of companies one of which comes from human sources. With the human resources that are unethical, then the company does not earn the trust of stakeholders, such as employees, customers, suppliers, competitors, and others. Distrust impact on the demands presented to companies that will add costs to the company. Additional costs will lead to rising prices, or if the price is fixed,  than the profits will be reduced.
2.4.5.2. Companies will left consumers
Availability of similar products or substitute products in the market caused consumers to have a great opportunity to choose. Unethical corporate customers will soon be abandoned, either to switch to other similar products or products that are substitutes. Similarly, unethical broker/intermedia-ry  will also abandoned its customers and will switch to another intermediary or it will buy directly to the manufacturer.
2.4.5.3. Company will bring  legal consequences
Unethical business behavior can impact on the stakeholders, whether customers, suppliers, distributors, employees, governments, and communities. In certain cases where the demands put forth enough material economic or significant influence, stakeholders will submit the matter to court. Litigants in court take  time and no small cost. Moreover, if the company is found guilty then the company will lose materially.
2.4.5.4. Impact on company's good name
Defamation may be caused by a valuation firm guilty in court. Besides consumers, consumer organizations and other institutions such as the Healthy Competition can also provide an assessment of whether or not ethical business behavior. This assessment will impact the company's good name.
3.       METHODS
3.1.     POPULATION AND SAMPEL
The population in this study is that there are companies in Yogyakarta, both companies were owned by people from outside Yogyakarta and Yogyakarta, long running activities or business activities in the area of ​​Yogyakarta. In addition, this study does not limit the field of business, so any field of business enterprises throughout its business activities in the Special Region of Yogyakarta, the study population.
From various companies in Yogyakarta with a variety of business fields, and then performed sampling. The selection of the sample in this study using simple random sampling method, the method of sampling by providing equal opportunities to the entire population to be selected into the study sample. (Soeratno and Arsyad: 2008).
3. 2. RESEARCH VARIABLES
Conceptually, these aspects will be studied in each variable can be seen from the definition of operations. In this study, there are several operational definitions as follows:
3.2.1. Emphasis on business ethics variabels
Emphasis on business ethics variables shows how the company's emphasis on the principles of business ethics. This variable is determined  using a Likert scale, with a scale of 1 to 5, 1 is not empha-sized and 5 is very emphasized.
Emphasis on business ethics variables is determined by the following nine principles:
3.2.1.1. Compliance with the law
Compliance with the law, consists of:
1.        Establishment of the company meets the terms / conditions apply
2.       Certificate of incorporation with the notary and legalized by the Ministry of Justice and Human Rights
3.       Business activities are carried out in accordance with the proposed permit
4.       The company has a taxpayer number
5.       The company pay corporation tax
3.2.1.2. Honesty
Honesty consisting of:
1.     Prepare single financial statements
2.     Inform the fines/penalties for the customers they do not fulfill their obligations
3.     Inform the costs to be borne when customers buy products or use the services of the company
4.     Amount of goods or services received by customers as agreed earlier
5.     Fill in the box according to the informed

3.2.1.3. Transparency/openness
Transparency consisting of:
1. Profit-sharing policy can be accessed by all internal stakeholders
2. Inform the type of business/activities to the local community
3. Amount of goods or services received by customers in accordance with the initial agreement
4. Inform corporate purpose or mission or vision to Employees
5. The company provides personnel serving consumer inquiries and complaints

3.2.1.4. Accountability
Accountability consisting of:
1. Develop a job description that contains the  duties and responsibilities of each employee
2. All employees know their rights and obligations
3. Orders and assignments given by superiors to subordinates clearly 
4. Superiors evaluate subordinates
5. The results of the evaluation submitted to the employee and given feedback

3.2.1.5.    Responsibility
Responsibility consisting of:
1. Companies do not pay wages below the minimum wage
2.  Involve employees in Social Security/insurance
3.  Stakeholders receive the profits of the company
4. Company's obligations to external parties (suppliers, distributors, creditors, etc.)
5.  Companies are willing to fulfill what had been promised to the customer

3.2.1.6.    Fairness
Fairness consisting of:
1. The Company treats all employees fairly
2. The Company treats all suppliers fairly
3. The Company treats all distributor fairly
4. Profits enjoyed by all appropriate stakeholders participation
5. Companies to strive for its existence does not harm the surrounding communities

3.2.1.7. Empathy
Empathy consisting of:
1. Company treat employees as to which company would be treated
2. Company treats the supplier as to which company would be treated
3. Treats competitors as the company where the company wants to be treated
4. Treat customers as the company where the company wants to be treated
5.  Companies   treat communities    as companies want to be treated
3.2.1.8. Togetherness

Togetherness consisting of:
1. Profit enjoyed by participation of all stakeholders  proportionally
2. Compan engage employees in the company plan
3. Company engage  employees in decision making
4.  Financial losses, the company reduced the rights of all stakeholders equitably
5. Along with the progress of the company, the company undertook the development of employee
3.2.1.9. Independence
Independece  consisting of:
1.  Forming corporate decision without pressure from outside parties
2.  Pricing  based  on consideration of profit - loss not due to the influence of outside parties who would receive the benefit of the pricing
3.  Write down the price/cost of transactions that take place in accordance
4.  Companies follow the rules/laws that apply to your own consciousness
5. Corporate social responsibility without the outside pressure
In the analysis, the emphasis of the company's business ethics are categorized into three (3) groups: high, low, and moderate. Grouping into the category of high, low, and moderate are as follows:
1. Scores categorized as low if the score is below average  (X) minus 1 standard deviation (α).
2. Scores categorized as moderate if the score is the average (X) minus 1 standard deviation (α) to the average score (X) plus one standard deviation (σ).
3. Scores categorized as high if the score is above average  (X) plus one standard deviation (σ).

3.2.2.    Variable Long/time Operation

Variable long or time business operations in Yogyakarta, is determined by the number of years the company was operating in Yogyakarta. In further analysis, the long operation are grouped into three (3), namely: less than 5 years, between 5-10 years, and more than 10 years.

3.2.3. Variable Fields of Business
The variable fields of business are determined based on a cultivated field during this time, which may include business services and non-service. In detail, the business may include: manufacturing/ fabrication, trade, transprtasi, tourism, contractor, furniture, printing, rentals, catering, restaurant, hospitality, delivery service workers, and others.

3.3. DATA COLLECTION METHOD
Collecting data using a questionnaire which is divided into two sections, first, company's emphasis on ethical principles both in terms of complience to the law, honesty, transparency /openness, accountability, responsibility, fairness, empathy, togetherness, and independence.
Second, fields of business and long/time  operations. In the event the company is a branch  of a company outside of Yogyakarta, it is the long of operation is calculated as the long of operating in the Yogyakarta area.

3.4. DATA ANALYSIS
3.4.1. Cross Tabulation Analysis
Cross tabulation analysis or elaboration technique is a method of analysis using the percentage distribution of cells in the table as a basis to infer relationships among the variables under study. The relationship between the variables of the study indicated the degree of influence of independent variables on the dependent variable. The number of respondents for each independent variable are recorded and then used in the interpretation. Tables prepared by composition of the dependent variable as independent variables as rows and columns (Singarimbun & Effendi, 1990).
Cross tabulation analysis is used to describe the relationship  variable long business operation as independent variables with an emphasis on business ethics company as the dependent variable. Second, variable fields of business as an independent variable with the company's emphasis on business ethics as a dependent variable.

3.5. TIME AND PLACE RESEARCH
The research was conducted in Yogyakarta Special Region, by selecting the companies that run their business activities in the Special Region of Yogyakarta. Implementation of the study began in November  2009 to March 2010.
4. RESULTS AND DISCUSSION
4.1. THE EMPHASIS OF BUSINESS ETHICS
Description of the general emphasis of the strategy shows that the average company's emphasis on business ethics at 3.916 and the standard deviation (σ) of 1.136. That is, the average company's emphasis on the application of business ethics in its business activity of 3.916. However there are deviations of 1.136 from the average. With a scale of 1 to 5, emphasis on ethics in the line of the continuum is described as follows.
1 ........... 2 ........... 3 .......*. .4 .......... 5
            3,916
The average value of 3.916, thus it can be said that in general the dimensions contained in the ethical principles emphasized by the company.
The results provide a signal or a positive indication that firms in the Special Region of Yogyakarta emphasize its business activity on ethical values. This condition needs to be improved or at least be maintained. The parties concerned and interested with the first rule of business ethics is the government. Government concerned with the first principle of ethics is obedience to the law. Government is responsible to bring order,  peace, prosperity and happiness in the order of social life. Companies that comply with the law will help the embodiment of order, peace, prosperity and happiness in the order of social life.
Talking about consumer protection, then that has become the foundation of society to protect its interests as a consumer is a consumer organization. Consumer demand for the company to comply with the Act No. 8 of 1999 on Consumer Protection. Although the company thus uphold ethics, not just observe the interests of consumers, but also stakeholders as a whole.
Educational institution has wide opportunities to spread the ethics of business, both to students in the hope of the future can implement a business ethics into his company or the company where he works. Additionally educational institutions can distribute business ethics directly to employers, in the form of community service and consultancy
Speaking about the factors that cause decline in ethical values, the cause not only of individual owners and the management company itself but also external factors. Several external factors, among others, competition is too keen, government employees who misappropriate authority and power, as well as law enforcement is not going well.
4.2. THE EMPHASIS OF BUSINESS ETHICS AND FIELD OF BUSINESS
The variable field of business is also a significant variable in the discussion of the application of business ethics, since each business has different circumstances that impact on ethical behavior is also different. For example, the contracting industry is most vulnerable to ethical issues, namely the independence dimension. In the practice of tender, submission of the project value can be affected by its competitors, government employees, the people who deal with tender and  and even from business associations.
The relationship between the business with an emphasis on business ethics can be seen in Table 1. Of all sample firms, as many as  2.7% company had an emphasis on ethics at a low level. Manufacturing companies in the field of business is generally more emphasis on the ethical dimension of compliance with the legal aspects of it. Along of aspects of the establishment and operation in accordance with the provisions of the law, they already feel safe.
Other things outside the law received less emphasis, as in relation to the workers. In situations where the labor supply far above demand, the employers are very strong bargaining power. With a strong bargaining power, then the policies will tend to be top down, so the relatively small participation of employees, including the transparency and friendship/camaraderie among employees and employers.
Table 1
Relationship of business with an emphasis on business ethics (%)


Line of business
Emphasis on business ethics
Low
Moder-ate
High
Total
Tourism & transport
              0
 5.41    50.00
 5.41    50.00
100
Furniture
              0
 5.41   66.67
 2.70    33.33
100
Manufacturing
 2.70  11.12
10.81  44.44
10.81  44.44
100
Contractors
              0
10.81 100.00
 0              0
100
Trade
              0
 8.11   50.00
 8.11   50.00
100
Printing
              0
 0              0
10.81100.00
100
Various Services
            0
 8.11   42.86
10.81   57.65
100
Total
 2.70
48.65
48.65
100
Sources: the research data 2010

A total of  48.65% companies with emphasis on business ethics at a moderate level. The most interesting part of the company with an emphasis on business ethics at the moderate level is that all companies in contracting field is in moderate emphasis. In the contracting field, the business did not distinguish the long operation. Field observations indicate that all contractors (no distinguish the length of operation) is more applicable provisions of legal/law, thus avoiding non legal consequences, such as the good name and left consumers.

A total of  48.65% companies with an emphasis on high-level business ethics. The most interesting part of the company with an emphasis on business ethics at a high level is that all areas of business printing company with the emphasis being on high. It should be appreciated, because no matter how long his business, it does not distinguish its emphasis on business ethics. The companies recently founded until that has experienced more than 20 years, the emphasis on business ethics remain high.

Meanwhile, for the furniture business by 66.67% with an emphasis on business ethics at a moderate level. If the degree of emphasis on ethics in the furniture business is broken down by the nine (9) the dimensions of business ethics will appear as follows:



Table 2
The value of each dimension of Business Ethics for furniture business

Ethical principles
Average value
Level emphasis
Compliance with the law
4.50
Height
Honesty
4.20
Height
Transparency
4.00
Medium
Accountability
3.93
Medium
Responsibility
3.93
Medium
Fairness
3.93
Medium
Empathy
4.10
Height
Togetherness
4.10
Height
Independence
2.90
Low
Source: Data from 2010 study

From table 2 above, companies in the furniture business has a high emphasis on the dimensions of complience to the law, honesty, empathy, and togetherness. While the emphasis on the moderate on the dimensions of transparency, accountability, responsibility, and fairness. This business field has an emphasis on low level for the dimension of independence. Further study of the dimensions of this independence is that the firm write down the magnitude of the price of furniture is often inconsistent with actual transaction prices, or indeed what is written there, but then the seller to give "token of appreciation" which amount ranges from 5% to the person assigned to make a purchase.

Group of companies in the business of manufacturing consists of  11.12% companies with low levels of suppression,  while for moderate and high pressure in the same proportion as many as 44.44%. Given that the only company with a low level of emphasis from manufacturing businesses, it is important for further analysis. By using the grouping as above, can be analyzed in detail based on the ethical dimensions of business as shown paada table 3.

Table 3
The value of each dimension of business ethics in   manufacturing business field

Ethical principles
Average value
Level emphasis
Compliance with the law
3.91
Medium
Honesty
4.20
Height
Transparency
3.60
Medium
Accountability
3.87
Medium
Responsibility
3.48
Medium
Fairness
3.80
Medium
Empathy
3.90
Medium
Togetherness
4.18
Height
Independence
2.71
Low
Source: Data from 2010 study

Of all the ethical dimensions of business, companies in the manufacturing business has only two dimensions at high levels, ie the dimension of togetherness and honesty. Six dimensions of compliance with the law, transparency, accountability, responsibility, fairness and empathy are all on the level of moderate. While the dimensions of independence at a low level.

Of several businesses, it appears that the dimensions of independence is a dimension that is less stressed by business people face many obstacles when it will happen. In efforts to increase the emphasis on business ethics, this dimension should receive special note. The hope, the company in various fields began to emphasize this dimension in the application of business ethics. If this dimension is a dimension that hard to achieve, considering the amount of influence and outside interference in running the company's activities and decision making, it would require the support of various parties is necessary. As in the field of business associations, educational institutions, consumer organizations, Private Ombudsman, government, and society.

Manufacturing firms to treat stakeholders such as suppliers, retailers, consumers, advertising companies, government, community, physical environment, and certainly in the company's own employees fairly. However, in some cases, where an agency to purchase the product are often the buyer requested that prices be raised from the actual. Can also occur,  the price listed is what is written there, but then the seller to give "token of appreciation" which amount ranges from 5% to the person assigned to make a purchase.

In the world of trade, especially in shops or stalls frequently encountered words "purchased goods must not be exchanged or refunded". While at the purchasing process, often the product purchased is tried first, even the buyer can not open the seal, so that the item is damaged or not at all unknown. If the goods are in fact already broken when he was in the hands of the seller, a consumer should bear that has been damaged goods since in the hands of the seller.

Another example of this is still happening right now isget the price down” to child’s milk  from the original price of Rp50,000, - fell to Rp36,000, -. This information must be very tempting for mothers who have children, but limited economic capabilities. When the mother arrived at the store and pick up your child's milk, it turns out down the price rule applies only if the consumer has to purchase a minimum of Rp35.000, -. The Company does not meet the elements of transparency and only emphasizes the element of "sensation" down the price alone.

The field of tourism and transportation services business has an emphasis on moderate  and high levels with the same proportion, ie respectively by 50%. Similarly in the field of trade, each with a proportion of 50% suppression of business ethics at a moderate level and 50% emphasis on business ethics at a high level. The second field of business is no emphasis on business ethics at low levels.
Tourism services industry will face different ethical issues, such as customer/tenant hotel rooms are often associated with prostitution problems, infidelity, and drug transactions. Business hotel itself is not problematic and is generally not involved with these things, but when used by customer for these things then the owner can not escape from this responsibility.

Finally, business services etc. as much as 42.86% have an emphasis on ethics at a moderate level and 57.14% at a high level. No company in this business a low level of emphasis on ethics.

One type of business of the other services are labor services abroad. Given that in Indonesia occurred surplus labor, then to send workers abroad became one of the reduction of unemployment as well as a source of income. The labor is sent abroad the most with a relatively low level, so the lack of understanding of regulatory and labor issues as abroad. Such conditions are often used by some service providers overseas employment (recruitment agency) for not fulfilling its responsibilities as promised, do not open and even dishonest in providing the actual information.


Of several examples of ethical issues above, suggests that ethical issues in their respective fields of different businesses. These differences give a different effect for the businesses in implementing business ethics in its activities.

4.3. THE EMPHASIS OF BUSINESS ETHICS AND LONG  OPERATION

Description of data based on long operation shows that the majority (40, 54%) of respondents had run his business more than 10 years, and as many as 32, 43% of new conducting its business in that area for less than 5 years, and run their business as much as 27.03% in the period between 5 to 10 years.

Table 4
Company description based on long operation

The long operation (year)
Prosentase (%)
Less than 5
32.43
Between 5 – 10
27.03
More than 10
40.54
Total
100.00
Sources: the research data 2010

Long operation to be a significant variable in the discussion of the application of business ethics, for a long time trying to influence the ability of enterprises to implement ethical values. With time, the company has the opportunity and experience to examine the ethical act like what it is, why companies should behave ethically, and the impact of unethical behavior to the company. Furthermore the company will determine its position or emphasis in the implementation of business ethical values ​​in business activities.

Long of  business operation also provides learning (leason learn) for companies to experience firsthand how the external pressure on companies not considered ethical. For example, establishment a cafe   meets the applicable licensing provisions, but  peace  of community interfere in its operations so the community demanded the government to close the cafe. External pressures could threaten the survival of the company, but can also in a weaker form for example: decreased level of society's willingness to buy its products, the circulation of company’s bad images, a decreased level of confidence in suppliers, and others.
Firms that ever get a problem in terms of ethics, it will be learning for themselves. Learning context can be a double meaning, firstly in the sense that it is wrong, negative consequences, so that in the future will not be done again. Secondly, it is wrong, negative consequences, but now it knows how to avoid it.
The relationship between the factors of long of business operation with an emphasis on business ethics are shown in Table 5.

Table 5
The long operation relationship with an emphasis on business ethics

The long operation
Emphasis on business ethics (%)
Low
Moderate
High
Total
˂  5
            0
18.92   58.33
13.51    42.67
100
 5 – 10
2.70  8.33
18.92   58.33
 10.81   33.33
100
10 ˂
            0
10.81   30.77
 24.36   67.23
100
Total
2.70
48.65
48.65
100
Sources: the research data 2010

Based on table 5 above it appears that majority companies in Special Region of Yogyakarta is located in moderate and high pressure, and only 2.7% emphasis on business ethics is low.  Company's business ethics with an emphasis on low-level operations between 5-10 years old.

Companies in their activities is less emphasis on ethics in general because they are more short-term profits, so the expense of ethical conduct in its activities.  In addition, their behavior is based on the belief that ethical violations do not have significant consequences. They are not necessarily abandoned its consumers, there is no strong pressure from the public, while ethical behavior can have an impact on costs.

The rationale is in line with the law enforcement situation is relatively low in Indonesia, including Yogyakarta. Law enforcement continues to be selective, so it still found the defendant not being penalized either prison sentences or fines.

Moreover, economic policies that promote growth also support this situation. Government is more supportive of economic growth, so the ethical violations that  have found no legal provision is left impressed.

A total of (48.65%) companies  in Yogyakarta with moderate emphasis. Of these, consisting of 18.92% companies with long operation less than 5 years, 18.92%  companies with a long operation between 5-10 years, and 10.81% companies with a long operation more than 10 years. Especially in companies with emphasis being has not appeared sufficiently strong relevance between the old business with a high emphasis on business ethics. Both their old business of less than 5 years, between 5-10, or more than 10 years have not provided a strong relevance to business ethics emphasis.

In the group of companies with an emphasis on business ethics at a high level, the long operation  less than 5 years (13.51%) and between 5-10 years (10.81%) are relatively similar proportions. 
It will be very different than the old company with businesses in over 10 years. Companies with long operating more than 10 years had a greater proportion (24.36%) in the suppression of high ethical

This suggests that the long operation to give confidence and stability for the company to apply ethics in their business activities. Whereas in the old companies with less than 5 years of business and between 5-10 years are still there the emphasis changes to the ethical dimensions of themselves. At the company that had more emphasis than the dimensions of business ethics and complience to the rule of law, could be in course of time shifted toward honesty and openness, and so forth.

5. CONCLUSION

Based on the analysis of data on the application of business ethics in companies that exist in Special Region of Yogyakarta, it can take several conclusions as follows:
5.1.  The average company in the Special Region of Yogyakarta has an emphasis on the ethical values ​​of 3.916 of the maximum scale of 5. Thus in general the dimensions included in the ethical principles emphasized by the company.
5.2.  Companies that exist in Special Region of Yogyakarta is located in medium and high pressure in the same proportion is 48.65% respectively, and only 2.70% with low pressure.
5.3.  Long the operation had a positive impact on corporate emphasis on business ethics, especially in companies with long operating over 10 years. This suggests that the long effort to give confidence and stability for the company to apply ethics in their business activities.
5.4.  Field of business affect the degree of emphasis on business ethics. This is due to their respective business environments and have different stakeholders, thus providing a different effect in implementing ethics in their business activities.
5.5.  Of several businesses, the dimensions of independence are less stressed or relatively difficult to achieve. In efforts to increase the emphasis on business ethics, this dimension should receive special note. The hope, the company in various fields began to emphasize this dimension in the application of business ethics. If the dimensions of independence is difficult to realize, because of the many influences and outside interference in running the company's activities and decision making, it is necessary to support various stakeholders such as business associations, educational institutions, consumer agencies,  Ombuds-person Institution Private, government, and society in general.

 6. ADVICE

Based on this research, some suggestions can be compiled as follows:
6.1.  Generally have low scores on the dimensions of autonomy, so that internally the company needs to make improvements. Among others, by setting the decision-making procedures and conduct capacity building. The principle of independence related to the presence of external interference, this effort would be more effective if supported by various parties, such as business associations, educational institutions, consumer agencies, Ombuds-person Institution Private, government, and society.
6. 2. In the future studies, it is necessary to do a study of factors inhibiting and supporting ethical behavior of companies. Prepared in the hope of realizing a strategy for the ethical conduct of the business world. Also, it can indicate that business ethics is not solely "determined by the businesses" but will be determined by various factors, such as law enforcement, community, government, and business associations.

7. REFERENCES

Departemen Pendidikan Nasional,  (2002), Kamus Besar Bahasa Indonesia (Big Indonesian Dictionary), Edisi Ketiga, Balai Pustaka Jakarta.
Griffin, Ricky W and Ronald J. Ebert, (2002), Business, Sixth Edition, Prentice Hall International Inc, New Jersey.
Haryani, Sri dan Imam Subhan, (2007), Pedoman Prinsip-Prinsip dan Penilaian Bisnis Beretika Berkelanjutan (Guiding Principles for Sustainable and Ethical Business Valuation), Cetakan Kedua, Lembaga Ombudsman Swasta Daerah Istimew Yogyakarta, Yogyakarta.
http://www.Scribd.com, diakses 10 Juni 2010


Keraf, Sonny, A. Dr., (1998), Etika Bisnis: Tuntutan dan Relevansinya (Business Ethics:


Demand and Its Relevance), Penerbit Kanisius, Yogyakarta.
Nash, Laura, (1990), Good Intentions Aside: Manager’s Guide to Resolving Ethical Problems,  Harvard Business School Press, Boston, Massachusetts.
Komite Nasional Kebijakan Governance, (2006), Pedoman Umum Good Corporate Governance Indonesia (Code of Good Corporate Governance Indonesia).  
Rindjin, Ketut, (2004), Etika Bisnis dan Implementasinya (Business Ethics and Its Implementation), PT Gramedia Pustaka Utama, Jakarta.
UU NO 8 tahun 1999, tentang Perlindungan Konsumen (Law No. 8 of 1999, on Consumer Protection).



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