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Ethical and environmental considerations
Study how ethical and environmental expectations influence business decisions and create trade-offs with profit.
6
Objectives
10
Flashcards
10
Questions
90 min
Study time
AqaGcseBusinessInfluences on business
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Syllabus checklist
What you need to know
6 objective pages available
Ethical considerations3 objectives
- Identify where a business may face a trade-off between ethics and profit.
- Analyse benefits and drawbacks of ethical behaviour by businesses.
- Use relevant examples of businesses behaving ethically.
Environmental responsibility and sustainability3 objectives
- Explain how businesses and consumers may accept greater environmental responsibility in decision making.
- Analyse costs and benefits of environmentally responsible business behaviour.
- Identify where a business may face a trade-off between sustainability and profit.
Key terms
Ethical trade‑offCorporate social responsibilityEthical sourcingsustainable supply chainEnvironmental costtrade‑off
Exam tips
- Show the link between ethics and profit: When answering, first identify the ethical issue, then explain how it could affect costs or revenue, and finally discuss the impact on profit.
- Structure your answer: Begin with a clear statement of the main benefits, then list the main drawbacks, and finish with a balanced conclusion that weighs both sides.
Common mistakes
- Confusing profit with revenue: Profit is sales revenue minus total costs; higher sales can increase profit only if costs do not rise proportionally.
- Assuming all ethical actions increase profit: Ethical actions can improve reputation and customer loyalty, but they may also raise costs or limit market flexibility. The financial impact depends on the specific context and how the benefits are monetised.
Practice preview
- A small manufacturer chooses to source cheaper raw materials that are less environmentally friendly. Which of the following best describes the trade‑off?
- A small retailer sells 100 units at £30 each. Variable cost is £8 per unit and fixed cost is £2000. Calculate the profit and explain how the retailer might face a trade‑off between ethics and profit if it considers using cheaper suppliers.
- Which of the following is a potential drawback of a business adopting a highly ethical supply chain?
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