Importance of Ethics in Business

 Importance of Ethics in Business


 “Ethics is knowing the difference between what you have a right to do and what is right to do”                                    -Potter Stewart-


 

Business Ethics and Individual Behavior

Ethics is often usually abstract or relative to people who believe that rules don’t apply to them. Rules and laws apply to all, as do standards of right and wrong behavior. Each individual's actions among the company affect both the individual and the organization.  It helps the whole organization when an employee commits ethically and responsibly.

Leaders set the tone for ethics in their organizations.  Unfortunately that some employees in the higher layers of the organization decide to act unethically, but it is a fact of business and also life. Because of that, it is necessary for a business to be careful of who they promote within their company.

When the wrong kinds of people are promoted in an organization, it sends a message that unethical behavior is not only tolerated but it is also rewarded. Companies looking to be successful cannot afford to have leaders who send negative messages about ethics.

It is a phrase heavily used in the business world, refers to business practices and initiatives that benefit society, not simply the corporate. Organizations that specialize in energy efficiency and initiatives that profit the environment are practicing corporate social responsibility. While practicing philanthropy and have excellent labor practices. Mainly ethics should be practiced by all entities, whether large or small.

Corporate social responsibility involves every individual at intervals a corporation taking part in giving back to the community. During this means, the complete company is causative to society and acting ethically. To grasp the importance of ethics in business, it is vital to comprehend however business ethics have an effect on those concerned. Moral and unethical behavior directly impacts not solely the organization however the community and society at massive.

Effects of Unethical Business Practices

Poor ethical decisions can affect a company in many ways.

  • Legal problems

 That act unethically in ways that break the law could face massive fines and different penalties.

  • Poor employee performance

 A lack of ethics inside a corporation affects the manner employees do their job. Employees can decide that as a result of leaders will break the principles, they will too. This will lead them to break the corporate. They become discouraged or not see the need to work hard in an unethical environment.

  • Poor company credibility

Once a corporation is unethical, it affects its name. Not solely can the leaders and company lose respect from staff, they'll lose credibility with the final public further. This will lead to reduced sales, lost customers, and important monetary damage.

Impact of Ethical Practices

 A corporation that gives significantly to fund each year is practicing ethical behavior and presenting corporate social responsibility. This practice helps the corporation by providing them to write off the donation against their taxes, also gives out a piece of positive information and has a positive impact on society. This system of giving back can bring in more customers, develop or improve positive business relationships, and even allow the firm to add new employees.

Ethical practices also help corporations catch an excellent reputation, which helps bring in extra customers, creates positive publicity, and can help fix support for the organization in times of crisis and controversy.

Business Ethics are Ultimately Personal Ethics

Business ethics and personal ethics work hand in hand because a company is just a society of employees working together to achieve particular goals. As a result, employees must receive the ethics the company winners or at least be willing to practice them while employed.

Some corporations give their considered employees informational materials that contain a mission statement, policies, and other ethical responsibilities that all employees must continue by. While these works are worthy, it does nothing if the employee refuses to respect the organization by following the guidelines placed out for them. Preferably, corporations should look for employees that fit the culture and ethics of the company from the outset.

Conclusions

Learning the importance of ethics in business is the key to success. Customers, management, and employees all appreciate honest and ethical systems. Company ethics are important because they help keep a great reputation, help avoid vital financial and legal issues, and finally benefit everyone involved.


References

Biography.com. 2015. Potter Stewart Biography. [online] Available at: <http://www.biography.com/people/potter-stewart-9494966> [Accessed 1 May 2021].

CIPD. 2019. Ethical Practice and the Role of HR | Factsheets | CIPD. [online] Available at: <https://www.cipd.co.uk/knowledge/culture/ethics/role-hr-factsheet> [Accessed 1 May 2021].

Corporate Finance Institute. 2020. Business Ethics - Overview, Examples, Components of Business Ethics. [online] Available at: https://corporatefinanceinstitute.com/resources/knowledge/other/business-ethics/ [Accessed 1 May 2021].

 

Comments

  1. Maduka Udagama 3 May 2021 at 21:33

    Ethics are the values and behaviours related to morals. Human Resource professional are responsible for safeguarding and implementing ethical values. Ethical guidelines express how employees should be treated. Few ethical guidelines are recognize the employee needs, recognize employee rights and embrace organization needs with organizational needs.

    ReplyDelete
  2. Ranjana Bandara4 May 2021 at 05:19

    Ethics are important to the business organisation as well as the whole community. Ethics should be implemented ideally throughout all aspects and operations within organisation. With successful implementation of ethical management, organisation can enhance the efficiency in the long run. Unfortunately, many organisations cannot perform ethical management due to human nature and other inappropriate management control systems. Business organisation with successful ethical management can achieve superior performance because they can attract and retain those high quality staff, customers, suppliers as well as investors

    ReplyDelete
  3. HR Times- Isuru Wijayalath5 May 2021 at 08:18

    In a world disillusioned with globalisation, the importance of business ethics is greater than ever. Business needs to be truly acting in a way which goes beyond purely profit-based motivations, towards a model which works for everyone

    ReplyDelete
  4. Hansika Samarakoon6 May 2021 at 02:52

    HR ethics deals with the enforcement of the rights of employees in an enterprise.
    Such as having a right to work and be compensated for the same, Possessing a right to free association and participation, Enjoying a right for fair treatment in an enterprise, Holding a right to work in a hazard-free environment and etc.

    ReplyDelete
  5. Tania De Mello6 May 2021 at 10:38

    With consistent ethical behavior comes an increasingly positive public image, and there are few other considerations as important to potential investors and current shareholders. To retain a positive image, businesses must be committed to operating on an ethical foundation as it relates to the treatment of employees, respecting the surrounding environment, and fair market practices in terms of price and consumer treatment.

    ReplyDelete
  6. HR ZONE JINODA7 May 2021 at 07:50

    In the workplace, business ethics is an activity that decides what is right, wrong, and necessary. Laws also govern business ethics, preventing corporations and people from participating in criminal activities like stock trading, discrimination, and bribery. Other values, on the other hand, will affect how workers handle one another, corporate social responsibility, and client and vendor relationships. The goal of business ethics is to ensure that everyone in the company, from senior management to new hires, has a consistent moral attitude. It aids in the treatment of all with dignity, justice, and integrity.

    ReplyDelete
  7. KD Jayakody8 May 2021 at 11:37

    The values, behaviors, and policies of a business organization reflect business ethics. A business's ethical obligations are laid out in laws. Business ethics has evolved over time.

    ReplyDelete

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