By definition, business ethics refers to standards of morally correct and bad behavior in business. The law partially defines behaviour, but “legal” and “ethical” are not necessarily the same thing. Business ethics improves the law by describing acceptable behaviour outside the control of the government. Regulatory ethics. These are designed to maintain certain performance standards depending on the industry. An example is the obligation to maintain data protection at all times when it comes to customer data. This element defines how employees should handle sensitive data and what happens if someone breaks the rules. This is not to say that every business decision is a matter of right against wrong. Sometimes unethical behavior can be minor, such as: When a customer service representative distorts sales figures to meet the pressure of monthly quotas to keep a job, or when a business executive falsifies records to keep a business running and save hundreds of jobs.
The concept of business ethics began in the 1960s when companies became aware of an emerging consumer society that cared about the environment, social causes and corporate responsibility. Increased attention to so-called social issues has been a feature of the decade. Fill out the form on this page to download our online MBA program guide and learn how Redlands University can help you grow as a qualified and ethical leader. Since almost everyone agrees that U.S. civil rights laws serve an ethical purpose, should U.S. companies voluntarily implement these laws as policy in their operations in other countries that don`t have similar laws? Like finance and marketing, ethics has become an essential business function. But why? In this blog, we`ll explore the top reasons why business ethics are important for aspiring businesses and professionals. This article deals with ethical issues in law in the context of the conduct of business. A lawyer is professionally qualified to advise entrepreneurs on the law; Judges are empowered to decide what the law is; and the legislature may enact laws within the limits of the Constitution.
Religious and other organizations make many statements about what is ethical, but if ethical standards are not enshrined in law, they are unenforceable and remain to some extent a matter of personal opinion. Telling lies about your competitor or their products is also unethical and can damage your reputation with suppliers and customers. Exaggerating the size of your business to get a large order may seem reasonable in the short term, but it can cause problems in the long run. Many small businesses form networks to increase their ability to handle larger contracts. It`s ethical as long as you don`t falsely present these network members as your employees. You risk alienating a network that is important to your success. Once customers discover the truth, they may be suspicious of other claims you`ve made. Earning and maintaining customer trust is critical to business success. In order to educate and guide others in the organization, a set of codes of ethics or conduct should be developed and distributed.
Kimberlee Leonard, writing for the Houston Chronicle, explains, “A code of ethics is important for companies to ensure that everyone in the company is clear about the company`s mission, values, and guiding principles.” Although it takes some time to create a code of conduct, the ideals associated with it should already be present in the company`s culture. Here are some examples of business ethics at work when companies try to balance marketing and social responsibility. For example, XYZ sells grains containing all-natural ingredients. The marketing department wants to use all-natural ingredients as a selling point, but needs to curb enthusiasm for the product in the face of laws that govern labeling practices. In addition to civil rights, the environmental movement was another great crusade. The goal of environmental protection is to protect the planet not only for ourselves, but also for those who will come after us. Respect for environmental law appears to be a fundamental ethical norm. How far should environmental law go? The chemical companies that make products we use every day pollute the environment because of their commercial nature. What is the ethical position of a chemical company when it spends money to lobby the public and Congress for new laws and enforcement of existing laws? Cars still pollute the atmosphere, although much less than in the past. Gasohol is a fuel made in part from ethanol, which is made from corn, but is more expensive than gasoline.
What are the ethical issues surrounding ethanol? This module focuses on essential ethical views as a basis and examines the specific characteristics of working life with the help of cases and examples. There is no universal set of ethical behaviors in the business world, which is why determining appropriate ethical behavior to maximize profits is a unique challenge for entrepreneurs. Entrepreneurs and managers face daily challenges where individual values conflict with those of teams, organizations, customers and customers. We will examine the nature of morality and the various normative theories of ethics related to economics, economics and the environment. The concept of corporate governance is relatively new compared to the entire history of free trade and business creation. There was probably a “code of honor” that companies followed in the past, but it wasn`t until the 21st century that more attention was paid to how companies operate and how operations affect employees and the communities in which they operate. Company law consists of a number of necessary standards of conduct.