Why Business Ethics Matter

Why Business Ethics Matter

Ethics, in simple terms, is “doing the right thing even when nobody is looking.” If you ask your co-workers or friends what “being ethical” means, you’ll get a similar answer. My daughter is working on an essay concerning business ethics, and when she asked business leaders in the area what being ethical means, they all said something similar to what you read above.

World philosophers will note that ethics refers to the principles and values governing individuals' and organizations’ behavior. As our local business leaders note above, it involves questions of right and wrong, good and evil, and fairness and justice. Yes, even when nobody is looking.

Ethics can be divided into three branches:

  • Meta-ethics deals with the nature of ethical thought and language;
  • Normative ethics encapsulates the content of moral rules and principles and
  • Applied ethics concerns the practical application of ethical principles to specific situations.

One thing you don’t see here is business ethics. I’m guessing because anyone who thinks of ethics as a full-time job doesn’t separate life and work from an ethical dilemma. However, business ethics is real.

Business ethics refers to the moral principles and values that guide the behavior of individuals and organizations in the business world. These principles and values are essential for maintaining trust and integrity in the marketplace and ensuring that business practices are fair and responsible. Furthermore, they promote social responsibility within a company.

Generally speaking, businesses have a significant impact on society, and they must consider the needs and well-being of the communities in which they operate. Using Amazon as a current example (I am not picking on them; they’re just in the limelight right now), they should be committed to fair labor practices. Other businesses need to be more mindful of the environmental hazards they’re causing. Additionally, companies should be transparent about their operations and not engage in activities that deceive or mislead customers.

When businesses engage in ethical practices, they build trust with customers, employees, and other stakeholders. This trust is essential for maintaining long-term relationships and attracting new customers and talent/employees. An even better reason, to be honest, is that businesses that engage in ethical practices are more likely to be seen as reputable and trustworthy, which will help to protect their reputation (and don’t forget about their brand image).

Business ethics are also vital for ensuring that business practices are fair and responsible. When businesses engage in ethical practices, they are more likely to be accountable and honest in their dealings with others. Another example you may have seen in the news is that businesses should be committed to treating all customers and employees fairly, regardless of their race, gender, or other characteristics.

Finally, business ethics are essential for the long-term success of organizations. Businesses that engage in ethical practices are more likely to be successful in the long term. They are more likely to attract and retain customers, employees, and others interested in doing the right thing. They’re less likely to face legal challenges and negative publicity. A positive image is (most of the time) positive income.

Business ethics are essential for promoting social responsibility, trust, and integrity in the marketplace, fair and responsible business practices, compliance with legal requirements, and long-term success (it’s true; see this). Businesses that prioritize ethical practices are more likely to succeed in the long term and will positively impact their communities.

The last thing I’ll harp on is that it’s essential for businesses to have a code of conduct in place and to ensure that employees are aware of and understand the ethical principles and values that guide the organization’s actions. It’s also the organizations/companies’ responsibility to regularly review and update their code of conduct to ensure it aligns with the changing business environment (’cause nothing lasts forever).