A human being’s personal ethics determine individual standards of right and wrong. Ethics allow people to determine what they should do in a given situation. Each person develops ethical standards, and it is the responsibility of each individual to examine personal morals and behavior. In business, ethics refers to the behavior relating to the moral problems that occur in business organizations.
What Is Business Ethics?
People often automatically assume that businesses are unethical. Business seems to be constantly linked to scandals. Given the media attention to bad ethical decisions, companies that practice good business ethics can distinguish themselves in the minds of their customers and their employees. The company culture helps determine the ethics of the organization. It is crucial that businesses behave ethically in every working relationship.
- Employees: Companies need to treat all of their employees ethically. Begin by providing employees with the rights guaranteed to them by the United States Department of Labor. Ethical businesses, however, may go beyond the minimum requirements in the way that they treat their employees.
- Shareholders and investors: There is a moral obligation to pay back investors and meet the needs of shareholders, particularly low level shareholders.
- Customers: Every business needs to build ethical customer relationships by providing safe products and honoring warranties. Consumers are growing more aware of which companies treat them fairly, and they will support the ones they trust.
- Community: Businesses have an ethical obligation to be involved in their local communities. This includes communities where they interact with customers and beyond.
- Vendors and Other Companies: Always deal ethically with vendors and other organizations you work with.
10 Benefits of Managing Ethics
Operating an ethical business has a number of rewards. The circumstances of each company will determine the results of managing ethics. There are, however, 10 common benefits that all companies have when they manage their business ethics.
- Ethical companies comply with all legal requirements and are less likely to be fined or sued.
- Consumers are more likely to support a business with a reputation as an ethical organization.
- Companies with ethical values improve their communities.
- Ethical rules save organizations from accidentally violating the rights of employees or consumers.
- Employees’ personal moral standards will improve at an ethical business.
- A fair working environment facilitates teamwork and productivity.
- Many successful financial business practices are reinforced by ethical business practices.
- Established ethical guidelines will lead a company in times of change and stress.
- Ethical companies retain employees and save money in turnover.
- There is personal satisfaction in doing the right thing.