What is ethics in business?
When conducting business, you work and relate with people.
The way you conduct yourself and your business has a long way in determining your business.
So, if you don’t understand or want to know more about business ethics, then you should follow this discussion to the end.
What Is Business Ethics? – What Is Ethics in Business
Business ethics are the set of principles or morals that work as guidelines for conducting business.
These principles cover the different aspects of a company’s operations including its interaction with other businesses and the government.
It also includes the way a company treats and relates with its employees and customers.
When there are any ethical controversies or dilemmas, business ethics are to be referenced to resolve the situations.
Understanding Business Ethics Nature – What Is Ethics in Business
Business ethics is complex and simple at the same time.
It is complex because it has many sides and aspects, and simple.
After all, once you understand it and adhere to its principles you will do well.
The following will help you to understand business ethics nature better:
Ethics Has No Framework
Yes, there are principles of business ethics.
However, this doesn’t provide business ethics with any laid down framework or structure.
In its simplest form, business ethics is an abstract concept that businesses choose to follow or not.
So, it doesn’t need to be universally accepted.
Some of the reasons for this are:
- Ethics (even business ethics) are dependent on individual moral standards;
- Moral standards are dependent on individual value systems;
- People’s value systems are dependent on their childhood experience and background;
- The experiences and backgrounds of people are different
As a result of this, the business ethical practices of individuals and companies in business differ.
Companies’ ethics are based on the individuals who established and own them, the people who work in them, and the value and culture that has gradually developed since their inception.
The decisions we make are what determine the actions and behaviour we exhibit.
In other words, ethical actions and behaviours are influenced by ethical decisions.
Ethical decisions ought to express certain obligations to other people.
It should not only work to benefit oneself alone.
When it does, then it’s an ethical decision.
The core point of being ethical is that you will do some good, not for yourself alone but also for others.
The same applies to being ethical in business.
To know if your decisions are ethical, then you should check if they are:
- Right: are they morally due and correct?
- Equitable: are they equal and just?
- Good: do they bring good to all those concerned?
- Proper: are they acceptable and appropriate?
- Fair: are they due and honest?
When you understand that your ethical disposition is determined by you and that your decisions affect your actions, then you will have understood a vital aspect of business ethics.
And this will help you to know how to conduct yourself and your company ethically.
Categories of Business Ethics – What Is Ethics in Business
Business ethics are grouped into different categories, and they are:
Personal responsibility business ethics is based on the personal attitude and behaviour of individuals in the business such as employees, business owners, investors, suppliers, and others.
It is the set of moral principles that these individuals portray.
Normally, ethics is meant for people to do things the right way.
So, in business, these personal ethics are ones that the individuals follow when conducting business and performing their duties.
It helps them to personally do the right things and avoid criminal activities without being told.
Personal responsibility business ethics enable individuals in business to handle business finance better, accept and fix mistakes, and develop better skills.
Some of the characteristics that an individual who adheres to personal responsibility will exhibit include:
- Willingness to effectively execute their duties
Corporate Social Responsibility – What Is Ethics in Business
Corporate responsibility business ethics have to do with how a company or organization behaves and conducts its business as an entity.
They are the contractual legal and ethical obligations that a company has to adhere to ensure that the interests of their external and internal parties are safeguarded.
These parties include customers, employees, investors, suppliers, and other business stakeholders.
Companies who adhere to corporate social responsibility ethics will ensure that their goal to make profits will not be costly for society.
What this means is that they will not put the society in harm’s way to make money.
Some of the behaviours that companies who adhere to corporate social responsibility business ethics are:
- Environmental protection
- Social cause
- Spreading awareness
- Receiving feedback from shareholders
- Appreciating shareholders
Since the world has evolved in the 21st century, business conduction has also evolved.
Companies have adopted the use of technology to conduct business.
Transactions and payments can now be conducted online.
So, it is only right that they also do these things in a morally right way.
This is where technology ethics come from.
It protects online operations from engaging in criminal activities.
Some of the things that companies with technology will provide their customers include:
- Provision of customer-privacy
- Protection of personal information
- Intellectual property protection practices
Principles of Business Ethics – What Is Ethics in Business
Business ethics are those principles that guide people in business and companies as an entity to act and conduct business in a morally right way.
Some of the principles include:
The conscience principle is determined by a person’s inner feelings in analyzing what is wrong and right.
In other words, it is what a person thinks or feels is wrong or right without any external individual involvement.
With this principle, people get to personally determine how they behave in different situations when conducting business.
For example, an employee who feels that it is wrong to delay a customer will do all in their power to ensure that they attend to their customers quickly.
This will work well for the business they work for, as they will be indirectly bettering the relationship the customer has with the business.
Wishless Work – What Is Ethics in Business
This principle is centred on the idea that one shouldn’t be self-absorbed when performing tasks.
In other words, not all tasks should be performed for self-interest.
Other people’s interests should be considered when making decisions or taking actions in business.
Also, just because you are doing something for others’ interest, doesn’t mean you should devote less effort.
Rather, do your best.
This principle makes it easier for companies to practice corporate social responsibility ethics.
Also, adopting this principle as a business individual (whatever role you play in your company) will enable you to do your best in your work.
This principle is all about keeping all the people or organizations indirectly or directly involved with a business well-informed of all its performances and activities.
This principle works in removing doubts and misunderstandings in the minds of the stakeholders in a business.
Transparency is a principle that every business should adhere to if they want to succeed.
The benefits of transparency in business cannot be overstated.
Espirit – What Is Ethics in Business
According to the espirit principles, business people are to pay enough attention to providing the best service possible.
Also, they are to put effort into developing feelings of truthfulness and devotion in their services.
They should focus on building activities and behaviour based on their value motive in their business.
When a company or individual in a company follows the espirit principle they will avoid offering poor services to their customers.
This will automatically improve their customer care services and make their customer satisfied and happy with them.
This principle is all about following truthfulness, tolerance, and politeness to develop mental peace.
Business people relate with people from different backgrounds and cultures.
And no matter how you see it, every business person has some problematic customers.
So, the principle of purity is necessary to help business owners tolerate different people they meet while protecting their mental health.
Universal Values – What Is Ethics in Business
This is the principle based on the universally accepted truth, customs, norms, and assumptions of society.
Businesses operate in society, so, they are expected to conduct their businesses based on generally accepted values.
If a company refuses to adhere to universal values, it might be seen as a company that disrespects society.
For example, let’s assume that a universal norm is smiling at customers (this is a good practice) and you and your employees fail to do this while attending to customers.
Your customers who know and believe this universal norm will feel unhappy with your business.
This would automatically have a bad turnout for your business, as people will be more inclined to patronize businesses that adhere to the universal norm.
While conducting business, you also need to follow and respect the different human values, human aspects, and human decorum within their different working niches.
People need to feel that you value and respect their values.
You might not believe in them, but showing respect for them will go a long way in securing the patronage of customers, suppliers, investors, and so on.
Communicability – What Is Ethics in Business
According to the communicability principle, business people are to be capable of effectively communicating with the external and internal parties engaged in their business.
Your communications need to be open, clear and justified.
This will ensure that people involved in your business are carried along.
It will also portray to those people that you value them.
This principle is centred on business people being able to fulfil the assurance and commitments they make to people.
What helps in implementing this principle is responsiveness and honesty.
Honesty will ensure that you tell the truth about what you can and can’t do when making a commitment or assuring your stakeholders
Meanwhile, responsiveness works to ensure that a business person does the needful in meeting up with the assurance and commitment they have made.
The commitment principle is quite important when conducting business because it helps business people not to lose valuable business relationships.
This principle is meant to be followed by business people to avoid making irrational decisions or taking irrational steps.
This ethical principle aims to make business people analyze and evaluate the bad or good, wrong or right, unethical or ethical aspects of all their transactions.
Knowing the right things and ensuring that they are rational will help you to avoid mistakes that can be destructive to your business or its operations.
You need to ensure that you practice rational behaviours and attitudes in your business operations and activities.
Every operation or transaction in business has its due process that ensures its success.
So, you and your employees should follow the due process for every operation, task, and activity.
You need to ensure that all your business due process is justified and reasonable.
Transparency – What Is Ethics in Business
Ethics promotes truth and purity.
So, it is essential to adhere to an ethical principle solely centred on being truthful and open with your stakeholders.
If you adhere to the transparency principle, your stakeholders will be satisfied with your business as you will keep them well-informed about issues concerning them in your business.
Aside from meeting commitments, you also need to be capable of meeting the expectations of your business associates.
As a business person, your behaviour and action should be acceptable and good.’
You are to perform your best, be a good example, and meet the expectations of people.
Business excellence promotes the growth of such a business.
If you adhere to the principle of meeting expectations you will work hard and give your best.
Also, adhering to this principle will ensure that you don’t take on expectations that you cannot meet.
In other words, when your clients, investors, suppliers, or any other stakeholder has expectations that you know you cannot meet, you will be real with them.
You should tell them you cannot achieve that and lead them towards building an expectation that you can meet.
Balance Means and Ends – What Is Ethics in Business
The mean and end of anything that you do in your business should be balanced.
Most people use the wrong means to get good results in their business.
This doesn’t show their adherence to the principle of balancing your means and ends.
You should focus on aligning your work performance and activities.
Only engage in ventures that are within your capacities and resources.
This way you would avoid making decisions and actions with unbalanced means and ends.
As a business person, you are required to build and develop a role and behaviour that brings happiness and pleasure to your stakeholders.
In your business, your services and products should be capable of satisfying your customers at all stages.
If you adhere to this principle, you will do better in developing services and products that will be of great value to people.
Non-Corporation Evil – What Is Ethics in Business
This principle is considered to be the core of being ethical in business.
It is centred on discouraging evil unethical behaviour in a business, its stakeholders, and society at large.
A company that frowns on corporation evil will thrive in its corporate social responsibility.
They will be at the forefront of doing and supporting movements that will better society.
This will make society value them and increase their patronage.
Cooperation with Others
Team spirit and the feeling of collaboration are promoted by ethical norms and values.
And this is a good thing because it is required in business in its daily operations.
So, you as a business person ought to fully cooperate with other people with your value-based behaviours and good conduct.
Benefits of Business Ethics – What Is Ethics in Business
The following are some of the benefits of practising good business ethics:
Builds Good Reputation – What Is Ethics in Business
Adhering to business ethics works in building a good reputation for your business.
The reputation of your business can greatly affect the growth and success of your business.
So, adhering to business ethics works in your favour.
It Attracts People – What Is Ethics in Business
Aside from promoting a good reputation for your business, adhering to business ethics will attract people to your business.
Everybody wants to associate with a business that has a good reputation.
Most of them will want to actively involve themselves with a business that adheres to different good business ethics.
As a result, you will not struggle to get people to patronize, work, or invest in your business.
You will even be at liberty to choose the people who actively get involved in your business.
Promotes Better Profitability
Not only will you have a good reputation and attract people to your business, but you will also have better profitability.
This is because your customer base will grow and your product demand will increase as several people will patronize your business, and also refer your business to other people.
Reduces Risks– What Is Ethics in Business
Several risks can be reduced when you practice good ethical conduct in your business.
It can help you to avoid reputational risk, legal risk, and cybersecurity risks.
This is because good ethics will help promote a good reputation that will be difficult for other people or businesses to tarnish.
Also, you would adhere to rules and regulations concerning your business, and practice technology ethics which will help you avoid cybersecurity risks.
Strengthens Business Bonds
When you adhere to business ethics, it will help to strengthen your business bonds.
This is because you will be conducting business in a way that is good for both yourself and your stakeholders.
As a result, people will feel happy with your business and want to do more business with you.
Conclusion on What Is Ethics in Business
Ethics in business is very important.
Without ethics, a business will build, grow, and operate on values that will become destructive to it.
As a business person, you would want your business to grow and succeed.
So, you need to ensure that you adhere to business ethics.
In this article, information about business ethics has been shared.
So, try to make good use of it.