Ethics in Business

One of the most important attributes for small business success, is the distinguishing quality of practicing admirable business ethics. Business ethics, practiced throughout the deepest layers of a company, become the heart and soul of the company's culture and can mean the difference between success and failure.
"If you have integrity, nothing else matters. If you don't have integrity, nothing else matters." -- Alan K. Simpson

What are Ethics?

Ethics are norms or standards of behavior that guide moral choices about our behavior and our relationship with others.  Business should guide. As other social organization, all parties in business should exhibit ethical behavior.

General Business Ethics :

Business Ethics is guided by its corporate vision. For a non-profit organization, social welfare should come first than financial interest, for a corporate, first should consider the returns to its shareholders than social welfare. It differs as the aspect change. Every corporate should have a minimum level of social responsibility, though it’s a matter of debate to identify the share of support. Business also has to set a policy how it will behave to its rivals. How it will attack or counter - attack in the competition. Business also set a behavioral instruction about how it will try to influence the political environment to its favor.

Benefits of Practicing Business Ethics

In the research study, "Does Business Ethics Pay?" by The Institute of Business Ethics (IBE), it was found that companies displaying a "clear commitment to ethical conduct" consistently outperform companies that do not display ethical conduct. The Director of IBE, Philippa Foster Black, stated: "Not only is ethical behaviour in business life the right thing to do in principle, we have shown that it pays off in financial returns." These findings deserve to be considered as an important insight for companies striving for long-term success and growth.

Beside these, almost every aspect of the business have ethical guideline to follow. 

1.         Ethics of accounting information

·           Accounting should always follow GAAP [Generally Accepted Accounting Principal]. -Creative accounting or any misleading financial analysis should be prohibited. Corporate - CEO and Top management should not get excessive payments, as it directly concern with the shareholders interest.

·           Bribery and other unethical activities should be prohibited as those have direct bad effect on society.

2.         Ethics of human resource management

·           HR department should not discrimination on the bases of age (ageism), gender, race, religion, disabilities, weight and attractiveness.

·           HR department should maintain a standard environment in workplace and should ensure the safety of the workers.

3.         Ethics of sales and marketing

·           Organization should not practice unethical behavior like spam marketing, price fixing by the group of sellers, offensive advertising, sex in advertising, marketing in school, black markets, grey markets, etc. 

4.          Ethics of production

·           In production, several ethical issues should be considered. Organization should not produce defective product for getting higher profit margin. 

·           Production unit must consider environmental issues arise while production,

·           While testing a product, it should not violate the any law or rights. E.g. animal rights.

5.         Ethics of intellectual property, knowledge and skills

·           All patent and copyright should be followed.

·           While doing survey on the competition, no ethical values should violate.

7 Principles of Admirable Business Ethics

1.         Be Trustful: Recognize customers want to do business with a company they can trust; when trust is at the core of a company, it's easy to recognize. Trust defined, is assured reliance on the character, ability, strength, and truth of a business.

2.         Keep An Open Mind: For continuous improvement of a company, the leader of an organization must be open to new ideas. Ask for opinions and feedback from both customers and team members and your company will continue to grow.

3.         Meet Obligations: Regardless of the circumstances, do everything in your power to gain the trust of past customer's and clients, particularly if something has gone awry. Reclaim any lost business by honoring all commitments and obligations.

4.         Have Clear Documents: Re-evaluate all print materials including small business advertising, brochures, and other business documents making sure they are clear, precise and professional. Most important, make sure they do not misrepresent or misinterpret.

5.         Become Community Involved: Remain involved in community-related issues and activities, thereby demonstrating that your business is a responsible community contributor. In other words, stay involved.

6.         Maintain Accounting Control: Take a hands-on approach to accounting and record keeping, not only as a means of gaining a better feel for the progress of your company, but as a resource for any "questionable " activities. Gaining control of accounting and record keeping allows you to end any dubious activities promptly.

7.         Be Respectful: Treat others with the utmost of respect. Regardless of differences, positions, titles, ages, or other types of distinctions, always treat others with professional respect and courtesy.

Recognizing the significance of business ethics as a tool for achieving your desired outcome is only the beginning. A small business that instills a deep-seated theme of business ethics within its strategies and policies will be evident among customers. It's overall influence will lead to a profitable, successful company. By recognizing the value of practicing admirable business ethics, and following each of the 7 principles, your success will not be far off.