What are business ethics and what is their importance?
Posted on 14. Apr, 2009 by BoardofEthics in Business Ethics
- The social responsibility that a business is supposed to have towards the community in general, particularly the one in which it operates or has any interests. An example of this would be the Exxon Mobil oil spill. It is the responsibility of a business to protect the interests of the people, animals and environment where it uses resources. Due to improper handling of the issue, it became a public relations nightmare for the company. Exxon has now been ordered to clean up the area which it should have taken care not to damage in the first place. Indifference to business ethics in this case, caused a negative public image for the company and a huge lawsuit.
- Issues regarding a company’s responsibility towards its shareholders. This is a heavily regulated area but one that requires a lot of government intervention due to certain unethical practices adopted by many companies in the past. The concept of increasing shareholder value is part of the fundamental principles of a company and if business ethics are not brought into play here, the business can collapse due to the pressure exerted by shareholders.
- Inter-company dealings and negotiations. Often rivalries in business can turn ugly due to the amount of money and ego riding on them. Hostile takeovers and business espionage are some of the examples of unethical behavior within the business world. If discovered, these deeds can be punishable by law or simply public opinion. To allow for fair play and keeping the best interests of the consumers in mind, the government regulates a great deal of what goes on in company dealings. Microsoft has been the target of much abuse and outrage due to its allegedly monopolistic techniques of doing business. While this has not sunk the IT giant, many say that it may have long term repercussions. The government has also stepped in to make sure that other businesses and consumers are not harmed.
- Stakeholder protection. Every business has stakeholders other than its owners – the employees, the stockholders and the general public. The business has to ensure that the rights and interests of all of these groups are adequately protected in the course of its operations. The recent outcry about the harassment and bad working conditions of employees in Wal-Mart led to the generation of a lot of negative press about the outsized department store. This gives the competition the lead and rivals take the opportunity to get ahead while the company is busy trying to do some damage control.
- Fundamental business practices of a company. Underhanded dealings, the use of substandard products, spreading misinformation about the product, hiring illegal workers at lower than minimum wage, etc. prove that a business is run in an unethical way and that it is not a high quality work place or service provider. For instance, cigarette companies that spent most of the seventies telling people that it was not unhealthy to smoke, though they knew this to be untrue. In a recent judgment, one such company was forced to pay out $28 billion.
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William King is the director of Wholesale UK Dropshipping & Wholesalers Trade Suppliers , Wholesale Dropship & Dropshippers Suppliers Directory , and Pakistan Property & Pakistani Real Estate Portal . He has 18 years of experience in the marketing and trading industries.
To Thine Own Self Be True – It’s Better for Business – What Arthur Anderson Would Say to His Company
Posted on 14. Apr, 2009 by BoardofEthics in Business Ethics, Featured Articles
To Thine Own Self Be True
As a child, you probably heard, “to thine own self be true.” But what does that really mean? When the newspapers are full of cheating and lying business owners, politicians, and academics, does it really make sense to maintain your integrity?
To me, the answer is a clear, unwaffling YES! Without your integrity, you really don’t have a business or a career–just a waiting game until you world comes crashing down around you.
But fear of being caught isn’t the reason to live your life with integrity. The real reasons are that it helps you get to where you really want to be, and lets you feel really good about yourself.
Sometimes, integrity involves taking risks. Here’s an example from my own career:
A graphic artist and I were at a pitch meeting to produce some materials for our local Board of Realtors. The organization had registered a very obscure domain name that only had meaning for them.
The “safe” thing to do would have been to nod our heads and continue the conversation. But when we heard the domain name, the graphic artist and I exchanged looks, and we started telling the organization why the domain they’d picked would be a marketing disaster. I told the executive director to imagine giving out that name on the radio, and to look at a name that would reinforce the group’s identity and message.
We went out on a limb; this was a free consultation during a meeting to pitch for business, and if someone was really attached to the name, we might never have gotten the job. But we all brainstormed a bunch of better domain names–and then a few months later I got a call from the president of the largest real estate firm in the service area. He had been impressed at that meeting and came to me to rewrite the firm’s entire collection of a dozen or so brochures–a very juicy assignment. By advising the client that its course was strewn with obstacles, I had put myself in the position to receive a much, much larger assignment, one for which I was not competing against any other copywriters.
Over and over again in my life, I’ve achieved or drawn closer to my goals by turning down work I didn’t feel good about, refusing to compromise with my core principles, treating others with respect, and expecting high standards of others. I’ve even had to educate a few clients about plagiarism as I refused their assignments.
Arthur Andersen, the founder of the accounting firm that was driven out of business by integrity failure, lost a major account after refusing the company’s request to engage in exactly the sort of unethical accounting that later brought down his company–early in his career, when he wasn’t sure he could meet his next payroll. He told the client that there was “not enough money in the city of Chicago” to change his mind. Too bad his successors didn’t understand this!
Article Source:
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Copywriter, marketing consultant, and speaker Shel Horowitz is the author of Principled Profit: Marketing That Puts People First ( http://www.principledprofit.com), Grassroots Marketing: Getting Noticed in a Noisy World (http://www.frugalmarketing.com), and other award-winning books.