Ethics Rules in Business

The Importance of Business Ethics

The analysis of correct management rules and procedures about inherently contentious topics such as fraud, corporate governance, and fiduciary obligations is referred to as business ethics (DeGeorge, 1982).

Definition and Significance of Business Ethics

It is typically specified in the company’s code of ethics. It demonstrates how the firm interacts with its clients and the rest of the world, i.e. the rules and values that regulate workers of an organization within the corporate world. Laws refer to what is legally binding and the written guidelines that must be enforced in society, whereas morals refer to the rules that individuals create as a result of societal traditions and beliefs.

The Benefits of Business Ethics

The benefits of business ethics include cultivating strong teamwork and productivity. Management usually conducts a regular dialogue regarding values in the workplace, and this builds openness, integrity, and this contributes to a strong team at work. It also helps in creating a good image of the business which contributes to long term profits. Usually, people will prefer to be part of a business that is not just profit-oriented but also values the people more (Hunt and Scott, 2006).

Supporting Employees’ Growth

Furthermore, ethics helps in supporting employees’ growth. The workers can face both good and bad side of the business and themselves. This helps them know areas needing improvements and those that need to be dropped. It also helps in avoiding criminal acts of omission and can lower fines. Ethical programs tend to detect ethical issues and violations early enough, so they are reported and addressed before causing any damage.

The Evolution of Business Ethics

The development of business ethics started before 1960, during this period ethical issues related to business situations were only discussed within the domain of philosophers and theologians in churches, mosques, and other spiritual institutions. Subjects such as fair wages, labor, and capitalism were considered.

In the 1960s the social and political movement led to changes in business ethics. It was proposed that consumers have rights such as the right to safety, to be informed, to choose, and to be heard which are contained in the customer bills of rights. In the 1970s set of morals, values were identified. And the idea of maximizing positive impact on shareholders and clients and minimizing their adverse effects was adapted. The six principles initiated in the 1980s were to support the code of conduct, ethical training for employees, an open atmosphere for employees to report violation with no fear, the preservation of integrity in the defense industry, and adopting a philosophy of public accountability.

In the 1990s, the issue of poor working condition was addressed and the rise of corporate liability for personal in the 21st century new problems arose that keep helping business ethics to evolve. Therefore, these developments played a key role in shaping ethical imperatives that are still applied in modern businesses.

References

DeGeorge, R. T. (1982) Business Ethics, New York: Macmillan, 5th edition.

Hunt, Shelby D. and Scott J. V. (2006) “The General Theory of Marketing Ethics: A Revision and Three Questions,” Journal of Macro-marketing 26(2),