The Importance of Business Ethics

It is not uncommon to read about unethical behavior by organizations every other day. There are business scandals, accounting scandals and other unethical business operations being conducted worldwide every single day. But why is this? Isn't every employee guided about how to be ethical and conduct business ethically? Apparently not — and the number of ethical people and businesses is dwindling – and this is the reason why business ethics is such a hot topic these days.

Ethics and Social Responsibility

Every business or organization has a social responsibility towards society – and more importantly, towards the environment. Organizations need to be extra careful when it comes to the environment and natural resources. Businesses should be extra careful when dealing with hazardous chemicals, as these will definitely affect the environment. And if it were to harm the environment or damage it in some way, management should take steps to make amends – this is considered ethical.

Ethics and Shareholders

A company has to display good ethics on several levels – and one of these is its responsibility towards shareholders. This is an area that requires as lot of monitoring from the government; and in fact, the government is cracking down on unethical behavior and questionable business practices, especially when it comes to buying, selling and valuing shares. But paying attention to shareholders shouldn't be done just because the law requires it — it is simply the right thing to do.

Inter-Company Ethics

Ethics in negotiations and inter-company dealings are important. No one wants to be part of a company where the employees and top management don't trust each other. Companies that don't pay attention to inter-company ethics risk not being profitable for very long.