Ethics in Business
1. Definition of Ethics
Ethics is the study of how people should act.
2. Importance of Ethics in Business
There is strong evidence that ethical behavior pays off financially for businesses.
Unethical behavior is a bar to financial success.
3. Ethical Principles
Utilitarian ethics holds that decisions should be made on the basis of practicality, and whatever action is most convenient should be favored.
Deontologists would agree that the increasing medical concern over obesity in the United States justifies federal regulation of high fat, high sugar, low nutrition food advertising during children’s television programs.
4. Ethical Decision-Making
In analyzing a situation to determine how to act ethically, a business manager should:
- gather background information by either talking firsthand with the people involved or by talking to those who gained information informally through the company “grapevine.”
- narrowly focus on a single issue.
- determine whether an alternative violates important values.
5. Stakeholders
Stakeholders in a business decision might include:
- shareholders
- customers
- employees
- the community in which the business operates
6. Ethical Challenges in Business
Some common ethical challenges in business include:
- bribery and corruption
- discrimination
- environmental pollution
- product safety
- insider trading
7. Promoting Ethical Behavior in Business
Businesses can promote ethical behavior by:
- establishing a code of ethics
- providing ethics training for employees
- creating an ethical culture
- rewarding ethical behavior
- punishing unethical behavior
8. Conclusion
Ethics is essential for the success of any business. By understanding the importance of ethics, ethical principles, and ethical decision-making, businesses can create a more ethical and profitable workplace.