 Ethics Word Cloud Ethics are the principles that guide us to make a positive impact through our decisions and actions. Ethics play an important role not only in our personal lives but also in business.
We are all encouraged to make ethical choices and apply ethics in all areas of our lives. But what does ethics mean, and why do ethics matter for business? We can think of ethics as the principles that guide our behavior toward making the best choices that contribute to the common good of all. Ethics is what guides us to tell the truth, keep our promises, or help someone in need. There is a framework of ethics underlying our lives on a daily basis, helping us make decisions that create positive impacts and steering us away from unjust outcomes. Ethics guides us to make the world a better place through the choices we make. Ethics in business is just as important as ethics in personal life. Business leaders have a unique role and a great responsibility in shaping the ethical culture of their businesses, and thereby influence their broader communities as well. Key Questions to Ask Business leaders may not set out to define the ethical culture of their businesses but they inevitably do. Here are a few key questions to consider to bring ethics into your business mindset:
How Ethics May be Tested Business leaders, and entrepreneurs especially, are under tremendous pressure and can face very significant ethical challenges. Here are a few examples of how unethical decisions arise for entrepreneurs:
Ethics and Social Responsibility Social responsibility is the idea that an individual (or organization) has an obligation to act for the benefit of society at large. Today, social responsibility has become an important part of culture at businesses of all sizes. TOMS Shoes is an excellent example of a business that prioritizes social responsibility. TOMS was founded with the commitment to provide a new pair of shoes for a child in need for every pair of shoes purchased. The company has now expanded to support other causes such as safe water, mental health, and equality. TOMS Shoes’ inspirational tagline “Stand for Tomorrow” communicates its dedication to social responsibility in just three words. Social responsibility can be practiced in big or small ways every day. Businesses can volunteer with local organizations, donate funds to a chosen cause, sponsor a neighborhood group or sports team, and much more. Even planting flowers, applying a fresh coat of paint, or picking up trash in front of your store has a positive impact on the community surrounding your business. When businesses give back, they not only contribute to the common good, they engage with their communities in meaningful ways, build morale among employees, and create positive regard for the business. Ethics When Things Go Wrong It is not easy to handle a business crisis, but avoiding it or postponing a response could make it worse. Businesses should think ethically when coming up with a plan to handle an ethical crisis. In other words, act in a way that promotes the greatest common good and encourages trust rather than diminishing it. Some situations may warrant the advice of a lawyer and a crisis expert. Here are some general practices that could be followed:
Source: "Principles for Handling Ethics Crises," Kirk O. Hanson, senior fellow of the Markkula Center for Applied Ethics at Santa Clara University and former executive director of the Center Ethics is a Lifestyle Ethics has influence over the decisions we make and the actions we take, from our personal lives to our professional careers, and beyond. We are all part of an interconnected global community. Our contributions to the common good, no matter how big or how small, can have a lasting impact. Choosing an ethical lifestyle will ensure our impact is positive. Business leaders have a unique opportunity to create and influence the ethical culture of their businesses and among their stakeholders. Even bringing ethics into your business mindset will help you approach situations in a more ethical way. And if you are unsure how to create an ethical culture in your business, leading by example is a great way to start. It’s a simple as be good, do good. Interested in MOBI's FREE Online Entrepreneurship Courses? Learn About Our Courses View Sessions by Topic View Sessions by Course Enroll Now 508885 Whether you work for a small business or a major corporation, following ethical principles matters. The most recent lesson on the importance of business ethics came with the Wall Street collapse, as once highly esteemed financial institutions made headlines for their bad choices and questionable behavior. While businesses have to meet economic expectations, they also have ethical responsibilities. Everyone, from the bottom to the top of the organizational chart, must take care to meet these responsibilities. According to Dr. Jill Young, an instructor in South University’s College of Business, integrity is the most important ethical concept because it covers such a broad area. “If you act with integrity, ethical behavior is just a natural progression,” she says. “Those who have integrity are guided by a set of core principles that influences their decisions and behaviors.” People with integrity value other principles, including honesty, respect, personal responsibility, compassion, and dependability. These qualities are integrated into the Six Pillars of Character offered by the Josephson Institute, a nonprofit organization that develops and delivers services and materials to increase ethical commitment. The pillars are:
“The overriding principle that you have as an individual is you have to make the right decision,” says Rich Jarc, executive director of the Josephson Institute. “That is sometimes very difficult because a decision may be easier, but it is not right. So it takes more of a personal challenge to do the right decision.” Jarc says making the right decision can also be difficult when it calls for the employee to look beyond the scope of their current duties. “So, what is the right thing to do? It depends on the responsibility the executive has,” he states. “Most of us know what has been assigned to us and if we see something beyond that scope, it can tell us it’s time to bring it to someone else’s attention.” “If you look at any profession, if you ignore something that is wrong, it could end up being a big problem,” Jarc adds. Young says one of the ethical concepts in business that she highlights in her Business Ethics courses is the importance of executive leadership support of ethical practices within organizations. “If it does not come from the top leadership, it will not permeate through the rest of the organization,” she states. “Employees look to their top leaders for the behaviors they are expected to model. “The main point I want to emphasize to my students is that ethical business practices are not necessarily the most profitable methods in the short term, but they are essential for long-term organizational survival,” Young continues. However, behaving in an ethical manner can create positive business results. A business environment that promotes and upholds strong values is usually a happier and more productive workplace, Jarc says, and customers receive good service so they keep coming back. In addition to work behavior, Jarc believes that ethical principles should guide our personal and professional lives. “Being ethical requires looking at universal values and that is the decision matrix people can use in their business and personal lives,” Jarc says. Business Ethics for ExecutivesIn addition to the Six Pillars of Character, the Josephson Institute offers 12 Ethical Principles for Business Executives:
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What are the moral principles and standards that guide behavior in the world of business?
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