How Does Ethical Behaviour Pay Off In The Long Run Business Essay
Ethical conduct means that there are standards of morality that individuals should observe and is important for everyone. One obvious reason is that it sets the standards for management, employees and creates a tone for the organization as a whole. Ethical standards depict behaviors morally accepted as good and right as opposed to bad or wrong in a particular setting it is particularly crucial for the business for a number of reasons. For example, murder and robbery are not only illegal but are universally regarded as wrong, while dishonesty , while not necessarily illegal, is usually thought to be immoral. They are created and adopted by people who are interested primarily in ensuring there are guidelines for behavior for the group members. For example, doctors and lawyers have ethical codes of practice which they sear to uphold as part of their professional practice.
An ethical decision is one which typically involves choosing between what you have agreed not to do and what you find yourself wanting to do. For example, is it ethical to pay a bribe to obtain a business contract? Is it ethical to allow a company to withhold information that might discourage a job candidate from joining theorganization? Is it ethical to ask someone to take a job that is not good for their career progress? Is it right to do personal business on company time? It might not be considered ethical for an organization to put the health of its employees at risk, or defraud its shareholders, even if there was no chance that the organization would be found out.these examples highlight why there is a need for maintaining high standards of ethical behavior and moral standards at work place. It is the expected conduct that organizations want their employees to hold while at work and important because every individual's conduct affects the relationships within an organization thus unconstructive on the overall performance of an organization.
Most business experts suggest that establishing a code of conduct can help steer the company down the path of ethical business behavior. A codes of conduct is a formal document that ststes an organizations primary values and the ethical rules it expects its employees to follow. Ethical standards protect the business from scandals and prevent them in the future. Ethical statements imply the employees, business associates, and the larger community a framework of the company's operating principles (the rules and regulations) that need to be adhered, why the company exists, what the company believes, and how it intends to act to make sure that its activities comply with its professed beliefs. Carring out active reviews of these strategic plans and objectives will ascertain that they are not in conflict with the company's basic ethical standards. In addition, reviewing the standard operating procedures and performance measurements will ensure the business owners and mangers that it is well structured and does not encourage unethical behavior.
Studies has shown that organizations are now increasingly take account of ethical considerations, there has been a shift from traditional profit and free market business approach to ethical approach, in favor of consumer interests. A business that behaves ethically focus their involvement on activities in meeting all responsibilities to employees, customers and suppliers is awarded with a high degree of loyalty, honesty, quality and productivity in the long run.
Ethical investments is one way of responding to issues of social responsibility in business decisions and activities and avoiding to be self serving. The traditional profit and free market business approach is only concerned with how much profit is made. Ethical investors retains profit making as a top corporate priority and is essentially concerned with how profit is made and seeks to maximise profit and return on investment at the same time as minimising and avoiding negative social effects where possible. On the positive side, the public will begin to recognize and to honor individual companies for their contributions to solving most obdurate problems. It also aligns the interests of shareholders, when the interests of both parties are focused on the long term health of the company. The proponents of shareholder value take this long term focus for granted, they assume that for its own future well being, a company will want to be responsive to its employees, consumers, and the public, and that this is the best way to realize true shareholder value.
Socially responsible factors in areas of public concern include the environment, sustainability, globalization effects for example exploitation, child-labour, social and environmental damage anywhere in the world, corruption, armed conflict and political issues, staff and customers relations, for instance education and training, health and safety, duty of care, etc. it also includes the local community and other social impacts on people such as thier health and well-being. For example, Dell began a program of recycling of computers at no cost to purchasers and Shell started to cooperate with environmental groups. They set a company record by giving back to the society.
Behaving ethically also improves the quality of work life and enhances the role of every employer in creating an environment where employee pride blossoms and theft losses disappear. People are valued as individuals and treated with fairness and equality, respect and dignity, valued as individuals and there is reduced corruption. Positive results are achieved when employees are given a positive basis for trust and respect and an ethical vision to live by. If employees believe all are held to similar high standards, they likely will feel better about themselves, their collegues, their organization and behave ethically when dealing with customers and business associates. Employees are more likely fiercely loyal, hard working and productive.
Ethical companies have improved customer service and relationship building, an advantage over their competitors. Research proves that consumers are used to buying products from companies that have public recognition, a company record or being promoted. Enhancing customer loyalty to the brand is probably the single most powerful incentive for convincing companies to adopt ethics as a way of life.
Another advantage of behaving ethically is that it promotes better staff retention and attraction, good organisations cannot function without good people. Ethical organizations have increased commitment by employees as good employees want to work with responsible and ethical employers. When a company fails to be a good employer they lose good staff because and it reduces the likelihood of attracting good new-starters. This pushes up costs recruiting new candidates and damage efficiency and performance.
Ethical standards also play important role in protection of company assets, employees that have respect for their organization , tend to respect and protect the assets of that organization. Employees who are treated with dignity and respect, who take pride in their organization and its ethics. Many business want employees to behave ethically because such a reputation is good for business which in turn can mean larger profits. For example, the workplace dictates the dressing protocol (the uniform) for employees , the most evident indicators of the employees opinion of their organization. Both men and women are supposed to conduct themselves with utmost dignity in the place they work. The workplace also dictates verbal and non-verbal decorum i.e. polite and socially correct behavior. How one behaves in the workplace goes a long way in building a rock solid reputation, praises and accolades in the years to come.
Similarly, encouraging employees to act ethically can save money by reducing employee theft, down time and lawsuits. Because many unethical acts are also illegal, a firm that allows workers to engage in unfair practices might be prosecuted. it is noticed that employees not having respect for their organization and co-workers encourage many forms of theft such as personal long distance phone calls on company accounts, padding of labor charges and expense accounts, taking office supplies home. Conversely, employees who are steadfastly ethical avoid practices such as breaking areas and rest rooms, untidy work areas, excessive breaks or sick days from work and improper use of machines and equipment e.g. the photocopier, computer and personal use of company vehicle. In addition, an employee with little self or organizational pride not only causes lost supplies and equipment but can subject that organization to losses in production, time, , professionalism, overhead charges, initiative, reputation, attitude, spirit drive and customer respect. It is important that employees have a clear understanding of their organization's ethical standards and a feeling of management support for acting within those standards. Teaching ethics to an employee is not always effective. Management must set examples by their personal alignment with ethical standards and principles.
It is my firm belief that ethical behavior in business serves the individual and the enterprise much better in the long run apart from setting a border between right and wrong. Ethical behavior means being morally responsible and adhered to accepted behavior in the place we work. Maximum productivity and creativity is achieved when individuals operate regarding the ethical considerations of their position. On the other hand, practicing unethical behavior results in reduced success and diminished effectiveness.
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