Can ethical behavior pay off long term


Ethical behavior is linked to a management behavior by classifying response of mangers to a series of illustration as by the ethical theory represented by a response. The illustrations represent ethical dilemmas in various areas such as


Conflict of interest

Physical environment

Personal integrity and


Values or ethics have been dealt from various perspectives in management literature. Writers have focused on business environment and have provided advice for giving the importance of ethical aspects of business behavior. Some have discussed the teachings of ethics to present and the proposed managers. There is growing studies on concerning investigation on ethical beliefs and behaviors of mangers and enterprunal and settled businesses.

Little effort has been made to try to link ethical theory to management behavior. This connection would be really helpful in understanding the values held by mangers as well as in providing the basis for altering behavior in more ethical direction if such a change is deemed to be in the best interest of the society. The purpose of the present study is to make an initial attempt at providing such a linkage. The writers believe that the study of business ethics has suffered because of the empirical research and much of the non-empirical writings lack of theoretical basis. The philosophy provides a set of well developed ethical theories; business researchers have made little use of them. There are potentially two reason of this shortcoming: there appears to be a general lack of understanding for ethical theories as relevance to business research or ethical theories are so difficult to operationalize. (htt1)

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Ethical standards play important role in protection of company assets

A good indicator of high levels of corporate, and hence, employee ethics is how well employees protect their company's assets. Who take pride in this company's ethical standards reflect that pride in a respect for assets.

Employees who are treated with dignity and respect, who take pride in their organization and its ethics, tend to respect the assets of that organization. One of the most evident indicators of the employees' opinion of their organization is their conduct at work.

Employees who have respect for their organization and co-workers will avoid such practices as

1. Padding of labor charges and expense accounts

2. Personal long distance phone calls on company accounts

3. Untidy work area, break areas and rest rooms

4. Taking office supplies home

5. Excessive breaks or sick days

6. Improper use of copy machines and computer equipment

There are many forms of theft. In addition to lost supplies and equipment, an employee with little self- or organizational pride can subject that organization to losses in time, production, overhead charges, initiative, professionalism, customer respect, reputation, attitude, spirit and drive.

Everyone can play an important role in creating an environment where people are valued as individuals and treated with respect and dignity, fairness and equality, where people perform with unquestionable ethics and integrity. In such an environment, employee pride blossoms and theft losses disappear.

The historical and global importance of religious views on business ethics is sometimes underestimated in standard introductions to business ethics according to Dr. Todd Albertson author of The Gods of Business book. Particularly in Asia and the Middle East, religious and cultural perspectives have a strong influence on the conduct of business and the creation of business values.

Examples include: (htt2)

Islamic banking, associated with the avoidance of charging interest on loans.

Traditional Confucian disapproval of the profit-seeking motive.

Quaker testimony on fair dealing.

Ethics often downplay the role of social context, social arrangements, social processes, history, politics and structural aspects constituting individuals and individual actions. Issues taken as ethical dilemma by business ethicists are often narrow in scope, such as behaving politely with customers, following office etiquettes, protecting privacy of employees, avoiding discriminations, bribery etc., while issues like inequality among global labor, ethics of lobbying, intellectual property alienation, bio-piracy etc., are broadly neglected. The term ethics says different thing to people oriented differently. There are arguments of thought about ethics. The differences are not just a matter of talking about the same thing in different ways. Rather, these different ways of talking about ethics seem to be talking about different things, about different ways of imagining ethics itself. Like discussions of ethics in any other fields, business ethics too should be treated along the percepts of various established, neglected and emergent schools of ethical thought. Business ethics is assumed to be something that does not really trouble basic assumptions about the normal practices of business. Instead of looking at the politics the corporate firms play in modifying rules of accounting practices, diluting labor laws, weakening regulatory mechanisms etc., and it tends to look at the ethical collapse of firms as if it were isolated instances of individuals slipping away from their ethical responsibilities. Further, Business ethicists often foreclose the goal of being ethical. They attempt to convince that being ethical serves a strategy of image management or sustained profit making. Others hold being ethical and making profit are equally valid goals of firms, some others claim being ethical is just for the sake of being ethical Further, Ethics, when remodeled as business ethics it suffers the fate of business expediency thus business ethicists prepare themselves for unambiguous quick and standard answers while ethics is not a matter of stable solutions but one of endless openness and difficulty and beyond the limits of normativity

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Not everyone supports corporate policies that govern ethical conduct. Some claim that ethical problems are better dealt with by depending upon employees to use their own judgment.

Others believe that corporate ethics policies are primarily rooted in utilitarian concerns, and that they are mainly to limit the company's legal liability, or to curry public favor by giving the appearance of being a good corporate citizen. Ideally, the company will avoid a lawsuit because its employees will follow the rules. Should a lawsuit occur, the company can claim that the problem would not have arisen if the employee had only followed the code properly.

One of the most important attributes for small business success is the distinguishing quality of practicing admirable business ethics. Business ethics, practiced throughout the deepest layers of a company, become the heart and soul of the company's culture and can mean the difference between success and failure.

"If you have integrity, nothing else matters. If you don't have integrity, nothing else matters." -- Alan K. Simpson

In the research study, "Does Business Ethics Pay?" by The Institute of Business Ethics , it was found that companies displaying a "clear commitment to ethical conduct" consistently outperform companies that do not display ethical conduct. The Director of IBE, Philippa Foster Black, stated: "Not only is ethical behaviour in business life the right thing to do in principle, we have shown that it pays off in financial returns." These findings deserve to be considered as an important insight for companies striving for long-term success and growth (Moment)

Benefits of ethical practices in business

Customers Loyalty

Customers do favor business who demonstrate ethical issues and ethical responsibilities. Companies that do not practice good ethical behavior can have lots of potential risk to loose market share and popularity which in effect reduces revenues, profit and investments. Good corporate citizen also enhances overall business performance, improved competitive advantage, higher financial returns and better reputation.

Better employees

Good ethics helps in retaining best employees. Bad employer means no more good staff and reduces the likely hood of attracting best people in the market. This will increase the costs and underlines performance. If a business need be best, it has to have best people working for it and it cannot be achievable without best practice of ethics. To achieve these goals, a value oriented code of conduct is the necessary first step toward greater consideration of ethical issue during the decision making process.

Efficiency in employs

Integrated, socially responsible and globally recognized staffs of any organization are less prone to attrition, stress and dissatisfaction. Happy efficient people are a common scenario in highly successful organization. This can free up enormous amount of energy for task accomplishment. The result can be greater power and influence in the market place.

Market place of an organization

It may take ages to build a market reputation of an organization. Ethically responsible organizations are less prone to any disasters. Ethically responsible organizations will automatically know how to deal with it quickly and honestly. Peope and government tend to do forgive organizations who are genuinely trying to do right thing.

Attract foreign investors.

Investors completely investigate and study the company they are going to invest in. Very few invest in organization which lack integrity and responsibility and where there is no practice of ethics.


Hardly any leader would prefer to be remembered for doing something good, rather than making a pile of money, or build a great big empire. It’s human nature to be good. Mankind would have not survived if it would have not. The ethical practices are fundamentally changing the view of what a life time legacy should be and can be.


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Avolio, B. J. (n.d.). Retrieved from

Moment, R. (n.d.). Retrieved from

Ethics Essay

“With in the business context, businesses are expected to have good ethical values and act socially responsible. The problem is that the ethics of a business is a mixture of individual sets of ethics. This is why it is important to have god individuals as employees. It is also equally important that when you go to work somewhere that you feel like you share the values of those you work with. Ethics is not just talking about the right thing. It is doing what is right in every decision that is made.”

Based on the observation discuss the impact that ethical leaders can make.

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The topics of authentic leadership and the ethical behavior of leaders have received significant interest in recent years due to the plethora of ethical scandals in corporations we developed a theoretical framework that maintains that employees' psychological empowerment mediates the relationship between leaders' ethical behaviors and employees' organizational commitment, society and trust in leaders. We also argue that authenticity (i.e., the consistency between leaders' true ethical intention and behavior) moderates the relationship between leaders' ethical behaviors and society outcomes.

Leaders are obligated to set a moral example for organizational members and to determine those organizational activities which may be detrimental to the values of society in general

Leaders exhibit ethical behaviors when they are doing what is morally right, just, and good, and when they help to elevate followers' moral awareness and moral self-actualization. Indeed, ethical leadership encompasses more than the fostering of ethical behaviors. For example, Butcher (1997) pointed out that, "Ethical business leadership requires not only investing in the small trees and experimental hybrids that won't yield a thing that in this quarter or the next, but also caring for the soil that allows us to produce such a harvest in the first place. Thus, ethical leaders must create the right conditions and organizational culture (i.e., an "organizational soil") to foster the development of ethical behavior in associates in ancient China, Confucius pointed out that "gentlemen can convince the world only with their noble ethics."

Ethics is fundamentally concerned with the impact of an individual's action on others. (Avolio)

Most of our decisions have some ethical issues or impact, here are some guidelines that should raise sensitivity and improve our decision-making process.

Over the past several weeks, we have suggested guides for personal decisions and activity, including what we say, how we approach ethical decision-making, and personal character traits. But how about guidance to determine if the decision even has ethical implications?

Labeling a decision as an "ethical decision" may disguise the fact that almost every decision holds some ethical issue or impact. Perhaps a better approach would be to develop an ability to judge the ethical implications. What role do my ethics play in this decision? How do I recognize an ethical situation or problem? What are the warning signs that this may be a tougher decision with deeper issues and wider impact? Here are some guidelines. Not all apply every time, but they should raise sensitivity and improve our decision-making process.

1. Do I put a monetary value on this decision? Would I make this decision differently if cost were not a factor? Am I putting a monetary value on my ethics?

2. Do words such as right, fairness, truth, perception, values, or principles appear in my reasoning when I am making my decision?

3. Do I feel as if I need to search through standard policies and procedures or contact a legal department representative for help with my decision?

4. Do questions of fair treatment arise?

5. Do my personal goals or values conflict with my professional ones?

6. Could this decision generate strong feelings or other controversy?

7. Would this pass the newspaper test? How would I feel if this were to appear in my local newspaper tomorrow?

8. What does my heart tell me? Do I ponder this decision on the way home?

9. Do I offer myself excuses such as everybody does it, or no one will find out, or I did it for?

10. Does this decision really need to be made by someone else? Did I inherit it because someone else doesn't want to make it?

11. How am I going to feel tomorrow if I do this?

If you face a tough decision and you feel as if you need help, there are many places to turn. Your supervisor or manager is generally the best for that is the one who understands your situation the best. But there are other sources of good information...the open door to higher levels of management, the ethics booklet, Legal, Human Resources, and your Ethics Office. Ask and keep asking until you feel you have a good answer that complies with standards. Know what's right. Do what's right.

All the above discussion, let us think about what impact our decisions and ethical values have on society and leaders and what impact it has on world.

Looking at the theories and bibliographic of the of the world leaders, it reveals that ethical leaders made a deep impact on the society and they can move the society to the direction that is best and beneficial for each.