Incompatibility of business and ethics


Business is an organization that enables investors or owners to convert their investment into profit mainly through the process of trade or buying and selling of goods production of gods and services. Business is normally in the public and private sector.

Ethics is becoming an extremely important matter in today business world. Ethics means getting things done which are right they are not included in law but it is things that are correct according to the business. For example the law has never force business such as banks or large companies to help the poor by giving them money or shelter but business do it this is called business ethics.

Business ethics can be a code of conduct which a business consider to be right such as no child labour, no exploitation of workers at work place , on chemical product tested on animals in short business do not want to do things which are not right but at the same time no included in the law to earn profit. Business ethics is doing something, which is morally correct and accepted by all people in the community. Each business has their own ethics and there are no any prescribe business ethics to particular type of business each business has to develop their own.

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Business and ethics are not the same as they have different objectives for example the business may aim to maximize profit through the investment made by the owners. The aim of business owners is to recover the money invested as well as to make profits even if it means selling loose quality items. The problem of nowadays is that people are too money minded to think about the possible bad quality of the products they are selling. As such in quest of profit, they end up in making the life of consumers a hell as the products are of cheap quality and end up breaking up very quickly.

Another aspect of unethical business is the fact that the company holders will never hesitate in exploiting resources, be it machine or human. The fact that multinationals choose to open in countries like Mauritius, China and some countries in Africa is because they benefit from cheap labour. The fact that there is a craze for employment, these companies make the must by over-employing people. This is just over exploitation of labour and unethical as according to laws, this is illegal. Some companies even employ children that breach the laws that prevent children from working. For example England has cancelled all its order from India for carpets as India was employing children to manufacture the carpets.

As stated above businessmen are nowadays money-minded and would not even hesitate to destroy the flora and fauna to make their dream of maximizing profits come true. Singapore is an example of how businessmen have destroyed the environment to make business flourish. It's not that the country is not benefitting from these businesses but it has paid a great price for the development as the flora and fauna is just minimal compared to what it was long ago. As such one cannot be so money minded that they lose track of the country's beauty that lies in the environment.

However business ethics can prove to me loss making to a business such as a very profitable project may be rejected as the policies of the company does not permit it. It is costly to set up an ethical business structure and small businesses might have difficulties to apply business ethics as they are new and lack finance. However a business must see ethics as a generator of profit and not a burden and they must ensure that their ethical code is correct.

Think of the costs likely to be associated with unethical behavior, as well as the benefits likely to be derived from ethical behavior.

Good corporate citizenship improves the situations of the employee as well as it benefits to the consumers in best resources available. The factors identified include more effective recruitment; higher retention; and better morale, loyalty, motivation, and productivity.

Customer relationships are also improved. Factors identified include increases in customer loyalty, enhancement of brand image, and tiebreaker effects for customer purchasing decisions. Empirical evidence suggests that customers' sensitivity to corporate citizenship continues to gain momentum. Good corporate citizenship also enhances overall business performance, particularly improved competitive advantage, higher financial returns, and better reputation. A considerable number of studies, including work done by this editor, demonstrate a positive link. Yet critics maintain that too many "best business practices" and other influences are present to attribute the superior performance solely to good corporate citizenship.

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When unethical behavior is present in a business, it poses a significant risk to that organization. Further, we as quality professionals contend that one of the individuals most at risk from such behaviors is the quality professional. Because we depend on data for our decision-making, we are vulnerable to unethical manipulation of these data.

Unethical behavior in firms results in lower productivity, especially among highly skilled employees, lower financial performance as measured by metrics such as economic value-added, and market value-added as well as abnormally negative returns to the shareholders for prolonged periods of time.

It also takes years to build a reputation for integrity that can be lost overnight. Once an organization loses it's reputation for integrity, the effect can be permanent. As unethical behaviors are manifested by upper-level management, workers throughout the organization and as a result unethical behavior becomes a routine. Ultimately, this culture results in detrimental behaviors such as under delivering on promises, turf guarding, goal lowering, budget twisting, fact hiding, detail skipping, credit hogging, and scapegoating.

These other significant risks and costs from unethical behavior include:

  1. Increased risk of doing business and the possibility of bankruptcy and severely damaged company brand and image.
  2. Decreased productivity.
  3. Increased misconduct and conflict internally.
  4. Decreased performance levels of employees.
  5. Increased employee turnover and more challenging employee recruitment.
  6. Decreased productivity.
  7. Increased absenteeism and "presenteeism."
  8. Decreased probability of reporting misconduct and unethical behavior of others.
  9. Increased dysfunctional behaviors such as not paying attention to details, scapegoating, withholding information, under delivering & over promising, not giving credit to others, lowering goals, misrepresenting results, etc.
  10. Decreased value of the company.