Ethics and

Entrepreneurship
 What Are “Ethics”?
• . moral principles that derive from beliefs
about right and wrong used to judge concrete
actions . . .

• Ethics is the moral values and behavioral

standards business and people draw on as
they make decisions and solve problems.

• “The owner’s value system is critical to the

ethical considerations that surround a business
decision” (Hornsby et al., 1994: 14)
 Defining Ethics
Ethics provide the basic
rules or parameters for
conducting any activity in
an “acceptable” manner.
 What, then, are ethics?
• Ethics A set of principles outlining a behavioral
code that lays out what is good and right or bad
and wrong
• May outline obligations and appropriate moral
actions for both the individual and the
organization
• Ethics does not just apply to business
• It may be difficult for individuals or groups in
society to agree upon what is right and wrong
 Legal vs. Ethical

• The law provides boundaries for defining

what activities are illegal
• The law, however, does not necessarily
outline what is “ethical.”
 Ethics within
businesses
• Many businesses develop their own
codes of ethics or conduct of conduct.
These codes outline what employees
are to do in order to carry out what the
company sees as the “right thing to do”
in various circumstances
 The “Ethics Check”
List
1. Is it legal
2. Is it balanced/fair/win-win
3. How will it make you feel about yourself?
- will it make you feel proud?
- would you feel good if your decision
was published in the local newspaper?
- would you feel good if your family knew
about it?
 Outline for a Code of
Ethics
The, a code of ethics should be a formal statement of a
business’s values concerning ethics and social issues. It
commonly refers to acceptable norms of behavior, guided by
six areas of concern:
1. Honesty: to be truthful in all your endeavors; to be honest
and forthright with one another and with customers,
communities, suppliers, and other stakeholders.
2. Integrity: to say what you mean, to deliver what you
promise, and to stand up for what is right.
3. Respect: to treat others with dignity and fairness,
appreciating the diversity of the people you deal with and
their uniqueness.
4. Trust: to build confidence through teamwork and open,
candid communication.
5. Responsibility: to speak up — without fear of retribution
— and report concerns in the workplace and elsewhere,
including violations of laws, regulations, and company
policies.
6. Citizenship: to obey all laws of the countries where you
do business and to improve the communities where you live
and work.
 Being Socially
Responsible
• It is not enough to be ethical, or do the right
thing anymore (thankfully)

• Businesses are now expected to act in a

socially responsible manner – they need to
be good citizens as well as give back to the
societies (including global) in which they exist.

• Can you think of a company that is socially

responsible? One that is not?
• There are financial benefits to being a
“socially responsible” company or organization.
What might some be?
 Business Success

• Business excellence and success is

reach based on ethics and hard work,
rather than cutting corners and taking
unethical actions.