WHAT ARE BUSINESS ETHICS?

Business ethics are principles that guide decision-making. As a leader, you’ll face
many challenges in the workplace because of different interpretations of what's
ethical. Situations often require navigating the “gray area,” where it’s unclear
what’s right and wrong.

When making decisions, your experiences, opinions, and perspectives can

influence what you believe to be ethical, making it vital to:

 Be transparent.
 Invite feedback.
 Consider impacts on employees, stakeholders, and society.
 Reflect on past experiences to learn what you could have done better.

The system of moral and ethical beliefs that guides the values, behaviors,
and decisions of a business organization and the individuals within that
organization is known as business ethics.

Some ethical requirements for businesses are codified into law.

Environmental regulations, the minimum wage, and restrictions against
insider trading and collusion are all examples of the government setting forth
minimum standards for business ethics.

What qualifies as business ethics in history has changed over time and the
different areas of ethics are important to every business.

 Business ethics involve a guiding standard for values, behaviors, and

decision-making.
 Ethics for business have changed over time but they're important for
every company.
 Running a business with ethics at its core from the top down is
essential for company-wide integrity.
 Behaving in a consistently ethical manner can lock in a solid reputation
and long-term financial rewards for companies.
 Employees tend to remain loyal to, and perform more effectively for, a
company with a high standard of ethics.

Benefits of Business Ethics

 The importance of business ethics reaches far beyond employee loyalty

and morale or the strength of a management team bond. As with all
business initiatives, the ethical operation of a company is directly
related to profitability in both the short and long term.
 The reputation of a business in the surrounding community, among
other businesses, and for individual investors is paramount
in determining whether a company is a worthwhile investment . If a
company is perceived to operate unethically, investors are less inclined
to buy stock or otherwise support its operations.
 Companies have more and more of an incentive to be ethical as the
area of socially responsible and ethical investing keeps growing. The
increasing number of investors seeking out ethically operating
companies to invest in is driving more firms to take this issue more
seriously.