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Need and Guidelines of Business Ethics

   Posted On :  04.05.2018 03:43 am

Need and Guidelines of Business Ethics

Need For Business Ethics

  • Ethics corresponds to basic human needs. It is human trait that man desires to be ethical, not only in his private life but also in his business. These basic ethical needs compel the organizations to be ethic-oriented.

  • Values create credibility with public. A company perceived by the public to be ethically and socially responsive will be honoured and respected. The management has credibility with its employees precisely because it has credibility with the public.

  • An ethical attitude helps the management make better decisions, because ethics will force a management to take various aspects – economic, social, and ethical in making decisions.

  • Value driven companies are sure to be successful in the long run, though they lose money in the short run.

  • Ethics is important because the government, law and lawyers cannot do everything to protect society.

Ethical Guidelines

In business, many of ethical guidelines arise from the following value consideration:

  • Is there any unfair gain to the person doing it? An example is a conflict of interest in which manager gains through a purchase contract that he makes with a firm in which he has a secret interest.

  • Is there unfair harm to others? Example: a private disclosure of unfavourable financial information to a shareholder of the firm.

  • How substantial is the unfair gain or harm to others? Example, water pollution in the community and taking part in the civic programme of chlorinating the drinking water.

  • Was the act a personal one or a representative behaviour according to the established practice? Example dismissing an employee on personal dislike is more serious than dismissing him on grounds of poor performance.

Tags : Business Environment and Law-Business And Its Environment
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