Without ethics, our society would be chaotic and self-destructive. Here are 5 importance of business ethics to your organization.
Because ethics is the study of what is right and wrong. Then, business ethics generally means knowing what is right or wrong in an organisation and learning to do the right thing.
Do you know the role of ethics in business success? Ethics are the foundation of respect towards others. Business ethics are moral and ethical principles that guide the values, behaviour, decisions and the way a business organisation behaves. It is relatively easy to distinguish unethical business practices such as dishonesty when advertising. Business ethics ensure that profits are made only through the right channels.
Decisions which are taken within an organisation may be made by an individual or a group, but whoever is in charge of making them is influenced by the ways of the organisation. The decision of an organisation to behave ethically is a moral decision and employees need to decide what they think is the right course of action. Behaving ethically and incorporating social responsibility can bring significant advantage to a business.
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Business ethics guide organisation executives on how to cater to the needs of the employees as well as the community where their resources are gotten from.
Some ethical blueprints for business organisations are already imbibed into law and some environmental regulations.
Ethics should be implemented ideally into all aspect and operation of an organisation. Implementing these ethics can enhance the efficiency of an organisation in the long run. When business ethics are adhered to, the needs of the consumers are respected.
This article will now further explain the importance of business ethics in an organisation.
Importance of Business Ethics in An Organisation.
Good Corporate Culture
When an organisation devotes its resources into creating policies and procedures to promote ethical actions, it builds a good corporate culture. These policies which promote ethical actions include open door policies, Anti-discrimination rules and equal opportunities for each of the employees to grow.
Team morale increases when employees are not afraid of being retaliated for their personal beliefs. When the employees feel good about being in the workplace, the entire feeling in the organisation is more positive.
This positive overall feeling builds productivity and loyalty because the employees feel more comfortable with showing up at work. Every individual will like to be associated with an organisation which they can respect and be proud of, an organisation which the society respects as an honest and socially responsible organisation.
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Attracting and Maintaining Better Employees
Good ethics in an organisation should not only involve the employees but should start at the top. The executives of an organisation should lead its employees by example. When employees are executives making good and ethical decisions, it makes know that the executives have confidence in the organisation and they know that they and the consumers will gain better things.
This boosts the morale of the employees and word will also spread about how the employees are treated with consideration and respect, attracting more good employees who will want to be a part of the organisation. Employees always want to stay longer in an organisation which values their rights and opinions, to them their primary needs are satisfied. When an organisation has a good retention rate of employees, they can save money on recruitment costs and training.
Good Public Reputation
An organisation can maintain consumer loyalty with ethical practices which can start with fair and honest advertising methods and continue in honesty through the entire sales process. Consumers will prefer to buy a product or get services from an organisation that is honest and offers good value for their money.
Organisations lose consumers confidence when they fail to honour guarantees or deal negatively with their complaints.
This is one of the reasons why there should be constant policies and training of employees. Organisations need to direct their employees on how to treat consumers and respond to consumer’s complaints.
When an organisation takes it’s time to determine what is important to its target market and consumers, it can set up better protocols and value statements to meet higher ethical standards.
Having a good public reputation gives your organisation clients and consumers who believe in your organisation and want to support it. Investors who want to help your organisation grow, trade and community organisations who want your organisation as their member and businesses that want to partner with your organisation.
Fewer Risks and Other Legal Issues
Laws and regulations are complicated but your organisation can keep away from a lot of trouble by doing what is morally right. When business decisions are made with business ethics in mind, it can save your organisation the stress of defending itself against lawsuits and fines. If an organisation does not develop policies on ethical standards, it stands the risks of facing financial liabilities, one of the liabilities being a reduction in sales. An organisation must find an ethically responsible middle ground to sway public opinion from corporate greed and towards environmental responsibility. Organisations should also maintain policies and procedures that address several types of discrimination and harassment, they must remain constant in the execution of policies dealing with these accusations. This can help an organisation reduce silly lawsuits that can cause bankruptcy.
Good Decision Making
An organisation that has respect for good business ethics will go through the process of putting various economic, ethical and social aspects into consideration when they want to make a decision.
Decision making will be better if the interest of the public, employees and the organisation’s own long term good is put into consideration. Decisions are driven by value, so what the organisation values will determine the type of decision it makes.
Overall, when the executives and the employees at all levels of an organisation behave ethically and make ethical decisions, it is good for the organisation.
These helps an organisation to grow and have bigger profits. Ethics tries to create a sense of right and wrong in an organisation, and often when the law fails, it is ethics that keep organisations from harming the society or the environment.
Do you know more reasons why ethics is important within a business organization? Please share them with us.