Maintain Your Business's Ethics With Effective Training

A company’s ethics will determine its reputation and are essential for the long-term success of an organization. Implementing an ethical program will foster a successful company culture and increase profitability. Developing a business ethics program takes time and effort, but will have a major impact on the future of your organization.

A company's ethics will have an influence on all levels, including customers, employees, suppliers, competitors, stakeholders, etc. All of these groups will have an effect on the way a company's ethics are developed. Understanding and maintaining ethics is a crucial part of doing business, especially today.

In this blog post, we discuss what ethics is, why it’s important, and some of our general guidelines for meeting ethical standards in the workplace.

What is Ethics?

You may have heard of ethics in a variety of contexts. Personal ethics determine individual standards of right and wrong and steer people to the choices they make. It is an individual’s responsibility to examine their morals and behavior.

Business ethics refers to the behavior relating to the moral problems that occur in business organizations.

Sometimes, your personal ethics will overlap with your business ethics. It is important to work for an organization whose values align with your own, so you can feel happy and confident with the choices you are making in the workplace.

10 Benefits of Managing Ethics

Running an ethical organization is rewarding in various ways. Having a set ethics code will prepare your team to deal with an ethical dilemma, and can be revisited as needed. Ethics management has a multitude of benefits that will positively benefit the short- and long-term success of your organization.

Here are just some of the benefits that companies have when they manage their business ethics:

Benefits:

• Ethical companies comply with all legal requirements and are less likely to be fined or sued.
• Consumers are more likely to support a business with a reputation as an ethical organization.
• Companies with ethical values improve their communities.
• Ethical rules save organizations from accidently violating the rights of employees or consumers.
• Employees’ personal moral standards will improve at an ethical business.
• A fair working environment facilitates teamwork and productivity.
• Many successful financial business practices are reinforced by ethical business practices.
• Established ethical guidelines will lead a company in times of change and stress.
• Ethical companies retain employees and save money in turnover.
• There is personal satisfaction in doing the right thing.

Ethical Obligations

Everyone who is associated with an organization is entitled to an ethical relationship with it. There are various different types of groups with different ethical needs. Below is a list of groups you must maintain an ethical relationship with:

• Employees: Companies need to treat all of their employees ethically. Begin by providing employees with the rights guaranteed to them by the United States Department of Labor (or whichever department is associated with your region). This is a solid start, but ethical businesses go above and beyond the minimum requirements in the way that they treat their employees.
• Shareholders and investors: There is a moral obligation to repay investors and meet the needs of shareholders, particularly low-level shareholders.
• Customers: Every business needs to build ethical customer relationships by providing safe products and honoring warranties. Consumers are growing more aware of which companies treat them fairly, and will choose to only support the ones they trust.
• Community: Businesses have an ethical obligation to be involved in their local communities. This includes communities where they interact with customers, and beyond.
• Vendors and Other Companies: Always deal ethically with vendors and other organizations you work with.

Identifying Types of Responsibilities

There are different types of responsibilities related to businesses. Ethical organizations need to address different areas of responsibility and consider the social ramifications of their actions.

Types:

• Legal: Companies are obligated to meet legal requirements that govern their industries. Health and safety standards and fair treatment of employees fall under this type of responsibility.
• Financial: Financial responsibility is more than turning a profit. Financial ethics cover everything from fair salaries to fair payments for raw materials and services, and offering fair prices to their customers.
• Philanthropic: Many organizations are being recognized for their philanthropy. Philanthropy can come from donations, service, education, and environmental programs. Some companies consider the environment its own type of social responsibility.
• Social Responsibility: Socially responsible business practices will contribute to a successful organization. Being socially responsible requires companies to integrate the needs of their stakeholders into the values and operations of their organizations. Implementing a sense of social responsibility indicates the company’s attempts to consider all of these needs in their business practices.

Types of Ethical Approaches: The Basics

Typically, there are five ethical standards used to interpret the world around us. Based on your particular situation when having to make an ethical decision, you have likely used one of the following methods:

• Utilitarian approach: This approach focuses on the consequences of actions. The goal is to do ‘more good than harm’, in a situation.
• Rights approach: Focusing on the rights of all involved defines this approach. It makes respecting the rights of others a moral obligation.
• Fairness approach: A fair approach indicates that all people will be treated equally. A fairly based standard is used to determine actions that are unequal such as pay rate.
• Common Good approach: The conditions that affect all people are considered in the common good approach. Systems and laws are created to ensure the welfare of everyone.
• Virtue approach: This approach uses virtues such as honesty, compassion, love, patience, and courage to guide behavior.

We should always make an effort to make ethical decisions. It is possible; however, for two ethical people to make different decisions in a situation. Having defined responsibilities and policies for addressing an ethical dilemma business, it is important that people understand ethical dilemmas and the ethical decision-making process.

Guidelines for Managing Ethics in the Workplace

Managing ethics in the workplace requires certain tools. Every organization needs to create and disseminate a Code of Ethics, a Code of Conduct, and Policies and Procedures. These tools direct the organization, and guide employees to manage workplace ethics. Some tips to remember when developing your organization’s code of ethics are:

• Give it time: Managing ethics is process-oriented, and requires time and constant assessment.
• Focus on behavior: Do not list vague requirements; ensure ethics management has an impact on behavior.
• Avoid problems: Create clear codes and policies that will prevent confusion concerning ethical issues.
• Be open: Involve different groups in ethics program development, and make decisions public.
• Integrate ethics: Make sure that all management programs have ethical values.
• Allow for mistakes: Lead employees to behave ethically, and do not give up when mistakes happen.

Conclusion

Like everyone, at some point in your career you will find yourself in an ethical dilemma. You may have to think quickly and make some tough decisions. But with proper preparation and a strong understanding of your organization’s values, you can make ethical decisions that will benefit your organization and all of its different stakeholders.

Ready to develop or revisit your organization’s code of ethics? Get started today with our Business Ethics Workshop!

Posted by Katelyn Roy on January 27, 2022