Business Ethics

I. Introduction

Business ethics is defined as policies and practical activity related to the potential objective
which provides a basic guideline for businesses to follow in order to gain public approval. Public
law normally can guide to meet business ethics, but other parts of business ethics need to follow
the ethics theory to meet the business ethic goal to ensure a trustworthy between consumers and
other market participants in the businesses. Business ethics is a key to implying the sustainability
of a business because organizations are not only important to themselves but also contribute to
the growth of the economic system and benefits to their customers.
Based on Becker (Becker, 2018), business Ethics is the methods and applications that provide a
new structural approach to establishing business ethics that cover the complexity and various
ethical challenging of modern business.
To continue to the next section, we should understand how do business ethics benefit companies?
Following the behavioral ethical standards can help companies strengthen and succeed internally
among executives, management teams, and staff. In addition, companies can be interested and
keep investors who feel they are attracted to companies that behave with their own standards of
ethical behavior. In other words, business ethics can help companies develop last long, solid
reputations and financial success.

Figure 1: Business Ethics Principal Mind Map

1. Problem on Business Ethic

In the article (Minkes, Small and Chatterjee, 1999), there are two basic problems have been
outlined, first is concerns how the organizations are managed, and how far dose it has regard to
ethical behavior and second is that the managers are not able to manage many of the interactions
in the organizations that they are leading.
Establishing a code of ethics in the business can help a firm to fundamental trust between owner
and employees, clients, partners, suppliers, and other stakeholders. Following the law often gives
the guideline to escape from ethical issues in business, but that’s not always the case. So,
business owner should familiar with ethical problems in business which causing problems and
how to solve it effectively. Common ethical issues facing businesses in 2021:
 Unethical accounting: Clients and employers they rely on accountants with financial
information. So, the information accessor like accounting should be trustworthy and
dependable
 Harassment: It can make an unfriendly work environment it can come in many forms,
including unwelcome behavior, policies, race, and other uncomfortable actions.
 Health and safety: Working stress environment can result from a lack of not accountable
for employees safety and physical injuries.
 Technology, privacy, and social media: Using social media in improper manner can
lead to serious consequences for privacy and security.
 Discrimination: The actions or any activity that results in the treatment of an employee
in a less favorable manner.
That's a good question about why some companies have bad business ethics? especially when the
advantages on financial arising, a high level of ethical behavior can be greater. there are reasons
may cause by some CEOs, managers, or employees may feel easier when not follow the ethical
standard. The company may reach certain financial goals faster while they do not care about the
long-term repercussions. It may seem to be easier to work without moral and ethical areas where
money is concerned, good ethics can be overlooked.

II. Literature Review

In this section, we will discuss on the literature review which took back to previous research
results and theories existed. We will discuss more about the definition and organization
decision on the business ethic. Typically, ethical Business issues have relations with
decision-making by individuals, organizational style and structures and rules of the industry
or a global standard (Becker, 2018).
In the previous study (Minkes, Small and Chatterjee, 1999), organizational effectiveness and
efficiency are formerly main issues for managers in thinking in terms of goal
accomplishment for their organizations, now have been augmented by the awareness of
issues in business ethics, and required members of the corporate governance to acting in
more social responsibilities.
 In the overview article (Rendtorff, 2012) mention that practical issues and cases in business
ethics may involve the many topics included Integrity, honesty, truthfulness and fairness,
bribery and corruption issue, trust violation, conflicts of interests, fraud and theft.
Table 1: Business Issue Overview
Ethic Issue Other added
The ethics of the market antitrust legislation
Corporate governance and investor
protection
Stakeholder management and fiduciary
duties to stakeholders
The ethics of reporting accounting and auditing
The ethics of finance corporate mergers and hostile takeovers
Ethical issues in relation to particular fields pharmaceutical companies or
of business biotechnology firms
Ethics of entrepreneurship
screening of suppliers for violation of
Ethics of supplier relations
ethics rules
Social responsibility of business (CSR) in
different fields of business
human resources and organizational
Ethical issues of values
culture
cultural difference and respect for
Globalization
human rights
Socially responsible investments (SRI)
work ethics worker rights, and worker democracy
privacy protection, discrimination or
Employee ethics
affirmative action
Ethical leadership and ethical behavior of
managers
including the political consumer and
Ethical relations to customer and clients
protection of consumer interests
Ethical protection of the environment and of
ecological systems
Ethical accounting, social accounting, and
environmental accounting
Legitimacy of corporations
Public relations and ethics of branding
The relation of the corporation to the local
contribution to the local community
community
Corporate philanthropy and gifts to local
communities
Foundations of values values, ethics, and political theory
History of business ethics and values of
social and economic systems
 Business ethics in processes of globalization
and internationalization of world cultures.
Source: (Minkes, Small and Chatterjee, 1999)
Brickley article (Brickley, Smith Jr and Zimmerman, 2002) mentioned that corporate
business ethics programs have the potential to give an effective method of setting and
communicating expectations with employees for them to deal with customers, suppliers, and
other employees. Corporate managers, and employees not able directly expected to know the
any appropriate decisions which promotes the interests of the organization.

III. Implementation and Discussion

In this section, we will talk about the implementation of good Business Ethics. Encouraging
an environment of ethical behavior and decision-making needs time and effort and always
starts at the top. Most of the companies have initiated an ethics code, principles guidelines,
procedure reports, and training programs to improve ethical behavior. When conducting is
defined and programs implemented, continuous connection and communication along with
employees are also vital. Leaders or managers should regularly encourage employees to
report concerning behavior. In addition, there should be ensured that the one who reports or
informs will not face any adversarial actions.

After take implementing the programs, we should keep trying to monitor and report unethical
behavior. When we want to prevent unethical behavior and regulate its side effects,
companies usually look to managers and employees to report incident experiences. However,
the barrier of the company culture such as fear of revenge for reporting improper behavior
can prevent good ethical goals achievement.

Based on the Global Business Ethics Survey of 2021 (Ethics & Compliance Initiative, 2021)
has surveyed over 14,000 employees in ten countries about different forms of misconduct
that they have observed in their workplace. Results found 49% of the employees said they
had noticed misconduct and 22% mentioned they observed behavior that they can categorize
as abusive. 86% of employees have reported the misconduct that they had observed. and 79%
said they had retaliated against their report.

IV. Solution and Conclusion

After discussion and review articles above we find out the experiences which can remove the
issue mention in the problem statement. For instance, the Daniels Fund Ethics Initiative
promotes eight business ethics principles included integrity, trust, accountability,
transparency, fairness, respect, rule of law, and viability and it claims that those principles
were at the core of the success of the businessman Bill Daniels (DFEI, 2016).
Brickley (Brickley, Smith Jr and Zimmerman, 2002) suggest to follow the US corporations
adoption the formal codes of conduct, appointed ethics officers, and provide employee in
ethics training programs. Those codes and programs regularly focus as the following:
 Employees must obey the laws and observe permitted regulations.
 Customer relations of the reputation, and integrity of the company are very importance.
 Employees must support the policies of the company to customers.
 Conflicts of interest must be avoided between the company and the employees.
 Confidential information obtained in the business must not be used improperly.
 It is improper to conceal fraud and protect others in their fraud.
 Advice to customers should be restricted to provide the true about which the employee
is confident
However, as recent development and research have suggested the company to obtain the
general of business ethics main point such as Accountability, Compassion, Environmental
concern, Fairness, Honesty, Integrity, Leadership, Loyalty, Respect for laws, Responsibility,
Respect for other, Transparency.

V. Reference

1. BECKER, Christian U. Business ethics: methods and application. Routledge, 2018.

2. Ethics & Compliance Initiative. (n.d.). The Global Business Ethics Survey (GBES) from the
Ethics & Compliance Initiative. [online] Available at: https://www.ethics.org/global-business-
ethics-survey/.
3. Daniels Fund Ethics Initiative Overview. [online] Available at:
https://www.danielsfund.org/ethics/overview.
4. Rendtorff, J.D. (2012). Business Ethics, Overview. Encyclopedia of Applied Ethics, pp.365–372.
doi:10.1016/b978-0-12-373932-2.00074-0.
5. Brickley, J.A., Smith Jr, C.W. and Zimmerman, J.L. (2002). Business ethics and organizational
architecture. Journal of Banking & Finance, 26(9), pp.1821–1835. doi:10.1016/s0378-
4266(02)00193-0.
6. Minkes, A.L., Small, M.W. and Chatterjee, S.R. (1999). Leadership and Business Ethics: Does It
Matter? Implications for Management. Journal of Business Ethics, 20(4), pp.327–335.
doi:10.1023/a:1005741524800.