Ultimate Learning Guide For Business Ethics7 mins - Introduction
Business ethics is a complicated web of ideas which govern how business interact on both a personal and global scale. The concepts that outline business ethics are just as complex, but if we break down the concept into smaller chunks, the definition of what it is becomes clearer.
The easiest way to go about this is to first look at ethics. Ethics are what tell societies how one should act in a certain situation. Why? Because it will help us achieved a particular objective and help us to take into consideration everything around us. Take, for example, being a child. You really want that pack of gum that’s sitting on the shelf near the cash register at a local store. Your mom has told you more than once that you’re not able to get it. No one’s looking, and you feel like if you just snag it and put it in your pocket, no one will know.
Ethics asks us to take into consideration how fulfilling our desires will affect our surroundings, in this case, your mom, the cashier, and the business. Stealing takes profits away from the business. The cashier could get in trouble for not noticing that a product was taken, given certain circumstances. And your mother could get in trouble because you stole something. In other words, ethics asks us to take responsibility for our actions by considering the consequences for ourselves and those around us. In this case, ethics would advise you not to steal the gum, and respect your mother’s decision.
Business ethics is similar to general ethics but it focuses mainly on a set of professional or applied ethics that review or study moral or ethical principles and moral or ethical problems that come up in different business environments. Business ethics tries to solve complex issues that arise such as when there is a conflict between the concept of legal and social responsibilities of the business and its need to maximize profits. The goal is to try and find a “sweet spot” between making a good profit but also making sure that a business avoids controversy. For instance, a business will want to try and seek the cheapest way to get their product manufactured but will want to make sure to avoid breaking laws, such as outsourcing to a business that may be involved in slave labor, harsh working conditions, and other morally compromising issues.
Business ethics involves different types of ethical and moral issues. Some of these concepts focus on the issues concerning the focus of business within the realm of our environment where the business activates. They typically fall under political, economic, legal and other social aspects. Other concepts turn their proverbial eye toward the corporate issues, such as the issues involved with the functions of a certain business or company. All the whole, other concepts look at the issues of the individual, or the issues that deal with the behavior and conduct of people within a business or company.
One way that many people forget that business ethics works in favor of is for employees. This is arguably one of the most controversial topics because it’s a hot button issue. The big question is what is the ethical baseline for businesses and their employees? Basic standards are meant to exist globally to dictate what is wrong or unethical as far as business practices go. A good example is determining what are and are not unsafe working conditions and determining if they’re unethical or not. They’re implemented to keep workers out of danger. This issue can be something like having a crowded work floor with only one way to exit if there is a fire. This would be a hazard because if something happens, many of these people are trapped in there. Frenzied workers may even trample each other to get out of the building!
In our modern world, we are constantly having to reanalyze and restructure our concepts of unethical business practices. This is not only because we have constantly evolving ethics and politics but also because there is still quite a bit of unethical business practices happening around the world. Determining what practices are and are not ethical aren’t always found in black or white scenarios. Problems arise when they’re found in shades of grey. The lines between ethical and unethical become blurred.
One such example crops up in the following scenario: Company 1 works with contact from Company 2. This person is the one whom they negotiate all their prices for supplies that they buy from Company 2. Company 1 wants to get the best prices they can for these supplies. An opportunity arises when the person from Company 2 comes to Company 1’s location to finalize the discussing points of a new contract. This individual, they decide, will be put into a luxurious hotel, given one of the best suites, all to make sure that what their needs and wants are met.
In layman’s terms, these favors aren’t technically illegal, but these actions fall into a grey area. Some people (especially those outside of the business) may see this as a form of bribery. The reason being is that all these actions were done to be able to win the favor of the other company and reap the benefits of cheaper prices and better deals.
In more recent years, business ethics have been challenged by the now influential voices of social media. As we’ve seen on social platforms like YouTube, Facebook, and Twitter, things like ad revenue (a huge part of some businesses’ income), have been greatly influenced by the thoughts and actions of many individuals. YouTube had what was called the “Adpocalypse” after it was discovered that some of its controversial content creators were receiving ad revenue. Traditional media and other people pointed out how some of these racist, homophobic, and other concerning videos were making money. The response was swift, with many content creators losing their ad revenue for various reasons — many of them not related to the controversial channels. We’ve also seen many other businesses come under fire for allegedly supporting certain problematic groups, and the ad support being pulled immediately due to the acknowledgment.
Business ethics can be broken down into three basic components. They’re the easiest way to understand the interconnected nature of business ethics.
Let’s first look at the history. Business ethics have been around for a while. Many people believe they were brought into existence alongside the creation of the first organizations and/or companies. Yet it’s analysts who believe that it started to gain ground, conceptually, in the 1970s. This is when the term became commonplace in the US. The main principles of business ethics are rooted in the academic world. Through academic writings, the concepts of business ethics took off and truly flourished. It gave birth to the research and the practical study of how business and ethics both work together and outside of each other.
Like any academic field, business ethics has seen itself slowly but surely change with the times. As the political climate in not just America but worldwide continues to shift, business ethics will be called to do the same. Political issues, such as gender equality, have brought into question the ethical issues of pay rates of women compared to men, the ratio of male to female employment opportunities in a business, and the repercussions of sexual harassment in a workplace. Most recently, we’ve seen the push for equality for LGBTQ+ rights in the workforce or the debate between those who argue that religious freedom should be something businesses should keep. Business ethics will undoubtedly continue to shift with these international debates.
We’ve lightly touched on this earlier with the recent influence of social media platforms on business ethics. This is the second major meaning behind business ethics. One example is when a company is exposed for selling goods in the US which were created using child labor or facilities with bad working conditions. Business ethics attempts to keep these issues from happening, but as we’ve seen in the international business market, such things continue to happen.
Many analysts consider this concept to be the most recent and continually expanding aspect of business ethics. It revolves around companies that are building business ethics into the core of their companies. By doing so, they make them the main standard and part of their operational blueprint. This has become one of the most important things for companies to consider in recent years. As of 2019, we live in a politically divided world. The integration of business ethics into a company’s core has been force-fed into many companies. People have decided to give their money to companies who seem to politically align with their values more. Some companies have decided to move forward with the integration, such as Gillette who presented a transgender male in their commercial, or the various companies who have, within the month of June (Pride Month for the LBGTQ+ community) has colored their logos with rainbows to show their support for LGBTQ+ rights. The done is done by companies and individuals who want to uphold or integrate more traditional Christian values and/or more conservative-leaning values into their companies.
Business ethics are like wind in the business world. They can’t be seen but they are definitely felt. They keep employees safe, help trade and interaction between companies (especially those on an international level) go smoothly and keep things as righteous as possible. They’re meant to help make for better services and goods as a whole, not to tear businesses down. Businesses run on individual concepts in many cases, but business ethics is there to try and keep a commonality between them so that companies can be both productive and honorary.