Ethical Behavior in Business

Abstract

Ethical behavior in business is shown from two opposing views.  One view is in support stating that ethics is good for business, while the opposite view argues that ethics is bad for business.  This paper will demonstrate the positive side of ethical behavior in business, and will illustrate the idea that good ethics leads to good business.  It is shown through numerous examples involving management, employees, and consumers. It will discuss the importance of abiding by personal moral judgment even in times where acting immorally may promote business positively.  Acting in an unethical manner or using unethical behavior, regardless if it meant improving business, is inexcusable and should not be supported.  Although everyone has his/her own opinion on this topic, this research will back up why it is that ethical behavior is positive for business no matter the circumstances.

 Business ethics is a controversial topic that shows support from both ends of the spectrum. Some encourage the side that states ethical business betters a business, while others back up the argument that ethical business worsens a business. Of course there will be examples for both sides just like any case, but with the right research and proper evidence to back it up, it is strongly suggested that ethical behavior is in fact beneficial for business.

Building an Ethical Foundation

As most would agree, management is the key to a business. Not that other aspects are not important, but whoever it is running the company sure has a lot to do with the success of the company. “Information rises from the bottom of the organization to the top.” (Velasquez, 2002). This exemplifies the idea that from a solid base, there is something strong to build from, and that core is instilled by the management. After management would then come the employees, and the employees learn from the person in charge. Setting a good example, as cliché as it sounds, can not be emphasized enough on the significance of this concept.  “Managers should be the true promoters of ethics principles in the institution they lead, to apply in daily activities and decisions taken, and to train their employees to interpret and transform them into tools for improving the quality of service” (Corodeanu Agheorghiesei, D. 2014). Perfect example of what was stated earlier. Employees will not learn out of nowhere; it has to be shown and taught in order to accomplish good ethical behavior throughout the business. Ethical standards should be shown not only to employees, but to the customers, stakeholders, and even the investors; this is all in the hands of the management. “When moral standards are unclear or unenforced, it’s easy for employees to feel emboldened to engage in questionable behaviors that are readily rationalized.” (Gino, F., Ordonez, L., & Welsh, D. 2014). This example is showing that if the proper regulations are not made for the company by management, many situations could go wrong. This would lead to a decrease in income, reduced profit, and eventually result in unsuccessful business. “In order to be profitable, managers must make decisions based on ethics.” (Burton, B., & Goldsby, M. 2009). Plain and simple. No one wants to witness unethical behavior, especially when it comes to business and bringing currency into the picture. Who would buy from services that are being immoral and just hands down improper business etiquette? If someone is looking to reduce business, then behaving immorally is the answer. It all comes down to having a strong foundation with ethical behavior being a key factor. That is when a successful business will be produced.

Lead with Ethics, Others will Follow

        Observational learning is one of the most common forms of obtaining information. Starting from young ages, and continuing into adulthood, there is constantly different things that are learned strictly from watching and observing. Same thing goes for business. Employees are going to learn from their leadership providers, and duplicate the actions they see being done and incorporate it into the services they are providing. Doing this will not only benefit the consumers obtaining the service, but it will also benefit the management by replicating the standards they have throughout the entire company. “If employees are treated well, their productivity will rise.”  (Burton, B., & Goldsby, M. 2009). It is more likely that the employees will work hard if they are being treated with good morals, and this also will give management proper treatment in return. As they say, “treat others the way you want to be treated”. Branching off of that, it is not just about the way the employees are treated, but it is also important that they believe in the management and what the business stands for. If management cares about the business, so will the rest of the company. Something else to consider is that employees want something to work for, or something motivating them. Example being a raise, or extended vacation time, anything that could show that the management cares and respects everyone in the business. This would be good moral behavior. The opposite would be expecting the employees to do what is wanted, without giving any kind of compensation. Not necessarily a bribe, but just a bright light at the end of the tunnel knowing they are on the right track. After all, employees functioning morally and ethically reflects on the customer service, essentially meaning a growth in business which is exactly what every business wants. All of this is yet another reason to back up the main idea of ethical behavior being positive for the business.

Benefiting Consumers Leads to Better Business

        There is a saying, “happy employees equals happy customers.” Extending that thought, happy customers equal happy business. After all, at the end of the day, the consumers are the ones bringing the income for the company. Without that income, where would the success of a company even come from? “Companies earn customers’ trust by demonstrating credibility over time; they can lose it at any point.” (Nickels, W., & McHugh, J., 2013). This quote shows how easy it is to lose clients. Slip up a few times with unethical behavior, and suddenly a decrease in consumption. One important thing to keep in mind, is that satisfied customers are more likey to return for more service. “If customers are treated well, they will be more loyal than otherwise.” (Burton, B., & Goldsby, M. 2009).  Customers love good service. If they are given this amazing service, they are going to be invested in the company, and will also want to see the company succeed. Then this will all lead to expansion of your client base, and more and more business will be produced. If there is a constant increase in consuming and profits, this reduces the risk of the company failing. “Reclaiming these ethical values, particularly those focused on the patient’ rights, but always taking into account the rights of others and the public interest, gains an increasingly consistency in the workof healthcare institutions.” (Corodeanu Agheorghiesei, D. 2014). Using healthcare as an example, the patient being the customer, and the healthcare being the business, this quote is showing exactly how important it is to provide ethical behavior for your consumers in relation to bettering the business. Especially in specific cases like healthcare, the patients are depending on the business in some of the most vulnerable moments of their lives. The whole concept is that ethical behavior towards any type of customer will lead to a benefit for the business.