When the firm makes a decision, it affects people, like consumers, suppliers, employees, competitors, etc. So, the company should decide after considering them. Business ethics are the set of principles and moral beliefs that help the management to make a decision. Ethical practice is doing the right thing. Ethics differ from person to person; what may be ethical for one person may not be ethical. Laws are compulsory for everyone to follow as non-compliance of the same would lead to punishment, but ethics are not necessary to follow. Ethics are voluntary. It is not mandatory to follow it.
Some of the ethical decisions that a firm could take are;
Making environment-friendly products.
Providing a friendly environment to the employees.
Offering work and life balance to the employees.
Giving fair wages and salaries.
Following the fair-trade practices.
Providing equal opportunities to everybody.
The organization should acknowledge its obligation towards its employees, consumers, suppliers, and society. The company can promote ethical practices by providing training to the employees or by having a written policy for ethics.
Importance Of Business Ethics
Business ethics helps the firm to grow. People tend to buy products, which have some moral ethics attached to them. For instance, two firms sell Notebooks, but if one firm sells a notebook whose pages can be recycled, the consumer will be more attracted to buy it. Business ethics improve the company’s reputation in the consumer’s eyes, hence improving the chance of fixed consumers. If the company considers the needs of the employees, then they would also work hard. All this will further encourage people to apply for jobs in the company. If a company with a good reputation enters the new market, it will be easy to build trust for the new product. By following ethical practices, the firm does not only makes others happy but, the firm also feels happy for being honest and ethical. Companies have created a corporate ethics officer post to look into the ethical practices and report its breach.
Steps To Ethical Business Decision
By following the steps below, a company can make an ethical business decision:
Spot The Problem: The first step is to understand the problem. It is necessary to determine the problem to which ethical decisions need to be made.
Research: Research is required for any problem to solve. All the resources, whether from inside or outside the company, should be used for the expertise. Finding different ways to deal with a problem leads to a broader perspective to choose the best option available.
Search For Alternatives: Find out the various options available to solve the problem. Consider the method used by the competitor in a similar situation. For example, if a company faces a financial crunch, a pay cut could be an option instead of firing the employees.
Evaluate The Options: Find out the pros and cons of every solution available. The outcome of every solution should be determined, and the long and short-term impact that the solutions will have on the firm should be analyzed.
Make A Decision: After researching and evaluating all the available solutions, the company considers the best.
Implementation: Once the decision is taken, it is necessary to implement it. Review the decision made to see if it is going as planned.
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