Making Ethical Business Decisions
Making Ethical Business Decisions
How to use ethical reasoning in business situations. While ethical decision-makers may sometimes achieve better short-term results than their less ethical counterparts, it is essential to make ethical business decisions consistently. You can set the example for your company by making ethical business decisions. This will help your company gain a positive reputation and a loyal customer base.
Before making business decisions, create a code and review it. By agreeing to a set rules, a formal code of ethics can make it easier for you and your employees to make quick decisions. Your code of ethics can be written as general or as specific as you like. It should be numbered. Examine each option and determine if it conforms to the code before making a decision.
Be aware of the impact your decisions have on all stakeholders. While decisions are usually made to address a single issue or a few issues, such revenue growth, cost control, or client-specific issues; it is important that you consider the larger implications of your actions on all stakeholders. For example, business decisions that are in the stockholders’ best interests can have repercussions on clients, employees, suppliers, local residents, future generations, and the natural environment.
Examine the outcomes of your business decisions in the past and learn from them. Although no one is able to make perfectly informed decisions every time, it’s easier to make ethical decisions than to be consistent in making profitable or successful decisions. You should immediately redress any ethical issues that have been created by your decision and make every effort to reverse its effects.
Ethical Business Decision Making
It is a discipline. It’s a way to identify and resolve problems in a business context. It can also be used in other contexts. It is not enough to make ethical business decisions.
Ethics in business requires awareness of and sensitivity to ethical issues. It also requires a way to resolve these issues. There are several basic questions that can help you to examine ethical issues. This approach is flexible and adaptable to different contexts.
It is important to have a thoughtful discussion with all parties before making ethical business decisions. It is vital to have and evaluate this dialogue. This discipline can be used by managers and employees to make ethical decisions.
Leaders use an ethical decision-making framework to communicate these principles and make sure they are implemented.
Making ethical decisions is a complex process.
- Commitment: A willingness to do the right thing, regardless of the cost
- Consciousness is the awareness of your ability to act consistently and to apply moral convictions to your daily behavior
- Competency: The ability and willingness to gather and evaluate information, create alternatives and predict potential consequences and risks.
Business Ethics: The Benefits
Business ethics is more than employee loyalty and morale. It also impacts the strength of a team bond. The ethical operation of a business is directly linked to its profitability, both in the short- and long-term.
It is important to assess the reputation of a company in its local community, as well as other investors, before making a decision about whether it is worth investing in. Investors are less likely to support a company’s operations if it is not ethical.
As ethical investing becomes more popular, companies have more incentive to be ethical. Increasing numbers of investors are looking for ethically-operating companies to invest in is driving firms to consider this more seriously.
Although values are the basis of ethical behavior, a process for ethical decision-making can help you see the bigger picture in difficult situations. The process helps decision-makers to find a solution. This model can be used to avoid unattractive and unethical consequences.
The ethical decision-making process
These are the facts
These are the answers to questions like who, what and when. Don’t jump to conclusions or make assumptions.
It is time to resolve the ethical question. Stick with one issue at the time.
Consider the people and organisations you may have an impact on. Consider their perspectives.
A set of rules or codes that can be used for making decisions. There are many opinions on which framework is best. Learn more about ethics frameworks by clicking here
Business ethics covers all aspects of business conduct, both by individuals and organisations. Conduct that is consistent with one’s personal beliefs, shared institutional or organisational values is ethical behavior. Individuals who act on behalf of an organisation’s ethics are a reflection of its values to society. Companies are dependent on their reputations so it is essential for them to set clear expectations about employee behavior and to establish consistent standards. Employees prefer to work in organisations that are committed to their moral beliefs. Employers can benefit from a company’s ethical policies by attracting and keeping employees.