What is business ethics and its importance?

Answer 1

Answer;

D.Sathish MBA.,

What is Business Ethics?

Business ethics is the behavior that a business adheres to in its daily dealings with the world. The ethics of a particular business can be diverse. They apply not only to how the business interacts with the world at large, but also to their one-on-one dealings with a single customer.

Many businesses have gained a bad reputation just by being in business. To some people, businesses are interested in making money, and that is the bottom line. It could be called capitalism in its purest form. Making money is not wrong in itself. It is the manner in which some businesses conduct themselves that brings up the question of ethical behavior.

IMPORTANCE OF BUSINESS ETHICS / IMPORTANCE OF ETHICS IN BUSINESS INVESTMENT:

Business ethic is that aspect of corporate governance that has to do with the moral values of managers encouraging them to be transparent in business dealings. Business ethics takes into consideration the feelings of customers in fashioning out the services or goods that is given to our customers. It also takes into account the interest of other stakeholders.

Good business ethics is the backbone of every forward thinking business. This is more important now that consumerism has rooted deep into the heart of the customers. Consumerism is a term that is used to explain the rights of customers and the position of the law as far as knowing the content of what they consume is concerned.

In this article, I will be discussing the importance of having good business ethics in all our business endeavors.

BENEFITS OF GOOD BUSINESS ETHICS

Good business ethics brings much goodwill to a company that will in the long run translate into tangible benefits. Goodwill is that intangible asset that a company has earned over her period of operation as a result of being perceived by business associates and other third parties as being transparent, reliable, straightforward, trustworthy, etc

Note the use of the word ‘earned’, this means that true goodwill is earned and not purchased. Forget about the accounting goodwill here. Some of the tangible benefits that accrue a company for operating on an ethically sound business values are:

PROFITABILITY

The first direct dividend of ethical business operation is ‘profitability.’ A company that is based on sound business value is more likely to be profitable than a company operating on corrupt practices.

GOING CONCERN IS ASSURED

Being profitable will ensure that the company be around for at least the next twelve months. It is the desire of every business entity to be around for a longer time. Ethical business practice is the way to go if you and your business truly value going concern.

SUSTAINABILITY

Without sustainability, investmentsin business will simply not yield fruit. And without running your business on sound ethical values, sustainability will not be achieved in businesses and investments.

COMPETITIVE EDGE

Quality save money is a popular belief in accounting, business and investment. You will save the cost of reworking defects borne out of using poor equipment and employment of sharp practices. Again, this will give you and your investment (business) easy access to the heart of the general public if you build your business on ethical values and principles.

Like Zig Ziglar would always say, “you will get all that you want in life if you can simply help enough others get what they want.” He called this the ‘golden rule philosophy.’ And it is indeed a golden rule philosophy.

This philosophy is not only applicable in general life interactions. In fact, it is truer in the world of business. Your customers and other stakeholders in the business community will naturally come to love and appreciate your company and the product you have to offer if they discover that you uphold business ethics in your business operation.

Good business ethics will definitely reflect on the quality of your products, because you have the satisfaction of your customers at hand while you were producing your products.

Uphold good and sound business ethics in your business operation and watch your business soar!