Conclusion of Importance of Business Ethics

Almost every company now has a business ethics program. This is partly because technology and digital communications have made it easier to identify ethical missteps and publish them. To avoid negative effects, companies are devoting more resources to business ethics. In a survey of accountants, for example, 55 percent said they believed the importance of business ethics would continue to grow over the next three years. In addition to establishing formal programs, companies create ethical workplaces by hiring the right talent. « High integrity and honesty » is the second most important skill for managers, according to a recent survey. Today`s business people need to understand the connection between business ethics and business success. Another reason why business ethics are important is that it can improve profitability. The winners of this year`s list of the world`s most ethical companies outperformed the large-cap index by 10.5% in three years. A well-implemented ethics program can also reduce losses.

Twenty-two percent of the cases reviewed in the 2018 Global Professional Fraud and Abuse Study cost the victims` organization $1 million or more. Companies that practice questionable ethics can also experience a drop in stock prices and broken business partnerships, which can affect profitability. In addition, business ethics are linked to customer loyalty. More than half of U.S. consumers said they no longer buy from companies they found unethical. On the other hand, three out of 10 consumers will express their support for ethical businesses on social media. Business ethics create trust, which strengthens brand image and sales. In today`s business environment, it is more important than ever to strive for strong ethical behavior. Never before has information been so widespread – news about indiscretions, even minor ones, can spread quickly.

Legislators, regulators and the public expect businesses to operate to the highest ethical standards. When companies operate without transparency, honesty and user-friendliness, they risk legal and financial repercussions as well as loss of credibility in the eyes of customers and other stakeholders. Do you understand why business ethics are important? Cooking books (accounting), conducting unethical accounting practices is a serious problem, especially in listed companies. One of the most notorious marks was the 2001 embarrassment concluded by the American vitality organization Enron, which has long falsely announced its financial reports and its inspector, the accounting firm Arthur Andersen, approved the announcements even if they were inaccurate. As reality unfolded, the two organizations left the company, Enron`s investors lost $25 billion, and despite the fact that the previous accounting firm « Enormous Five » worked with Enron for some of its employees, the company`s conclusion resulted in the loss of about 85,000 jobs. CSR: Corporate social responsibility focuses on the concept itself, as the industry uses society`s capital. It requires the restoration of a certain benefit for society. Businesses can do this by investing in education, developing transportation infrastructure, donating money to civilized charities, and more. Thus, an organization creates a better relationship outside of business with society. With the increasingly scrutiny of business practices, it`s more important than ever for companies to get the job done the right way. Ethics programs are an extraordinary tool for promoting moral behavior. Organizations also need employees dedicated to ethical decision-making.

The history of business ethics is an ongoing history of the employee-employer relationship, from factory working conditions to the diversity-oriented workplace of the 20th century. According to the 2013 National Survey on Business Ethics, supervisors are responsible for ensuring that the work environment violates the dominant part of the time, which is nearly 60%. Business ethics is the moral and ethical belief system that governs the behavior and operations of an organization and its employees. Business ethics influence a company`s values and goals, as well as how it conducts its day-to-day operations. H&M: H&M, one of the world`s largest apparel manufacturers, is very committed to its clarity in the manufacturing process. Once every three months, they distribute and update a 98.5% overview of their suppliers` names and addresses on their website. This ensures that they can be considered freely responsible for the behavior of their suppliers and that anyone can confirm that their suppliers comply with the organization`s policies. In addition to sharing data on the existing network, H&M also has a reliable sourcing goal of using only 100% recycled or wearable materials by 2030. This will enable H&M to become a true pioneer, innovator in the ethics of apparel retail. The importance of business ethics goes beyond simply acting within the limits of the law. For example, companies can follow the letter of the law but ignore the spirit of the law with « creative » accounting that makes their financial health better.