The basics of business ethical policies
Business ethics relate to the development of policies that address areas such as social responsibility and fiduciary duties. A business ethics policy, or code of ethics, outlines the principles that guide employee behavior in the workplace and can potentially help make an organization more attractive to potential employees.
Let’s take a more detailed look at why ethics policies are important.
Ethical considerations in customer interactions
A code of ethics can serve as a guide on how to deal with potential and current customers to help build long-term relationships with them. This can provide your employees with important information on communicating with vendors and other business contacts that provide goods and services to your company.
For instance, many businesses don’t allow their employees to accept gifts from customers or suppliers. This is based on the idea that gifts can influence an employee to make decisions that are biased and not in the best interest of the company.
Reflecting company values in daily work
A company’s code of ethics often communicates the principles that guide decision-making and behavior, emphasizing integrity, fairness and transparency. Highlighting these values can help shape a culture where ethical considerations inform daily choices and interactions.
Recognizing conflicts of interest
An ethics policy may also address possible conflicts of interest, which can include an employee taking a second job with a competitor. An employee having a financial interest with an organization that is considered one of your competitors may also fall under this category.
Consider outlining the principles that define acceptable and unacceptable relationships to help employees understand how to navigate these situations.
Establishing a positive reputation
A company’s code of ethics can help support a culture of integrity, transparency and professionalism, which may contribute to a strong organizational reputation.
Ethical practices, including careful handling of sensitive or proprietary information, may help build trust with customers and partners. By emphasizing these principles, companies can potentially help foster consistent, responsible decision-making across the organization.
Types of ethical challenges in business
Even with a well-written ethics policy, a company and its employees may still face ethical challenges. Here are a few types of ethical challenges to consider:
- Accounting practices
- Social media use
- Health and safety
- Technology use and privacy
1. Accounting practices
Ethical considerations can arise in how organizations report and share financial information. Upholding principles such as honesty, transparency and accuracy in financial reporting can help maintain trust with collaborators and help reinforce a culture of integrity.
While accounting methods may be guided by regulatory requirements, a company’s code of ethics may emphasize the importance of conducting these activities responsibly and ethically.
2. Social media use
Social media activity could potentially raise ethical considerations because employees’ online behavior may reflect on the organization.
While individuals may distinguish personal opinions from the company, a code of ethics can highlight the principles of professionalism, respect and responsibility when engaging online. Emphasizing these principles can help employees understand the potential impact of their social media activity on the organization’s reputation.
3. Health and safety
Employee health and safety can influence overall wellbeing and workplace performance. A code of ethics can emphasize principles such as responsibility, care and respect for others in maintaining a safe work environment.
While specific operational procedures are often addressed through safety protocols and training, ethical guidance can help underscore the importance of acting responsibly and prioritizing the wellbeing of oneself and coworkers.
4. Technology use and privacy
A code of ethics can highlight principles such as transparency, respect and responsibility when handling information and using workplace technology.
By emphasizing these principles, organizations can help foster trust, encourage responsible behavior and support an ethical approach to technology and employee privacy.
