Business Ethics

Essential Elements of Business Ethics

Many businesses are run efficiently when principles and rules are set. These rules help the businesses to know how to act in difficult scenarios. Ethics are therefore the foundation stone for any business. The contribution of individuals into the businesses for ethics is also as much required as the organization themselves. There are also managerial ethics which the leaders in the organization needs to follow so that organizations can run properly.

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Foundation of Managerial Ethics

Any business, to be successful, needs to have a strong foundation of managerial ethics. These managerial ethics are built upon the four key elements. Here are those:

  1. Training in ethics
  2. A strong code of ethics
  3. Confidential reporting system
  4. Ethics coach

managerial ethics

1. Training in Ethics

When the ethics built in the organization does not understand or followed, then it is only a worth of paper or space it is stored in the organization. There is the relevance of it for the organization. That is why many companies have their own in-house training departments.

These departments can provide the necessary requisite training required by the employees as well as the leaders of the organization. A trainer is equipped with the task of providing the training of ethics. He should be well equipped and have sufficient experience in the field of ethics so that he can be more effective.

2. Strong Code of Ethics

As we mentioned above, ethics are the backbone of any organization. That is why it is important to have a strong code of ethics in the organization. The Sarbanes Oxley Act in 2002 further stated that the businesses should compulsorily have a ethics code of conduct. This means that there should be a code in writing which every employee can follow and strive on it.

Further, this also informs the employees to learn the various important aspects on how to speak to their veterans and how to carry out their actions at the workplace. This can act as a reminder and something as a reference when they are being pressed to do something which they are not comfortable with.

3. Confidential Reporting System

This helps the employees to report something at the workplace when they found it to be a misconduct or a violation. Further, this adds discouragement to the people who are getting involved in such acts. This system helps in providing everything related ‘to do something about’ options at the work. In addition to this, if the misconducts are resolved early than the company may be able to save a huge amount of money in the future.

4. Ethics Coach

Just as the employees require training in ethics, there should also be a person who is friendly and will be available for any issues related to ethics. He should be a confidential resource in matters of employees.

This person should be able to solve every ethical dilemma in the company. He needs to have the sufficient expertise required for the job. He should be aware of the concepts and should be able to take the decisions required.

Questions for You

Q. In which area is the scope of ethics in business is there?

A. Finance              B. HR                  C.Compliance                       D. All of the above

Answer: D. All of the above

Q. The person/expert that can solve the ethical dilemmas confidentially is known as:

A. Ethics guide               B. Coach(Ethics)             C. Ethics trainer               D. None of these

Answer: B. Coach(Ethics)

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