Always do the right thing. That sounds easy, but what is the right thing?

What is the right thing to do?   
Business ethics depends upon the context of the question. There are different types of “correctness” that need to be understood.

  • What is legally correct?
  • What is morally correct?
  • What is in the best interest of the business?
  • What is in the best interest of the client?
  • What is in the best interest of society?
  • What is in the best interest of the environment?

Legal Correctness
Managers should operate within the law of the jurisdiction which they are operating in. If laws are not adhered to; governments and respective judicial authorities have power to (in the extreme), extinguish the existence of the organisation.  So ensure that you are fully aware of the legal requirements of your business in terms of what you produce or sell, health and safety, duty of care, your staffing requirements and so on.

Moral Correctness
Morality and ethics determine what is acceptable and appropriate behaviour within a society and workplace It is the moral rules that determine operating methods, what is honest and true in the way the business operates within,- with its workers and  also externally,  in its operations in the business arena or wider community.  If the manager acts in a way that is seen to be inappropriate, the opinion of everyone from clients to competitors will degrade, and that can impact upon the effectiveness and viability of the organisation.

  • Immoral or unethical actions are not necessarily illegal actions
  • Immoral or unethical actions can be acceptable in one sector of society while being unacceptable in another. 
  • Your morals  and ethics will reflect on the morals and ethics that your organisation live by.

The Best Interest of the Business
What is in the best interest of the business is not necessarily in the best interest of staff, customers, the environment and so on. But the business does need to ensure that it survives, so this should be taken into account. For example, a firm sells footballs. It is in their best interest to make as much profit as they can on the footballs.  This is not necessarily in the best interests of customers who may want the cheapest football they can get at the highest quality. But to stay in business a firm needs to make a certain amount of profit.

The Best Interest of the Client
The best interests of the client will also vary and may be different from what is good for society or the business itself. For example, many firms may purchase low quality cheap goods that use sweat shop labour.  This may suit the business as they get cheaper good to sell. It may suit the client because they can buy the goods more cheaply, but it is not necessarily in the interest of their suppliers as they may make little money on the sale of their goods. Ethical clients want to deal with ethical businesses, with ethical staff who reflect in themselves the company’s ethical values. Good business partnerships depend on shared common values. Shared values build strong trust.

What is in the Best Interest of Society?
Here is where we consider what is in the best interest of society as a whole. It is obviously not in the best interest of staff working in a sweat shop for little money to produce the goods. This is where ethical business and purchase comes into play. But obviously this is a moral decision on behalf of the business and their customers. Remember though that your responses and actions in this reflect often greatly affect who does business with you.

The Best Interest of the Environment
Linking to ethical business, there is also the impact on the environment of goods and services that are offered. Organisations also need to consider what they are doing to be environmentally aware and how the products and services they sell or produce might harm the environment. The activities in the business to day to day may effect the local and wider environment with toxic material wastes polluting and no sustainable practices that may give cost savings in the start but have wider implications to the whole community when activities do not involve sustainable and recycling practices where ever possible and adherence to any legal matters in this regard.  

Whatever decision you make as a manager, you should be aware that whatever you do – legal/illegal, immoral/moral, ethical/unethical, will have implications. An ethical decision to stop selling goods containing certain harmful chemicals may have positive effects on your business as new customers may start to purchase your goods who did not before.  Selling goods with harmful chemicals could result in reduced sales and poor publicity for your product.  So whatever you decide to do, be aware of the implications of your actions – now and in the longer term. This not only applied to you personally but your staff, the business, the local environment and also the local and wider community.

As well as being aware of the ethics and law relating to products, you also need to be aware of doing the right thing by your staff and that the staff under your control are doing the right thing too as companies are only as good as their people. This obviously relates to employment law, health and safety, procedures and so on. But as a manager it is also relates to how you treat them. Confidence in a good system and top ethics builds company loyalty which has a direct flow therefore on productivity and morale. We have talked about motivation, giving credit, handling conflict well and so on, so it is also important to ensure you are doing the right thing by your staff.
Thought processes of the manager need to be aligned to ethical and legal business ethics.

A useful checklist on overall business ethics can be seen here;
1. What is the true description of the problem? What does it look like from both sides of the fence/ for both parties?
2. What happened to cause this discrepancy?
3. What is your initial intention here and what might be the results of this?
4. Will this action cause harm or injure someone, something, the business, the community?
5. Is your decision valid, who else have you discussed this with or referred this too for professional advice/assistance in decision making and proposed actions? (Even managers cannot know everything, so confer with those with legal and ethical knowledge in the area concerned.)
6. Are you flexible in your approach to the final decision, have you built in a variable to adjust your views if its needed and still remain ethical?
7.  Are you so confident and clear in your decision you can confidently speak to staff, senior managers, business partners, community members about this without loose face or important ethical business links?
8. Does all this align with current policies and procedures and/ or do you need to write it up for reference for the future too? 
As a manager you are responsible for what you produce or sell or control, so you should be aware of what your organisation is doing. Ignorance is no excuse.  You need to make it your business to be aware and ensure that you are doing the right thing.

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