Ethical expectations are a vital part of the business environment. The public expects business to be ethical and wants corporate managers to apply ethical principles—in other words, guidelines about what is right and wrong, fair and unfair, and morally correct—when they make business decisions.
In the global arena, ethical standards—and even what is meant by ethics—can vary from one society to another. In spite of differences in ethical meanings, cultural variation does not automatically rule out common ethical agreement being reached among people of different societies.
Human rights issues have become more prominent and important for business. For many years that pressure was exerted on South Africa’s political leaders to halt racially discriminatory practices of apartheid and its business leaders to challenge the South African government’s enforcement of the policy.
The question is not, ‘Should business be ethical?’ nor is it, ‘Should business be economically different?’ Society wants business to be both at the same time. Ethical behavior is a key aspect of corporate social performance. To maintain public support and credibility—that is, business legitimacy—businesses must find ways to balance and integrate these two social demands: high economic performance and high ethical standards. When a company and its employees act ethically in dealings with other stakeholders, they are improving the organization’s contribution as a social actor. When they fail to act ethically, there is the risk of losing the public support an organization needs to be credible and successful.
Business leaders are faced with the continuing challenge of meeting public expectations that are, themselves, always changing. Yesterday’s acceptable behavior may not be tolerated today. Many forms of harassment and discrimination were once common. Today, however, social standards make such actions unacceptable. Public expectations of service and ethical behavior are as relevant to a business as customer expectations regarding products such as automobiles and computers.
My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.