The Role and Value of Ethics in Business
The role of ethics in business is to establish guidelines and limits on that which the organization will do in
the pursuit of its goals. This encompasses a number of areas of activity within the bounds of the
business.
1. Integrity of the business – Ethical behaviors de”ne the integrity of the business. Companies
must determine the limits of activity and communicate those limits through the organization to
ensure that activity is consistent with the stated values of the organization. Behaviors which
many of us would consider marginal may be acceptable to some organizations. The decisions on
what will be acceptable, marginal, or unacceptable should be carefully considered as these
decisions will become part of the personality of the company.
2. Interaction with regulatory agencies – As part of the implementation of the personality de“ned
above, companies will react to regulatory agencies di’erently. Companies accepting a high level
of marginal activity will become secretive or closed mouth rather than forthcoming and open.
This will lead to inconsistent behaviors as di’erent parts of the organization seek to hide or
obscure activity from various organizations. This secretive behavior will be reffected in the
behaviors of employees toward regulators, customers, and vendors/suppliers, and ultimately
fellow employees.
3. Interaction with Stakeholders – Companies who espouse and practice high levels of integrity
tend to have a simpler interaction with stakeholders. The message addresses the business,
vision, and mission, and objectives of the company. This would include how the company will
accomplish its mission or the critical skill sets and business activities leading to success.
4. Interaction with Customers/Consumers – Part of the business vision and mission includes a
stated or implied promise to customers and consumers. This identi”es those products and/or
services the company will provide and go to market strategies. These go to market strategies
identify the things which the company will be doing in pursuit of market success. It is rare that a
company will implicitly state that which they will not do, but a general statement of the
de”nition of ethical behavior and the values of the organization should be part of this statement.