Ethics in business is essential to adequately meet objectives in the 21st century

By June 30, 2014September 30th, 2017No Comments

“Ethics among shareholders, owners, directors and management are an essential element for companies to adequately meet their business objectives in the 21st century,” says Janine Hills, Founder and CEO of Vuma Reputation Management.

Ethics is a branch of philosophy that involves regulating and recommending concepts of right and wrong conduct, often addressing disputes of moral diversity. Ethics investigates the best ways for humans to live, and what kinds of actions are appropriate in particular circumstances.

Hills adds, “Ethics is a key requisite in guaranteeing and balancing the interests of everyone involved, including employees, clients, consumers, shareholders, suppliers, business partners and the society at large.”

In traditional economic analysis, consumers’ choices are used as evidence that particular products or services have good economic value. Economic good is thus seen as whatever stimulates economic growth.

“However not all economically good products have ethical value,” Hills points out. “For instance, some might claim cigarettes fare ‘good’ in the economic sense as the demand might be high, and production cycles can provide many jobs such as employing tobacco farmers and workers for manufacturing and distribution processes.”

“Conversely, many others would agree, cigarette smoking is not morally ‘good’ nor naturally ‘good’ with a negative public opinion and degenerate effects on one’s body and overall health, even for non-smokers.”

Nowadays, communications flow faster and farther and people have changed, moving from being CONsumers to PROsumers with far more influence than ever before.

PROsumers transformed from being professional consumers to product and brand advocates. Rather than simply consuming products, people are becoming the voices of those products and have the power to significantly impact the success or failure of companies, products, and brands.

Hills says, “These changes affect most aspects of how and with whom we do business, and corporations need to understand, if they want to remain in business in the 21st century, they will have to be ethical in all their dealings.”

Vuma sometimes partners with Cynthia Schoeman, MD of Ethics Monitoring & Management Services, a niche business focusing on workplace ethics, providing practical support to effectively manage organisations’ ethics and building a more principled culture.

In Schoeman’s booklet, Ethics: Giving a Damn, Making a Difference and An Employee’s Guide to Workplace Ethics, she notes that there are many different aspects of ethics in the workplace, which is a vital and necessary ingredient of long-term success.

In one of her quarterly ethics newsletters, Setting the Example, Schoeman noted the most effective route to align corporate values with ethics, is to ensure that values constitute real facets of the organisation – and leaders at all levels in the organisation should actively, visibly and consistently live the values.

For Hills, responsible behaviour is paramount. She says, “As we see unprecedented ethical dilemmas unfold everywhere in South Africa with devastating consequences on reputations, it’s clear responsible behaviour and morality matters most. A company has to be responsible. It has to respond to the legitimate demands of its environments and make commitments to the societies in which it is located.”

“Companies have become essential instruments for creating global economy and thriving societies, and must and should, become powerful catalysts for transformation towards a more prosperous, balanced and sustainable world,” she adds.

What Hills says is very much in line with the paper ‘Values and Ethics for the 21st Century’ in which Francisco González of BBVA noted that shared values and ethics are vital for the proper functioning of the economic, political and social network and, for the wellbeing and potential development of every world citizen.

“Companies should thus realise and understand that ethics are not only desirable, but also profitable. Companies must be solvent, efficient and innovative, and at the same time apply solid moral principles in their relations with their stakeholders,” González said.

In the 21st century, a growing impatience resides within society, observing selfish and irresponsible actions that impoverish some, while enriching the crafty.

Hills advises, “To address this, organisations should take responsibility and make ethical values a priority so that consumers will believe in them. There must be an alignment process that integrates consumer needs with business ethics, mission, vision, values, cultures, strategies, goals, relationship building and defining expectations.”

The goal of an ethical organisational culture is the greater good of all. Relationships between leaders and followers, clients, customers, vendors and the community are all prized. As a result, people are treated well consistently and an ethical culture emerges.

Rushworth M Kidder – the founder and president of the Institute for Global Ethics, identified four key factors in creating a values-based culture:

  • Core values: honesty, respect, responsibility, fairness and compassion. A values-based culture will make these core values the driving force in all decision-making.
  • Common language: employees need a language of ethics that allows them to communicate readily and comfortably about issues that are typically sensitive and difficult to discuss.
  • Commitment at the top: top-level executives should walk the talk.
  • Moral courage: the quality of mind and spirit that enables one to face up to ethical dilemmas and moral wrongdoings firmly and confidently, without flinching or retreating.

Hills says ethics, business, culture and lifestyle must become so interwoven that they cannot be separated. Together, they constitute how people relate to one another in the home, the workplace and every part of society.

“By creating an ethical-morality-values-based culture within the organisation, one that’s positively influencing people, could affect the entire society to move forward with honour and dignity,” conclude Hills.



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