Business ethics are necessary for order, consideration, and integrity in the business world. They are not defined by established laws and can vary between cultures. Good ethics help build a company’s reputation and corporate image, which can lead to increased sales. For example, a company that sources materials in an environmentally conscious way may attract consumers who are environmentally aware.
The main reason for the application of business ethics in various business transactions comes from the fact that a business world without ethical considerations would be chaotic where anything would go. Therefore, the need for business ethics is related to the order, consideration and integrity that ethics instill in the business world. Bearing in mind the fact that while some ethical considerations may be considered universal because they derive from basic morality, the true meaning of ethics in business is not something that can be defined as an established set of laws. This means that the perception of ethics in business is somewhat malleable and can have different meanings for companies, especially in the global business community where different cultures and values play an important role in determining the exact corporate ethics that will guide operations of the company. The reasons for applying ethics in business could be for marketing, corporate image or other personal considerations unique to the company.
One of the reasons for the application of ethics in business is the fact that the application of good ethics in business helps a company build goodwill among members of the business community, among consumers and also among members of society where the company is located. A company that develops a reputation for fair practices will rank very highly among other businessmen and women who will use this ethical reputation as a yardstick to measure its dealings with the company. This good reputation is loosely related to the presentation of the corporate image that such a company is trying to build, something that can also be used as part of its identity. The desire to develop its image constitutes a requirement of corporate ethics since it will be the basis for the development of the corporate image.
A need for business ethics can be illustrated using the example of a company that builds its brand on the basis that it sources its raw materials in a way that does not harm the earth or the environment. This illustration of the need for business ethics can be further explained by establishing a connection between the perception of a company among consumers and the effect that perception has on sales. A sizable percentage of consumers like to think they are aware of conservation issues and may patronize such a company based on the view that they are environmentally conscious, leading to increased sales for the company.
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