Just a few decades ago, business ethics received far less attention and scrutiny than they do today. Some questionable practices were regarded as simply the price of doing business and remaining competitive in a crowded marketplace. As the public demands greater transparency today, both small and large businesses must understand and honor ethical boundaries.
Many companies conduct business with a constant eye on the bottom line, a practice that’s not inherently illegal or unethical. However, if organizations inflate fees and charges, fail to give customers everything they paid for, bill clients for time they don’t work or price gouge in the event of natural disasters or other catastrophes, they breach the trust of clients and the general public. Also, if companies knowingly sell inferior products or services, they violate ethical boundaries by fraudulently taking customers’ money and potentially placing them at risk, especially if the products are dangerous or don’t function as promised.
The public expects that the primary responsibility of employees and company management is to their customers, yet professionals sometimes place their personal benefit first or use their positions to gain favors or other perks. For example, if a company is evaluating bids from several suppliers and accepts gifts from one candidate in exchange for the contract, this constitutes a bribe and unfairly eliminates other applicants from the bidding process. Similarly, if a professional uses insider knowledge to dump stock he knows is about to take a significant hit, this violates ethical standards and could be considered criminal activity.
How a company treats current and potential employees reflects on its ethical principles and can damage employee morale or drive away top talent. Employers who favor candidates in their 20s regardless of their qualifications unfairly discriminate against older workers. Ethics also come into play regarding the day-to-day treatment of employees, such as allowing a culture of bullying, requiring employees to work exceedingly long hours or in inhospitable conditions, and paying workers below minimum wage or less than the standard industry wages.
Some ethical violations aren’t immediately obvious but gradually cause damage to the community. For example, companies that use unethical business practices to squeeze out their competitors could shut down businesses in the community and threaten the economy and people’s livelihoods. If companies don’t assess the environmental footprint they leave behind, they could cause irreparable ecological damage that also may threaten the health and safety of residents in the community.
