How to Run an Ethical Business

Ethics in business requires diligence and the entire organization needs to be on the same page in order to make ethical decisions. It is important to create principles and codes that directly reflect the needs of the business. A successful ethics program requires safeguards. It will be necessary to make adjustments from time to time. Becoming an ethical business is a process that takes time.

Addressing the Needs of the Business

The needs of the business should be determined by surveying both the customers and the employees. Anonymous surveys allow people to describe how the business runs and what it needs to increase ethical behavior.

The following needs should be addressed:

  • Company Values
  • Personal Responsibility
  • Employee Participation
  • Conflicts
  • Trust

Ethical Principles

A business’ ethical principles should reflect its needs. The following are some basic business ethics principles that most companies can benefit from instituting:

  • Trust: Customers and employees react better to a company they trust and which they feel trusts them.
  • Clarity: Make sure that all documents, codes, principles, etc. are clear and easy to understand.
  • Community: Support community involvement.
  • Accurate records: Keep all records and accounting up-to-date and above suspicion.
  • Respect: Treat all people with respect, regardless of their position.

Ethical Safeguards

Ethical safeguards need to be in place to ensure ethical behavior. Safeguards take away the excuse that employees do not know better. The following are some examples of ethical safeguards in business:

  • Code of Conduct
  • Employee training
  • Ethics audits

Developing a Code of Ethics

A Code of Ethics is the foundation of an ethics program. The Code of Ethics needs to address certain issues:

  • Laws and regulations: All legal requirements need to be considered.
  • Company needs: Consider the needs of the organization when creating a code.
  • Ethical values: Use the ethics and values of the company. Include two examples for each value.
  • Wording: Make sure that everyone knows that they have to abide by the Code of Ethics.

Update the code each year, and make sure that everyone has a copy of these guidelines.

Performing an Internal Ethics Audit

An internal ethics audit utilizes several different sources. An auditor or a committee usually goes over the information to determine if any adjustments need to be made.

Sources include:

  • Surveys
  • Interviews
  • Documents
  • Focus Groups
  • Direct Observation

The audit is used to evaluate the design, execution, and effectiveness of the organization’s ethical objectives, programs, and activities.

Upholding the Ethics Program

There needs to be complete buy-in for an ethics program to be successful. Managers must uphold the ethics program by adhering to it themselves and holding all of their employees to the same standards. Managers are also responsible for ensuring that employees have all of the necessary resources to be successful and that they are adequately trained in any new policies or procedures.


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