Business ethics is about studying business transactions, actions, and choices in which ethical considerations are addressed. Business ethics typically relates to a corporation or an organization of decision-making that involves social responsibility. In contrast, social responsibility pertains to the effect of a business or activities on society. While legal obligation focuses on how a business avoids illegal conduct.
It also deals with fairness and integrity in business decisions and practices. Which involve discrimination, harassment, and the prevention of harm. Ethics also involves honesty in business transactions and relationships, particularly those that involve finances.
Components of business ethics:
- The significant components of business ethics include commitment, accountability, credibility, honesty, knowledge, integrity, motivation, knowledge, and care. Commitment, as the first component, considers to be the basis of business ethics because it is an ethical commitment to do the right thing even when others are not doing the same or right things, as demonstrates through various actions or forms of behavior, including honesty, dedication, diligence, objectivity, and professionalism.
- As the second component, accountability considers to be how an individual or an organization communicates information, ideas, or outcomes to others.
- Likewise, credibility, the third component, relates to whether an individual or an organization is reliable or trustworthy. In addition, honesty, the fourth component, relates to whether an individual or an organization has honesty and integrity. Lastly, knowledge, the fifth component, pertains to whether individuals or organizations have good judgment or sound business acumen.
Framework of business ethics:
Businesses and individuals operate within a framework of [B.E]. Which serves as their guide and guideline in matters that involve their reputations, assets, costs, profits, responsibilities, and interests. Therefore, although leadership is not necessarily an essential element of business ethics. The combination of leadership and management role requires to guide others effectively is necessary for effective management, which is necessary for achieving company goals. In general, managers play a more visible role in society, becoming necessary in society, ethics, and business. However, it is this dual role and responsibility of managers that businesses must utilize to be successful and achieve organizational objectives.
Dimensions on which business ethics:
There are five dimensions on which ethical business pertain to a manager’s performance as a leader: commitment, honesty, responsibility, motivation, and religiousness. All of these individual components are important in creating effective managers, as each one plays a vital role in ethical business.
- Within the larger ethics framework, each of these components represents individual values and perspectives on what it means to be ethical.
- The level of commitment to business ethics comes from how much an individual or organization cares about their success and the effectiveness of their mission, processes, practices, or products.
- Individuals who support strong business ethics can increase public trust and use that as a basis for continuing good behavior. According to applied psychology, it begin to get more complex when religion becomes more involved. Religion considers a significant force in society for centuries, and its influence continues to be felt today. Many believe that increasing levels of religiously based business ethics increases levels of religious involvement. Religiously motivates individuals, likely highly involves in decision-making, and their actions can reflect on how they feel about themselves and their world.
Importance of Business Ethics:
Ethical Business is an essential topic in management training because the way a company conducts business affects everything it does. By definition, it relates to the ethical standards for right and wrong behaviour in business. Ethics connects to a set of rules or a moral code that applies to a company. The Code of Ethics of Businesses (CBE) was created in 1960 and serves as a guideline for corporations and other associations. Unfortunately, the Code of Ethics has been frequently overlooked in corporate training programs because it confuses other business management training programs.
There are several types of business ethics that managers should focus on. The most well-known types are ethical code and transactional ethics.
However, these programs are not interchangeable; each involves slightly different procedures. By definition, ethical code relates to the actions that consider morally right or wrong in a transaction. Ethical transactional conduct describes how individuals or teams make decisions based on the expected results; it also may involve some degree of deception.
- To understand ethics, managers should understand what makes them different from each other. Business professionals who dedicates to upholding the code of ethics can make a positive difference in their company. They can make a positive difference in the lives of others and help society at large. While most business ethics programs focus mainly on teaching managers how to make ethical decisions, good managers also know how to avoid ethical problems.
- When planning a ethical program, it is essential to consider the difference between business ethics and law. Business professionals refer to policies and procedure develops by business organizations as business ethics, while legal professionals refer to laws and judicial interpretations of laws. Both business professionals and legal professionals have a wide range of duties that cross both disciplines. For example, business professionals may oversee an ethics policy or review a legal code, while legal professionals may argue cases before the court, draft legislation, or oversee compliance with laws. Therefore, they are both essential members of the team that develops and implements this.
Play a critical role:
Business ethics and legal practices play a critical role in the day-to-day operations of most companies. The integrity of the company cannot be questioned, no matter what the circumstances. Therefore, a solid education in this and legal practices will give any business professional a competitive edge when seeking employment.
Furthermore, these skills will only increase a business professional’s chances of finding work. An ideal candidate for this type of degree program should like detail-orient, confident, and ethical. When choosing which online MBA program is right for you, be sure to research all aspects of the online program. Make sure it accredits and in which part of the world the school is located. Be sure that it has a curriculum that suits your learning style and schedule. Finally, make sure that the school offers assistance for the transition to working in an online environment.