Ethics in the business environment defines a set of principles, values, norms of conduit and perception codes. There has to be a company philosophy for a business to work and attain success. All employees, managers, CEOs and owners must adhere to that philosophy and abide by certain rules and regulations in order for that company to be able to function as a unified entity. In the US, business ethic is all about trust, and if there’s no trust the whole business model, goals and objective will fail.
In the “The Protestant Ethic & The Spirit of Cataclysm”, German sociologist Max Weber talks about the difference between “moral ethics” and “responsibility ethics”. Moral ethic emphasizes on a behavior that’s 100% pure. Those that adhere to its principles obey without thinking about the consequences of their actions. On the other hand, we have the responsibility type of ethic; an ethic that targets business people and that predicts both intentional and non-intentional consequences of one’s actions. Even though Weber’s concept was interpreted like an affirmation of the disjunction between ethic and business, in the end his pledge was merely focused on the merger between business and ethic.
In the business environment, one must give up a set of moral values (pity, altruism, love, compassion, etc.), because if he/she doesn’t do that their whole business might collapse. For example, even though a manager feels sorry for an employee and deep down really wants to give them more money to raise his 5 kids, he/she won’t do that if the employee is lazy or inexperienced because it affects the company productivity. Imagine what would happen to your business if you were to give salary increases to 10 more employees in similar situations – you would go bankrupt!
A business philosophy has to balance ethics with end goals. Niccolo Machiavelli’s famous quote “it is a means to an end” makes perfect sense in business as long as it doesn’t go beyond the limits of a normative model imposed by society. Truth be told, any type of business must have a clear set of rules and regulations; as long as they’re rational everyone in the company won’t have an issue respecting them, thus defining the coordinates for “business ethic”.
Establishing a managerial decalogue inspired by a properly laid-out company philosophy that can keep a company united, while also balancing business with ethics, might seem like the right thing to do. The Japanese have such a managerial decalogue. For example, the company philosophy of Matsushita Electric (Panasonic) abides by the following rules and regulations:
- to contribute to the well-being of the society ;
- to make sure there’s harmony and cooperation among employees;
- to constantly improve activity within the company;
- to be humble and polite;
- to accomplish a national service;
- to be grateful, loyal and respectful.
In 2015, some of the world’s most ethical companies were: 3M Company, ABB Group and Accenture LLC. These are at the top of the list. We can also see more familiar names like Microsoft, Adobe, L’Oreal, and Xerox.
French sociologist Raymond Pollin mentioned in “Etique et Politique” that a government with proper accomplishments that can fight for the greater good is the only legitimate government. Sadly, too much power can have a negative effect on business ethics. People get greedy, and some companies stop focusing on the quality of ethical values. For a business to succeed, it must find a way to balance profitability and ethics.
References
- Weber, M. (2013). The protestant ethic and the spirit of capitalism. Merchant Books, 132.
- Polin, R. Etique et politique. Sirey, 1968.258.
- Greenwood F. Kobu B. Managerial Modification. Vol. 55. No.4/ 1990
- The Municipal Machiavelli. Chapter 8: Does the end justify the means? http://ianchadwick.com/machiavelli/chapters-8-14/chapter-8-does-the-end-justify-the-means/
- Basic Business Principles. Panasonic.aero
- Adams, S. The world’s most ethical companies. 2015. Forbes.com
- Nayar, V. Profits, ethics, and trust. 2009. hbr.org