What is business ethics? Managerial ethics are focused on workplace behavior ethics and ethics in leadership. Ethics and ethical reasoning are necessary characteristics of your business culture.
The modern history of business has been muddied by many issues, including managerial ethics, and this is especially true during tough economic times.
One of the biggest struggles, above and beyond growth and survival, has been deciding what's more important: maximizing profits for the shareholder or a company's societal contributions.
There is no question that companies have an ethical responsibility to shareholders to make a profit and improve the bottom line. And the business also has a responsibility to its employees, customers, suppliers and other stakeholders. This need not be done by abandoning workplace behavior ethics.
Actually, ethical management of a business' assets enables the organization to become more socially active. It's a win-win.
Having said that, there are times when balancing the two goals of maximizing profits and contributing to society becomes very difficult.
For example, some of the processes and machinery that make for 'green' manufacturing are more costly to buy and run. That lowers the profit, and lessens the money that a company can put back into the community. Even though going green is certainly ethically good and right, the overall impact may have a negative affect on profits.
Understanding 'what is business ethics' is more than understanding the difference between right and wrong; often it means understanding, and acting upon, the difference between right and right (when two choices are very similar but the cost (tangible or intangible) of one may be higher than the cost of another).
The way management handles a business code of ethics (how they apply it to themselves and all staff) directly impacts business ethics as a whole.
By definition, business ethics means examining specific principles and moral guidelines that impact the organization's overall environment.
Nearly every field of employment (legal, medical, clerical, and more) has numerous ethical questions facing employees every day.
Good management means having a leader who can apply the corporate philosophy and codes in a substantive way daily.
Ethics in leadership of a business is in high demand.
The end user or consumer, and the public as a whole, is tired of unprincipled, immoral, unscrupulous and disreputable business practices. And even while many businesses do not operate to one extreme (highly unprincipled) or another (highly ethical), the marketplace wants to work with, and support, businesses, services, products and people they can trust.
That means having leadership and management on which you can depend to implement positive workplace ethics and behaviors. It also means that as a business leader you need to ensure the culture in your business is focused on ethical practices and that all employees and stakeholders are aware of that commitment.
To implement managerial ethics and leadership values, first a company has to define them. That means opening the lines of communication amongst key personnel and determining what's most important to the business and its corporate identity.
Do you stress proactive decision making? What about personal efficiency and accountability? Are ethical decisions and behaviors recognized as part of your performance evaluation programs? Also recognize the impact of you develop work quality, compassion, reliability, loyalty, etc.in your organization.
Generally, you will discover that the most effective leaders in your business (even if they are not management) are those who already have supported the values that your business embraces. They also are the individuals who LIVE those values rather than just talking about them. That allows other employees to have a better picture of expectations, and improves overall trust in the workplace.
As leaders and management begin to illustrate the corporate philosophy and code of conduct or ethics themselves, there is a trickle-down effect. Managerial ethics means making your values SHOW. This, in turn, motivates better behavior in others and also highlights the expectations you have for your employees.
A recognition of leadership values and ethics also communicates a sense of regard and respect toward everyone in a company; no matter their position. That respect inspires people to do their best daily. And it also supports your staff in knowing what kind of decisions are supported by the business.
In most cases, workplace behavior ethics begins with simple psychology. Know your company, know yourself and know your people.
Have a solid vision for the future of your organization, inspire others to believe in that vision, and really walk the talk of managerial ethics. Leaders and managers whose actions follow their words enable a generally more positive and ethical workplace.
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Hello. I am a professor teaching Human Resources Management. You have an excellent page on writing business value statements entitled your "Value Statement: Develop a Definition of Values in Your Business". I would like to use this page (giving full credit) to teach my students how to write good business value statements for the HR Strategic Plan they are required to prepare. Thank you. Richard C. Brocato, Ph.D. Professor of Management, Maryland, USA
(Note from Kris: I was happy to give permission to use as the source was fully credited.)
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