The Importance Of Business Ethics

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For Velasquez (2012), Business ethics is a specialized study of moral right and wrong. It focuses on moral standards as it is applied on business institutions, organizations, and behavior. These moral standards specifically apply to Kohlberg’s theory. It is grouped into three levels. In the preconventional level, there is recognition of authority. This person gives a punishment or reward. In the conventional level, it is understood that there are certain rules to follow. It is also understood to be accepted and to maintain order. And in the post conventional level, An individual may or may not necessarily follow or accept the rules given, Instead, this person develops his/her own code of ethics. There are arguments against business ethics.…show more content…
it is the foundation of success. Business ethics isn’t that complicated. It can be seen if a practice is ethical through the impact of that certain practice in a business. An example is paying a fair wage to employees. When employees are given a fair amount of wage that they actually deserve, a possible impact in the business is that they become more engaged and innovative with their work. The chances of them becoming loyal to the company can also be higher than it first was. Studies show that companies with higher wages tend to perform better in the industry than low-wage companies. Employees that are poorly paid are more likely to quit faster, resulting to rehiring and retraining which can bring troubles to a…show more content…
The first one is poor employee performance. An unethical environment within the company can affect the employees’ performance. It could result to them also breaking company policies, being discouraged with their own work. And last, it could make them not see the need to work hard. These can damage the company. The second one is poor company credibility. A company’s reputation can be fully affected once it is unethical. It can lead to loss of customers, reduced sales and significant financial harm because of their loss of credibility from the general public. It can also be because the company and leader lost the respect of its employees. The last one is legal problems. A business that acts unethically to the point when it breaks the law could face penalties and large fines. In the case study of Cadbury Schweppes (2013), it showed how business ethics can bring advantages and benefits to a business. Properly dealing with consumers may not be that much of an easy task. But through ethics, it won’t have to give the shopkeeper that much of a headache. Showing good behavior, properly communicating and ensuring the customers that the product they are buying are completely safe by properly adding its expiration date and labels is a step in managing a good
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