All a business has to do to maintain ethical conduct is to follow the law.

Business ethics are often the subject of discussion and debate, especially in the wake of high-profile cases of ethical breaches. Some ethical principles, or standards of moral behavior, have been codified into laws, such as the Fair Labor Standards Act and truth in advertising laws. But unethical behavior is not always illegal; in fact, ethical principles go beyond just obeying the law to comprise a code of conduct that governs all your business dealings. The ethical code you're familiar with in your personal life is the same one needed for a successful business.

The Golden Rule

1. Do unto others as you would have them do unto you is a well-known ethical standard. This personal moral principle also applies to how businesses treat their stakeholders, including employees, suppliers and customers. If employees are treated well, for example, morale is high and they are eager to contribute and be productive. Conversely, lying to employees or abusing them can lead to low morale and high turnover. Likewise, if you pay your suppliers late, this could put them in the position of paying their bills late, which is unethical -- and in some cases, a breach of a legal contract. For a business to succeed, productive employees and loyal suppliers are important.

Put the Customer First

1. Sometimes quotas, sales goals or the need for a quarterly profit tempt owners and sales managers to oversell to a client -- for example, selling someone a $15 million life insurance policy when he only needs $5 million. Other examples of unethical practices are high-pressure or deceptive sales tactics. Putting profits before customers -- while perhaps lucrative in the short term -- ultimately affects the long-term reputation of your brand and undermines customer loyalty.

Tell the Truth

1. Telling lies about your competitor or its products also is unethical and can undermine your reputation with suppliers and customers. Exaggerating the size of your business to gain a large contract may seem defensible in the short term, but it can cause problems in the long run. Many small businesses form networks to increase their capacity to handle larger contracts. This is ethical as long as you don't misrepresent these network members as your employees. You risk alienating a network that is important for your success. Once customers discover the truth, they may distrust other claims you've made. Earning and keeping customer trust is essential for business success.

Be a Good Citizen

1. Be involved in your community and find ethical -- rather than self-serving -- ways to meet public needs. One way to be involved is by initiating a volunteer program among your workers, allowing them a certain number of hours away from work to volunteer for a community charity. The business benefits from an improved image and broader exposure in the community, and employees will probably be more engaged and committed to the company. Engaged employees and a strong community image increase business success.

   Like finance and marketing, ethics has become an essential business function. But why? In this blog, we shall explore the main reasons why business ethics is important for companies as well as budding business professionals.

   What Is Business Ethics?

   By definition, business ethics refers to the standards for morally right and wrong conduct in business. Law partially defines the conduct, but “legal” and “ethical” aren’t necessarily the same. Business ethics enhances the law by outlining acceptable behaviors beyond government control.

   Corporations establish business ethics to promote integrity among their employees and gain trust from key stakeholders, such as investors and consumers. While corporate ethics programs have become common, the quality varies. According to the 2018 Global Business Ethics Survey (GBES), less than one in four U.S. workers think their company has a “well-implemented” ethics program.

   Business ethics is an essential skill.

   Almost every company now has a business ethics program. In part, that’s because technology and digital communication have made it easier to identify and publicize ethical missteps. To avoid the negative implications, companies are devoting more resources to business ethics. In one survey of accountants, for example, 55 percent said they believe the importance of business ethics will continue to grow in the next three years. In addition to establishing formal programs, companies are creating ethical workplaces by hiring the right talent. “High integrity and honesty” is the second-most important skill for business leaders, according to a recent survey. Today’s business professionals must understand the link between business ethics and business success.

   Business ethics drives employee behavior.

   According to the 2018 Global Business Ethics survey, employees are more likely to apply ethical reasoning when their company clearly demonstrates why business ethics is important. Ninety-nine percent of U.S. employees who experience a strong ethics culture said they’re prepared to handle ethical issues. Companies that advocate for business ethics motivate their employees to perform their roles with integrity.

   The first step in building this kind of ethical culture is to create an ethics program. According to the U.S. Department of Commerce, a complete ethics program should touch on all of the business functions. That includes operations, human resources, and marketing, to name a few. The global research company Gartner advises companies to integrate their ethics program with business operations.

   Doing so can maximize the program’s impact by making ethical processes part of employees’ workflow. According to Gartner, an ethics program should:

   1. Define the program mandate
   2. Mitigate and monitor risk
   3. Establish policies and procedures
   4. Oversee allegations of misconduct
   5. Provide training and communications
   6. Reinforce behavioral expectations
   7. Manage the function of behavior ethics

   Corporations have a critical role in developing good ethics in business. But educational institutions also play a fundamental part in shaping ethical leaders. U.S. News & World Report reported that ethics education is vital to a well-rounded MBA curriculum. At the University of Redlands, we understand why business ethics is important. Business professionals currently face some of the world’s most significant problems. Complex dilemmas like climate change, safety, and security require critical thinking and ethical reasoning. That’s why we equip students with these skills.

   Redlands’ ACBSP-accredited MBA program develops students as competitive and ethical business leaders. Through a cutting-edge, interactive curriculum, we prepare students to meet and advocate for the behavioral expectations of an ethical workplace. Our students investigate the ethical, legal, and social factors of decision-making, and cultivate an ethical framework of business decisions in one of four concentration areas. We underscore ethics throughout our online MBA program, preparing students to promote an exceptional culture of ethics wherever they choose to work.

   Business ethics benefits the bottom line.

   Another reason why business ethics is important is that it can improve profitability. Honorees on this year’s list of the World’s Most Ethical Companies outperformed the Large Cap Index by 10.5 percent over three years. A well-implemented ethics program can also reduce losses. Twenty-two percent of cases examined in the 2018 Global Study on Occupational Fraud and Abuse cost the victim organization $1 million or more. Companies that practice questionable ethics may also experience a decrease in stock price and severed business partnerships, which can affect profitability. In addition, business ethics is linked to customer loyalty. Over half of U.S. consumers said they no longer buy from companies they perceive as unethical. On the flip side, three in 10 consumers will express support for ethical companies on social media. Business ethics cultivates trust, which strengthens branding and sales.

   Understanding why business ethics is important

   Amidst growing scrutiny of business practices, it’s more important than ever for companies to carry out work the right way. Ethics programs are an exceptional tool for promoting moral conduct. Organizations also need employees dedicated to ethical decision-making.

   Learn more about how our bachelors and masters business programs can help enhance your skills as an ethical business leader today. 

   What is required for the business to be ethical?

   Unethical behavior has consequences for future business. Ethical behavior includes honesty, fairness, integrity and understanding. There are several ways to encourage an ethical workplace culture, including establishing a company-wide code of ethics.

   Why is it important for the business follow ethical code of conduct?

   Business ethics enhances the law by outlining acceptable behaviors beyond government control. Corporations establish business ethics to promote integrity among their employees and gain trust from key stakeholders, such as investors and consumers.

   What are the 4 ethical principles in business?

   Honesty. Integrity. Promise-Keeping & Trustworthiness. Loyalty.

   What ethical rules should be considered when conducting business research?

   The following is a general summary of some ethical principles:.

   Honesty: Honestly report data, results, methods and procedures, and publication status. ... .

   Objectivity: ... .

   Integrity: ... .

   Carefulness: ... .

   Openness: ... .

   Respect for Intellectual Property: ... .

   Confidentiality: ... .

   Responsible Publication:.