"No, stop, don't move forward on this path," says an inner voice to you. That is the value system which helps us distinguish between the right way and the wrong way to implement plans, make decisions, achieve ones goals and lead ones team and can be termed as ethics.
ETHICs are defined as "the principles of conduct governing an individual or a group." Ethics are the moral fiber of business, which unless clearly laid down in a program, will be defined by the behavior of top management, setting an example for employee behavior.
Should an enterprise set-up for the purpose of rendering a service or making available a product with the intent of making profit, or a return on investment for the shareholders, have strong business ethics or should their primary consideration be profit? Can ethics and profits co-exist in a business environment?
Sustainable business can only be built and nourished on the basis of a strong atmosphere of trust between all team members and with all the involved stakeholders i.e. the shareholders, the employees ,the employers, the vendors, the regulators and last, but not the least, the customers. It is only when trust has been gained and merited through the experience of past behavior and interaction, that all these stakeholders will show increased involvement and commitment towards the shared vision of the business enterprise. This enhanced involvement will see improved investment, business and profits.
Since any business, not built on ethics and strong values, is always subject to questioning, doubt, suspicion, investigation, and deteriorating relations, the trust of its stakeholders will be eroded slowly and, maybe, as a sudden downslide of public relations etc.
What does each stakeholder see as value in the enterprise?
- Customers see product value or service value, value represented by the business behavior, service, social responsibility, etc.
- Employees see value in their personal goals reflected as part of the business vision, their job content, security and the growth it brings within the corporate hierarchy.
- Shareholders see a growing and well-run business, the customer perception, the strong and sustainable business model, etc.
- Vendors also share the corporate vision of growth and see their growth along with the enterprise, and also see value in the business ethics and management of vendors and take pride in being associated with the business.
- Regulators see value in a corporate who creates industry while preserving ethical standards and also fulfilling their social responsibility.
As economic upswings and downswings happen, a business built on strong ethics and fundamentals will not just survive, but survive profitably with a strong network of relationships with all stakeholders and will serve as a role model for all businesses who have long-term vision of successful survival.
In short, not only is what an enterprise does or deals in important, equally important is ‘how' the enterprise does what it does. Especially as the economy moves away from the recent turbulence, all stakeholders will perceive increased value in a business built on strong ethical standards as well as business standards.