Why are business ethics important?
By BBC Maestro
Every business has them, but not every business prioritises them. Business ethics are all about ensuring there is a standard of goodness at the heart of your business. Whether you’re the CEO of a global corporate or an entrepreneur in the making, every business owner has a responsibility to make a positive impact. Read on to find out why business ethics are important and ways you can bring about change for good in the space you’re in.
What are business ethics?
Business ethics refer to the moral and ethical standards that are upheld throughout an entire business. They may be observed through the conduct of individuals who work in the company or through the lens of the entire organisation itself. For example, you may recognise a company with good business ethics through a sparkling employee benefit in their HR policy or their latest philanthropic donation to a community cause.
Regardless of how they are demonstrated, all businesses have a duty to maintain good business ethics. This is usually guided by law, but many companies choose to go above and beyond to share their do-good attitude and impact to gain public approval.
How to incorporate good business ethics
Every company has a corporate responsibility to their employees, customers, and the wider community. We’ll help you work out where to start.
There’s no time like the present
It’s never too early or too late to think about how your business can make the world better. If you’re an entrepreneur on the cusp of building your big idea, you are in the prime position to create a good business right from the go.
“If you’re just starting out, it’s really good to embed [a] social conscience within your business,” says British businessman and entrepreneur Peter Jones in his BBC Maestro course. “Thinking about how you can help the community around you as you are continually growing your business, is a really good thing,” he says.
Think about what morals, values and standards you want your company to uphold. What do you want to stand for? It may be that you want to create a truly diverse workforce or that you want to support the fight against climate change. Once you’ve identified these, you can start getting creative about your ways to help.
As Peter Jones says in his online business course: “the wonderful thing about entrepreneurs is that the businesses we create, and the money that we derive from making that business successful, as well as making our lives better, can also make other lives better as well”.
As a business owner, you are responsible for progressing your business. Of course, you’ll have shareholders who are hoping to make as much money as possible, but you can be socially responsible and help your community all at the same time.
You may have come across the term ‘CSR’ at some point. This stands for corporate social responsibility, and it refers to practices and policies undertaken by companies that intend to positively influence the world around us. The main idea is that corporations support lots of positive objectives in addition to maximising their profits.
So why not consider ways in which your business could improve the lives of those in the wider community. Look at some of your values and morals you want to instil more of and brainstorm ways you might be able to help those beyond your usual field. Once you’ve got an idea you find ways to integrate them into your business strategy. Achieving these goals alongside your financial goals will feel incredibly rewarding.
If you own a more established company, or are working for one, why not review some of the goals and aims of the business and see if there is room to do better? The world is always changing and there are always organisations or causes that could use some support.
A socially conscious company is one that understands the impact of its business on the world, but they also take the actions to match it - whether that be through supporting communities on your doorstep, giving back to those less fortunate than you or lending a hand in tackling global issues.
Companies that are showing up in this space are becoming increasingly more valued, with many people calling for businesses to do their part for the wider good too. Data from Wunderman Thompson found that 89% of people across the world think companies, brands, countries and individuals should work together to tackle sustainability issues, for example.
But it’s for the younger generations of millennials and Gen Z that having a social conscience really matters. For them, companies that are investing in improving society and committing to making a positive impact on the world at large, are the ones that stand out. So, it’s important to shout about your initiatives, pledges and socially positive actions as and when they implement positive change. And as these cohorts are stepping into the professional world, it's an indication of what they expect from you as a business leader.
Company culture is key to business ethics. Making sure your employees are treated well and fairly, whilst feeling encouraged at work, is so important. This is something Peter Jones places a lot of emphasis on in his course. Beyond making sure everyone from the stakeholders to the customer is happy, he argues that keeping your team happy is crucial too.
Embedding strong ethics into your culture can be incredibly powerful in improving your business overall. This means championing diversity and equality, and supporting and encouraging your staff at every turn so that everyone feels included and can really have an impact. At the same time, implementing policies and standards that protect people against actions like bullying, harassment and discrimination are also important.
You may want to consider how you can help support employees’ mental health or to help in times of need like illness, bereavement, maternity or paternity care and cover. Taking time to consider what your employees will need and want from you will help you work out what kind of culture you want to create. Think about what perks you could provide in your employee offering too – these are great for morale and productivity.
When you have an idea of what you want, chat it through with a business partner or mentor to get feedback.
Now it’s time to turn your ideas into action. Soon you’ll be building the company of your dreams. Maybe you’ll commit to reducing your carbon footprint or you might pledge £100,000 to a social cause that strikes a chord with you. Whatever you choose, take it one step at a time. You’ll never be short of ways to make a positive impact with your business.
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