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Chapter: 11th Commerce : Business Ethics and Corporate Governance

Key Elements of Business Ethics

Some of the basic elements of business ethics while running a business enterprise are:

Key Elements of Business Ethics

Some of the basic elements of business ethics while running a business enterprise are:

 

1. Top Management Commitment

Top management has a very important role to guide the entire organization towards ethical behaviour. The top level personnel in any organisation should work openly and stronglycommittedtowardsethicalconducts and guide people working at middle and low level to follow ethical behaviour.

 

2. Publication of a “Code”

Generally organisations formulate their own ethical codes for the conduct of the enterprise; it should followed by the employees of the organisation. The organisation principles are defined in the written document called code. The code of conduct covers various areas such as health and safety in the work place, fair dealing in selling and marketing activities, ethical practices in the business etc.

 

3. Establishment of Compliance Mechanism

To make sure that actual decisions match with a firm’s ethical standards, suitable mechanism should be established. Any organisation following ethical codes in training, recruitment, selection etc., is sure to be profitable. The organisation must provide for an environment where the employees are to free to report about the matters of unethical behaviour.

 

4. Involving Employees at All Levels

It is the employees at different levels who implement ethics policies to make ethical business a reality. Therefore, their involvement in ethics programmes becomes a must. For example small group of employees can be formed to discuss the important ethics policies of firms and examine attitudes of employees towards these policies.

 

5. Measuring Results

The organisations from time to time keep a check on ethical practise followed. Although it is difficult to accurately measure the end results of ethics programmes, the firms can certainly audit to monitor compliance with ethical standards. The top management team and other employees should then discuss the results for further course of action.

 

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11th Commerce : Business Ethics and Corporate Governance : Key Elements of Business Ethics |


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