At any organization, any business, there are bound to be opportunities for employees to take an unethical “easy road”. If the company has fostered an ethically sound environment, most people will avoid cutting corners, however, if people think that they can succeed at work by acting unethically and get away with it, they will.
While it may be a profitable strategy in the short term, unethical conduct can (and almost always will) come back and hurt a company. After all, giant corporations like Enron and AIG had their reputations destroyed because they fostered a culture of bad decisions. More profit now and more money taken home, can seem like a great thing at the moment. But in the long term it will bring a company to its knees.
So what should you do to keep unethical behavior to a minimum? You should set a clear code of conduct for your employees, with clear consequences which will be doled out swiftly in the case of infractions.
Fortunately, ethical business practices are not at odds with your goal of making a profit. In fact, the two are closely connected. Here are a few reasons why:
- Ethical actions build a good reputation – A business only thrives to the degree that it pleases and serves its customers. Maintaining a high standard of ethics helps you build a solid reputation. This is now more important than ever, as customers now commonly rate and review businesses online.
- Increase employee satisfaction – Employees are more likely to stay with an ethical company, reducing turnover. People like to work for a company that they believe in. An ethical workplace increases employee satisfaction and, therefore, productivity.
- Attract investors and stockholders – People today are increasingly selective about where they invest their money. This applies to large investors as well as ordinary people who buy stocks. Running an ethical company makes you far more attractive to potential investors.
- Help you avoid costly problems – As we mentioned before, companies with questionable ethics face problems such as employee lawsuits or penalties from government agencies. Additionally, there’s the harm to your profits that a negative reputation creates.
These are some of the reasons that ethical business practices help you thrive. As everyone, from customers to employees to lawmakers, becomes more conscious of ethics, it’s imperative that business owners pay attention and act accordingly. Unethical behavior will eventually ruin a company, while ethical behavior helps companies flourish.