In the current political climate, the question of ethics is front and center. On one hand, we elected a president who is arguably doing good things for the economy. On the other hand, our country longs for a leader who upholds this idea of what it means to be ethical. Many of us scratch our heads wondering if it’s possible to have both. Alternatively, we may wonder if those qualities are mutually exclusive. With this in mind, employers must also be mindful of the ethical principles they hold in their business.
So, now is a good time to identify what it means to be ethical in the business world. Here are some policies you can implement to help align your company with your ethical principles.
How to Stay the Path, Ethically Speaking
While the list of unethical activities can be quite long, there are a few items that stand out and may occur more often than others. Here are a few of those items, and how you can help keep your company on an ethical path with each.
One of the first ways a company can go astray is to foster a discriminatory environment. This starts when they begin selecting candidates for roles. When a candidate submits his job application, he should feel confident that the employer will let him through to the next steps in the process based on his credentials, experience, and expertise. Here are some factors that should not be taken into consideration:
- national origin
- gender expression
- sexual orientation
- veteran status
- military obligations
- marital status
Now, it’s important to recognize that discriminatory practices may exist even after a candidate has been hired. For example, avoid bypassing candidates based on the aforementioned factors for promotions and special tasks. Bypassing an employee for on the basis of any of these factors would constitute discrimination, and violate the ethical principles you hold.
So, bribery is a slippery slope, especially if your company commonly wines and dines clients, or gives them gifts. Bribery is considered to be an unethical business practice because it is unfair to give payment in return for favorable actions or decisions.
Still, many companies don’t view their practices as a question of ethical principles. For example, if a company takes a client to dinner, the amount spent needs to be proportionate to the type of business. Avoid spending so much that the gesture looks like a bribe to earn business, as opposed to a gesture of etiquette or hospitality.
According to smallbusiness.chron.com, “The role of ethics in financial management is to balance, protect and preserve stakeholders’ interests.” Therefore, businesses are responsible for ensuring that stakeholders can trust the financial transactions that take place, and the information provided by the company.
However, some businesses will forget ethical principles and make unethical financial decisions. They may report information that gives an inaccurate picture of a company’s financial standings or management. For example, perhaps a company doesn’t want to disclose the pay variances among employees, in fear of appearing discriminatory in nature. Well, mishandling payroll reporting can lead to all types of problems, with discrimination being only one part of the problem. Therefore, don’t use fear as a reason for cooking the books. Instead, report accurate information, and continuously look at your operations for any trace of unethical practices.
Some of us associate this with huge corporations and wealthy business people, but anyone can participate in insider trading. Essentially, insider trading occurs when someone gains non-public information. Then, he uses the information to gain advantage in buying or selling stock before an event takes place that will profoundly affect stock prices.
Now, insider trading can also extend to one person telling another person the classified information, and, as a result, that person taking action with his/her shares. So, in order to help reduce the risk of insider trading, make sure your employees are aware of what it is. Furthermore, it isn’t a bad idea to assign a watchdog to sniff out any concerning discussions or actions taking place within the business.
Never to be diminished, the topic of social responsibility in terms of ethical principles is the last item we will discuss. This focuses on a company’s environment and community impact. In other words, what kind of footprint are you leaving on your environment and community? Is it positive or negative?
So, some ways to find answers to this question are to look at your company’s emissions. Is your company polluting the environment? Consider the air, the land, and the water. How much does your company consume versus what it gives back? Do you find ways to reduce, reuse, and recycle? Then, the same questions can be applied to your company’s impact on your community. Do you work in partnership with other local businesses? Does your community view you favorably? Do you give back to your community via connections with non-profits and charitable contributions? Align these questions with your company’s ethical principles. Then, if your answers aren’t to your liking, you will clearly see where you can start making changes.
Handling Unethical Behavior
While the goal is to operate an ethical company , it is unrealistic to believe nothing unethical will ever happen. However, the most telling reputation about a company is not the mistakes that are made, rather, the way a company moves forward from the mistakes.
Now, this where leadership needs to establish a sound policy and plan for handling unethical behavior. Research shows, many employees want to report unethical instances they witness, however many instances go unreported due to fear of retribution or retaliation. This fear, which is not unwarranted, enables unethical behavior to persist.
So, be dedicated to keeping ethical principles on the forefront of your human resource department’s awareness. Furthermore, remind employees to turn to HR whenever in question about anything, and to give them the reassurance that their questions will be kept confidential without fear of backlash.
Keep Practicing Ethical Principles
Unfortunately, embodying good ethical principles can be a challenge at times. No person or company is perfect, nevertheless, individuals and companies alike should be striving to be evermore ethical. So, make a concerted effort to identify the areas where unethical business practices commonly occur. Next, enlist the help of your trusted human resources team to help you through sticky situations. Also, make sure to revisit the topic of ethical principles on a regular basis. Finally, if you put these policies into practice, then your ethical mindset and actions will make you stand out among other companies.