Saturday, July 31, 2004

What should business ethics mean for consumers?

In a free column in Forbes, Ian Ayres and Barry Nalebuff (both professors at Yale Law School and Yale School of Management) ask: What do we make of the fact that most people's actions aren't consistent with what they consider to be ethical behavior? Ayres and Nalebuff think this is a result of their not having thought much about the issue. The most worrisome result is that this inconsistency causes some people to try even harder to find an ethical justification for their actions. And that leads to the worst possible approach to ethics, in which your actions determine your ethical reckoning. The reasoning goes as follows: "I am an ethical person. Hence, if I did something, it must be ethical. Let me find the ethical justification for it." Better to allow the possibility that you made a mistake but will do better in the future.

Thursday, July 15, 2004

Ethical conduct pays off !

In recent research performed by the Institute of BE - an organization which is promoting corporate ethical best practices, it was found that companies displaying a "clear commitment to ethical conduct" almost invariably outperform companies that do not display ethical conduct. The Director of the Institute of BE, Philippa Foster Black, stated: "Not only is ethical behavior in the B. world the right and principled thing to do, but it has been proven that ethical behavior pays off in financial returns." These findings deserve to be considered as an important tool for companies striving for long-term prospects and growth.

The following 7 Principles of B. Integrity are a good starting off place to consider. By integrating each of these principles within a company environment, a major step towards a responsible enterprise can be made.

Principle 1: Recognize that customers/clients want to do B. with a company they can trust; when trust is at the core of a company, it is easy to recognize. Trust defined is assured reliance on the character, ability, strength, or truth of a B.

Principle 2: For continuous improvement of a company, the leader of an organization must be willing to open up to ideas for betterment. Ask for opinions and feedback from both customers and team members and your company will continue to grow.

Principle 3: Regardless of the circumstances, do everything in your power to gain the trust of past customer's and clients, particularly if something has gone awry. Do what you can to reclaim any lost B. by honoring all commitments and obligations.

Principle 4: Re-evaluate all print materials including small B. advertising, brochures and other B. documents making sure they are clear, precise and professional; most important make sure they do not misrepresent or misinterpret.

Principle 5: Remain involved in community-related issues and activities thereby demonstrating that your B. is a responsible community contributor. In other words, stay involved.

Principle 6: Take a hands-on approach in regard to accounting and record keeping, not only as a means of gaining a better feel for the progress of your company, but as a resource for any "questionable " activities; gaining control of accounting and record keeping allows you to end any dubious activities promptly.

Principle 7: Treat others with the utmost of respect. Regardless of differences, positions, titles, ages, or other types of distinctions, always treat others with professional respect and courtesy.

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