What is Business Ethics?

Business ethics is rules of good and moral conduct or
behavior that is applicable to business firms. such ethical behavior of business is not
assured solely by personal ethical behavior by its employee. One reason for this is that
business ethics includes the consideration of fair and just treatment to its
employees.

There is no agreement among scholars on either
definition of ethics or the details of ethical behavior. My view is that ethical or
moral behavior refers to behavior that is decided in accordance with rules that will
lead to benefit of the entire community when adopted universally. For example stealing
may benefit one person or a business, but if every one depends on stealing for food,
then their will be no one producing food to be stolen, and everyone will
starve.

An important feature of business that is ethical is
that it behaves ethically in absence of any compulsion such as that of law, and in face
of losses without prospect of recovery later. Any behavior that a business is compelled
to adopt, or is motivated by fear or prospect of future profits is still selfish
behavior for profit, and not ethical behavior.

In deciding
ethical behavior a business mus take into considerations the interests and need of all
the stakeholders affected by its action. This includes owners or shareholder, customers,
suppliers and other business partners, employees, community in general, and
government.

Some business and professional associations do
prepare codes of ethical conduct. It may or may not be mandatory for the member
businesses to adhere to such codes of ethical conduct. However, no such codes can
provide guidance in all situations requiring ethical choices. For a business to be truly
ethical it is important for the top management of the company to have a strong sense of
ethics and the courage to stand by their principle in face of significant
losses.