Discuss the necessity of ethics in business

Good ethics are good business. Honesty is the best policy.

Simply put, ethics involves learning what is right or wrong, and then doing the right thing — but “the right thing” is not nearly as straightforward as conveyed in a great deal of business ethics literature. Most ethical dilemmas in the workplace are not simply a matter of “Should Bob steal from Jack?” or “Should Jack lie to his boss?” Values which guide how we ought to behave are considered moral values, e.g., values such as respect, honesty, fairness, responsibility, etc. Statements around how these values are applied are sometimes called moral or ethical principles.

Business ethics is based on broad principles of integrity and fairness and focuses on internal stakeholder issues such as product quality, customer satisfaction, employee wages and benefits, and local community and environmental responsibilities issues that a company can actually influence.

There exist two broad areas of business ethics:

1. Managerial mischief: "Managerial mischief" includes "illegal, unethical, or questionable practices of individual managers or organizations, as well as the causes of such behaviors and remedies to eradicate them.

2. Moral mazes. The other broad area of business ethics is "moral mazes of management" and includes the numerous ethical problems that managers must deal with on a daily basis, such as potential conflicts of interest, wrongful use of resources, mismanagement of contracts and agreements, etc.

Business ethics has come to be considered a management discipline, especially since the birth of the social responsibility movement in the 1960s. In that decade, social awareness movements raised expectations of businesses to use their massive financial and social influence to address social problems such as poverty, crime, environmental protection, equal rights, public health and improving education. The emergence of business ethics is similar to other management disciplines. For example, organizations realized that they needed to manage a more positive image to the public and so the recent discipline of public relations was born. Organizations realized they needed to better manage their human resources and so the recent discipline of human resources was born. As commerce became more complicated and dynamic, organizations realized they needed more guidance to ensure their dealings supported the common good and did not harm others - and so business ethics was born.

The ethics of business will improve only when we are able to apply the universal values of honesty, promise-keeping, loyalty, fairness, and respect for others equally in both our private and professional lives. Ethics, on the other hand, is concerned with standards of judging the world in moral terms, especially the way people treat each other. Ethics presumes that there is a difference between right and wrong and that we all have a moral obligation to discern the difference and do what is right.

Ethics provides a basis or moral point of view for evaluating all human activities, including business. Business ethics becomes a major social issue when ethical obligations are disregarded in the pursuit of financial gain. Unfortunately, this happens too often.