Business Ethics
- Ethics relates to the rights or wrongs of making a business decision
- Some businesses have an ethical code of practice which informs decision-making and may set out how they behave
Diagram: Ethical Codes of Practice
Ethical codes of practice provide a framework for decision making
- Ethical codes of practice commonly cover how businesses
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- Behave in an environmentally responsible way (for example, using recycled materials in packaging)
- Avoid negative impacts on animals (e.g animal testing)
- Adopt fair working practices (e.g. paying a real living wage)
- Implement robust and equitable supply chains (e.g. using sustainably-sourced raw materials in production)
- Take steps to eliminate corruption (e.g. ensuring appropriate tax is paid in the countries in which the business operates)
- Avoid controversial products or take steps to minimise their impact or access to them (e.g. having strict verification procedures in place prior to cosmetic surgery procedures being carried out)
- Break links with questionable suppliers or customers (e.g. cancelling a supply contract with a supplier that uses child labour)
- Businesses that choose to adopt ethical principles can attract long-term loyalty from employees and customers and may find that their approach provides a useful competitive advantage
- Taking an ethical approach costs more and may reduce the overall level of profits, especially if the business is not able to raise their prices to compensate
Examples of Current Ethical Concerns
The Gender Pay Gap |
Minimum Wages |
Responsible Sourcing |
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