Implementing ethical business practices helps businesses build trust among employees and customers, recruit quality team members, and reduce hiring and training costs.
Managers should remain aware of any ethical concerns that arise within their company to help prevent legal issues.
Transparency
Transparency is one of the key ethical business practices as it fosters trust. Customers, employees, and other stakeholders should all have an accurate picture of what’s taking place at their organization and its effects.
Transparency can enhance a company’s sustainability performance and help attract top talent, according to a 2020 study that highlighted transparent businesses as having higher employee retention rates.
Establishing an environment of openness can be challenging, but can be achieved using some effective tools and tactics.
Publishing a list of your suppliers and updating it regularly can go a long way towards assuring transparency with customers, especially if your industry involves human rights abuses.
Accountability
Accountability refers to the obligation for individuals or organizations to act ethically correct, adhering to various principles and standards such as honesty, integrity, respect for human dignity, social responsibility etc.
Accountable organizations attract and retain good employees while building a dependable customer base, while companies that do not hold themselves accountable often see customer numbers decline, employee turnover increase and investor mistrust increase significantly.
Managers need to foster an environment of trust and pride within the company to build accountability within it, so all employees feel secure taking actions with the best interests of the business in mind.
As accountability becomes a greater part of society, leaders should foster an ethical culture. This culture should stress ethical decision making and the minimization of risks. Additionally, this environment creates a healthy work environment which has multiple benefits for companies as well as improving employee quality of life resulting in them being more productive and happier in their jobs.
Fairness
Fairness can be defined as treating people with respect and dignity without allowing your personal emotions to influence your decisions. Furthermore, fairness involves making rational calculations regarding how best to treat various groups.
Understanding organizational fairness requires leaders to proactively address it – something which should be integrated into the company values and culture.
Establishing fair procedures with positive outcomes in low-trust environments can greatly increase teams’ commitment. On the contrary, commitment decreases when leaders fail to manage procedures and outcomes fairly.
A company cannot predict its own future; however, it can pledge its efforts toward helping rather than hindering others, being as fair as possible and taking full responsibility for any impacts on those it affects. These practices can build trust and sustainability for a healthier and fairer world; the challenge lies in doing this while staying true to company strategy and core business goals.
Community
Ethical business practices foster trust with customers, employees, suppliers and communities while simultaneously increasing profitability and reputation of an enterprise.
Community is defined as any social unit which shares a sense of place and/or shared beliefs, values or customs. This could include either physical communities like neighborhoods or cities or virtual ones like social media platforms like Facebook.
Recent study participants described community as an assemblage of individuals from diverse characteristics who are bound together through social ties, share perspectives and engage in joint action within geographical settings or locations. Locatioin, sharing, joint action and social ties were cited by 20% or more participants as core components of community while 16% listed diversity as such a factor; these results align with similar studies conducted within social science and public health research.