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BUSINESS ETHICS: WHY THEY MATTER FOR SMALL BUSINESS

Provided by: - November 22, 2023

By PETE PACZKO

For the Regina & District Chamber of Commerce

You’re a small business owner. You try to treat your staff, customers and partners professionally and respectfully. So, why do you need to have your ethical, professional and operational standards spelled out in a formal policy or policies? One word: protection. Having a code of conduct or set of business ethics helps protect your business’ reputation and protects you from legal liability.

What are business ethics?

The financial media Investopedia website defines business ethics as “… the implementation of policies and procedures regarding topics such as fraud, bribery, discrimination and corporate governance.”

According to the Indeed.com employment website, “…these principles govern every aspect of the company’s operations, including its interaction with the government and other businesses, its treatment of its employees and its relationship with its customers.”

A written code or set of policies can be your guide whenever an ethical dilemma or controversy arises, or your protection if a legal challenge arises.

How many different types of business ethics are there?

Different sources list anywhere from 5-12 types of business ethics. The following are most often cited, so for the purposes of this article, they are our top five:

  • Personal responsibility: This could entail completing tasks your manager has assigned or simply fulfilling the duties of your job description. If you make a mistake, you acknowledge your fault and do whatever you need to do to fix it.
  • Corporate responsibility: Businesses have responsibilities to their employees, their clients or customers and their board of directors. Some of these may be contractual or legal obligations, others may be promises.
  • Loyalty: It’s important for team members to be loyal to their coworkers, managers and the company. This might involve speaking positively about the business in public and only addressing personnel or corporate issues in private.
  • Respect: Respect is an important business ethic, both in the way the business treats its clients, customers and employees and in the way its team members treat one another.
  • Social and environmental responsibility: Many companies look for ways to help their communities through volunteer work or financial investments. They may also adopt measures to reduce waste and promote a safe and healthy environment.

How to practice what you preach

There are an unlimited number of ways businesses can express their ethics, including the following examples:

  • Data protection
  • Customer prioritization
  • Workplace diversity
  • Whistleblower protection

Perhaps most importantly, a business needs to clearly define its set of operating principles or ethics and commit to living those principles each day. This won’t eliminate the possibility of things going awry, but you will have the tools you need to hopefully effectively resolve any issues that may pop up.

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