Business ethics – Part One: Does it matter?

Abstract

PurposeThe purpose of this paper is to provide an overview for senior managers of the strategic importance of ethical values in organisations working in the profit‐making and not‐for‐profit sectors.Design/methodology/approachThe paper examines the principles involved and contrasts them with examples of unethical behaviour in the news at present. The paper presents the practical application of ethical business values through case studies from different organisations where ethical values are part of a positive strategy to achieve competitive advantage. There is an analysis of the case against and for ethical values, a discussion of how business ethics can be part of an organisation's strategy, the evidence that non‐executive directors and others may find of ethical behaviour in business decisions, a discussion of ethics in an international context and a short checklist of questions to provide readers with a guide to the “ethical health” of the organisation.FindingsThe arguments in favour of defining ethical values within business are persuasive.Practical implicationsThere are examples from experience together with clear guidance about how to manage ethical values in business. Readers could start with the ethical health checklist of questions, decide how their ethical values statement, if any, compares with the examples in the papers, conduct an audit of an existing ethical strategy to identify if their values statement is being translated into behaviours throughout the organization, and test the impact of the ethical values strategy on the competitive position of the business.Originality/valueThe paper is educational and therefore provides value to senior managers and directors in a concise but comprehensive overview of the topic that is of current concern in the business world. It points to practical actions they can take in this respect. It could be a thought starter to managers discussing the topic at an away day for example, or for strategic leaders to discuss how to use ethical values to develop a competitive position.