Ultimately, ethics, values and basic integrity in a business exist because of a consciously developed ethical mindset, irrespective of individual culture or background. They are practices which are entrenched within a business environment from the top down. Unethical behavior can only exist in a business where it is accepted and/or promoted. In a country where the economic climate is still in flux, businesses and their boards need to ensure that ethics form the backbone of their business’s culture. In brief, the golden rule applies in ethics “Do to the others as you would like them to do unto you”.
Ethics is a key issue for both the private and public sector, instilling confidence in its stakeholders including, staff, customers, investors as well as the public. However, there are many instances of questionable ethics that have recently been highlighted, giving rise to the question of: how can companies protect their reputation and ensure that the organization is steeped in unwavering integrity?
We are experiencing a wave of scrutiny where ‘watchdogs’ are uncovering acts of corruption and fraud. Although listed companies are heavily regulated and are also answerable to their shareholders, most often it is considered that as long as an organization is generating a satisfactory profit, the ways and means it uses to do so are left relatively ungoverned.
It is often tempting for executives to leverage the likes of nepotism, connections, and bribery for personal gain. Greed is one of the largest motivating factors behind unethical decision making. However, the short-term gains to be had from such dealings lack long-term sustainability, and negatively impacts the business on the whole. Not only is an organization’s reputation on the line, for exposure would severely damage their credibility as a trustworthy institution, but their future sustainable growth is damaged, too, as hardworking employees bear the brunt of poor decisions.
Managers are typically chosen by the board to run the business in a sustainable, profitable – and ethical – manner. However, there is often a lack of clarity about what business ethics are that can lead to confusion over management’s responsibilities and where the limits of those responsibilities are.
The board has a judicial responsibility to take accountability for any identified unethical behavior and to take action accordingly. Managers found to be acting in their own interests should be held responsible and face the relevant disciplinary action. However, it is not always possible for the board to be aware of the unethical behavior, particularly when a business seems to be profitable and there are no immediately obvious red flags to highlight unethical activity.
Unethical Practices By Multinationals is Hindering Africa’s Social Economic Transformation Agenda.