Unethical Business Practices of a Certain Establishments

Every business or every entrepreneur has to have some framework for their code of conduct for a business; this would essentially be the guidelines within which a business can conduct certain activities. Business ethics are moral values and principles that determine our conduct in the business world. It refers to commercial activities, either with other business houses or with a single customer. They can be applied to all aspects of business; from generation of an idea to its sale. Businesses use the society for its resources and functioning, thereby obligating it to the welfare of the society. While the objective of any business is to make profits, it should contribute to the interest of the society by ensuring fair practices. However, greed has led the present business scenario towards unethical business practices, legal complications and general mistrust. Many organizations now implement the code of ethics in their company polices, which they implement during induction and regular training. A Code of Ethics "is generally a more blanket statement of values and beliefs that defines the organization or group" (Brandl and Maguire).

            Though there are some unethical manners that are conducted in businesses. Here are some of them: Resorting to dishonesty, trickery or deception. Creation of false documents to show increased profits, Avoiding penalty or compensation for unlawful act, Lack of transparency and resistance to investigation, harming the environment by exceeding the government prescribed norms for pollution, Invasion of privacy used as leverage, for obtaining personal or professional gains and sexual discrimination.

One example of unethical practice happened within the Wal-Mart company. The story is about Wal-Mart employee named Deborah Shank. While working Ms. Shank was run over by a truck. The accident left her in a wheelchair. Ms. Shank did not get any accident settlement from the company. Because of this Wal-Mart company is often criticized that they treat their employees as a commodity which is inhuman business ethics.

            In the book, The Ethical Traps, Robert Hoyk and Paul Hersey have extensively enlisted the reasons that cause employees to err and do things that are malicious. They have stated that sometimes employees may be displaying unethical behavior without even knowing it as they perceive that their acts are in accordance with what the organization is looking for, that is, maximization of profits. They also point out that most of the reasons are psychological in nature, and as they have put it, these are "webs of deception" which make it difficult for us to differentiate between ethical and unethical practices. There are myriad examples of unethical business behavior that one gets to witness or hear about in today's business environment. Some common examples are:

We all know that the accounting process is largely controlled by organizations themselves, and often vital information is misconstrued. Regulations in recent years have curbed this practice to a large extent, but still there are loopholes that the regulators need to look into. Invoice fraud is another common unethical business practice and because of this, customers end up paying higher amounts for a product. Employees may also inflate invoices so that they get their share of commission. Most business houses have gone online and it has created a new set of challenges as identity thefts have become commonplace. It is not only a breach of security, but it also puts the confidential data of an organization at risk. Sharing company's confidential information with competitors or using it to your own financial gain strictly against the ethics of business. It can not only call for termination of an employee, but also a lawsuit.

Seminars on business ethics should be conducted for employees. This will help them in understanding the importance of ethical work culture. Compliance officers must be appointed to keep a check on fraud, corruption, and abuse within the organization. To promote ethical behavior, performance management system of the organization must be modified to incorporate ethical behavior as a parameter for appraisal and rewards. Business houses that comply with ethics to determine their conduct are shrinking in number. The lack of business ethics in the market is a big reason to worry. Organizations now recognize the positive effects and outcomes of being ethical, humane and considerate. They have a competitive edge in the market, because of the honesty they show in their services. Their morally upright reputation attracts better staff and helps in retention. Though ethics are legally binding in most cases, self-monitoring, transparency and accountability will go a long way in establishing trust of the people. Besides this, it makes sense to change, before you are penalized.

Bibliography:

Top 10 Unethical Business Actions (n.d) Rory Hynes

www.listverse.com/2011/09/13/top-10-unethical business-actions/

Unethical Business Behavior (2012) Rahul Pandita

www.buzzle.com/articles/unethical-business-behavior.html