The Ethics of Business

Sean Russell

CIO
Germane-Software
60252 Rimfire Rd.
Bend, OR, 97702
USA

Copyright © 2002 by Sean Russell

Abstract

Businesses are members of our society; they interact with us and impact our environment. Good behavior means more than just obeying the laws of society; it means obeying some code of ethics, even if those ethics are not rigidly defined.

This is an essay in progress.

Table of Contents

Ethics and Laws
Businesses are Organisms
Businesses are members of our societies
Businesses are morally crippled
Conclusion

Ethics and Laws

  • Laws keep the society functioning

    • Formalized rights and responsibilities for good behavior, for the good of the society

  • Ethics are unwritten laws

  • Ethics are social lubricators

  • Ethics are contextual

  • Ethics are important for the health of society

    • Laws are only for when ethics fail

    • Laws are expensive to implement

    • Laws are prone to error and abuse

    • Too many laws are restrictive, and are bad for social health

Businesses are Organisms

  • They consume

  • They produce

  • They reproduce (asexually, sexually)

  • They fight for survival

Businesses are members of our societies

Businesses must be regulated by at least as many rules as we have govorning our citizens.

  • Laws are for the health of society

  • Businesses' behavior impacts larger numbers of people than individuals

  • Businesses' behavior impacts the environment greater than individuals

Businesses are morally crippled

  • Businesses lack a social context for ethics

    • Businesses lack a sense of ethics

    • Humans learn from their parents... who do businesses have?

    • "The ends justify the means"

    • Businesses are rewarded for performance, not for good behavior

    • Businesses have little environmental stimulus to encourage good behavior

    • Businesses never develop a sense of ethics

  • Capitalism doesn't help

    • "If it is good for business, it is good for the society/country" overgeneralization

      • Ignores environmental impact

      • Ignores social impact

      • Ignores anti-competitive practices which hurts capitalism

      • Encourages bullying and dishonesty rather than good product (easier to bully than do good work)

    • Capitalism encourages behavior that would be controlled by good ethics

  • In the absence of Business Ethics, the burden of ensuring good behavior falls entirely on laws

Conclusion

  • We have an environment which encourages corporate misbehavior

  • Some businesses do have a developed sense of ethics; usually small businesses, which inherit the ethics from the owner, or older businesses that have a strong ethics department.

  • Can this be fixed?

    • The solution must be internal, self regulated

    • Laws could help encourage self-regulation

    • "Ethics" department?

    • Tax breaks for ethical behavior, or proven ethics committee -- reward, not punishment

    • Peer pressure -- same way it works with humans