Why Are Business Ethics Important?
Business ethics are important because they help to develop customer and employee loyalty and engagement and contribute overall to a company’s viability. Businesses rely on reputation and a lack of moral guidelines can ruin a reputation.
Ethical behavior involves using an overall set of corporate values to govern actions and decisions that come up in business. Using morality to make corporate decisions is part of corporate culture and is seen as a social responsibility.
There are tangible benefits to corporate ethics that are proven by case studies.
- Improved customer loyalty
- Improved employee retention and easier recruitment of new employees
- It makes it easier to attract investment capital
Along with loss of customers, employees and corporate reputation, in the worst of cases, unethical corporate behavior and practices can result in death, prosecution and imprisonment.