Business Ethics for Success: The Impact of Moral Principles on Performance

Workplace ethics are concerned with how your business articulates its principles. Below are the guidelines to lead ethically.

In a profit-driven economy, workplace ethics are not usually at the forefront of consideration. But more than you might think, a company’s moral compass and how its leaders uphold its principles matter greatly.

The head of the MAMC Social Media program at the University of Florida, Andrew Selepak, is unambiguous in his definition of moral decisions.

He said, “Ethical issues occur when you have to pick between two good options”. 

Robert Foehl, executive in residence for corporate law and ethics at Ohio University, asserts that a company must first make a crucial choice before narrowing down an ethical challenge to two possibilities.

According to Foehl, establishing a company’s ethics in relation to society is the first thing that must be done. In other words, a company’s ethical code will be influenced by how it defines good, moral ideals in society.

Leadership and ethics in the workplace

Leaders must not only set high ethical standards in a company; they must also uphold them.

The employer sets the example when it comes to a company’s ethical standards, according to Selepak. If the employer doesn’t behave ethically, it affects everyone in the organization.

In addition to establishing an ethics code, leaders can influence the company’s ethical standards through their management approach. These components are included:

• sending suitable messages
• staying clearly on topic
• acting in accordance with the business’s stated ethical intentions

According to Foehl, in order for a corporation to act ethically, the leadership must first do so.

He continued, “Leaders can’t merely lead by talking about [ethics] or by setting an example. “Leadership impacts the ethics of the organization through actions and words exhibiting the value of ethics”.

But not just the top management does so. Foehl asserted that “leaders at all levels, not just executive leaders,” determine a company’s moral compass.

Company leaders must take into account both their official and informal behaviors in order to foster a moral workplace. Informal behaviors are the actions conducted by a company entity, while formal behaviors are what they say.

According to Foehl, “[A corporation] must have both if it intends to create an ethical work environment,” as a lack of either will result in unethical behavior.

Four types of ethical personalities

Ethics aren’t understood the same way by everyone. Some people strictly follow the guidelines provided by management, while others are guided by their own internal moral compass.

According to Mark Pastin, an ethics expert and the author of Make an Ethical Difference: Tools for Better Action, “We all have an instinctual ethic sense that lets us know the correct thing to do, but we don’t always follow it” (Berrett-Koehler Publishers, 2013).

He said, employees could agree to something they believe to be unethical because they are afraid of the consequences of bringing the matter to light. He claimed that there are four basic categories of ethical personality that people can fall into. Pastin described these four kinds and described how each one approaches workplace ethics.

The Conformist: This employee likes to follow procedures closely and doesn’t question authority figures. Although one could think this ethical type would always act ethically, conformists might overlook unethical behavior by their leaders. That’s a result of their propensity to perceive managers as people who must always be obeyed. The conformist will experience ethical problems at work unless their organization has strict standards with clear repercussions for breaking them.

The Navigator: Navigators rely on their intrinsic sense of ethics to guide their behavior, even while making difficult judgments, when they are faced with circumstances in which individuals are acting unethically. This moral personality has a typically sound moral compass, which gives the Navigator the freedom to make decisions—even controversial ones. Others come to respect and depend on the Navigator because of their moral sense, which endows them with leadership abilities. They are successful in most businesses and will abandon an immoral one.

The Negotiator: Negotiators attempt to build rules up as they go. When faced with a questionable circumstance, such as a coworker drinking during lunch, the Negotiator may take a wait-and-see attitude to determine whether the incident will have any impact on their ability to perform their job. For instance, they might hold off to see whether the drinking gets worse or if anyone else notices. If a navigator’s position requires them to make decisions without restrictions, they may run into ethical issues since they tend to bend the rules to suit their current convenience.

The Wiggler: The Wiggler chooses the path that is most advantageous for them rather than giving much thought to what is right. For instance, Wigglers might tell a falsehood to appease a supervisor, but if they perceive that others are starting to suspect them, they might not tell another lie. Being on a manager’s good side, securing a better deal for themselves, or avoiding conflict are the main drivers of wigglers’ behavior. When people notice that they sidestep moral dilemmas in order to further their own interests, they frequently get into problems.

No one wants to be known as the workplace leaker, but according to Pastin, when employees feel a connection to the people who will be impacted by their decisions, they will act more morally. He continued by saying that if managers and staff are willing to talk about ethical issues, many of them can be resolved.

According to Pastin of Business News Daily, “most ethical issues that develop in the workplace may be resolved if raised in a timely manner.” “The issue is that many individuals shy away from discussing moral issues. In order to create a more moral workplace, welcome conflict and debate.

Moving beyond wise decisions

Establishing a business’s code of ethics requires open communication with the public regarding the operations of the company, according to Selepak. Nevertheless, there can be a price for such transparency.

For instance, does the company want its staff to promote the brand, possibly even on social media? If this is the case, Selepak requests that business leadership inform the public that the posts are just the writer’s opinions and not necessarily indicative of the company’s morals and values.

If a business permits any of its employees to serve as brand ambassadors, it must be picky about who it grants that right to. In addition, if any employees have the authority to publish anything about the business online, they are required to disclose their affiliation with the brand, according to Selepak.

“You want to be accurate in your company marketing because we know that individuals are influenced by the media they see,” he said.

Ethics of Rewriting history 

How far can a business that has a reputational blemish change the course of its past while retaining its ethical values?

Selepak gave the example of how the Nazis developed the fizzy drink known as Fanta. Although it can be alluring to keep this information hidden, doing so might be seen as unethical. Making the right choice is not always obvious.

“Should the corporation be forthright about its poor history, if it has one, and face the consequences? If you hide that history, you generate more sales, [and] more people have jobs. said Selepak.Selepak gave the example of how the Nazis developed the fizzy drinks known as Fanta. Although it can be alluring to keep this information hidden, doing so might be seen as unethical. Making the right choice is not always obvious.

“Should the corporation be forthright about its poor history, if it has one, and face the consequences? If you hide that history, you generate more sales, and more people have jobs. said Selepak.

He recommended that a business make the information publicly accessible to the extent that “repeating it is not necessary.”

Another example of changing the course of history is the removal of critical comments from a company’s social media sites. The brand’s executives must choose whether to delete the comments or leave them in place.

“What is the standard of the company?” is a primary factor, said Selepak. Is the post spam, racist, or homophobic? Criticism that does not violate these standards should remain displayed, while comments that do should be removed responsibly.

According to the company’s code of ethics, “an ethical norm needs to be established to determine how to respond,” Selepak stated.

Educating employees code of ethics  

According to James Bailey, a leadership expert at George Washington University, there is no better moment than during onboarding to inform new employees of the company’s code of ethics.

Furthermore, he added, the procedure had to be formal and clear. Bailey urges firms to utilize story examples because they are a great way to engage someone reading the code.

He also recommended telling a prospective employee throughout the interview process about the corporate culture and how it relates to ethics. The employee will be immediately aware of what is required, he asserted.

He continued that a company’s code of ethics ought to be in paper and adhered to. “A code that is not followed is a shell.”

A code of conduct, however, is unable to fully address all ethical issues. The guiding principles of a corporation are its ideals, not a rulebook, said Foehl.

Customer Satisfaction and corporate ethics

Consumers are now more prepared than they were in the past to examine a company’s historical practices because of the spread of the internet.

According to Foehl, there is an unparalleled level of transparency on the internet.

Customers frequently make emotional purchases, and the average American consumer is becoming more interested in how businesses behave.

According to Foehl, “we see a lot more people deciding where to invest money depending on the behavior and moral standards of the businesses they support.”

He even cited anecdotal data to support the idea that clients are willing to pay more to engage with organizations whose actions are consistent with their ideals.

Businesses with strong moral and ethical principles perform better, according to Foehl. “[They are] stronger, more stable, and experience lower employee turnover.”

According to him, a rising number of American firms and enterprises are currently responding to the moral and cultural revolution in society.

With a change in how businesspeople and leaders view business, more corporations are becoming aware of their historical disregard for ethics and conduct, according to Foehl. “A shift in societal expectations is partly responsible for that,”

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