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Elements of Business Ethics

Since ethical business behavior is good for both the business enterprise and society, we foster ethics in their day-to-day working. Some of the basic elements of business ethics while running a business enterprise are as under:
  1. Top Management Commitment: Top management has a crucial role in guiding the entire organisation towards ethically upright behaviour. To achieve results, the Chief Executive Officer (or CEO) and other higher level managers need to be openly and strongly committed to ethical conduct.
  2. Publication of a 'Code': Enterprises with effective ethics programmes define the principles of conduct for the whole organisation in the form of written documents which is referred to as the "code". This involves areas such as fundamental honesty and adherence to laws; product safety and quality; health and safety in the workplace etc
  3. Establishment of Compliance Mechanisms: Company must ensure that actual decisions and actions comply with the firm's ethical standards by establishing suitable mechanisms. Some examples of such mechanisms are: paying attention to values and ethics in recruiting and hiring; emphasizing corporate ethics in training; auditing performance regularly to analyze the degree of compliance; and instituting communication systems to help employees report incidents of unethical behaviour.
  4. Involving Employees at all Levels: Involvement of employees in ethics programmes is a must as at different levels they are the ones who implement ethics policies to make ethical business a reality. Although it is difficult to accurately measure the end results of ethics programmes, the firms can certainly audit to monitor compliance with ethical standards. The top management team and other employees should then discuss the results for further course of action.

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