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Moral Ethics vs Business Ethics

What is the difference between moral ethics and business ethics?
[MUSIC]. Situations may arise when moral and ethical issues come to the forefront and influence decisions and behavior within organizations. Morals are a set of values based on our beliefs system and are influenced or stimulated by religious, political, or philosophical ideals. Ethics on the other hand, are more about how beliefs are applied in decision-making and the two terms are not interchangeable. Both are applied in business practices and may take a higher order to maintain professionalism both in a broad sense but also specifically within professions who are accountable for their conduct in all transactions. Let’s look at these in more detail. Through the pressures of globalization and the need for greater compliance through corporate and social responsibility.
Many organizations regularly face moral or ethical dilemmas in their decision-making and behavior. Through mission statements and the need to comply with the regulatory environment, organizations and their leaders place greater emphasis upon morals that will define the organization and what all stakeholders expect it to stand for. Public fatigue with corporate scandals impacting on the stakeholders within the community has encouraged this. Clear statements highlighting issues like honesty, accountability, integrity, quality, diversity, and a degree of dedication helps to create a sense of trust between the organization, its clients, and other stakeholders. Ethics is about practice. Ethical practices are normally based on the notion of trust and integrity.
This needs to be in place in order to build relationships with customers and a wider group of stakeholders. Once an ethical dilemma has been identified, then the facts need to be investigated and evaluated before making an alternative decision that ensures employee and customer rights have been protected. It is also important that the decision is fair ensuring the common good, individual values, and beliefs have been protected. This can be a tough call when operating in a cross-cultural environment where misunderstanding or cultural clashes potentially impact on decisions, behavior, or relationships. Many professions have support process and use a standing committee on ethics to ensure both individuals and organizations can manage ethical and moral dilemmas effectively.
This begs the question, is there a difference between moral ethics and business ethics? While it may give an appearance of an oxymoron, it would be unwise in the current economic climate to use this as a cover or scapegoats for poor behavior. Moral ethics act as a driver in the way we, or organizations knowingly or subconsciously behave and it acts as a framework. It has something that has been nurtured within us through education, upbringing, community, and relationships with friends and family. It is instinctive in most people. Business ethics is concerned with the way in which organizations apply a moral framework to the way business or decisions are conducted. It covers all the operational and strategic decision-making or planning activities.
It pervades all areas of activities as normative, basis that can be articulated into the best practices for all to see and to follow in developing policies. Now let’s summarize. Incorporating ethical frameworks into an organization requires clarity in understanding morals and the obligations of the organization to all stakeholders. Business ethics needs to include and demonstrate through mission statements, policies, and practices the ethical framework that respects the wider belief systems of employees and other stakeholders as inclusive, demonstratable practice, starting at the top with leadership and governance. By clearly demonstrating corporate and social responsibility policies and practices, organizations strengthen trust, improve their reputations, image, and their brand. Now we’ll summarize five key points.
One, it is a common mistake to assume that ethics and morals are interchangeable. Two, business ethics is not an oxymoron. Three, moral ethics act as a driver of business ethics. Four, business ethics act as a framework that supports policies, practices, and decisions by the organization. Five, demonstrating compliance with common goals of CSR enhances image, reputation and the value of the brand.

Let’s now find out a bit more about the two types of ethics: moral and business. What are the main differences between the two? Watch this video from the University of Law Business School to find out more.

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Ethical Management and Decision Making

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