Question

Reason(s) why business should act ethically include(s) ____________.

• A. To keep its commitment to society to act ethically
• B. To meet stakeholder expectations
• C. To protect their employees and their reputation
• D. All of the above

Answer 1

The correct option is D All of the above

Customer satisfaction is a vital factor of a successful business strategy. Repeated purchases/orders and an enduring relationship with mutual respect is essential for the success of the company. The name of a company should evoke trust and respect among customers for enduring success.

This is achieved by a company only when it adopts ethical practices. When a company with a belief in high ethical values is perceived as such, the crisis or mishaps along the way is tolerated by the customers as minor aberrations.

Investors are concerned about ethics, social responsibility and reputation of the company in which they invest. Investors are becoming more and more aware that an ethical climate provides a foundation for efficiency, productivity and profits. Relationship with any stakeholder, including investors, based on

dependability, trust and commitment results in sustained loyalty.

People aspire to join organizations that have high ethical values. Such companies are able to attract the best talent. The ethical climate matters a lot to the employees. Ethical organizations create an environment that is trustworthy, making employees willing to rely on company’s policies, ability to take decisions and act on those decisions.

In such a work environment, employees can expect to be treated with respect, and will have consideration for their colleagues and superiors as well. Thus, company's policies cultivate teamwork, promote productivity and support employee-growth.