Ethics: The Compass for Business Decisions

Incorporating ethics into everyday decisions in the business world can greatly reduce the scandalous behavior that has as of late has run ramped. Obviously, we have seen the results and consequences of business conducted absent any moral or ethical boundaries. When decisions are made without the consultation of ethics there is no direction from the moral compass and surely consequences will follow. Choices contemplated by managers may often seem difficult, but assessing the options against ethics can assist the manager in making the best decision.

Bird & Waters suggest that once the options or choices are evaluated against moral standards the balance between right and wrong become clear. Managers are often burdened by this because it adds

There are many important economic relationships other than exchange, such as the institution of production and arrangements of distribution. Here business ethics can play a major part. Even as far as exchange is concerned, business ethics can be crucially important in terms of organization and behavior, going well beyond basic motivation” (p. 47). Yet, left unchecked the system will continue down its current path. Therefore, intervention in some form is

Nevertheless, there are some that would disagree with the need for more ethical consideration in business operations. One such proponent of this line of logic is Friedman. Friedman remains firm in his view that business and ethics should be separate. He believes that companies are in business to make money and managers are obligated to maximize profits for the company. It is not only a fiduciary duty, but the manager’s job to increase profits. Friedman (1970) says “allowing ethics to dictate business operations is similar to socialism because shareholders money is being used for the betterment of others.” (p. 84). Essentially, it is redistribution of wealth, which is consequently the foundation of socialism (Friedman, 1970). Subsequently there are some major flaws in Friedman’s logic.

The conflict arises because ethics are not taken into consideration. There are certain actions that may not violate any law, but nonetheless are still unethical. For example, company A may decide to dump the maximum allowing waste to maximize profits while staying within the EPA rules while company B may decide to reduce its waste production even lower than what the EPA limits are because it is an ethical choice to reduce impact on the