Improved employee and organisational morale
Increased ability to attract new customers
Improved customer loyalty
Reduced risk of negative exposure and public backlash caused by poor ethics
Attraction of new stakeholders
Making a positive impact on the community[1]
Business ethics are important for managing a sustainable business mainly because of the serious consequences that can result from decisions made with a lack of regard to ethics. Even if you believe that good business ethics don't contribute to profit levels, you should be able to recognise that poor ethics can have a detrimental effect on your bottom line in the long term.
Poor ethical standards can result in business managers making misinformed, misguided or bad decisions. The future effects of their actions could be significant and wide reaching, particularly if they cause injury or financial loss to other people or businesses. Poor ethics are the basis of many legal cases where people seek compensation for the losses they have suffered as a direct or indirect result of the decisions of business people not following basic ethical standards.
In a sustainable business, employees at every level should be committed to the ethical standards of the business. As a business manager, it is important that you are able to clearly define and communicate to your employees what factors and ethical standards you expect them to adhere to and what the consequences are for failing to meet those expectations.