Business Ethics

Reviewed by Anjaneyulu | Updated on Jul 30, 2021



Business ethics is a type of professional ethics which discusses ethical principles and moral/ethical issues which may arise in a business environment. It extends to all aspects of corporate activity and applies to the actions of people and organizations as a whole.

Such principles come from entities, organizational statements, or the legal framework. The principles that govern a company are certain standards, beliefs, and ethical/unethical practices. They help those businesses build a closer relationship with their stakeholders. Business ethics consists of trustworthiness, respect, fairness, and other values.


For several reasons, business ethics is relevant. First and foremost, it keeps the company running within the boundaries of the law, ensuring that it does not commit frauds against its workers, clients, investors, or other parties. The company, however, also has a range of other benefits that will help them succeed if they are aware of business ethics.

Businesses should create trust between the business and customers. If customers think they can trust a company, they would be more likely to choose that company over its competitors.

Some businesses choose to use specific aspects of corporate ethics as a marketing tool, particularly if they want to highlight a common social problem. Using business ethics wisely will contribute to improved overall brand equity.


Being a responsible company also puts great appeal to investors and shareholders. They are more likely to get more capital into the company, as upholding traditional ethical business practices and properly exploiting them can be a road for many companies to success.

The employees can also be beneficial if they follow business ethics. It is substantially easier for responsible companies to recruit top talent. Employees will only admire a socially aware boss but would also view them as the kind of company that would behave in their employees best interests. This builds more dedicated workers, which can also reduce recruiting costs.

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