The Click Times: Ethical difficulties in company may be a challenging challenge for any business owner to handle. Though there are rules and legislation in place to hold employees and employers accountable, they do not totally restrict people from acting unethically.
What Are Business Ethical Issues?
Ethical concerns in business cover a wide range of topics that fall under the purview of an organization’s ethical standards. Fundamental ethical challenges in business include supporting honesty and trust-based behaviour, but more sophisticated issues include accommodating diversity, empathic decision-making, and compliance and governance that is compatible with the organization’s fundamental principles. According to the 2019 Global Business Ethics Survey, 25% of employees believe that their top managers do not grasp critical ethical and regulatory business risks throughout the corporation.
To manage ethical concerns in business that occur in your firm, you must first have a complete awareness of what those difficulties might comprise. Understanding how to detect and, more importantly, prevent these issues from becoming a problem will help you keep your emphasis on business development and success rather than correction.
Top 6 Business Ethical Issues and How to Handle Them
1. Workplace Harassment and Discrimination
Harassment and discrimination are among the most serious ethical challenges confronting company owners today. If harassment or discrimination occurs in the workplace, the consequences might be disastrous for your company’s finances and image.
Every company should be aware of the anti-discrimination laws and regulations in place to safeguard employees from unfair treatment. The United States Equal Employment Opportunity Commission (EEOC) outlines numerous distinct forms of discrimination and harassment regulations that might affect your firm, including but not limited to:
- Age: refers to anyone above the age of 40, as well as any ageist policy or treatment.
- Disability: Employees with physical or mental impairments are entitled to reasonable accommodations and equitable treatment.
- Equal Pay: equal pay for equal effort regardless of gender, ethnicity, religion, or other factors.
- Pregnancy: pregnant employees are given reasonable accommodations and equitable treatment.
- Race: Employee treatment should be uniform regardless of race or ethnicity.
- Religion: reasonable accommodations and equitable treatment are offered regardless of employee religion.
- Sex and Gender: Employee treatment should be uniform regardless of sex or gender identity.
2. Workplace Health and Safety
Employees have a right to safe working conditions, as defined in the Occupational Safety and Health Administration’s (OSHA) laws. According to their 2018 survey, 5,250 people in the United States died as a result of occupational accidents or illnesses at work. On average, this equates to more than 100 deaths every week, or more than 14 deaths per day. The following were the top ten most often reported infractions in 2018:
- Fall Protection,e.g. unprotected sides and edges as well as leading edges.
- Hazard Communication, e.g. classifying harmful pollutants.
- Scaffolding, e.g. Numbers such as needed resistance and maximum weight.
- Emergency procedures and respiratory/filter equipment requirements, for example, are examples of respiratory protection.
- Controlling hazardous energy, such as oil and gas, is an example of lockout/tagout.
- Powered Industrial Trucks, for example, fire truck safety standards.
- Ladders, for example, guidelines for how much weight a ladder can withstand.
- Methods of electrical wiring, such as methods on how to wire a circuit to decrease electromagnetic interference.
- Machine Guarding, for example, stating that guillotine cutters, shears, power presses, and other machinery require point of operation guarding.
- Electrical, General Requirements, such as not locating wires or equipment in moist or wet areas.
However, worries about health and safety should not be restricted to physical injury. In a 2019 study, the International Labour Organization (ILO) emphasised the growth of “psychosocial hazards,” as well as work-related stress and mental health problems. Job instability, excessive expectations, effort-reward imbalance, and limited autonomy have all been linked to health-related behavioural hazards such as sedentary lifestyles, heavy alcohol use, increased cigarette smoking, and eating disorders.
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3. Social Media Rants or Whistleblowing
Because of the growing use of social media, employees’ online behaviour has become a determinant in their job status. The ethics of terminating or disciplining employees for their internet postings is a tricky issue. However, when an employee’s online activity is seen to be disloyal to their company, a boundary is frequently drawn. This implies that a Facebook post complaining about work is not unlawful in and of itself, but it can be punished if it causes a decrease in business.
Similarly, business owners must be able to appreciate and not penalise employees who act as whistleblowers to regulatory authorities or on social media. This means that workers should be encouraged to raise awareness of workplace breaches online rather than penalised for doing so. For example, a Yelp employee wrote a post on the blogging platform Medium about the allegedly terrible working circumstances she was subjected to at the online review organisation. She was eventually dismissed for breaking Yelp’s terms of service.
The uncertainty of her situation, and whether her post was justified or spiteful and disloyal behaviour, highlights the necessity of establishing explicit social media policy inside a business. To prevent the potential of misunderstanding, a business should specify which online acts constitute an infringement.
4. Accounting Practice Ethics
Any firm must follow proper bookkeeping procedures. “Cooking the books” and other unethical accounting practises are severe concerns for firms, particularly publicly listed companies.
An notorious example of this was the 2001 Enron affair, in which the American energy company was exposed for years of falsely reporting its financial accounts, with its accounting firm Arthur Andersen signing off on numbers that were erroneous. The misrepresentation had an impact on stockholder prices, and public stockholders lost more than $25 billion as a result of this ethical infringement. Both firms subsequently went out of business, and despite the fact that just a tiny part of the accounting firm’s workers worked for Enron, the firm’s demise resulted in the loss of 85,000 jobs.
In reaction to this and other significant business scandals, the United States Federal Government enacted the Sarbanes-Oxley Act in 2002, requiring additional financial reporting rules to safeguard customers and shareholders. Even tiny privately held businesses must keep accurate financial records in order to pay appropriate taxes and share employee profits, as well as attract business partners and investments.
5. Confidentiality and Corporate Espionage
Many employers are concerned about current and former workers stealing information, especially customer data that is exploited by groups that compete directly with the firm. Corporate espionage occurs when intellectual property is stolen or confidential customer information is unlawfully disclosed. In order to deter these sorts of ethics infractions, companies may implement obligatory nondisclosure agreements with harsh financial penalties in the event of a violation.
6. Privacy and Technology Practices
The advancements in technology security capacity, which fall under the same umbrella as nondisclosure agreements, raise privacy issues for both clients and staff. Employers may now monitor employee activities on their laptops and other company-provided devices, and while electronic monitoring is intended to assure efficiency and production, it frequently borders on privacy invasion.
According to a 2019 American Management Association poll, 66 percent of firms monitor internet connections, 45 percent track content, keystrokes, and time spent on the keyboard, and 43 percent store and examine computer files as well as monitor employee emails. Transparency is the key to employing technology monitoring ethically.
According to the same report, 84 percent of those organisations inform their employees that their computer behaviour is being monitored. To avoid employee monitoring becoming an ethical problem for your company, both employees and employers should be aware of the real advantages of being observed, as well as if it is a beneficial means of establishing a record of their job performance.
Final Thoughts on Addressing Business Ethical Issues
Avoiding ethical concerns in company always begins at the top. Transparency and ethical company practises may be ensured by providing clearly established policies and processes that guarantee such policies are both acknowledged and adhered to.
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There are various everyday steps you can do to successfully detect and, more significantly, discourage ethical concerns in business from developing in your firm. When making decisions, be sure to express and enforce a strong code of ethics, and expect your workers to do the same. Maintain an awareness of the anti-discrimination legislation in your area. Keep up to date on the rules that affect your business, and make sure your organisation is following them. Work with accountants to ensure that your financial reports are transparent and honest. Be present in your organisation, ensuring that your organisation and its people are constantly doing the correct and ethical thing.
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