Importance of business ethics it is generally viewed that good business ethics promote moods business. So business ethics has its own importance Some of them are as follows: 1.Increases goodwill: Ethical conduct of business enhances its reputation. People do not like to deal with fraudulent and mischievous businessmen. If an establishment follows a goods ethical standard, people will deal with them and tell others about that business so it helps to enhance the value of goodwill. 2. Helps to increase mutual trust and confidence: According to Prof. Robert Bay, “when ethical conduct is displayed, it puts some kind of trust and confidence in relationship”. 3. Helps in professionalisation of management: To become professional, the management should follow good ethics. Follow and develop a good business ethics, is the first and foremost condition of professionalisation. 4. Protects each other: Business ethical standards help to protect people in dealing with each other. 5. Release from tension: A businessmen who follows ethical standards to conduct business, is released from tension and worries. He need not worry about legai action, protection of property etc. 6.Perpetual succession: A business can prosper on the basis of the good ethical standards. It can retain its business for long years. 7. To face challenges: Today business is too complex. Competition is increasing day by day. The business wants to face a number of challenges. It is better to have a goods ethical standard to face all these challenges. a. It helps to establish high standards. b. It brings improvement in work practices, work culture and life style of business and society. 1.Limitations 1. No reward for ethical conduct: Certain authorit believe that, there is no reward whether the business in conducted on ethical standards or not. 2. Difficult to decide an act whether it is ethical or not: It is difficult to decide which act is ethical and unethical by a businessman in certain circumstances. For example, a business wants to survive. At that time, the businessmen will choose an unethical conduct to earn short-term benefits. 3. Lack of proper knowledge of ethical standards: People may not have proper knowledge of ethical standards. For example the consumers may not have knowledge whether the prices or the quality of the products are based on ethical ground or not. 4.Measures to improve ethical conduct of business A businessman must be motivated to follow ethical standards. A number of measures are adopted to motivate them. It may be classified as follows: 1. Government level The government has passed a number of enactments to control and regulate the activities of the business. These enactments aim at to improve moral and ethical values of business. The following measures should be taken by the government in this direction. a. The government should make clear-cut policies and working procedures b. b. Excessive control over business may be reduced c. C. Enactment relating to consumer protection, public interest etc should be strictly enforced. d.Penalty provisions should be made to control the acts of business. 2.organizational level A handbook of ethical code of conduct should be epared and supplied to all employees on the organisation. An ethics committee should be formulated to give proper advice and improving ethical standards. Training is to be imparted to the officers and employees of the organization to improve the ethical conduct of business. d. The working of the organization should be transparent. The procedure of functioning, rules and policies, decision etc should be clear and easily understandable. e. Social audit is conducted to identify the ethical and unethical conduct of business. f. Professional managers are appointed. They are bound to follow code of conduct in their respective professions. g. Criminal and monetary punishment is imposed to those who neglect ethical code of conduct. 3. Social level a). People should boycott the businessmen who follow unethical conduct of business. It means their products should be boycotted. b) Business associations should formulate code of conduct to their members. They should take strict measures to adopt code of conduct. c)There are number of associations who are working for me welfare of the consumers. Consumers Guidance lety of India, Consumers forums etc are some of them. They should take proper steps to bring to the horities of those businessmen who acts on unethical grounds. d) Religious leaders can take measures to businessmen to follow good ethical standards.
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