Can You Prove Your Business Is Ethical?
In Texas, a handshake can still seal a deal or a partnership. "A person's word is their bond" as the saying goes. People have had to go to court to get out of these verbal contracts because people take it as "gospel."
That faith doesn't seem to be as strong elsewhere. Scandals, misconduct, and fraud are reported almost daily across the country and around the world: big banks who manipulate foreign currency; the local pharmacist who is running a drug ring; individuals, providers, clinics, and businesses committing medicare fraud; even reputable professors who find themselves named in faked research results.
And, it's not just established businesses who act unethically. Even though crowdfunding is policed heavily, there are some questionable practices. There are those pre-start businesses raising funds whose founders illegally contribute their own money. They do so in order to raise their profile, skew results to get "featured" and attract press attention, and to "win" the money others legitimately contribute by meeting goals they wouldn't have met otherwise.
It seems you can't trust anyone.
If you're tired of unethical businesses, prove you're different! Here are four actions you can take.
1. Get a degree in ethics or hire someone who has one
There are a growing number of under graduate and graduate degrees in ethics at major universities:
- Healthcare ethics at Duquesne University
- Environmental ethics at Bowling Green
- Business ethics at Loyola
- Ethics and values at Valparaiso
- Center for Ethics & Leadership at St. Edwards University
These are online and in-person programs. They are extremely popular in the United States and overseas in Japan, Korea, Australia, England, Canada, Ireland, and Thailand — to name a few. Graduates of these programs are the people who are getting hired as managers to run businesses and who are starting or growing their own businesses.
2. Get certified as ethical
The newest trend is to be certified. Just as there are certified fraud examiners, there are Certified Compliance & Ethics Professionals (CCEP)®. As described by the Certified Compliance Board, this is someone with "knowledge of relevant regulations and expertise in compliance processes sufficient to assist organizations with their legal obligations, and someone who promotes organizational integrity through the operation of effective compliance programs." If you go to the effort to get your CCEP® credentials, you will have to renew your certification every two years. Since 1999, the Certified Compliance Board has certified approximately 7,800 professionals.
3. Create, promote, and enforce an ethical culture
What is a business ethics culture?
"Business ethics is the application of ethical values to business behaviour. Business ethics is relevant both to the conduct of individuals and to the conduct of the organisation as a whole. It applies to any and all aspects of business conduct, from boardroom strategies and how companies treat their employees and suppliers to sales techniques and accounting practices. Ethics goes beyond the legal requirements for a company and is, therefore, about discretionary decisions and behaviour guided by values."—from the Institute of Business Ethics
Culture is guided by people at the top. If you are the owner or a top executive, check your own ethics. How do you treat the people you work with, sell to, and buy from? Do you behave ethically in private as well as in public? Do you encourage others, too?
Ethics was the unspoken 800-pound gorilla in the room with psychologists Dr. Art Markham and Dr. Bob Duke, hosts of the public radio program Two Guys On Your Head. In the episode, "Why Seeing Isn't Believing," they discussed how our brain uses our experience to interpret what we see; it is not necessarily reality. If we perceive that certain people behave a certain way (i.e., unethically), we will expect that to happen and we'll act as if this will happen or has happened — —whether it's true or not.
Those around you will perceive your business as ethical or unethical based on what they believe they see you say and do. Make sure what happens in your business is what you intended and that you would not be ashamed to see it covered on the evening news or in print.
4. Create a business ethics code, make it public and stand behind it
BuzzSumo reported that one of the most read business ethics articles comes from the UK: "Ethics in Small Businesses Must Take Centre Stage." It focuses on creating a code of ethics that builds trust and helps attract customers and employees. Although it doesn't use the "C" word, it's the business culture that makes the code real.
Take your culture and turn it into your business ethics code. Put it up for employees to read and people to see. Provide a venue for employees to discuss it so you make sure they are familiar with it and can add to it. Make following it a condition of employment and for any purchases that are made on behalf of the company. Share it with everyone who does business with you — all stakeholders (customers, vendors, strategic partners, etc.) as well as employees.
Support employees and others who come forward to tell you about problem behavior and practices at your company. Take a risk to tell others about questionable ethical incidents in their businesses. For examples and draft codes of ethics, go to the Institute of Business Ethics. You can see the Business Success Center's business ethics and core values at our website.
Finally, don't put this in a drawer and forget it. Business ethics is not set completely in stone. It's also a living breathing thing and your code of conduct should be, too. Review it periodically and revise it as necessary.
Don't stop there. Ask your vendors if they have written down and put in place their business ethics. If they don't, ask why. If they do have one, ask to see it. Use it determine if it's just words or has real meaning. Then, decide if you still want to buy from them. (You might want to ask your customers, too.)
Some good news about ethics
If you can prove you practice what you preach, the results are enormous. Here are just a few of the major ones:
- You will attract and retain great employees.
- Customers will be attracted to your business and convert others.
- You can expect your ability to get a loan or raise capital to increase because those people believe they can trust you with their money.
- You may find that your insurance rates decrease.
How ethical are you?
Take the Business Success Center's business ethics poll to find out. Then watch for a post on the results.
