More consumers become aware of the importance of supporting an ethical business. These merchants refer to enterprises that abide by moral standards for the common good of the society, economy, and environment. And in this article, we’ll shed light on the ethical business decision examples you can use for your business.
What is an Ethical Business Decision?
Ethical business decision refers to the philosophy a company employs to present itself as an advocate of moral ethics. Its main objectives and key results doesn’t solely revolve around gaining profits, but it seeks to give back to its workers, customers, and community. Aside from presenting its product benefits to the consumers, it positions itself as socially responsible and environmental-friendly.
Businesses that practice ethical initiatives find success in marketing their brand and building consumers’ trust.
Why are Ethical Business Decisions Important?
Employing business ethics in operations says a lot about how the company runs the business. It doesn’t just manifest how the business visualizes itself as a brand, but also how it resolves ethical issues in a business context. Among its benefits for the business include:
Builds your brand reputation
It presents your business as more than just a money maker. When consumers highly believe in your ethical actions, they are more likely to support you for that.
Establishes consumer trust
Having the right ethics makes your business seem one step ahead of competitors. This is especially true when you treat consumers or employees with respect.
Boosts self-image
When you know you are doing something right, you feel good about it. With this in mind, you feel motivated to continue creating a business that promotes ethics.
Attracts highly-skilled workforce
Some employees are drawn to companies that have common interests as them. If they relate to your vision, you can score passionate talents who genuinely believe in your business. Thus, this top talent acquisition will help avoid employee turnover.
Appeals to shareholders
Showing ethics appeals to business shareholders. If you do it right, you can secure more financial support from them to scale up your business. This is because shareholders want to work with a brand that’s morally right and socially aware.
Ethical Business Decision Examples
Here are the ethical business decision examples to illustrate how it can effectively work on building your business:
1. Paying fair wages
Any business that pays its employees fairly attracts the best workers. The exploitation of laborers is so rampant that it became the norm in many industries. However, this flaw in the job market should not be encouraged.
Instead, you should do the right thing and invest more in incentivizing your employees. This way, you can motivate workers and minimize employee turnover.
2. Committing to sustainability
Many businesses have since started to support the environment, economy, and society by employing sustainability efforts. These initiatives focus on saving the future generations’ needs by using up just enough available resources to meet the present’s needs.
Some sustainability projects include:
- Using recycled materials
- Using cardboard recycling bins
- Producing biodegradable products
- Creating cruelty-free products
- Minimizing plastic use
- Promoting sustainable food
- Saving on electricity consumption
- Writing/printing on both sides of papers
- Planting trees with the company
- Banning bottled water and cups in the workplace
3. Encouraging employee education
One of the most ethical ways to promote employee empowerment is by investing in their education. You see, when you incentivize them by enriching their skills and expertise, they become better at what they do. Similarly, it provides you better outputs since they become specialized and are motivated with the acquired expertise.
You can do this by rolling out weekly training or enrolling them in an online class that’s relevant to their niche. By doing this, you are investing in upskilling your employees and motivating them to better themselves. As a result, there will be less turnover rate.
4. Support animal welfare
Many companies are getting backlash for testing products on animals. This is especially true for cosmetics, pharmaceuticals, and clothing retailers that practice animal trials and cruelty. But as an ethical business, you should steer clear from those terrible animal practices.
One way to support animal welfare is being organic and resorting to faux yet sustainable materials for your products.
5. Donating a portion of your profits
Portion donations are prevalent in the business. Several big brands took the spotlight from making this effort. For instance, TOMS donates a pair of shoes to a child for every pair sold.
This is an effective way to encourage sales while giving back to communities in need. People love the idea of helping in every possible way, and purchasing while giving back is one way to do it.
6. Having reasonable return and refund policies
When you are a retailer, it’s crucial to offer such flexible return and refund policies. This service helps you build a customer service-oriented brand that puts customers’ needs and concerns first. Having said that, you can attract more customers since you offer such flexible policies.
In addition, you can expect the word of mouth to work its wonders when customers are happy with your service. They can refer your product to personal connections, which can help you generate more sales.
7. Employing minorities
Hiring minorities such as women, LGBTQ members, disabled persons, and more is a great way to promote empowerment. This is because your business proves that quality work doesn’t know gender, race, or even physical abilities.
The group a person belongs to should not restrict him/her of opportunities. It doesn’t have any correlation to being a qualified employee. If the person displays the perfect skill set for the job, then there’s no reason not to hire them.
8. Respecting customer information
The majority of businesses collect customer information that must be carefully handled. These data may include the name, address, contact number, and payment information. All these are sensitive data that need utter security and protection.
Customers won’t trust you if you engage in unethical practices like sharing customer data. It’s not only disrespectful but also perilous since these data are part of their identity.
Recommended Courses for Making Business Decisions
Here are the best courses to help you make informed and ethical business decisions.
1. Decision Making Best Practices Of Fortune 500 Firms
Key Takeaways
The examples provided serve as a springboard for integrating ethical considerations into your business strategy.
For those seeking to further explore these concepts, our online course library offers a comprehensive selection in business management, entrepreneurship, and leadership. These courses can equip you with the knowledge and skills necessary to navigate the complexities of modern business.
We offer an All Access Pass that grants unlimited access to our extensive library of over 4,000 courses. This subscription allows for a holistic learning experience, fostering personal and professional growth.
Editor’s note: This post was originally published in March 2024. It has been updated for freshness and accuracy.
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