Ethics in Organizations (l): Ethics and Business

Since the dawn of mankind, we have had the need to receive and, therefore, give. When man began to exchange goods and started to do so for money, a great number of ways of giving less or receiving more also began to take shape, always to the detriment of others. This is known as unfair treatment.

There has been a great deal of discussion in recent years about the need to change things, to act with justice for the benefit of all, and not just a few.

Along these lines, the idea is to show a way for those firmly committed to turning their organization into a fair and ethical one, but we don’t even know where to start this process of change.

 Song of the Merchant

Don’t ask me what rice is.

Don’t ask me my advice.

I’ve no idea what rice is:

All I have learned is its price.

Don’t ask me what a man is.

Don’t ask me my advice.

I’ve no idea what a man is:

All I have learned is his price.

(Brecht, 1972)

Is there a raison d’être for ethics in business? Peter Drucker answers this question in Management. Tasks. Responsibilities. Practices. arguing that something called Ethics in Business should not exist. He claims that too many sermons have been preached and too much has been written about ethics in business or the ethics of businesspeople. He asserts that most of what has been said has nothing to do with business and very little to do with ethics, and that there is one simple overriding issue: “Honesty in everyday life”.

Businesspeople, some say solemnly, should not deceive, steal, lie or receive bribes. But no one should either. Men and women are not exempt from the ordinary rules of personal conduct because of their job, and neither do they stop being human beings when they are appointed vice-chairpersons, mayors or presidents of a university. However, there has always been a number of people who deceive, steal, lie, bribe or receive bribes. This, according to Drucker, is a problem of moral values and education of individuals, families, schools. For this reason there is no separate ethics in business, and no such thing is needed.

The point of view held by Peter Drucker leads experts in organizations and in human behavior in organizations to ponder over the existence of a tension between ethical values and the selfishness of people.

Maxwell takes a similar view to Drucker’s in There is no Such a Thing as Business Ethics when he claims that “there is no such thing as business ethics, there is only ethics, adding that:

People try to use an ethics package in their professional life, another one in their spiritual life and another one at home with their family. This causes problems for them. Ethics is ethics. If you want to be ethical, you live a single standard. Educators, philosophers, theologists and lawyers have taken what is truly simple and turned it into something confusing. He concludes by saying that “living an ethical life is not always easy, but it shouldn’t be so hard”.

Asked why ethics should be a part of business, M.G. Velasquez argues in Ethics in Business that “since ethics should guide all voluntary human activities, and since business is a voluntary human activity, it should also guide business conduct”.

This idea is used to justify ethics in business per se, as it is a desirable behavior in organizations, and because it seeks to “prove that ethical considerations are consistent with business goals, in particular the quest for profit”.

In other words, the challenge is for an organization’s management to be not only ethical, but also successful.

The series of posts that starts today will question the raison d’être of business ethics, arguing that it’s enough to become an ethical person and apply “honesty in our everyday life”.

Read the second part of the series here

Fernando Menéndez González

Researcher and Professor, Instituto Politécnico Nacional (México)