Business Ethics and Corporate Governance, Second Edition

IMPORTANCE AND NEED FOR BUSINESS ETHICS

Ethics is closely related to trust. Most people would agree on the fact that to develop trust, behaviour must be ethical. Ethical behaviour is a necessity to gain trust. Trust will be used as an indicator variable of ethics. Basically, trust is three-dimensional, that is, trust in supplier relationships, trust in employee relationships and trust in customer relationships. In such a situation, the entire stakeholders of the company are taken care of. If the company is able to maintain this trust-relationship with the internal as well as external stakeholders, then we can call that company as an ethical company.

Trust leads to predictability and efficiency of business. Ethics is all about developing trust ...