Managing Fraud Risk: A Practical Guide for Directors and Managers

The Business Ethics Framework

Introduction

The word ethics is derived from the Greek and it means character or manners. Ethical theory has its origins in the work of the ancient Greek philosophers such as Socrates and Aristotle and addresses issues concerning morality – questions about right and wrong, good and evil, justice and crime. Ethics or moral philosophy has developed out of these theories into a set of principles of right conduct, a theory or a system of moral values. The Encyclopaedia Britannica defines ethics as: “the branch of philosophy concerned with the nature of ultimate value and the standards by which human actions can be judged right or wrong”.

From a practical point of view it is helpful to understand that business ethics is the study of business situations, activities and decisions where issues of right and wrong are addressed, with a view to helping us to make better decisions at work. Ethical business behaviour in the workplace is actually determined by the interaction of many things: the law; government regulations; industry practices; professional standards; cultural and social mores; corporate culture; and one's own internal moral code.

Although all of these factors interrelate, in practice one of them is often more important than all the others. When I ask delegates to consider which one is the most important driver of behaviour in business, they almost always give me the same answer, which is “one's own internal moral code”. Actually, although no doubt ...