Changing the ethics of business

POLITICS has been dominated in the last week or two by issues centring on personal judgement and ethics.

The media has focused on the moral judgements of those in high profile, responsible positions, and highlighted the way that their sometimes questionable attitudes to ethical behaviour have affected their standing and credibility.

The role of university business schools in creating ethical leaders has been a hot topic for some time. Developing ethical managers is undoubtedly a priority for business schools, which are nurturing the next generation of business leaders.

It is also a critical issue for any company that wants to create a culture that will generate long-term trust and loyalty from customers and employees.

What I think is most important for business schools is that rather than ethics being studied as a discrete module of, say, the MBA, ethical challenges should instead be embedded within all core business and management degree modules.

An increasingly globalised business community requires managers who automatically reflect and consider the implications of their actions.

The United States responded to the Enron scandal with the Sarbanes- Oxley Act, which requires US-listed companies to have detailed ethical codes. This has resulted in a comprehensive review of policies and procedures.

Building a business culture that understands the impact of ethical behaviour on the bottom line takes time and commitment.

Business schools and employers can work together to incorporate ethical values within day-to-day working life.

The Bribery Act, which came into force this year, prompted many businesses to re-examine ethical policies. It is critical, however, that ethical behaviour is integrated within the culture and values of the business, rather than added on to specific aspects of working life.

A new emphasis on incorporating ethics with business policies – and business education – this year could have a major effect on the long-term sustainability of organisations worldwide.

Ethical codes and policies underpin corporate behaviour but the real difference comes when directors lead from the front, communicating the company’s ethical message clearly and effectively.

Leadership and management training is vitally important to ensure those at the top drive businesses forward sustainably.

Dr Sonal Minocha is associate dean at the faculty of business and law, University of Sunderland

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