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By incorporating acceptable ethics, morals, and practices into everyday operations, a company is more likely to receive support and investments from lenders due to the business’s maintenance of a sturdy social reputation. Written by Peter Turyakira, the article “Ethical Practice of Small and Medium-Sized Enterprises in Developing Countries” analyzes the significance of business ethics in growing enterprises along with the challenges in upholding good ethics faced by small to medium companies.
In recent years, our everchanging economy has shifted power from sellers and producers over to consumers and stockholders, meaning that excellent ethical practices are a critical success factor for corporations.
To ensure continual growth and profit, business owners have become avid in trying to keep a clean, public image to retain customers and attract possible investment deals. When a business has support from investors, this can provide a cushion to the constantly changing and unpredictable market. By exercising good business ethics, an enterprise may be able to avoid issues with the law, employees, and external stakeholder groups.
Businesses that don’t emphasize their ethics, tend to be more focused on survival instead of longevity and growth.
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In many underdeveloped countries, specifically in Africa, the importance of ethics to maintain good relationships is not understood. As a small business owner, personal goals mustn't outweigh the goals of the business. Bribery, theft, and discrimination are common practices among small start-up businesses due to their size and limited resources. The most challenging moral issue that businesses encounter is whether to uphold proper business ethics or to be selfish in the pursuit of personal benefit.
When a company is successful in establishing and enforcing an ethical code of conduct for its employees and the practices they follow, they are more likely to profit from the commitment of loyal customers and purchasers in a competitive world.
With an increasingly competitive market, one of the most important aspects of a small business’s success is positive word of mouth from happy consumers. A good reputation in the community can spout new endorsements from investors, and in turn, lengthen the success of the company. When fairness, honesty, and reliability are combined, a business is bound to create a solid reputation and loyalty to the product.
Defined as “the study of right and wrong and the morality of the choices individuals make” (pg. 39), Ethics is the foundation of how a business plans to operate with its consumers.
Consumers have taken a grip on businesses by putting their money where they feel valued as a customer. “If consumers feel they have been deceived or that companies have been unfair, they will take their business elsewhere” (pg. 40). When business owners are honest and fair about their practices, purchasers tend to respect that and will give them the time and money they are worth. This is also true for investors, seeing that they only want to lend their money to faithful businesses that they can trust. lenders must be able to foresee that the company will do their part in contributing towards the investment, or they will take their money elsewhere, rightfully so. On the other hand, if consumers feel that the business is only looking to make money off them, people feel disrespected and look elsewhere for the product. To continue growth and increase revenue, the employees must be capable of reflecting the ethics put in place by the owners.
More common than before, business owners are beginning to adopt the socioeconomic model of responsibility, meaning they’re taking responsibility for the impacts they have on society, as opposed to the economic model. Consumers tend to support enterprises that care for not only the community, but for the well-being of society and the ecosystem. The economic model of social responsibility focuses solely on profiting and believes that government officials are elected to maintain good societal norms. Since business has become such an influential part of the 21st century, and government officials are aligned with business owners, it is only right that businesses step up to help society since they can do so.
With small businesses and entrepreneurshipsentrepreneurshipit'sits blossoming all around the world, I think it's right for businesses to be held responsible for their social and environmental impact on the world. When money is the only motive of an enterprise, morals often become skewed and lost within a pursuit for personal benefit. If a company is built on a set of values that support and encourage surrounding businesses and humans, we could be living and participating in a much more cooperative market.
Ethics in Small to Medium Businesses. (2022, Aug 21). Retrieved from https://studymoose.com/ethics-in-small-to-medium-businesses-essay
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