Ethnical Behavior is More Than Profitable


Ethical Behavior is More Than Profitable

Ethical Behavior is More Than Profitable

There is an unfortunate stigma in many areas of the business sector surrounding that attempt beyond basic governmental guidelines and actually instituting a basic set of rules and ethics that govern business practice. Indeed, many people regard such an approach with animosity, because implementing a truly ethical business policy will only lead to a decrease, if not an end, of profitable business. It is unfortunate that this sort of attitude is given the kind of weight that it so often is. Not only is it a thinly veiled justification for engaging in immoral and unethical business practices without guilt, but also it is in fact not even correct from a purely fiscal standpoint. Many events over the last several years have begun to reveal that adhering to a system of ethical business practices is not only a positive thing to do on a human level, but that it is a positive thing to do on the level of profitability.

Businesses that engage in ethical practices are usually those that demonstrate the ability to incorporate long-term thinking into their decision-making and base their actions upon long-term goals rather than temporary benchmarks. This allows such companies to have successful long-term growth and establish important relationships with consumers, their employees, and their communities. This increases productivity as the satisfied and content employee will produce far greater than the disgruntled one, and consumers can feel as if they are doing the right thing by purchasing their products or services from a business that engages in ethical practices. These intangible qualities are byproducts of doing business in a fair and ethical way and have unforeseen, but immense effects on the profitability of a business. Moreover, one needs only to consider briefly the massive ethical and accounting scandals that have swept through the business sector in the last several years. The massive and seemingly unsinkable companies of Enron, Worldcom, and Tyco make it apparent that the costs of engaging in unethical business practices are colossal. It’s important to remember, “Ethics may require more of a business than the law demands.” (Copeland, 2003)

One such profitable enterprise is Paul Newman’s company Newman’s Own, which has “given over $150 million to thousands of charities since 1982”(Newman\'s Own, 2003) and even despite going above and beyond the demands of legal requirements and engaging in such philanthropy, it continues to be a thriving and profitable business. Newman’s Own is an example of this kind of corporation that not only generates economic profit but social profit as well. It manages to have a positive working relationship with its employees, consumers, and the community, and practices social responsibility by donating millions of dollars to worthy causes in such areas as the arts and helping the needy and the homeless. Newman’s Own, in this instance, reveals itself as a company that cares about its community and realizes that every person that they help in any way could also be a future consumer. Plus, their charitable donations generate press that helps to serve as a form of marketing as well. Another such company that has shown profitability despite using an ethical business model is Ben and Jerry’s, which has engaged in ethical practices that go above and beyond the letter of the law. Among their innovations is an attempt to make it such that all Ben and Jerry’s employees own a percentage of the stock and thus help control the company’s future. Moreover they have taken pains to promote environmental and other causes by donating money and including messages about such causes on their products and in their stores.

Businesses engaging in unethical practices need to consider not just the financial losses but damage to their reputation also. It has been estimated that the cost of replacing one customer can be as high as six times the cost of keeping them. Firms that produce quality goods and services in an ethical manner will keep the consumers loyal and the profits streaming in.


Copeland, J. D. (2003, October). Business Ethics: The Three Critical Truths. Retrieved November 7,2003,

Newman\'s Own (2003, March). . Retrieved November 7,2003,