It’s no secret that in today’s world trust and ethics feels like a scarce commodity, especially in business. The days of handshake deals and gentleman’s agreements have been replaced by contracts, NDAs, disclaimers and fine print because too many people and too many companies have broken trust for the sake of profit gains. Unfortunately, despite formal contracts, there are always those who prioritise profit over principle and act in bad faith.
This is why ethics in business matters more than ever. If you’re an entrepreneur and taking the first step in building your business, you have a powerful opportunity: to build an ethical business from day one. This isn’t done through making empty promises or telling people what they want to hear, it’s about backing your values with actions and staying true to your principles and ethics, even when no one is watching.
Now the question is, where do you begin? Building an ethical business isn’t just about the first step, like defining your mission and vision, it’s about the decisions you make in your day-to-day operations and if those decisions are guided by greed, or integrity.
Let’s breakdown how you can integrate ethical values into your business from day one.
1. Mission Statement
Every business needs a mission statement and an ethically-grounded business chooses a mission that means something, not just a pleasant-sounding statement, but rather a statement on the standard that the company will live by. It should show what the business wants to achieve, but also the “why” behind it.
Three questions to ask:
- What positive impact do I want my business to make?
- What values will guide the way that we treat our customers, employees and suppliers?
- How do we define success beyond profit?
2. Strategy
When developing a business strategy, think beyond just your shareholders, take your stakeholders into account as well and consider what impact your business will have on them too. Stakeholders are: your employees, customers, suppliers, environment, community you operate in, and so on.
Key actions:
- Assess the impact that a business decision may have on all stakeholders involved.
- Avoid a strategy that exploits or takes advantage of your stakeholders.
- Align your growth strategies with your ethical commitments, such as honouring payments owed to your suppliers or choosing sustainable sourcing despite higher costs.
3. Code of Ethics
Every business should have a code of ethics that guides the businesses daily decisions.
What should be included:
- The fair treatment of employees and suppliers.
- Transparent pricing and communication.
- Data and privacy practices.
4. Transparency
Transparency is everything. Not just when things go right, but when they go wrong as well.
Be transparent in your operations by:
- Sharing how your products are made or sourced.
- Owning business mistakes made and outlining how these mistakes will be rectified.
- Being clear about business practices, especially with customers and partners.
5. Measure more than just financials
If you only ever measure your businesses financial performance, that’s all that your business will ever work towards. While this is important, tracking ethical performance is as well.
Consider tracking these as well:
- Supplier turnover and satisfaction
- Employee turnover and satisfaction
- Customer trust and complaints
6. Lead by Example, Always
No mission, policy, strategy or code of ethics matters if those in leadership positions don’t model ethical behaviour. Their actions set the standard for the business and your stakeholders will notice.
Don’t just run your business by these values, live by them as well:
- Admit when you’ve made a mistake and learn from it.
- Treat everyone the way you want to be treated. E.g. Compensate stakeholders, such as suppliers and employees, fairly for their work.
- Making decisions solely on “what’s right”, not just what’s easy or profitable.
Ethics isn’t a layer you add — it’s the foundation you build your business (and your life) on.
