Business >

Are business ethics or profits more important?

This Debate has 18 articles on the Ethics side and 7 articles on the Profits side. Click here to see all the articles rated and ranked by Helium members.

Ethics

Profits

12 of 18

Ethics

This is an interesting choice. Strictly speaking, if an entity doesn't turn a profit, it won't continue to operate for long, unless it's a front for illegal activity, or the US government. However, I believe that ethics are more important than profits simply because profits aren't a business practice in and of themselves, but rather a result of good business practice. And regardless of your morals or desire to contribute to the common good, ethics are a good business practice.

Since it's easy for all of us to envision how a "good" business leader can see the importance of proper business ethics, I'm going to focus on how business ethics are just as important for the continued growth of the bottom line of a leader who isn't viewed so kindly. After all, it's a popular notion that the leaders of the world's largest companies don't care about the little man, or the environment, or anything other than raking in as much cash as they can, so why should they concern themselves with being ethical? If the only goal of these fat cats is piling the cash on their bed and rolling in it like a far-less-attractive version of Demi Moore, why should they bother conducting their business in an ethical manner?

To answer this question, let's assume that I'm the CEO of a massive global corporation. I'm so rich, I've hired full-time staff to rake my money in for me. And let's say I don't care about anything at all except increasing my pile of cash so that I can buy more gold-plated toothbrushes and whatever else strikes my fancy. My business makes a product that the public wants. It costs me $50 per unit to make this product, and I think I'll sell it for $200. Why not? I don't care if I overcharge my customers; all I want is their money. My marketing department will tell the sheep that my product will give them $200 worth of satisfaction, and they'll eat it up. Won't they?

Initially, maybe. The first part of the old saying, "you can fool some of the people some of the time," can prove to be true in the business world. However, the sharing of information in an open society will quickly put an end to my sinister plan. Once a handful of customers discover that my product isn't worth the price, word will get around. And in the internet age, word gets around far quicker than it used to. Suddenly, my unethical behavior has led to my sales drying up, and my cash pile isn't quite what it used to be. My profits are gone as a result of my lack of ethics.

Or let's say I produce a product for a reasonable price, but I go about getting the lowest bid from my suppliers in a shady way. Maybe I figure that if I share bid information with a couple of suppliers, they'll be able to change their bids and undercut the competition. As long as my cost is low, it's a good deal for me, isn't it? Maybe at first, but this leads to two problems: the other suppliers quit bidding my projects, so the talent pool I have to choose from dwindles, and the supplier I'm giving the deal to quits innovating, because he figures he's got the job anyway, so the quality of my product goes down. Eventually, someone figures out how to make a mousetrap that's better than mine, and my profits go the way of my ethics.
But let's say I don't simply give up at this point. Like some companies who made the news a few years back, let's say I take a trip down to Accounting and tell them to not "carry the one" on next quarter's balance sheet. Voila, my profits are back! Nothing but wine and roses for me again, right? For a while, but it never lasts, and this time the consequences are much more serious. Not only do my profits go away, but my giant mansion is replaced by a small cell and a man named Bubba who wants to initiate his own hostile takeover.

So, whether or not my goals are noble, if my business is unethical, it won't be around for long. Ethics are one of the factors that drive profits, and without them, you'll be out of business soon. As the rest of the saying goes, "you can't fool all of the people all of the time."