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Management Ethics in Business Environment: Meaning and Significance or Importance

Management Ethics in (Business Environment)

Management Ethics in Business Environment: Meaning and Significance or Importance

Ethics commonly refers to a set of rules or principles that define right and wrong conduct. Managerial ethics is the standard of behavior that guides individual managers in their work.



Meaning

Ethics is an outline for guiding månagerial decisions that affect employees, consumers, organizations, and society in general. Ethics is the set of moral principles and rules guiding individual behaviors. Ethics is the basis of determining right or wrong in a given situation. The ethical behavior of an individual depends upon the moral standard or code of conduct determined by society. Managerial ethics is the standard of behavior that guides individual managers in their work. It is generally accepted that business is conducted according to certain moral standards of the managers.

"Ethics commonly refers to a set of rules or principles that defined right and wrong conduct. ' - Robbins and Decenzo

"Ethics is an individual's personal beliefs about whether a behavior, action, or decision is right or wrong. Managerial ethics are the standard of behavior that guides individual managers in their work. " Ricky W Griffin  


Significance/importance of Management Ethics:

Management ethic is the set of moral principles while taking decisions in the favor of norms and values of society. Business ethics is the moral behavior of a businessman. An ethical businessman can promote goodwill and reputation in society, can gain benefit in the long run, and promote uniform growth of the business.


The following are the general significance of management ethics.

Significance/importance of Management Ethics:


(i) Promotes goodwill and image:

Management ethics includes matters on how to treat employees in the organization. In fact, the total performance and goodwill of an organization depend on how far managers take care of ethical standards while making decisions.


(ii) Better relation with stakeholders:

An organization's stakeholders are customers, competitors, suppliers, dealers, and unions who have certain economic and social interests. With the proper code of conduct, the organization provides quality goods and services to its customers. Maintaining ethical standards in pricing the product of a company is good for another competing company in the same industry. Suppliers will be happy with the company for its fair credit records.


(iii) Non-interference from the government:

With the proper accounting, vat, and tax system, an organization can make a very good relationship with the government.


(iv) Promotes social responsibility:

Management decisions based on ethical standards minimize environmental challenges, promote environmental responsibility, and encourage the development and diffusion of environmentally friendly technologies.


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