Business Ethics Based on Ayn Rand's Priniciples

Svmplv By Svmplv, 12th Mar 2014 | Follow this author | RSS Feed
Posted in Wikinut>Business>Ethics

Business Ethics in real world scenarios as conducted by Ayn Rand's business principles.
Are these ethical practices?

Rand Business Ethics

Ethical code - a system of principles governing morality and acceptable conduct



Humans as a species have always had an ethical code. Written or unwritten, this code was understood and accepted by all. This basic behavioral code of ethics however, evolves and changes with society to accommodate our wants and needs. Many philosophers such as Ayn Rand have argued that ethics in itself are irrational because they are based on the whims of society rather than reason, reality or mind. Rand argues that the value we place in an ethical code on deciding what is right and wrong is arbitrary and changes with society. Society has always defined and then redefined throughout the years what we view as right or wrong. We’ve seen this to hold true in history through slavery in America, the evolution of women’s role, racism in the workplace, and the acceptance of homosexuals. Even Aristotle based his ethical code on observations of what noble and wise men of his time chose to do.The ethics we hold to be dear and true are simply guidelines we create to help guide our lives and actions in present day society. We as a society have collectively created this code to give a false sense of justification based on the “good of society”. Society as a unit decides which guidelines are acceptable, based on subjective whims and the value our generation chooses to place on what we see as right and wrong. This is ultimately how we form our “code of ethics” and how the code changes with time. The world of Business like any society needs basic and concrete ethical guidelines to operate under, and anyone who seeks to make a profit in the current system must abide by them. Ayn Rand makes valid points on the flaws of our society’s subjective ethical code but, a basic code of ethics is essential to business as a whole and vital to the ultimate survival of the industry. Once people lose faith in the free market concept because of a lack in ethical practices, then the government must get involved a and regulation gets tighter. The key is in self regulation of these ethics, this will lead to longer self preservation and a better free market economy overall.

Ethics are not only subjective to society but, businesses as well; Ayn Rand illustrates this perfectly in her novel “Atlas Shrugged”. In the novel, society’s archaic ethical code subjectively decided which business practices it deemed right or wrong and justified the decision under the guise that these actions were “for the good of society”.
Even current ethical codes are still relatively subjective to business today. Each industry has a variety of ethical principles that could be considered unethical in another industry. For instance, there are different ethical codes for social media companies, start ups companies and companies in the financial industry take Merrill Lynch and Facebook for example. As an employee of Facebook it is probably very common that your entire immediate family has a Facebook account and you had a direct hand in setting each up, this would not be considered unethical and is most likely encouraged. However, as an employee of a Merrill Lynch investment firm it would be considered highly unethical if you had a direct influence on the personal transactions and accounts of your entire immediate family. These polar opposites in ethics show that not every industry has equally an equally stringent code of ethics.

Each industry in business also handles violations of its ethical code differently, from simple corporate public apologies to the entire destruction of a career. Ethics in business are prevalent but, diverse and inconsistent. This difference in ethical codes and how they are enforced creates a vague understanding of what an ethical code should contain and how they should ultimately be enforced. That is why despite this ethical ambiguity it still remains that we as a society, have to have established concrete guidelines on how we conduct business. Furthermore, anyone seeking to profit from the current system we as a society have established, based on this code is expected to accept it as it is and abide accordingly.

To begin to support my argument, consider that there still remain general ethics that are accepted by all business that operate in the free market. These bare bone ethics serve as guidelines to an open playing field, they allow for innovation, revolution, evolution ,and strategic takeovers in the marketplace but, still establish clear and definite boundaries within which all entities must operate. The best example of this in play is the way our justice system is set up. Currently in America we operate under two sets of laws Federal and State. Federal laws are the supreme laws that supersede all others and that we all must abide by despite where we may live and the laws of that state. These supreme laws make sure everything is covered and then state law can either prohibit or impose further restrictions on any action. Without these basic ethical guidelines the market would be in constant havoc as we made the same mistakes again and again.

Basic ethical guidelines ensure that we learn from our mistakes throughout history so we can be more efficient and further developed. Despite the many inconsistencies in ethical code across industries and companies in that industry, we have to establish ground rules on how we conduct business. These rules are universal and apply to everyone despite the size of the company. Hypothetical rules that would fall into this category would be guidelines on discrimination ,conflicts of interest, and relationships in the work place. These are the areas where most ethical conflict stems, if we can establish a set of ethical guidelines that cover these common issues then we are on track to a safer market. Without any rules or basic guidelines the playing field is open to anyone and anything without fear of repercussions. These guidelines would be put in place to protect the market itself and all those who operate in it, not to govern or oppress but, to have a gentleman’s agreement on what goes and what doesn’t.

These ethical guidelines not only protect the market but a strong ethical code helps keep businesses safe. When a company formulates a strong ethical code and it is fully adopted and integrated into the company culture, the company has then created clear and concise principles by which it expects its employees to perform under. A strong ethical code lets consumers know where a company stands and stringent ethical codes raise the reputation of the company and the industry as whole. When all businesses in an industry have similarly sound ethical codes it levels the playing field and makes the general guidelines clearer. A code of ethics creates guidelines for all the company’s employees to ensure ethical behavior, regardless of rank or status it holds everyone accountable to the same degree. When everyone knows there will be genuinely severe consequences for ethical code violations, if this code is clear and shown to be enforced then people are less likely to break this ethical code knowingly. For example, a manager chooses not to hire an employee based on the color of their skin, the company in question has a zero tolerance policy on discrimination and this is outlined in their ethical code. Even though this has been the best manager in the region for several years he is immediately let go, this swift action by the company allows all of its employees and the public see that the company stands by its ethical code and will not stand for injustice. This accountability strengthens the ethical system of the company and is given confidence when enforced after a violation. This code also communicates what is and is not acceptable as an employee/representative of a company and creates a universal standard for company culture.

Ethical codes can make businesses more efficient and successful in the long run. A clear and purposeful ethical code cuts down on the amount of scandals and other internal issues that might occur if company culture is left to its own devices. Overall a stronger ethical code that is enforced time and time again will build a rapport with the public and establish confidence in the company. This leads to better publicity and more potential revenue. For example, if I’m shopping for cars and I’ve heard through different friends and reviews that Company A has a reputation for being transparent and having fair prices while Company B has a long history of selling bad cars, cheating customers, and overall shoddy business practices, then I’m more inclined to take my business to Company A. Company B in this situation still makes money and is able to stay open but, Company A has a higher potential for more revenue, this consumer trust starts with a strong ethical code and being able to constantly enforce it as well as refer to it as a guideline. Ethical business practices help establish rapport and integrity with consumers. A strong code of ethics that are exercised and used as a point of reference during a major scandal or day to day issues help build the reputation of the company. These ethical practices also help generate potential revenue in the future as well as garner positive publicity.

Business as whole is one of the few industries that should require an ethical code above all others. Businesses can be the lifeblood of some families and the public in general places a lot of faith in our businesses. Ethical codes overall create transparency and are living documents that can be altered as they grow with the company and society. As society becomes more complex and progressive it begins to reevaluate its ethics to see where we may have flaws. For example, discrimination against gays wasn’t a huge ethical violation during the civil rights era when America was more focused on race than orientation but, now as we have become more progressive and evolved morally the rights for gays have increased. Today, it would be seen as highly unethical and distasteful for a company to base employment solely on the orientation of the employee in question. These ethical codes let all the rules be known, protect the market ,and create a level playing field for all involved. Companies that choose to adopt further ethical codes beyond the general guidelines can be expected to have less internal problems, better publicity, and more potential revenue than those who don’t. Contrary to Ayn Rand’s belief that society’s ethical code has no place in business, it not only has a designated place in this vicious industry but, is essential to the ultimate survival of the industry as a whole, once people lose confidence in the free market concept and the system we have in place, thats when the government must get involved and business regulations get tighter. Self regulation with an ethical code leads to longer self preservation and a better free market system as well as economy overall.

Tags

Business, Business Management, Business Plan, Ethical Dilemmas, Ethics, Ethics In Business

Meet the author

author avatar Svmplv
Sorry, this author hasn't written a bio yet.

Share this page

moderator Steve Kinsman moderated this page.
If you have any complaints about this content, please let us know

Comments

Add a comment
Username
Can't login?
Password