The Customer and the Challenge for the Ethical Business

Peter B. GiblettStarred Page By Peter B. Giblett, 4th May 2015 | Follow this author | RSS Feed
Posted in Wikinut>Business>Ethics

It is easy to say that a business exists to make a profit and that they should accept every customer that comes along, but many businesses pride themselves on how ethical they are and running a business by ethical guidelines does mean that some perspective customers are unacceptable, but is is legal to discriminate?

The Prospective Client

We have all heard the story about the rock star being escorted out of the Rolls-Royce dealership because he came into the showroom wearing scruffy jeans and T-shirt, although he had the cash for the car in the briefcase he carried. Sadly there have been many incidents of businesses turning away clients because, they do not have the right look. Indeed doormen from Harrods of Knightsbridge, arguably the world's most exclusive store even in the 1970s were instructed to turn away those they felt did not fit the profile of a Harrods customer.

Generally speaking today outlets would be discouraged from rejecting clients based on what they wear, or how they look, although such discrimination is known to happen. Generally when it comes to purchasing products the modern world, if you have the money (or a credit card) then the outlet will sell you the product, but what happens when special orders or services are needed?

Who to do Business with?

Should a business be allowed to refuse work from a client because they are ethically opposed to the prospective client's message? This is a complex question because it has the potential to involve many situations, including:

  • Refusing to print 'gay pride' materials
  • Refusing to print 'white supremacist' materials

Truth is the majority of business owners will simply print the materials, packet the cash and say thank you very much, but things are never that simple for the ethical business owner. Should an ethical Christian business owner refuse the work on ethical grounds?

It is clear that refusal to take commissions because of the beliefs or status of the perspective client can leave a business open to allegations of discrimination - it can be one thing to decline a project for a valid business reason, such as lack of manpower, but it is arguably unethical to refuse based on the religious (or other) beliefs of the owners - yet every person has causes they disagree vehemently with and they would like to think that there are valid reason not to do business with such organisations.

Ethical Decision Making

Decisions that business leaders make are a factor in defining who they are and where they stand on critical issues. Every person has their individual values and morals many of which they wish to carry through into their business in order to guide its ethical position. The general factors for ethical businesses are:

  • The integrity to use their autonomy to make ethical decisions.
  • They consider the impact of their decision on others.
  • It considers the legality based on laws and industry guidelines.
  • The business or processes does not cause harm to others.
  • Practices are consistent with past business decisions.
  • Fairness. Allowing your feelings for other groups to influence your decision is likely to make your business unethical.
  • The ethical decision-maker should give others a voice and consider the concerns or needs expressed before arriving at an ultimate decision.

Business leaders like Anita Roddick have proven that it is possible to create a world-class business and be a human rights activist/environmental campaigner at the same time.

Cab-Rank Rule

The history of this rule comes from the operation of taxi ranks and provides a different approach to business operation, it is based the hackney cab at the front of the queue taking the first passenger needing a ride. In Britain Barristers, as a part of their code of ethics, apply the cab-rank rule (as do many lawyers in other countries) which means when a case arises in any field in which they practise, irrespective of whether his client is paying privately or is publicly funded they must represent that client.

The principle here being that client gets represented based on the next available Barrister. For those of you who do not know in Britain a Barrister is a lawyer that specialises in litigation and court appearances.

The reason the barrister's code of ethics includes the cab rank rule is the belief that an unpopular person (such as a rapist) may go unrepresented. The principle of this rule is that it provides every person representation, not simply allow lawyers to cherry pick cases.

Questionable Ethical Grounds?

Does a business have the right to refuse work on ethical grounds? Is a Pharmacy allowed to stop women from seeking to fill birth control prescriptions? Are social workers allowed to refuse to counsel gay people? Can a Jewish cafe owner refuse to serve a Muslim? Businesses refuse work for many reasons, one of the main ones being their inability to fulfil the order within the time-frame available, and arguably if the Christian printer described above rejected the work order on this basis the potential customer couldn't have any complaint.

Truth is religion is too frequently used as an excuse in favour of discrimination. Every person has a right to religious beliefs (and even to agnostic or atheist ones) but does that give then the right to impose those beliefs on others who do not share them? The challenge being that everyone is entitled to their beliefs, but when you operate a business those beliefs do not give you a right to discriminate based upon them.

This cycles back around to the question of ethical decision making, discussed earlier.

The Impact of the 14th Amendment

Under the 14th Amendment no State shall make or enforce laws that take away the rights of certain people and neither shall they deny to any person equal protection under the law. However on its face this constitutional law seems to apply to government bodies, and not to the conduct of business. Yet the Supreme Court decided in a case called Heart of Atlanta Motel v United States - available at (1964) 379 U.S. 241, that the Federal Government has the power to make private discrimination illegal, here a motel owner refused to serve African Americans.

Does Congress have, under their Interstate Commerce powers, the ability to regulate local business activity? The Atlanta motel had a lot of interstate trade so federal law applied to its business practices. In another case (Katzenbach v McClung, (1964) 379 U.S. 294, 85 S. Ct. 377) The Supreme Court decided that the Federal Government has the power to regulate local business activity if any part of its business affects interstate commerce e.g. the purchase of supplies.

The constitutional law may be silent on sexual orientation, however the majority of states do oppose such discrimination - but there are a minority of states that accept discriminatory practices by businesses in respect of sexual orientation and there is where the battle grounds seem to be being formed.

Picture Credits

  • Bob the Salesman by IMSI
  • Gay Pride by
  • Cab Rank by
  • Refuse service by
  • 14th Amendment by Peter Giblett

Other contributions...

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Accept Every Customer, Causes, Customer, Disagree Vehemently, Ethical Business, Ethical Businesses, Legal To Discriminate, Refuse Work, Unacceptable

Meet the author

author avatar Peter B. Giblett
Author of "Is your Business Ready? For the Social Media Revolution"

Social media consultant, with C-Level background.

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author avatar Nancy Czerwinski
4th May 2015 (#)

Peter, excellent article as always. I always appreciate the fact that I learn from you every time you share your articles. Smiles to you today and always!

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author avatar Peter B. Giblett
5th May 2015 (#)

Thank you Nancy, it is always a pleasure to read your comments.

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author avatar snerfu
5th May 2015 (#)

Good article very articulate and mature on the ethics of running good businesses. Nice reading about it.

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author avatar Ptrikha
5th May 2015 (#)

In my opinion, there are two aspects to ethics in Business- How the employees within a company operate without any bias or discrimination based on Age, religion, sex, caste or ethnic background. Then, we have the point as to whether the owners of Business(or CEOs, CFOs) etc operate. I believe it is very important and many consumers demand it, and perhaps others should not ignore it, if we want a fair and just society all over the world.

And perhaps Wikinut is a great example of a Business run ethically!

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author avatar Peter B. Giblett
5th May 2015 (#)

Ptrikha, you are right, but I was focusing on the people that the business sells to rather than the staff in this article.

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author avatar Tranquilpen
5th May 2015 (#)

Hello Peter, my personal view of What challenges a business faces involving ethics? The question of business ethics should be visible at every stage of a business transaction. During the setting up of the initial business venture, principals should be on the same page so the company has a rock solid foundation on which to build. Starting at the recruitment and selection level, the companies system and processing needs to be resolute in determining which candidates are best suited for the company and this aught to be visible and corporate governance levels must maintain the standards of employment at all levels within the company.

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author avatar Tranquilpen
6th May 2015 (#)

Oops Company's and not companies-plural! ( 3 am.)

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author avatar Peter B. Giblett
6th May 2015 (#)

Tranquilpen you are right that visibility of ethical rules should be clear about every aspect of the company's approach.

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author avatar Sivaramakrishnan A
6th May 2015 (#)

Peter, my last post was on prejudices that we all have in varying degrees. Appearances can be deceptive when it comes to walk-in-customers though most businesses are influenced by profit motive.

I remember what was said during apartheid regime in South Africa - Chinese were considered black (that was much before the dragon started belching fire!) while Japanese were included among whites. When asked how they were distinguished - - "elementary, because of our bad English", though it was more due to their money power at that time!

I quote a headline - "Racist shop girl said I couldn't afford a £24,000 handbag, says billionaire Oprah Winfrey". People like me just take it as a bad hair day! siva

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author avatar Peter B. Giblett
6th May 2015 (#)

You certainly cannot assume what any walk-in customer can or cannot afford till you see the colour of their money (and most people do not attempt to purchase things they cannot afford).

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author avatar Legend
7th May 2015 (#)

In my job it would be unethical to descriminate in any way. In Private businesses I think that discrimination is legit seeing as anyone can choose who they want to do business with. Nonetheless unpopular discrimination is unwise. Isn't embargo a sort of discrimination?

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author avatar Peter B. Giblett
7th May 2015 (#)

Yes an embargo is a form of discrimination, but it normally has government sanction and is normally temporary in nature.

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