Introduction
One of the fundamental functions of vendors is to influence customers’ buying behavior so that they choose the goods or services that the vendor sells. In the process, however, the vendor is ethically responsible to ensure that the boundaries of moral standards are not crossed because the consequences affect the vendor’s business to a great degree, besides having crucial significance for the other stakeholders in the vendor’s business.
Ethics refers to a set of guidelines that determines what is right and wrong in any behavior. In business, from a vendor’s perspective, ethics is interpreted as influencing customers’ behavior by using legitimate and honest tactics, without resorting to deceit in any form.
Business ethics assumes vital significance to vendors on account of five reasons. Firstly, it provides a safe, legal umbrella that shields the business entity as well as its employees from the danger of potentially damaging and expensive lawsuits. Secondly, the danger of adverse publicity being incurred is erased, simply because there are no mitigating grounds that could spawn such publicity. Thirdly, it helps the business entity to generate, maintain and enhance the goodwill of the community and business partners. Fourthly, it is conducive to generating healthy business results, as efforts are directed solely at honestly boosting the entity’s business activities. Lastly, the business entity enjoys consistency in its operations, there are no ups and downs or controversial incidents to mar the smooth running of its day-to-day operations.
A professional Code of Ethics
For vendors to follow business ethics while dealing with customers, they should adopt a Code of Ethics, also follow General and Specific Regulations, and then take Ethical Decisions.
A professional code of Ethics lays down the basic assumptions and central qualities necessary to the functions of a certain profession. By adopting a professional Code of Ethics, vendors enjoy four distinct advantages. First of all, it enhances the process of arriving at ethical conclusions. Secondly, it helps to set up elevated role models of actions and behavior conforming to moral standards. Thirdly, it raises the level and volume of belief and esteem from the community at large. Lastly, it makes available a model or standard that would serve as a benchmark according to which judgments and evaluations could be carried out.
General Regulations
The vendor should follow a set of five General Regulations. First of all, a competent and sufficiently qualified corporate ethics officer should be employed in the entity. Secondly, a comprehensive set of ethical standards should be drawn up that apply to all employees of the business entity. Thirdly, it must be made mandatory for all employees to undertake training in professional business ethics so that they are well educated in what business ethics means, its importance to the business entity, and the role they are expected to play to ensure that it is constantly maintained. Fourthly, ethical standards should be incorporated in internal procedures involving employees (such as employee evaluation and employee compensation). Lastly, social audits should be carried out.
Corporate Code of Conduct
The Specific Regulations that a vendor should follow involves adopting a Corporate Code of Conduct. This is an advisory that focuses on a business entity’s fundamental ethical matters and recognizes the dominant qualities and basic assumptions that are not only vital to the entity, but that can also assist in the process of arriving at decisions. A Corporate Code of Conduct has two basic components. The first one is rules and/or basic assumptions. The other one is the ambitions of the business entity. A Corporate Code of Conduct is of immense value because it makes certain of three vital things, namely, that employees do not break the law, that they adhere to applicable rules, and that they act in a manner that conforms to moral standards.
Taking Ethical Decisions
Taking Ethical Decisions is a process that involves six tasks on the part of the vendor. The first task is to extensively collect and properly understand and assimilate the facts. The second task is to recognize interested players (all those who have a direct interest in the entity’s business) and their standing. The third task is to carefully think of the results and implications of a decision. The fourth task is to evaluate the assorted official recommendations and basic assumptions that are contained in the Four Common Approaches employed in the process of arriving at decisions. They are the Ethical Approach (the ethical selection that best shows the moral goodness in ourselves and those around us in our community), the Utilitarian Approach (the ethical selection that generates the highest surplus benefits over disadvantages or harm), the Fairness Approach (the ethical selection that does not indulge in partiality or preferential treatment but treats all equally), and the Common Good Approach (the ethical selection that promotes the good of everyone). The fifth task is to create and analyze options to judge their value, quality, extent, and importance. The last task is to critically examine the decision taken.