Unethical business practices:
Business organizations are reluctant to embrace ethical practices and behaviors. However, they engage in unethical business practices to earn a big profit and capture a bigger market share, which is a common business goal for every organization.
We will uncover all of these activities, but let’s understand the term business ethics in brief before we move to the principal theme of the discussion.
Business ethics refers to business norms, beliefs, a set of values, and guidelines defining an individual’s conduct and activities within the organization.
In general, the primary objective of every business is to maximize profits for its owners or stakeholders while upholding corporate social responsibility. However, as a matter of fact, the main and only concern today is big profits.
The unethical business practices in organizations result from the corporate culture of the organization, where the entire business is corrupt from the top to the bottom, and often individuals may also be unethical in their work.
There are many examples of unethical business practices, and most businesses around the world are involved in these activities somehow.
Types of unethical business practices
1- Unethical marketing practices
Ethics in marketing means the implementation of moral values and fairness in the marketing practices of an organization. We have listed down several examples of unethical business practices that raise questions about ethical conduct in marketing:
- Poor quality of products and services
- Products of unsafe nature
- Higher product prices than the market value
- Mislabeling on product regarding the content, weight, and size
- Presenting objectionable and misleading material to the minors with no regulation
- False claims regarding the delivery of products
- Non-disclosure of invisible risks
- Frequent Telemarketing calls, junk emails, etc
2-Data privacy protection
Data privacy is about access, use, and collection of data. The organizations are mainly responsible for maintaining the privacy of data, as it is necessary for the technologically powered and information-intensive environment. Here we see a few examples of unethical practices in business relating to data privacy.
- Collection of unnecessary or excessive data
- Inappropriate use of data relating to customer, employee, and supplier
- Outsourcing data to third parties
- Use of data other than a business purpose
3-Unethical practices of exploiting workers
The priority of high profit at the risk of workers, that’s what we call exploitation. We often hear frequent complaints by workers against the business owners and management of the company.
Let’s see some common unethical practices of exploiting workers.
- Pay too little to workers, not paid or postpone their salaries
- Unfriendly work environment
- Hiding of bonuses, unpaid overtime, and other incentives
- Discrimination in employees over age, gender, and religion
- Termination without reason
- Undue influence, nepotism
4-Unethical practices of exploiting the environment
It is the responsibility of a business to protect the environment in which it operates. It requires organizations to accept and follow the corporate environmental strategies and save the environment from the following unethical activities.
- Depletion of natural resources inappropriately
A deceptive or misleading business practice that harms either consumers or other business entities. The unfair competition gives consumers a wrong impression about the competitor and its products. Here we focus on unethical behavior that brings an adverse impact on businesses and their owners.
- Trademark infringement
- Misappropriation of a competitor’s trade secrets
- The false representation of products or services
- Stealing of trade secrets
- unauthorized substitution of one brand of goods for another
6-Unethical practices of manipulating financial statements
Accountants are familiar with accounting rules and regulations and know the impact of manipulating financial statements on the overall decision-making process. Even then they engage in such activities, although these actions typically result in short-term gains but long-term adverse consequences.
Unethical accounting practices are usually driven by management pressure, greed for quick promotion, bonuses, and other incentives.
Let’s have a look at a few examples of manipulations.
- Overstatement of assets and revenues
- Understatement of liabilities and expenses
- Misapplication of accounting reserves
- Inappropriate use of reserves
7-Unfair behavior of workers/employees
Workplace ethics are not for employers alone. Compliance with company rules, effective communication, accountability, professionalism, and mutual respect for your colleagues at work is supposed to be followed by the employees as well. Following the above rules, ensure maximum productivity at work.
So, let’s see unethical behavior by employees on the other hand.
- Doing non-office related work at the workplace
- Extended breaks/unofficial leaves
- Sexual harassments
- Lies with employer