Ethics in Business

We are hearing one more CxO title added in recent times by corporates – Chief Ethics Officer.

I am intrigued not by the title but by the very necessity of such a title. Why do corporates need to proclaim they have such a person and make a claim that all is fair & good in their business and in the manner they serve all their stake holders. Until that person arrives in that organisation, were the business practices not hunky dory? Why do they resort to re-iterating it? Agreed, it is to support the brand image but there have been 100’s of businesses still exist today that did not have that person but they were seen to be conducting their business, deploying ethical business practices. I don’t want to name those Indian and International brands as you know them too well.

The organisations per se, do not invent best business and ethical practices but the people, especially the leaders and employees in that organisations do. It is like a skin of an individual and those individuals collectively decide what is best for them, their customers and business / Government partners. It could be a simple safety feature in a product or not suppressing vital information to the regulators. The intention not to cheat any stakeholder is how they do their daily work.

When does an individual imbibe this ethical culture in him or her? It is as early as in his childhood, the parent, elders and teachers remind this act that gets embedded in a CEO’s mind that make him responsible to his team and customers to bring in that culture in the work place. We get shaped by what we did in our schools, what moral science teachings we read, what the parents taught and how the teachers corrected our thoughts.

A business is meant to perform in an ethical way and that culture should pervade all through the ranks. If that mind set is firmly set in, there is no need to have a watch dog like an Ethical officer to emphasize and oversee the business practices. If an organisation chooses to have one, that person is responsible only to the Board of Directors and not to a CEO or MD. Also it needs to be an independent role without any other responsibility attached to it.